Rainier Beach Development Company, LLC et al v. King County

Filing 34

ORDER granting in part and denying in part Defendant King County's 20 Motion for Summary Judgment. To the extent Plaintiffs' claims are premised on County conduct preceding March 10, 2013 or May 9, 2013 (depending on whether the 60-day period for tort claims applies), they are time-barred and DISMISSED with prejudice. The County's motion is otherwise DENIED. Signed by U.S. District Judge John C Coughenour. (PM)

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THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 9 RAINIER BEACH DEVELOPMENT COMPANY, LLC, a Washington limited liability company; EXCEL HOMES, INC., a Washington corporation; and JAVIER LUNA and DONALD ALLEN, individuals, 10 11 12 13 CASE NO. C16-0822-JCC ORDER Plaintiffs, v. 14 KING COUNTY, a political subdivision of the State of Washington, 15 16 Defendant. 17 18 This matter comes before the Court on Defendant King County’s motion for summary 19 judgment (Dkt. No. 20). Having thoroughly considered the parties’ briefing and the relevant 20 record, the Court finds oral argument unnecessary and GRANTS the motion in part and DENIES 21 it in part for the reasons explained herein. 22 I. BACKGROUND 23 This section, as is appropriate on summary judgment, presents the facts in a light most 24 favorable to the non-moving party. 25 In late 2009, Plaintiff Rainier Beach Development Company, LLC (“RBDC”) purchased 26 ORDER PAGE - 1 1 property located at South 115th Place in Seattle (“the Property”). (Dkt. No. 26 at 1; Dkt. No. 27 2 at 1.) The intended project at the Property was five single family homes with associated site 3 development work and construction of a private road and sidewalks. (Dkt. No. 21 at 2.) Non- 4 party Cooper Development started the project in 2004. (Id.) Cooper applied for building permits 5 for the five single family homes and a grading permit, which would authorize construction of the 6 private road, a retaining wall, and sidewalks, as well as restoration of a wetland and stream 7 buffer on one of the lots. (Id.) Cooper obtained building permits in 2005 and 2006, but it 8 encountered financial problems in 2009 and declared bankruptcy. (Id. at 3.) 9 Frontier Bank foreclosed on the Property and sold it to RBDC, which became the project 10 applicant. (Id.) Before purchasing the Property, RBDC received assurances from Defendant King 11 County (“the County”) that if RBDC paid certain debts owed by Cooper, it would receive a 12 permit to start work within 90 days. (Dkt. No. 27 at 2.) 13 Plaintiff Excel Homes, Inc. and its owners, Plaintiffs Javier Luna and Donald Allen, 14 worked as the contractors on the project. (Dkt. No. 26 at 2.) Their aim was to complete what 15 Cooper had started, including all private roadwork, utilities, and improvements. (Id.) However, 16 according to Plaintiffs, the County has prevented completion of the project by treating Plaintiffs 17 unfairly and discriminatorily. (See Dkt. No. 1-2 at 5.) 18 For example, in 2011, Plaintiffs put in an erosion control rockery after obtaining 19 permission from the County to build it in that location. (Dkt. No. 28 at 2.) However, in August 20 2014, the County issued a set of stop work orders alleging that Plaintiffs did not have permission 21 to build the rockery. (Id.) The stop work orders were not limited to the rockery, but stopped work 22 on the whole site. (Id.) Then, later that year, the County required Plaintiffs to reopen one of the 23 lots and make engineering changes that were not originally required. (Id. at 3.) The County also 24 required Plaintiffs to obtain a new grading permit that would not have been required at the time. 25 (Id.) To this day, Plaintiffs are still prohibited from working on the rockery and have been 26 required to obtain a wetlands biologist to make a report on the area. (Id.) Plaintiffs have appealed ORDER PAGE - 2 1 2 the stop work orders, but no decision has yet been issued. (Id.) On February 25, 2014, Luna and an RBDC representative met with Fred White, then- 3 project lead for the County. (Dkt. No. 25 at 1.) White shared troubling information with them, 4 including that White felt the County intentionally thwarted the project; former County employee 5 John Kane shared information about Luna’s background in an effort to discredit Luna; the 6 County added unnecessary permit conditions to create extra work and cost for Plaintiffs; White 7 felt Excel Homes had in fact done excellent work and exceeded code requirements; and the 8 County had “bizarrely” lost Plaintiffs’ project file multiple times. (Dkt. No. 26 at 3-4.) 