Supreme Court of the State of Washington
Opinion Information Sheet
Docket Number: |
85654-1 |
Title of Case: |
Bus. Servs. of Am. II, Inc. v. WaferTech LLC |
File Date: |
04/19/2012 |
Oral Argument Date: |
11/08/2011 |
SOURCE OF APPEAL
----------------
Appeal from
Clark County Superior Court
|
| 98-2-02045-1 |
| Honorable Diane M Woolard |
JUSTICES
--------
Barbara A. Madsen | Dissent Author | |
Charles W. Johnson | Signed Dissent | |
Tom Chambers | Majority Author | |
Susan Owens | Signed Majority | |
Mary E. Fairhurst | Signed Majority | |
James M. Johnson | Signed Majority | |
Debra L. Stephens | Signed Majority | |
Charles K. Wiggins | Did Not Participate | |
Steven C. González | Did Not Participate | |
Gerry L. Alexander, Justice Pro Tem. | Signed Majority | |
Dennis J. Sweeney, Justice Pro Tem. | Signed Majority | |
COUNSEL OF RECORD
-----------------
Counsel for Petitioner(s) |
| Howard Mark Goodfriend |
| Smith Goodfriend PS |
| 1109 1st Ave Ste 500 |
| Seattle, WA, 98101-2988 |
|
| James T. Mcdermott |
| Ball Janik LLP |
| 101 Sw Main St Ste 1100 |
| Portland, OR, 97204-3219 |
|
| Aaron D Goldstein |
| Ball Janik LLP |
| 101 Sw Main St Ste 1100 |
| Portland, OR, 97204-3219 |
Counsel for Respondent(s) |
| Eric Ronald Hultman |
| Hultman Law Office |
| 611 Market St Ste 4 |
| Kirkland, WA, 98033-5422 |
Amicus Curiae on behalf of Washington Defense Trial Lawyers |
| Stewart Andrew Estes |
| Keating, Bucklin & McCormack, Inc., P.S. |
| 800 Fifth Ave Ste 4141 |
| Seattle, WA, 98104-3175 |
|
| Daniel Joseph Gunter |
| Riddell Williams PS |
| 1001 4th Ave Ste 4500 |
| Seattle, WA, 98154-1065 |
|
| Bryan Joseph Case |
| Riddell Williams, P.S. |
| 1001 4th Ave Ste 4500 |
| Seattle, WA, 98154-1065 |
|
| Shilpa Bhatia |
| Wilson Smith Cochran Dickerson |
| 901 5th Ave Ste 1700 |
| Seattle, WA, 98164-2050 |
IN THE SUPREME COURT OF THE STATE OF WASHINGTON
BUSINESS SERVICES OF )
AMERICA II, INC., ) No. 85654-1
)
Respondent, ) En Banc
v. )
WAFERTECH LLC, )
)
Petitioner. )
______________________________ ) Filed April 19, 2012
CHAMBERS, J. -- Business Services of America II, Inc. (BSA) sued
WaferTech LLC. After the trial court dismissed BSA's claims, BSA appealed. In
March 2004, the Court of Appeals affirmed dismissal of all but one claim, which it
remanded for trial. After remand, the case lay mostly dormant until June 2009,
when BSA noted the case for trial. WaferTech then moved for dismissal. The trial
court granted the motion to dismiss, and BSA appealed. BSA argued that the trial
court had no discretion to dismiss the case because CR 41(b)(1) states that if a case
is noted for trial before a dismissal hearing, it "shall not" be dismissed. The Court
of Appeals agreed with BSA and reversed. WaferTech sought review. We affirm
the Court of Appeals and remand to the trial court for further proceedings consistent
with this opinion.
Facts
BSA and WaferTech were opposing parties in a lawsuit that began in 1998
Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
following a construction contract dispute. BSA was the assignee of claims by a
subcontractor who had been terminated from the contract. At trial all of BSA's
claims against WaferTech were dismissed, and $856,760.48 in attorney fees were
entered against it. The Court of Appeals affirmed dismissal of most claims but
reversed with respect to a lien foreclosure claim, which it remanded for trial in
2004. Bus. Servs. of Am. II, Inc. v. WaferTech, LLC, noted at 120 Wn. App. 1042,
2004 WL 444724.
In April 2005, WaferTech filed a satisfaction of judgment with respect to the
attorney fees it had been awarded. Then, in July 2006, the trial court issued a
"Stipulation and Order for Return of Exhibits." Neither party responded to the
order, and the trial court destroyed the exhibits. Next, in May 2008, BSA's counsel
filed a notice of intent to withdraw as BSA's counsel in the case. The notice stated,
not entirely accurately, "No trial date is set. This case has been dismissed and
judgment entered thereon against Plaintiffs." Clerk's Papers (CP) at 43.
