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The Honorable Dave Needy

Skagit County Superior Court
Hearing Date: August 21, 2015
Hearing ~nme: 1:30 p~,
Moving P'ait}i

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IN THE SUPERIOR COURT .FOR 1'HE STATE OF WASHlNGTON

IN AND FOR ISLAND COUNTY

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JONATHAN DEEGAN and ALICE

O'GRADY, on behalf of t.hemselves and
othc,rs similarly situnted,

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Plaintiffsj
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v.

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NO. 14-2-00705-6

DEFENDANTS' REPLY IN SUPPORT

OP MO'rION TO DISMISS UNDER
CIVIL RULE t2(b)(6)

WINDERMERE REAL ESTATP)CENTER14 ISLE, lNC. 1 a Washingto11 corporation; and

ACORN PROPERTIESt INC., dbu RB/M.\X
15 .ACORN PROPEltrlES, INC. a Washington
corporation,
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Defendants.

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A.

Defendants committed no unfair or decepdve fltt becouse they disclosed the

18 defect in Plaintiff&, properties: sJgnltlcant nolse level as a result of airport operntlons.

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This Court nt~ed not engrige in any foctua.l inquiry to detem1ilie tht1t Plaintiffs were on

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notice of tbt uircraft noise defect of their properties - we know thny received that notice 1n

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Defondm1L~v 2001 Form 22, The additional details a.b(>Ut the defect, which Plaintiffs allege

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J)efend1mts should have provided) 1 are immntcrial t<.1 the thre.shold question of law in th1s c~we:

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whether Plaintiffn have }lllcged an unfair or de(~eplive act or prac:tk.'th the first eloment of a

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i:~w1se of action unde.r the Washington Consumer Protection Act Plaintiffs hRve tmt,

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26

---------------

DBPENDAN'f'S 1 REPLY TN SUPJ:IORT OP MOTXON TO

DISMISS UNbIIR CIVIL RULE 12(H)(6) 1
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2015-08-17 14:07

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In Douglas v. Visser, the court held that no unfafr or decepthe act or practice for the

2 purposes of the Washington Consumer Protection Act exists if a buyer is on notice of a defect
3 in the sellets property~ even if the seller intentionally mis.represented the defect, because the
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buyer bas a reasonable duty to investigate. 173 Wn. App. 823~ 295 P.3 800 (2013). Douglas

5 doesn't add a Hduty to jnvestigate" element to the CPA. Rather, it defines wlu-1t constitutes an
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unfair or deceptive act or practice, lhe first prong of a CPA violaticm/ in the context. of failure

to disdosc a residential renl property defect in connection with a lfflle.

The Daugla,v Court.found thut where t.he buyer has notice of the defect~ fail11re. to

9 disclose the extent or severity of thl~ defect is not nn unfair or deceptive net or practice,
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Dougla,1', 173 Wn. App at 833-834 e'Bec:ause tbe Douglases were on nt1tke of the defect nnd

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had a duty tn make fnrther i.nquiry) it cannot be snid , . that the Vissers c.mnmitted an unfair or

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deceptive act that caiised the Douglasest Injury.'~).

Pluintiffs !\eem t:Cl concede that they had a duty of further inquit'}\ 3 but focus on the

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wrong question: whether they could have reasonably discovered the existence of ICC 9.44.050.

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lf Plaintiffs wanted additional information about the aircraft nolse defect that Defendants

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disclosed in the 2001 Form 22, they had a d1,1ty to investigate the informuticm they claim they

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should have received under ICC 9.44.050: decibel levels, times, and frequency. Plaintiffs do

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not allege that the aircraft noise defect wns undiscoverable or hidden. Plaintiffs' complaint

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does not allege that Plahitiffa made any further inc1uiry about: the volume or frequency of the

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noise. or that s:uch inquiry would huve been fruitless. 4

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22.

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Aviolation nt the C'..tmsumcr PmH:dion kl exists when thero is (1) 1m unfair or doi:->cJ)tivc act ot 1m1ctkc, (2)
occurring in trii!tlc or t::(.mnneroe.; (3) wllh a publk: interest impact, (4) th1ti pmidniiltcly causes, (5) h1jury 10 i
plltlnttff hi hi& or her buslnes!l or property. Svcmisim v. SUJt'kt 143 Wn.2d 546,553, 23 PJ<l 4:55 (2001); Jm!oor
Blllboard/Wath,, Im:. v. Jmcfl,ra 1)!/ecmH of Wash,, lite,, 162 Wn.2d 59, g3...g4, l 70 P..3d 10 (20{l7}

