ESTATE OF BATES v. GARRAWAY, 30868-1-II (Wash.App. 3-1-2005)

No. 30868-1-IIThe Court of Appeals of Washington, Division Two.
Filed: March 1, 2005 UNPUBLISHED OPINION

Appeal from Superior Court of Pierce County. Docket No. 03-2-04705-3. Judgment or order under review. Date filed: 09/08/2003. Judge signing: Hon. John A. McCarthy.

Counsel for Appellant(s), Geoffrey Colburn Cross, Attorney at Law, 252 Broadway, Tacoma, WA 98402-4005.

Counsel for Respondent/Cross-Appellant, Douglas N Kiger, Blado Stratton Kiger PS, 3408 S 23rd St, Tacoma, WA 98405-1609.

MORGAN, A.C.J.

This case arises from an oddly documented sale of real estate. The trial court ruled partly for the sellers and partly for the buyers. Rejecting both the buyers’ appeal and the seller’s cross-appeal, we affirm.

In 1989, Richard and Regina Bates owned two lots, totaling three and a half acres, in Spanaway, Washington. The lots were improved with an older house and a mobile home. James and Eunice Garraway owned contiguous property on which they operated an automobile wrecking and recycling business. On October 26, 1989, Bates and the Garraways signed a pre-printed form titled `Commercial Lease and Deposit Receipt’ and a second, separate, pre-printed form titled `Option to Purchase.’ The `lease’ called for a lump sum payment of $15,000 and `rent’ of $500 per month, plus late fees when applicable and reasonable attorney fees if suit was brought.[1] The `option’ called for a purchase price of $160,000, against which the sellers were to credit 100 percent of the lump sum payment and all of the `rent’ payments. The `lease’ ran until November 2013 (when about $159,000 would have been paid), and the `option’ was exercisable until that same date. Both the `lease’ and the option were signed by a real estate agent to whom the sellers were to pay a commission of $10,000 (6-1/4 percent of $160,000).

In 1989, the two lots were subject to property taxes of $1,888 per year. The lease said the Garraways would pay any increase above that amount but failed to say who would pay the $1,888.[2] From 1990 until trial, the Garraways paid all the taxes that were due.

The Garraways stopped paying rent in October 1999, but continued to pay taxes. On December 9, 2002, Bates[3]
served the Garraways with a Notice to Pay Rent or Vacate that demanded back `rent’ of $20,000, plus $900 in late fees.

The Garraways did not pay, so in February 2003 Bates filed an unlawful detainer action for possession, double damages, and reasonable attorney fees. The Garraways countered, `[b]y way of set-off and affirmative defenses,’[4] that the parties to the lease had agreed that Bates would pay the annual taxes of $1,888, leaving only the excess for the Garraways to pay; that Bates had never paid any taxes; that the Garraways had `paid in excess of $27,600 on taxes’ that should now be credited `against the alleged rent arrearages’; and thus that the Garraways were, `in fact, ahead of the payment schedule.’[5]

In August 2003, the court held a one-day bench trial. The next month, the court entered findings, conclusions, and a judgment in which it found the Garraways guilty of unlawful detainer, awarded Bates $26,400 ($24,000 for past due rent and $2,400 in late payment fees), reasonable attorney fees of $7,738.75, and costs of $549.78. The court denied the Garraways’ claim to an offset for taxes they had paid; it found, `[b]ased upon the course of performance of the parties under the lease, all real property taxes for the subject property were the responsibility of the Garraways.’[6] The court denied Bates’ claim for double damages, stating: `I’m not going to double damages. I’m just not going [to] do it. I think it’s very close and, you know, I do recognize Allied Stores. Basically my ruling was based upon the fact that there appeared to me to be a very established history of payment.’[7]

The Garraways appeal, and Bates cross-appeals. The Garraways claim that the trial court erred by denying their claim for an offset equal to the taxes they paid. Bates claims that the trial court erred by not doubling damages.[8] Both parties claim reasonable attorney fees on appeal.

The first issue is whether the Garraways are entitled to offset the taxes they paid. They might be if the `lease’ did not obligate them to pay the taxes. Otherwise, they are not.

The `lease’ was ambiguous on who was to pay the annual taxes of $1,888 per year. The trial court’s task was to ascertain and effectuate the intent of the parties.[9] The nature of that intent was a question of fact that we review only for substantial evidence.[10] The evidence showed that the Garraways began paying the taxes immediately after the deal was made, and paid them continuously until trial. That evidence amply supports the trial court’s finding that the parties to the lease intended the Garraways to pay the taxes, and thus that finding is supported by substantial evidence. The next issue is whether the trial court erred by denying double damages to Bates. RCW 59.12.170 provides that in an unlawful detainer action, [T]he court . . . shall also assess the damages occasioned to the plaintiff by any forcible entry, or by any forcible or unlawful detainer, alleged in the complaint and proved on the trial, and, if the alleged unlawful detainer be after default in the payment of rent, find the amount of any rent due, and the judgment shall be rendered against the defendant guilty of the forcible entry, forcible detainer or unlawful detainer for twice the amount of damages thus assessed and of the rent, if any, found due.

Even though the parties titled one of their documents, `Commercial Lease and Deposit Receipt,’ this was not really a commercial lease transaction.[11] It was instead, the record shows beyond any doubt, an oddly documented purchase and sale of real estate, with a down payment of $15,000, monthly payments of $500 for 24 years, transfer of title when $160,000 was paid (even if the 24 years had not yet expired), and a real estate commission of a little over 6 percent. Washington law does not permit or require the doubling of damages in an action to forfeit a real estate contract. Accordingly, we hold that the trial court did not err by declining to double damages incurred in connection with this contract for the sale of real estate.

The last issue is reasonable attorney fees and costs on appeal. Bates has prevailed on the tax-offset issue. The Garraways have prevailed on the double-damages issue. We deem neither party to have prevailed more than the other in this court. Accordingly, neither party shall receive its fees and costs on appeal.

Affirmed.

A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.

ARMSTRONG, J. and VAN DEREN, J., Concur.