9 On July 16, 2014, Luna submitted a claim for damages to the County. (Dkt. No. 26 at 2.) 10 The claim alleged that the County made Plaintiffs redo Cooper’s work and frequently changed 11 the requirements for obtaining permits. (Id. at 16.) According to the claim, the County “blocked 12 [Plaintiffs] at every turn. For example, as an issue would arise, [Plaintiffs] would suggest an 13 approach, the [County] would require a different approach, [Plaintiffs] would do the work, and 14 then (after a huge expenditure of time and money) the [County] would ultimately say that 15 [Plaintiffs’] original approach was the correct one.” (Id.) The claim listed a number of examples, 16 including issues with the project’s retaining wall, water district, service road, turnaround, and 17 sidewalk. (Id. at 16-17.) Less than three weeks later, the stop work orders issued. (Id. at 6.) 18 On May 9, 2016, Plaintiffs sued the County, alleging: (1) intentional interference with 19 business relations; (2) negligence; (3) violations of Washington Revised Code chapter 64.40; 20 (4) violations of 42 U.S.C. § 1983; (5) breach of implied contract and promissory estoppel; 21 (6) negligent misrepresentation; and (7) unlawful discrimination. (Dkt. No. 1-2 at 7-10.) Their 22 complaint asserts that, “[r]ather than honor its commitment and grant RBDC a grading permit 23 within 90 days, [the] County [has] engaged in a consistent pattern of capricious, improper, 24 unfair, unreasonable and discriminatory actions against” Plaintiffs. (Id. at 5.) 25 26 The County now moves for summary judgment, arguing that it granted Plaintiffs their grading permit in August 2012 and thus all claims are time-barred. (Dkt. No. 20 at 1-2.) ORDER PAGE - 3 1 II. DISCUSSION 2 A. Summary Judgment Standard 3 The Court shall grant summary judgment if the moving party shows that there is no 4 genuine dispute as to any material fact and that the moving party is entitled to judgment as a 5 matter of law. Fed. R. Civ. P. 56(a). In making such a determination, the Court must view the 6 facts and justifiable inferences to be drawn therefrom in the light most favorable to the 7 nonmoving party. Anderson v. Liberty Lobby, 477 U.S. 242, 255 (1986). Once a motion for 8 summary judgment is properly made and supported, the opposing party must present specific 9 facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56(e); Matsushita Elec. Indus. 10 Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Material facts are those that may affect the 11 outcome of the case, and a dispute about a material fact is genuine if there is sufficient evidence 12 for a reasonable jury to return a verdict for the non-moving party. Anderson, 477 U.S. at 248-49. 13 Ultimately, summary judgment is appropriate against a party who “fails to make a showing 14 sufficient to establish the existence of an element essential to that party’s case, and on which that 15 party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). 16 B. Analysis 17 The County argues that Plaintiffs’ claims are barred by the relevant statutes of limitations 18 because “the County issued final approval for all work under the grading permit by August 1, 19 2012”—almost four years before Plaintiffs filed suit. (Dkt. No. 20 at 1.) Plaintiffs counter that 20 their claims “are not limited to the issuance of a grading permit” and that, from 2009 to 2016, the 21 County systematically and unlawfully interfered with their efforts to develop the Property. (Dkt. 22 No. 23 at 1-2; Dkt. No. 26 at 6.) Plaintiffs further argue that their claims are timely under the 23 discovery rule and the continuing violations doctrine. (Dkt. No. 23 at 2.) 