~ "Ph!ntiffa were requirnd tt1 l<Xik: no further than '''fbe Nnise Reduction Ordinilhee 1 rcfe.ren4.-;,,d ln tltc1 disclo~ur!.\
thiy t'l':c~ive.d.'' Opposl!fon o! 9:10.
4 Rathe!\ Plaintiffs; OJ)J)ositfon to th,., mot'io1,. tq dhm1is:. nlloga.,; that only nn Inquiry io!o the cxistt;llce of nn<l
1Xinlont of ICC 9.44J!$D wuUld lmve bi:f~n l'J:ultlesr, bccm.1so H w:ui not teforcnct"d in tho 2001 form 21., Thin Court
t1ccd not rule on thfa lltB'llmcnl (,) tui'iCh II di~isir.m.

f>ttFBNf)AN'rS' REPLY JN SUPPORT OP MO't't()N TO

DISMISS UNDER ClVtL RULE t2{B)(6) . 2
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TOUSLEY.COM 2066822992 >> 360 240 5530

-.-

B.

Plaintiffs attempt to distinguish the key DougltJs ca..~e on a single point: "Douglas

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PJalntiffs fail to distinguish .Douglas v, Vh-ser from this case.

3 involved the setler~s failure to discloie the existence of rot and water damage - defects whose

4 disclosure is not specifically regulated by statute or ordinance. 1t Plaintiff.~ are incorrec,t. The
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defects at i.ssue in Douglas; (e.g. roof leaks, basement leaks or floodins.i defects in floors,

sidfn& interior willlih exterior walls~ and pest damage) are regulated in great detail by RCW

64.()6.020, which sets out the disclosure statement commonly known as Ml.S Form 17. Just ns

!stand County did with ICC 9.44,050, the Washington legislature evaluated the nature of

important disclosures in properly sales, and then determined the specific form and content of

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the disclosure statement needed to the buyer on notice of defects. The Douglas Court held that

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even an inifmtional misrepresentation in written disclosures (which Plalntiffs do not allege

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here) doeij not C'.onstitute a CPA violation if the buyer had notice of the defect. Douglas, 173

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Wn. App ut 833-834.

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Sellers, the Vissers, intendonally misrepresented the defects in their Form 17 disclosure

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to the Douglases:

'After the Douglases made an offer~ the Vissers filled out a seller disclosure

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statement. But, they answe.red, 'don't know' or simply foiled to respond at all to many

17 questions that the Douglases felt should have had a clear {yes~ or "no 1 answer...' Dougl<u; v,
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Visser. 173 Wn. App. 823, 826. Despite this, the Douglas Court found that the failure to

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disclose ~ even in cont.rnvention of the statutory requirements - did not <.,"OOStitute an unfair or

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deceptive act or praiiice.

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Plnint.iffs fail to distinguish Douglas,, and offer no reason why their claims in this case

22 fkhould not be dismissed on the basis that they had notice of the existence of the afrcmft noh!e

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defect. Nor do .r1aintiffa cite any case that suppmts their claim that a failure to describe the

24 extent of a defect can c.onstitui:e a CPA violation. 11011ce t\ buyer discovers evidence of a dotect1
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they nre on notice and have a duty to make. further inquiries. They t.'flnnot succeed when the

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ext.ent of the defect is greater than anticipated 1 even when it is mngnitudM greater/' .Douglas,

DEPENDANTW 1U1l1LY [N SUPPORT OF MOTION TO

DISMISS UNDER CIVIL RULE l 2(1S)(6) - :t
.Slllil.O!'I l/:i<J..1111. 2

l'OlJS:t.kv 1111.AlN ~"l'ltNrliro! PUC

J 700 S1tv1>tttl1 J\v&inuo, Suite :n,io
Soaitlc. Wsshilli,\ti.m \Ji!HJI
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1 173 Wn. App. 823~ 832. Edmonds v. John.I.. Scott, does not, as Plaintiffs clsim, oont"-Crn the
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extent of a defect. 87 Wn. App 834, 942 P.2d 1072 (1997). Rather, the Court of Appeals

found a CPA violation where the defect 1,vns a drainage problem. and the real estate agent

4 mfarepresented to the buyer that it had been .fixed prior to closing: "Because of the nets of

5 Scott's age11ts~ Edmottd8 was induced to believe that the drainage problem was mino.r and had
6 been cotre(..'ted." Edmonds, 87 Wu. App at 694.s
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Similarly. Sloan v. Thomp."ion 1 does not suilport PlaintUt~ position. 128 Wn. App. 176,

115 P.3d 1009 {2005). The Sloan Court found that notice of various defects in a property (e.g.

roof Jeaka.ge) did not constitute notice of other, undisclosed defects (framing and septic),

1.0 because known defects were not of the stune character as the undisclosed defects. Id. at 78911

90. By contrast, there is only one kind of defect at issue in this case, uircraft ll(lisei and

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Plaintiffs concede thal Defendants: gave them notitt! of that defect.