After remand, BSA went through a receivership and changed ownership
several times. Finally, in 2009, the current owner of BSA's claim decided to try the
lien claim. BSA noted the case for trial on June 15, 2009. Two months later,
WaferTech moved for dismissal. BSA opposed the motion, arguing that CR
41(b)(1) prohibited dismissal because it states that a case shall not be dismissed if it
is noted for trial before the hearing on the motion to dismiss. The trial court granted
dismissal, finding that it was not constrained by CR 41(b)(1). BSA appealed, and
the Court of Appeals reversed the trial court, holding that CR 41(b)(1) limited the
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
court's discretion to dismiss the case. Bus. Servs. of Am. II, Inc. v. Wafertech, LLC,
159 Wn. App. 591, 245 P.3d 257 (2011).
Analysis
a. Standard of Review
Interpretation of a court rule is a question of law we review de novo. State v.
Schwab, 163 Wn.2d 664, 671, 185 P.3d 1151 (2008) (citing City of College Place
v. Staudenmaier, 110 Wn. App. 841, 845, 43 P.3d 43 (2002)). Court rules are
interpreted in the same manner as statutes and are construed in accord with their
purpose. State v. Wittenbarger, 124 Wn.2d 467, 484, 880 P.2d 517 (1994). The
starting point is thus the rule's plain language and ordinary meaning. See State v.
J.P., 149 Wn.2d 444, 450, 69 P.3d 318 (2003) (citing Nat'l Elec. Contractors Ass'n
v. Riveland, 138 Wn.2d 9, 19, 978 P.2d 481 (1999)).
b. Dismissal under CR 41(b)(1)
The dismissal of an action for want of prosecution is in the discretion of the
court in the absence of a guiding statute or rule of court. Snohomish County v.
Thorp Meats, 110 Wn.2d 163, 167, 750 P.2d 1251 (1988) (citing State ex rel.
Dawson v. Superior Court, 16 Wn.2d 300, 304, 133 P.2d 285 (1943)). However,
dismissal is mandatory if CR 41(b)(1) applies. Id. at 167, 168-69. The rule states
in full:
Any civil action shall be dismissed, without prejudice, for want of
prosecution whenever the plaintiff, counterclaimant, cross claimant, or
third party plaintiff neglects to note the action for trial or hearing within
1 year after any issue of law or fact has been joined, unless the failure
to bring the same on for trial or hearing was caused by the party who
makes the motion to dismiss. Such motion to dismiss shall come on for
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
hearing only after 10 days' notice to the adverse party. If the case is
noted for trial before the hearing on the motion, the action shall not
be dismissed.
CR 41(b)(1) (emphasis added). There is only one exception to the mandatory
application of the italicized portion of the rule: "Where dilatoriness of a type not
described by CR 41(b)(1) is involved, a trial court's inherent discretion to dismiss
an action for want of prosecution remains." Thorp Meats, 110 Wn.2d at 169 (citing
Gott v. Woody, 11 Wn. App. 504, 508, 524 P.2d 452 (1974)). Such dilatoriness
"refers to unacceptable litigation practices other than mere inaction." Wallace v.
Evans, 131 Wn.2d 572, 577, 934 P.2d 662 (1997).
The sole question is whether CR 41(b)(1) applies in this case to limit the trial
court's inherent discretion to dismiss. BSA's argument is straightforward. It claims
that it noted the case before the hearing on the motion to dismiss, and therefore the
case cannot be dismissed. See CR 41(b)(1). WaferTech makes two arguments in
response. First, it asserts that this case falls under the "unacceptable litigation
practices other than mere inaction" exception to the rule in CR 41(b)(1). Wallace,
131 Wn.2d at 577. Specifically, it relies on the lack of any response from BSA to
the trial court's stipulation and order for return of exhibits and the notice of
withdrawal from BSA's counsel, sent to both the trial court and WaferTech, stating
that the case had been dismissed. WaferTech claims that these two instances
amount to conduct other than mere inaction, and thus the court was within its
discretion to dismiss the action. See id.
