No. 31763-0-IIThe Court of Appeals of Washington, Division Two.
Filed: April 12, 2005 UNPUBLISHED OPINION
Appeal from Superior Court of Skamania County. Docket No. 02-2-00145-1. Judgment or order under review. Date filed: 04/12/2004. Judge signing: Hon. E. Thompson Reynolds.
Counsel for Appellant(s), Joseph L. Udall, Attorney at Law, PO Box 858, Stevenson, WA 98648-0858.
Counsel for Respondent(s), Daniel Robert Laurence, Mills Meyers Swartling, 1000 2nd Ave Fl 30, Seattle, WA 98104-1064.
QUINN-BRINTNALL, C.J.
J L Borup, Inc. (Borup) appeals from a summary judgment order dismissing its claims of misrepresentation and promissory estoppel against the Port of Skamania County (Port). We affirm.
FACTS
In 1993, the Port awarded a lease contract to Borup to manage the Beacon Rock Golf Course following a competitive bid process. In 1998, the Port and Borup entered into another five-year lease. This lease was not competitively bid and contained a five-year renewal option. The Port calculated Borup’s monthly lease payment by using a percentage of revenues from the golf course.
In 1999, Borup’s principal, James Borup, pleaded guilty to misdemeanor theft for having embezzled $158 in golf course revenues. Borup was required to repay this amount and $2,890.20 for the cost of the state audit and the Port’s attorney fees. The State Auditor recommended that the Port change the lease from a percentage of revenues to a fixed monthly amount or it would require annual audits. It recommended allowing the lease to expire and then putting it out for a competitive bid, which would eliminate the need for annual audits.
The Port requested that Borup forego the five-year renewal option and assured Borup that it could participate in a competitive bid process. Borup agreed and signed an amended lease on September 25, 2001, that did not have a five-year renewal option.
In April 2002, the Port issued a request for proposal (RFP). Borup and two other applicants submitted proposals. On September 17, 2002, the Port sent a letter to Borup in which it stated:
The Port of Skamania County is pleased to offer you a lease for the Beacon Rock Golf Course under the terms of the attached Lease Agreement. As we explained, this lease is being offered to you first on a non-negotiable basis. If you decline to accept this lease, the Port intends to offer an identical lease to the other respondent to the Port’s Request for Proposal offering.
We understand you need an opportunity to review this lease with your attorney. Thus, this offer of lease will remain open for a period of 60 days from the date of this letter or until you provide a response, whichever date occurs first.
1 Clerk’s Papers (CP) at 20. Borup refused to sign the lease and requested an opportunity to negotiate a lease consistent with its proposal. The Port responded that if Borup did not sign the lease as offered, it would (and eventually did) offer the lease to the other remaining applicant.
Borup then sued the Port seeking (1) a mandamus order requiring the Port to adhere to competitive bidding process; (2) an injunction preventing the Port from deviating from the competitive bidding process; (3) damages for breach of contract equal to its projected profits from the five-year renewal period it gave up; and (4) attorney fees under RCW 39.04.240.
On December 13, 2002, the court denied Borup’s motion for a temporary injunction. On January 2, 2003, Borup filed an amended complaint seeking (1) mandamus (same); (2) an injunction (same); (3) misrepresentation damages; and (4) attorney fees (same). On January 30, 2003, the court granted the Port’s CR 12(b)(6) motion to dismiss the misrepresentation claim and the request for attorney fees. On April 15, 2003, Borup filed a second amended complaint seeking (1) mandamus (same); (2) an injunction (same); (3) misrepresentation damages (same); and (4) promissory estoppel damages.
On September 8, 2003, the court granted the Port’s CR 12(b)(6) motion to dismiss claims (1) and (2). The Port then moved for summary judgment under CR 56 to dismiss claims (3) and (4). On April 12, 2004, the court granted this motion and dismissed the complaint. Borup then filed this appeal.
ANALYSIS Key RFP Provisions
The RFP stated:
It is the intent of the Port to award a contract to the most qualified candidate. The Port reserves the right to award or not award a contract under this RFP. The Port reserves the right to enter into discussions with several responders prior to final award. All responders, by submitting a response to this RFP, waive all rights to protest or seek any legal remedies whatsoever regarding any aspect of this RFP. The Port reserves the right to issue written notice to all candidates of any changes in this RFP if it should, at its sole and absolute discretion, determine such changes are necessary.
1 CP at 14. The Port agreed to consider the following criteria in its evaluation process: (1) fulfillment and responsiveness to the RFP; (2) revenue; (3) asset protection; (4) recreational programs; (5) overall strength of the ownership and/or management team; (6) experience; (7) financial capability; and (8) proposed term length. The Port reserved the right to reject all proposals. The RFP then provided:
The successful responder will have sixty (60) days, unless extended by the Port, to negotiate an agreement with the Port consistent with the proposal submitted. If the preferred responder and the Port of Skamania County cannot agree on terms and conditions within the sixty (60) days following the date of the preferred responder’s selection, the Port retains the option of selecting an alternate preferred responder to then negotiate an agreement satisfactory to both parties. The Port also reserves the right to reject any and all proposals or parts thereof.