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C.
Failure tb provide the ICC 9.44.050 disclosure docs mlt constitute n per se
14 unfair or deceptive ad ()r p~-actice under the CPA.
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Plaintiffs are really asking this court to hold that Defendants' omission of the precise

16 language set oul itl ICC 9.44.050 constitutes a per se unfair or deceptive act or practk:e. But

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ICC 9A4.050 lacks the specific legislative intent necessary to create a per se unfair or deceptive

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act or practice.

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One way a plaintiff muy establish the. first two elements [of a CPA claimJ
is by nhowing that the alJeged conduct constitutes a per sc unfair trade
practice. The court explain$ i.[a] per se unfah trade practice exists when a
statute [that] has been declared by the Legislature to constitute an unfair or
d~~ptive act in trade or commerce has bee11 violated" and gives examples
of such statutei:i: RCW 19.09.340 (charitable solicitations), RCW
19.105.500 (camping clubs), RCW 19.102.020 (chain distribution
sche1m.Is)t RCW 19.110,170 (business opportunities), RCW 18.26,185
(debt adjustment), RCW 18.39.350 (embulming), RCW 58.19.270 (land

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""----- --W"---~o <-

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~ Thll: eventfl ~l itlsua fn Ed1mmds nhm Wok pince in l994i prior k, tho 1996 enactment of R(,"W 64.06.600 (CPA
d1>cr. not apply lo wr!Hen property disclmillr(ll,), 11nd so the EdmDNd.~ Ct1utt conslderotl whethur wri\11,111 properly
tliJ;ck~ure11 t.x,uld conruHutc n CPA vlnla.timt,

DEFENl)ANTS' REPLY IN SUPPORT OP MOTION TO

DISMISS UNDER CIVIL n.ULE 12(B)(6) ~ ,i
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2015-08-17 14:07

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development), RCW 63.10.050 (consumer lenses), and RCW 64.36.170

(time-share offerings).
The court notes the Legislature, not the court, is the appropriate. body to
est:abllRh the interaction hetween other statutes and the CPA by declaring a
statutol'y violation to be a per se unfair trade practice. Tl}erefo.re, the court
c.onfirn:1s "'[when] the Legislature speclfkaJly defi,ze,fi th.e exact
relationship betwt:e1t a statute and the CA4., this cmtrt will ac.w:nowle<Jge
that relatlonshlp. 0

A.mierso,i v, Valley Q1u1.lityHomes, inc,, 84 Wash. App. 511,515,928 P.2d 1143, 1145
(1997)(internnl citations omi.tted)(emphasis in original).

The charltabfo donations statute gives a.n example of the language U1e Washington
legifllature drafts when it wishes lo create u per se unfair or deceptive practice:

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The legislature finds that the practices covered by this chapter are matters
vitally nffecting the public interest for the purpose of tlpplying the
c<msumor protection act, chapter 19. 86 RCW. A violation of this chapter is
nt>t reasomibfo in refafli:m to the development u11d preservation of business
and i.s an unfair or deceptive act in trade m commerce and an unfoir
method of competition for the purpose of ttpplyiug the consumer
protection act, chapter 19.86 RCW,

15 RCW 19.09.340.
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Plaintiffs are correci that ICC 9.44.050 is constitutional. They ate also correct that

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Island County is free to require that sellers make a jet noise disclosure on Form 22, for a

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condition unique to Whidbey Ishind/i in addition to the Form i 7 disclosu.res required by RCW

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Chapter 64.06, Island County may enforce its Code against property selle.rs and against real

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estate agents. But the Island County Code contains no language suggesting that faUure to

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prnvide the ICC 9.44.050 notice is a per se CPA violation. The only liability langut,ge

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contained in JCC Chapter 9.44 is t11e. general liability disclaimer provided in ICC 9.44,060.