Second, WaferTech argues that CR 41(b)(1) does not apply on remand. It
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
claims that CR 41(b)(1), by its terms, applies when a case is not noted "within 1
year after any issue of law or fact has been joined" and asserts this requirement is
rendered inoperative when a case has been noted, tried, appealed, and remanded in
part. It also points out that no case has ever applied CR 41(b)(1) to limit, on
remand from appeal, a court's inherent authority to dismiss a case.
The trial court in making its decision to dismiss the case primarily relied upon
WaferTech's second argument. The following is the language at issue in this case:
"If the case is noted for trial before the hearing on the motion, the action shall not be
dismissed." CR 41(b)(1). This court addressed the purpose behind that language in
Thorp Meats:
This sentence was promulgated to encourage cases to be heard on the
merits, the courts recognizing that involuntary dismissal for want of
prosecution "is punitive or administrative in nature and every
reasonable opportunity should be afforded to permit the parties to
reach the merits of the controversy." Thus, the notice of trial setting
interposed after the motion to dismiss and before the hearing on the
motion is the exception to what would otherwise be a mandatory
dismissal under CR 41(b)(1).
Thorp Meats, 110 Wn.2d at 168 (footnote omitted) (quoting Yellam v. Woerner, 77
Wn.2d 604, 608, 464 P.2d 947 (1970)). Relying on the statement that the purpose
of the rule is to encourage cases to be heard on the merits, WaferTech asserts that
when issues of fact and law are joined in a case, and the case is noted for trial, tried
on the merits, appealed, and remanded for further trial, the concerns underlying the
promulgation of CR 41(b)(1) are no longer relevant. According to WaferTech,
under these circumstances the rule's purpose has been served because the merits of
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
the controversy have already been reached at least once. WaferTech also contends
that CR 41(b)(1) by its terms applies only when a case is not noted within a year
after joinder of any issues and so cannot apply to a case that was already noted and
tried, appealed, and then remanded. See CR 41(b)(1). Thus, WaferTech argues, a
trial court regains its discretion to dismiss at the point of remand.
As the Court of Appeals pointed out, there is no authority whatsoever for the
claim that the rule does not apply after remand. Bus. Servs., 159 Wn. App. at 598.
Moreover, we have held under the predecessor rule to CR 41(b)(1) that an issue of
law or fact is joined when, among other circumstances, a case is remanded from an
appeal. State ex rel. Wash. Water Power Co. v. Superior Court, 41 Wn.2d 484,
490, 250 P.2d 536 (1952) (citing Rule 3, former Rules of Pleading, Practice and
Procedure, 34A Wn.2d 69 (1938)). There is no reason to treat CR 41(b)(1)
differently, and we hold CR 41(b)(1) applies to cases on remand.
WaferTech's other argument relies on the solitary exception to the ordinarily
strict application of CR 41(b)(1). In Wallace, 131 Wn.2d at 577, as mentioned, this
court found that a trial court has discretion to ignore the prohibition of dismissal
under CR 41(b)(1) where delay was caused by "unacceptable litigation practices
other than mere inaction." WaferTech argues BSA went beyond "mere inaction" by
(1) failing to respond to the court's order resulting in destruction of exhibits and (2)
stating that the case had been dismissed in its notice of withdrawal of counsel. As a
result of these actions, WaferTech maintains that the trial court had discretion to
dismiss the case despite CR 41(b)(1).
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
In both Wallace and Thorp Meats, this court expressly referred readers to the
Court of Appeals case Gott for examples of the sort of behavior not covered by CR
41(b)(1). Wallace, 131 Wn.2d at 577-78 (citing Gott, 11 Wn. App. at 508); Thorp
Meats, 110 Wn.2d at 169 n.14 (citing Gott, 11 Wn. App. at 508). Specifically, both
cases cite to the following passage from Gott:
We do not believe, as defendants contend, that this interpretation
will seriously invade the discretionary power of the Superior Court to
manage its affairs, so as to achieve the orderly and expeditious
disposition of cases, to assure compliance with the court's rulings and
observance of hearing and trial settings which are made. In these areas
the trial court's inherent discretion is not questioned by our
interpretation. See Wagner v. McDonald, 10 Wn. App. 213, 516 P.2d
1051 (1973) (dismissal for want of prosecution where plaintiff failed to
appear at trial). See also Link v. Wabash R.R., 370 U.S 626, 8 L. Ed.