24 25 26 1. Conduct Alleged The Court first notes that the record is quite unclear as to the timeframe for the problematic conduct alleged by Plaintiffs. ORDER PAGE - 4 1 First, the complaint states that RBDC acquired the Property in fall of 2009 and received 2 assurances from the County that it would receive a grading permit within 90 days. (Dkt. No. 1-2 3 at 5.) Beyond this, no specific dates are alleged. Plaintiffs arguably frame their factual 4 allegations with respect to the grading permit, stating: “Rather than honor its commitments and 5 grant RBDC a grading permit within 90 days, [the] County [has] engaged in a consistent pattern 6 of capricious, improper, unfair, unreasonable and discriminatory actions against RBDC and 7 Javier Luna. Examples include: . . . . .” (Id.) The examples that follow make up the majority of 8 Plaintiffs’ factual allegations, including that the County conditioned its approval of a grading 9 permit on RBDC’s acquisition of wetlands adjacent to the Property and an easement from an 10 adjacent landowner; frequently changed permit requirements, causing extra work and cost for 11 Plaintiffs; withheld files pertaining to the project; allowed representatives with animus toward 12 Plaintiffs to evaluate the project; required Plaintiffs to go beyond code requirements to obtain 13 permits; and intentionally delayed the project. (Id. at 6.) Moreover, while the complaint 14 explicitly references the grading permit, it also alleges that the County “refused to grant permits” 15 and “inappropriately ma[de] permitting decisions”—both in the plural—and mentions Plaintiffs’ 16 building permit and land use application. (Dkt. No. 1-2 at 6- 8.) 17 Given the allegations and evidence presented on summary judgment, one can determine 18 that at least some of these examples occurred after August 2012, although this would have been 19 impossible to tell from the face of the complaint alone. Furthermore, the record suggests that the 20 grading permit—at least as Plaintiffs understood it—may not actually have been granted in 21 August 2012. (See Dkt. No. 26 at 15-16) (Luna 2014 damages claim stating that the County “still 22 has not issued a final grading permit”). 23 Under these circumstances, the Court can conclude that Plaintiffs allege conduct 24 pertaining to the permit issued in 2012, as well as conduct beyond. The Court admonishes 25 Plaintiffs that the pleading standard is heightened in federal court and their current complaint 26 comes dangerously close to failing to state a claim. However, given the ongoing interactions ORDER PAGE - 5 1 between the parties and continued issues with the project, the County’s attempt to frame this 2 entire case as tied to the 2012 grading permit was disingenuous. 3 4 2. Applicable Limitations Periods All but one of Plaintiff’s claims are subject to a three-year statute of limitations. See 5 Wash. Rev. Code § 4.16.080; Wilson v. Garcia, 471 U.S. 261, 280 (1985) (section 1983); City of 6 Seattle v. Blume, 947 P.2d 223, 226 (Wash. 1997) (torts); Karpstein v. Allianz Life Ins. Co. of N. 7 Am., 2016 WL 6432535 at *2 (W.D. Wash. Oct. 31, 2016) (oral contracts); Antonius v. King 8 Cty., 103 P.3d 729, 732 (Wash. 2004) (discrimination). There is an additional 60-day period for 9 any tort claims. Wash. Rev. Code § 4.96.020(4). 10 Plaintiffs’ other claim, violation of Washington Revised Code chapter 64.40, has a 11 shorter timeframe. This chapter creates a cause of action where an agency acts arbitrarily, 12 capriciously, unlawfully, or in excess of its lawful authority,1 or if it fails to act within time limits 13 established by law.2 Wash. Rev. Code § 64.40.020(1). It requires any action to be commenced 14 within 30 days after exhausting administrative remedies. Wash. Rev. Code § 64.40.030. 