1 CP at 19.
Standard of Review
The appellate court reviewing a summary judgment considers the matter de novo and makes the same inquiry as the trial court; summary judgment is appropriate when the pleadings, depositions, and admissions on file, together with the affidavits, if any, show there is no genuine issue about any material fact and, assuming facts most favorable to the nonmoving party, establish that the moving party is entitled to judgment as a matter of law. Wilson v. Steinbach, 98 Wn.2d 434, 437, 656 P.2d 1030 (1982). Intentional Misrepresentation
To avoid summary judgment dismissal of an intentional misrepresentation (fraud) claim, Borup had to make a prima facie showing of nine elements: (1) that the Port made a representation of an existing fact; (2) it was material; (3) it was false; (4) the Port knew that it was false; (5) the Port intended that Borup should act on it; (6) Borup was ignorant of its falsity; (7) Borup relied on the truth of the representation; (8) Borup had a right to rely on the representation; and (9) Borup suffered damages as a result. W. Coast, Inc. v. Snohomish County, 112 Wn. App. 200, 206, 48 P.3d 997 (2002) (citing Stiley v. Block, 130 Wn.2d 486, 505, 925 P.2d 194 (1996)).
In our view, Borup fails to show that there is a genuine issue of fact that the Port made a false representation of an existing fact. To the extent Borup argues that the Port falsely induced it to give up its five-year renewal option and, in return, it would have the opportunity to competitively bid for the contract, this is a promise of future performance and thus does not support a fraud claim. See W. Coast, 112 Wn. App. at 206 (citing Stiley, 130 Wn.2d at 505-06). To the extent Borup argues that the Port made this RFP knowing that it would not negotiate a lease but offer only a take-it-or-leave-it lease, it fails to show that the Port made this representation at the time it agreed to renegotiate its contract without a renewal option. It relies on the RFP, which the Port issued in April 2002, yet it signed the amended lease on September 25, 2001.
Borup has failed to show that the Port made an intentional material misrepresentation of fact. The trial court did not err in granting the Port summary judgment as to this claim.
Promissory Estoppel
Borup argues that all elements of promissory estoppel exist and the trial court erred in finding that the Port had kept its promise to hold a competitive bid process using a RFP. It urges us to take a broader view of the promise, arguing that the Port failed (1) to consult with the applicants about any changes it made to the RFP and (2) to negotiate with the successful responder consistent with the submitted proposal. It claims that these failings raise a material issue of fact of whether the Port acted in good faith.
To avoid summary judgment on its promissory estoppel claim, Borup had to make a prima facie showing of five elements: (1) the Port made a promise; (2) it reasonably expected Borup to change its position; (3) it caused Borup to change its position; (4) Borup justifiably relied on the promise; and (5) injustice can only be avoided by enforcing the promise. Corbit v. J.I. Case Co., 70 Wn.2d 522, 539, 424 P.2d 290 (1967).
Borup’s second amended complaint states that the Port’s September 17, 2002 letter contains a promise that Borup could compete for a new lease if it waived its five-year renewal option. But the September 17 letter contains no such promise. Rather, it offers Borup a lease as the first choice responder in the RFP process.
We have to assume then that basis for the promissory estoppel claim is the post-audit negotiations after the Port terminated the original lease and negotiated short-term arrangements with Borup to continue operating the golf course. During this time, the Port indicated that it would re-compete the lease for the period beginning January 1, 2003. Nothing in the record before us shows that the Port made a promise in order to get Borup to give up its renewal option. While the complaint alleges so, the documents it cites, Exhibits B and C to the original complaint, do not evidence such an agreement. To the contrary, the record shows that the Port deemed Borup in default, that it considered the lease terminated, and that it negotiated for a short-term solution until it could get a new lessee following a competitive bidding process.
Nonetheless, assuming Borup could show that it voluntarily waived its renewal option based on a promise that it would be able to competitively bid for the new contract, summary judgment was still proper. The Port issued an RFP. Borup and another submitted proposals. The Port deemed Borup the successful responder and offered it a lease. It refused to sign because the lease varied in significant ways from its proposal. The Port then offered the lease to the remaining responder, who accepted it.
This was a competitive process. And while the RFP indicated that the Port would negotiate with the successful responder, the Port’s refusal to negotiate with Borup (Borup did not even offer a counter proposal) did not make the process uncompetitive. The Port obviously regarded Borup as a qualified responder under the criteria set forth in the RFP, offered it a lease, and, when it refused, offered it to the other qualified responder. As the trial court observed:
[T]he Port did keep its promise. It used a competitive bidding process to offer a new lease. More than one party responded, which made it competitive. The Borups were the winner of the RFP contest. The Port offered them a lease. The Borups refused it. The Port in its RFP specifically stated that it did not have to lease to anyone.
Report of Proceedings at 28. But Borup contends that the Port’s conduct raises a material issue of fact as to the Port’s good faith dealing. But absent a contract, the Port had no good faith duty to Borup. See Keystone Land Dev. Co. v. Xerox Corp., 152 Wn.2d 171, 94 P.3d 945 (2004) (duty of good faith and fair dealing exists only in contract). Further, the RFP explicitly granted the Port the right to reject any submitted proposal. It apparently exercised that option here as to the terms of a future lease and offered Borup the terms under which it wanted the golf course to operate. Summary judgment was proper. We affirm.
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.
MORGAN, J. and BRIDGEWATER, J., Concur.