2d 734, 82 S. Ct. 1386 (1962) ([Fed. R. Civ. P.] 41) (dismissal where
failure to appear at pretrial conference was combined with general
dilatoriness).
Gott, 11 Wn. App. at 508. Other cases, although not expressly addressing want of
prosecution, have allowed discretionary dismissal for failures to appear, filing late
briefs, and similarly egregious sorts of dilatory behavior. E.g., Apostolis v. City of
Seattle, 101 Wn. App. 300, 305, 3 P.3d 198 (2000).1
The behavior engaged in by BSA here does not rise to the level of
"unacceptable litigation practices other than mere inaction." Wallace, 131 Wn.2d
at 577. A lack of response to the court's recall of exhibits is not equivalent to a
1 BSA also argues that WaferTech's claim is more appropriately viewed as an estoppel claim than
a failure to prosecute claim and spends some time arguing why an estoppel claim would fail here.
It is not clear why BSA is raising an argument for WaferTech, but since WaferTech does not raise
it, the court will not address it.
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
failure to appear at a court proceeding or noncompliance with a court order or
ruling. No response was required to the court's stipulation and order.2 The
withdrawal of counsel accompanied by a statement that the case had been
dismissed, while certainly not commendable, is likewise not an unacceptable
litigation practice that is a basis for an exception to CR 41(b)(1). The withdrawal
notice came about four years after the case was remanded for trial, and there is no
evidence that any party took any action or relied in any way on the statement in the
notice that the case was "dismissed." CP at 43.
While we do not commend BSA's failure to promptly move its case forward,
neither should WaferTech be commended. At all times, WaferTech knew that the
Court of Appeals had remanded the lien claim for trial. See Report of Proceedings
(Aug. 26, 2009) at 3-5. CR 41(b)(1) is designed to provide an option for parties like
WaferTech if they wish for early resolution. Certainly no one would expect BSA to
move to dismiss its own claim. One year after remand, WaferTech could have
moved at any time to dismiss BSA's claim for want of prosecution. See CR
41(b)(1). If WaferTech was concerned that delay would prejudice its ability to
present its case, a motion under CR41(b)(1) was available to WaferTech to bring
the case to a conclusion.3 WaferTech failed to move under CR 41(b)(1) for four
2 It is not clear from the record whether either party retains copies of the exhibits. The record
does establish that the trial court possesses copies of all files on microfiche.
3 Surprisingly, the dissent claims the majority says something it does not. To wit: that WaferTech
had an obligation to "forward the prosecution of the case." Dissent at 7. We do not assert or
even suggest that a defendant has any such obligation. We do suggest that if a defendant wants a
case dismissed for want of prosecution, moving for dismissal before the opponent notes its case
for trial is the best way for the defendant to accomplish its goal.
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Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
years and finally made its motion only after BSA noted the case for trial. Further,
while WaferTech complains that BSA did not respond to the trial court's
"Stipulation and Order for Return of Exhibits," which it claims resulted in the
destruction of trial court exhibits, WaferTech also failed to respond to the notice
regarding exhibits.4 If WaferTech wanted to save the trial court exhibits, it could
easily have done so. WaferTech seems to make much of BSA's counsel's notice of
intent to withdraw, in which the withdrawing lawyer erroneously states, "[T]his case
has been dismissed and judgment entered thereon against Plaintiffs." CP at 43. But
the notice of intent was not an order dismissing a claim. The "Notice of Intent to
Withdraw" in fact presented WaferTech with a perfect opportunity to seek an order
of dismissal of all claims, but it failed to do so.
Trial courts, of course, have inherent authority to maintain their calendars and
to control their courtrooms. The facts of this case do not implicate that authority.
Conclusion
We hold that because this case was noted for trial before the hearing on the
motion to dismiss, under the plain terms of CR 41(b)(1), the trial judge lacked
discretion to dismiss the case. Under the facts before us, BSA did not engage in the
sort of unacceptable litigation practices that would allow an exception to CR
41(b)(1). The Court of Appeals is affirmed.
4 No party claims that copies of the exhibits do not exist in some form or that any exhibit was
permanently lost.
9
Bus. Servs. of Am. II, Inc. v. WaferTech LLC, No. 85654-1
AUTHOR:
Justice Tom Chambers
WE CONCUR:
Justice James M. Johnson
Justice Debra L. Stephens
Gerry L. Alexander, Justice Pro Tem.
Justice Susan Owens Dennis J. Sweeney, Justice Pro
Tem.
Justice Mary E. Fairhurst
10
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