15 The County argues that this claim is untimely, because it should have been filed within 16 30 days of the issuance of the grading permit. (Dkt. No. 20 at 7-8.) This argument attempts to fit 17 a square peg into a round hole. Plaintiffs do not object to the issuance of the 2012 permit, but to 18 the County’s conduct preceding and following such issuance. This includes the 2014 stop work 19 orders, the appeal of which—according to Plaintiffs’ evidence—has not yet been resolved. From 20 this record and the arguments presented, the Court cannot conclude at this time that this claim is 21 time-barred. 22 The County’s motion is DENIED as to the chapter 64.40 claim. 23 1 24 25 26 The agency must have known, or reasonably should have known, that its acts were unlawful or in excess of authority. Wash. Rev. Code § 64.40.020(1). 2 The County argues that its conduct did not constitute an “act” under the statutory definition. (Dkt. No. 20 at 7.) However, the County also states that, “[i]n the interest of judicial economy, this motion focuses solely on the statute of limitations issue” and not the substantive issues at play. (Id. at 2 n.1.) Thus, the Court will not consider this substantive argument. ORDER PAGE - 6 1 2 3. Three-Year Limitations Period: Discovery Rule & Ongoing Violations Turning to the claims with a three-year statute of limitations, the County argues that all 3 are time-barred because the grading permit was issued in August 2012 and Plaintiffs did not 4 bring this suit until May 2016. (Dkt. No. 20 at 6.) As noted above, Plaintiffs’ claims are not so 5 narrowly focused. However, the County is correct that some of its challenged conduct took place 6 more than three years prior to this suit’s filing. Plaintiffs maintain that this conduct is still 7 actionable under the discovery rule and the ongoing violations doctrine. (Dkt. No. 23 at 2.) 8 9 Discovery Rule: Under the discovery rule, a cause of action does not accrue until the plaintiff discovers or reasonably should have discovered all of the essential elements of his or her 10 claim. Green v. Am. Pharm. Co., 960 P.2d 912, 915 (Wash. 1998). This rule does not require a 11 plaintiff to understand the legal consequences of the claim, but whether he or she discovered the 12 salient facts regarding the claim. Id. 13 Here, Plaintiffs maintain that they did not realize that the delays, extra requirements, and 14 added costs were attributable to the County’s wrongful conduct until they met with White in 15 2014. (Dkt. No. 23 at 10-11.) The County responds that Plaintiffs were actually aware of the 16 relevant facts prior to this meeting. (Dkt. No. 31 at 6.) For example, the County notes, Luna 17 wrote an email to White in 2011 complaining of “unjustifiable delays and significant expenses 18 that have since been proven unnecessary and even contrary to the [County’s] normal procedures 19 and jurisdictional guidelines” and that the County employees “acted with bias against this 20 project’s successful completion and . . . abused their positions of authority.” (Dkt. No. 31 at 6; 21 Dkt. No. 32-4 at 2.) In addition, Plaintiffs’ complaint alleges that from the beginning of their 22 involvement in the project, the County systematically and unlawfully interfered with their efforts 23 to develop the Property. (Dkt. No. 23 at 1-2; Dkt. No. 26 at 6.) 24 Thus, although the conversation with White confirmed Plaintiffs’ suspicions about the 25 County’s alleged bad acts, it did not lead Plaintiffs to discover something fundamentally new 26 about the elements of their claims. “[T]he law does not require a smoking gun in order for the ORDER PAGE - 7 1 statute of limitations to commence.” Giraud v. Quincy Farm and Chemical, 6 P.3d 104, 109 2 (Wash. Ct. App. 2000). 3 Accordingly, the Court declines to apply the discovery rule to Plaintiffs’ claims. 