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As discussed in Defendants' motion, even if l!lland County had attt!mptcd to makt.~

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failure to provide the ICC 9.44.050 language a per se CPA violation~ that would have brought it

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~ nm foe! that jct 1miM is n condHion un1qut, tn \1lhidbi.iy txpfo.lns why RCW Chj1pl$r 64.06 doe;;m t reqLiln'! lts
1

clfacfos111'1i hi the nlulu wld~ Form 17: the m;,1110 domm't $lmp1y c:<l11t lu uwst tlf tht1 s111.lll,

DBPHNDANTS 1 REPLY lN SUPPORT OP MOTION TO

DJSJ\l1SS UN!:)ER CIVIL RIJUi l2(ll)(6). S
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2015-08-17 14:08

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P (/10

into conflict with the legislature's plain statement in RCW 64.06.060 on the public 1nt.erest

2 element of a CPA violation: written seller disclosures in a residential real property sale a.re not
3 matters vitally affecting the public interest r-or the purpose of applying the consume:r p.rotection
4

a.ct~ chapter RCW 19.86 RCWt The disclosure required by ICC 9.44.050 is no different than

5 the disclosures required by RCW 64.06.020. It describes a defect in the subject prope..rty t.hnt is
6 best known to the seller, provided to the buyer so they can make an informed decision about
7 whether to buy the properly.
8
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:x

Further, if Island County had attempted to make failure to provide the ICC 9.44.0SO

language u CPA violationi It wnuld amflict with tll.e holding in Douglas that no CPA violation

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occurs where. the buye.r had notice of the <le.fectt 1egardless of the prec.ise form of that notice, lf

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court6 held otherwi.se, it would place an unrensonablc burden on any seller of property to

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disdose every minute detail nbout. n property defect. It would also permit buyers to rescind

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transactions or seek dmmiges based on immaterlul fock of disclosure. This is just what

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Pluinti:ffs urge the Court to do here, and their c~se should be dismissed.

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D.
At least a portion of Plaindff Oeegan's damages accrued at the time of his
purchase in .2006 and his claim is therefort timtlla.rred.

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Deegan alleges he was damagl~d because he paid too much for his house in light of its

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allegedly depressed value due to the a.ircrnft noise. Complaint at 421 50; Response at 20:9-14.

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Thus, bis alleged injury occurred whe,n he purchased the property in 2006. Ho\vever) he also

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alleges that his injury occurred "only after'~ the Navy introduced the Growler aircrnt1, which he

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alleges would dcpre.ss the value of his home in an entirely hypothetical and speculative future

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rmfo. Retiponse at 20:14~1.8. But. even if l.he Groi;vle1' flights exacerbated his original alleged

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injur}\ it is nonetheless dear that the statute of limitations began to run ,,,.,hen he purchased his

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hr,m.e: ,iifthe plaintiff is aware of some lnjurJ'., the statute of limitation begins to mn even i:f he

25

does not know the full extent of his injuries." Steele v. Organon, Inc.) 43 Wn, App. 2'30, 2341

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716 P.2d 920 (1986) (emphasis supplied). Thus, whethet the Growler flights caused t)eegan

nIWftND,<\NTS' REPLY rN SUPPO~T OP MOTION 'rO

DlSMlSS UNDER CIVIL RULI:r 1~t3)(6) 6
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2015-08-17 14:08

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additional inju.ry is immaierinl: Deegan alleged that he was injured by overpaying for his hornet

which, assuming without admiUing is true, occurred at the time of sale.

Doegan ts attempt to skirt this issue and invoke tho diS(,."OVery rule foils because he ls

required to have used "reasonable diligence to discover his cause of action, U.S, Oil & Ref

5 Co. v. State Depit (Ji Ecologyt 96 Wn,2d SS,93, 633P.2dl329 (1981). Dcegan1s discovery
6

argumellt simply ignores that alt of the alleged facts underpinning his claim were present, and

known to him, o.t the time 01' his home purchase itt 2006.: he had the allegedly defective

disclosure form; he knew that Acorn providod hlm that fom1; tho Navy was, accordlng lO the

9 Complair1t, flyi.ng jets over his house; and he ktww the pr.ice he paid for his house.
10

Deegan nppears to cJu.im thnt he did not know that the form Acotn gave him was

11

dofcctive until 11011tetin1e in the.four ye.ara before he filed suit. Even if true, that fact is

12

irrelevant because Ute cmitent of the form did not change since Acom gave it to Deegan, T'hc

13

only thing that apparently changed was Decgan's knowledge tha:t the form in his possessi<m

1.4

allegedly supported a legal claim. This type of knowledge does not delay accrual of the

15

statutory period. See Allen v. State\ 118 Wn.2d 753,758,826 P.2d 200 (1992) (a cau$e of

16

action accrues when the plaintiff is in possession of the facts relevant to his claim, not when the

17

plafotiff visits rm attorney and hears that his facts may suppmt a cause of action).

:l8

DATED thiii lih day of August) 2015.

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TOUSLEY BRAIN STEPHENS PLt.C

' ''Dy~'

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--~);;) --

Chr1itop[er L Brain, wg=BA #5054

Em all: cbra.in@t.ousley.com
Jason 1'. Dennettr WSBA #30686
Email: j deunett@toualey.com
Jacob D.C. Humphreys, WSBA #41699
Email: jhmnpl1reys@tousley.com
1700 Seventh Avenue. Suite 22.00
Seattle, WA 98HH
Tel: (206) 682-5600
Attonu,y.v for Defendtmts

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DBPENDANTS' REPLY lN SUPPORT OF MOT10N 'I'O

DISMISS UNDER CIVIL RULE 12(H)(5) ~ 7

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2015-08-17 14:08

TOUSLEY.COM 2066822992 >> jbO 240 ~~jO

CERTIFICATE Qt' &iRYICE

l
2

I, Jane A, Mrozek, declare and say a.~ follows:

I nm a citizen of the United States and resident of the state of Washington. ove.r the age

4 of 18 years, not a party to the above-entitled action, and am competent to be a witness herein.

5 My business address is 1700 Seventh Avenue, Suite 2200, Senttle, Washington 98:101, and my
6

telephone number is: 206.682.5600.

On Augufit 171 201.St I caused to be served the foregoing document on the individuals
8

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named below in the specific manner indicated:

Beth Terrell

Via Messenger

Michael Daudt
Mary Reiten
Samual Strauss
12 Terrolt Marghall Daudt & Willie

11

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14
15
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19

?.O

936 N. 34111 Street, Suite 300

Seattle WA 98103

Steve Skalet
a aig Bdskin
M.ehri & Skalet~ PLU~
1250 Connecticut Avenue, Ste, 300
Washington DC 20036
Attorneys for Plaintiff..v

Via U.S. Mail, post~ige prepnld

Lars E. Neste, #28781

Demeo Law Firm PS
5224 Wilson Ave:nue s~ Suite 200
Seattle, WA 98118-2.587

21

Co-Cmuuud f(}r Defim:dtmts

22

1declare m1det jl(~nalty of perjury under the luws c;f the Stute of Washington and the

23

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Uriitcd States that the foregoing fa true and correct.

Exet::uted this 17th day of August. 2015, at Scnttle~ Wu.':.hington.

25

26
nl Assist.ant

JJEWENDAN1~S' REPLY IN SOP PORT OF MOT10N ro

Dl8MlSS l/N1)BR CIVIL RULE 12(13){6) ~ 8
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3
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IN THE SUPERIOR COURT FOR THE STATE OF WASHINGTON

TN AND FOR ISLAND COUNTY

JONA'fflAN DEEGAN and ALICE

8 0 1GRADY. on behalf of themselves and
others simiiarly situated,

NO. 142-0070S-6

GR17 DECLARATION REGARDINO

REPLY IN SUPPORT O.F
DEFENDANTS' MOTION TO DISMISS
UNDER CIVIL RUL l 2.(b)(6)

Plaintlffo,
10
V,

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WINDERMERH REAL ESTATE/CENTER~

lSLE.1 INC., a Washington corpmntiott; and
ACORN PROPERTIES. INC., dba RE/MAX
ACORN PROPERTIES, INC.~ a Washington
c.orpomtlon,

14

15 -----------D_e_fondants.

-------J

16

Ja.f.on T. Dennett hereby declares:

17

J8

1am one of the attorneys for the Defendants in the above-captioned action tllld

make this declaration pursuam to OR 17.

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1 have examined the foregoing docmnent entitled Defendants' Reply In Support

20

of Motion to Dismiss Under Civil Rule 12(b)(6), determined that it co11sists of n.ine pages.

21

including this declaration, and that it is c-0mpletc and legible.

22
.23

24

I declare under pennlty of perjury under the laws of'the United States and the state of
Washington that the foregoing is true mid correct

DATEl) this

li11 dily of August~ 2015.

Bv:

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26

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Atiorney.,'.fbr D(4femlants
GRl7 l)HCLARATION IU{{.>AROlNG REPl,Y !NSUPPORTOP

DBJ'.i'ENDANTS' MOTION TO DISMISS UNDER CIVIL Rl.lL

12(B)(6)- I
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