4 Ongoing/Continuing Violations Doctrine: The continuing violations doctrine is “an 5 equitable exception to the statute of limitations, allowing a plaintiff to recover damages for 6 otherwise time-barred acts.” Antonius, 103 P.3d at 732. Under this doctrine, the “statute of 7 limitations runs from the date each successive cause of action accrues as manifested by actual 8 and substantial damages.” Fradkin v. Northshore Util. Dist., 977 P.2d 1265, 1269 (Wash. Ct. 9 App. 1999). The doctrine has been applied by Washington courts in hostile work environment 10 cases, Antonius, 103 P.3d at 736 (applying the rule set forth in National Railroad Passenger 11 Corporation v. Morgan, 536 U.S. 101 (2002)), as well as nuisance and trespass claims, see Pac. 12 Sound Resources v. Burlington N. Santa Fe Ry. Corp.¸125 P.3d 981 (Wash. Ct. App. 2005). 13 However, Washington courts have thus far declined to extend the doctrine further. See Cox v. 14 Oasis Physical Therapy, PLLC, 222 P.3d 119, 127 (Wash. Ct. App. 2009). 15 Plaintiffs maintain that the doctrine applies more widely, citing Ballard v. Popp, 174 P.3d 16 681 (2007) and RK Ventures, Inc. v. City of Seattle, 307 F.3d 1045 (9th Cir. 2002). (Dkt. No. 23 17 at 12.) However, the portion of Ballard addressing the doctrine is unpublished and even states 18 specifically that, “[i]n Washington, the continuing violation doctrine has been applied in the 19 context of workplace discrimination.” Ballard, 174 P.3d at ¶¶ 18-20 (emphasis added). And in 20 RK Ventures, the Ninth Circuit declined to apply the continuing violations doctrine, noting that 21 Morgan “overruled previous Ninth Circuit authority holding that, if a discriminatory act took 22 place within the limitations period and that act was ‘related and similar to’ acts that took place 23 outside the limitations period, all the related acts—including the earlier acts—were actionable as 24 part of a continuing violation,” with the exception of workplace discrimination claims. RK 25 Ventures, 307 F.3d at 1061, 1061 n.13. 26 Thus, the Court declines to apply the continuing violations rule to Plaintiffs’ claims. ORDER PAGE - 8 1 Because these doctrines do not operate to extend the limitations period, the Court 2 concludes that claims based on the County’s conduct prior to May 9, 20133 are time-barred. 3 However, claims based on later conduct are still actionable. 4 4. Discovery and Mediation Finally, Plaintiffs argue that the County’s motion should be denied because discovery is 5 6 at a preliminary stage and the County did not comply with the Court’s mediation order. (Dkt. No. 7 23 at 2.) 8 9 Regarding discovery, Federal Rule of Civil Procedure 56(d) allows the Court to defer consideration of, or deny, a summary judgment motion if the opposing party cannot present facts 10 essential to justify its opposition. Here, Plaintiffs complain that the County failed to respond to 11 discovery but do not explain how additional information would help them defend this particular 12 motion. (See Dkt. No. 23 at 13-14.) The Court cannot conceive of further evidence that would 13 contradict the procedural issues requiring dismissal of certain claims. This argument is rejected. 14 The Court similarly rejects the argument as to mediation. While the Court encourages 15 parties to amicably work out issues, the failure to do so does not alone warrant dismissal under 16 these circumstances, particularly given the County’s position that it cancelled mediation in 17 reaction to Plaintiffs’ failure to provide promised information. (See Dkt. No. 32 at 1.) 18 III. CONCLUSION 19 For the foregoing reasons, the County’s motion for summary judgment (Dkt. No. 20) is 20 GRANTED in part. To the extent Plaintiffs’ claims are premised on County conduct preceding 21 March 10, 2013 or May 9, 2013 (depending on whether the 60-day period for tort claims 22 applies), they are time-barred and DISMISSED with prejudice. The County’s motion is 23 otherwise DENIED. 24 // 25 // 26 3 ORDER PAGE - 9 Or March 10, 2013, if the additional 60-day period for tort claims applies. 1 DATED this 16th day of August, 2017. 4 A 5 John C. Coughenour UNITED STATES DISTRICT JUDGE 2 3 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDER PAGE - 10

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