"We are committed to: The highest ethical standards. Uncompromising honesty and integrity." —The Windermere Mission Statement "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." —Windermere CEO Geoff Wood's Public Affirmation
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THE GRUELING HUMAN TOLL OF CHASING WINDERMERE CROOKS THROUGH THE COURTS: $311,304.67 IN LEGAL FEES, 5 YEARS DISTRESSING LITIGATION, and DEMOLITION OF THE HOUSE TO BUILD A NEW ONE...
COURT SAYS WINIDERMERE CAMANO ISLAND'S SONYA EPPIG "...DID NOT SO UNEQUIVOCALLY SET FORTH THE PERMITTING AND INSPECTION PROBLEMS...
...And when Camano Realty listed the Hovis property for approximately two
years, Camano learned about the permitting and inspection problems but did not
inform the Ruebels."
(Left, Sonya Eppig and Windermere Real Estate/CIR owner, Marla Heagle.) Still producing commissions for Windermere Camano Island Realty to this day: "...Eppig did not tell the Ruebels about the addendum Nelson prepared disclosing that the engineering work was not complete and that the building plans did not meet the UBC requirements. Instead, Eppig helped draft a revised addendum that did not so unequivocally set forth the permitting and inspection problems. And when Camano Realty listed the Hovis property for approximately two years, Camano learned about the permitting and inspection problems but did not inform the Ruebels."
Read the entire Opinion here; and/or download a PDF copy of the Opinion here.
Thomas and Diane E. Ruebel became interested in Camano Island home being sold by Mike Hovis. The Ruebels had representation by Sonya Eppig of Windermere / Camano Island Realty. Mr Hovis had been remodeling the property since 1995 and the interior was yet to be completed. Unbeknownst to the Ruebels, Hovis had been cited by the Camano Island County Building Department for not having officially approved framing specifications and engineering drawings. An expert testified that the building’s structural integrity had been compromised. Hovis had installed wall treatments that hid the problems. Prior to the Ruebels, another buyer determined the home’s impediments, at which time Windermere entered in dialog with the County.
During the Ruebels’ initial purchase of the property, Eppig was involved in the permit and inspection concerns. Hovis and Eppig both proffered clear misrepresentations to the Ruebels about the status of the property. Through vaguely wording an addendum put into the closing papers, Hovis and Eppig sought to “disclose” the home’s impediments without actually revealing them. After closing, the Ruebels found the extent of the property’s damage was so severe, the most economical course of action would be to raze it to the foundation and build all over.
DO NOT CITE. SEE RAP 10.4(h).
Court of Appeals Division I
State of Washington
Opinion Information Sheet
Docket Number: 58533-9-I
Title of Case: Camano Island Realty, Et Al., App./cross-resp. V. G. Thomas & Diane E. Ruebel, Resp./cross-app.
File Date: 10/01/2007
SOURCE OF APPEAL
----------------
Appeal from Island Superior Court
Docket No: 03-2-00516-3
Judgment or order under review
Date filed: 06/08/2006
Judge signing: Honorable Vickie I Churchill
JUDGES
------
Authored by Ann Schindler
Concurring: Ronald Cox
William Baker
COUNSEL OF RECORD
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Counsel for Appellant/Cross-Respondent
Jeffrey Paul Downer
Lee Smart Cook Martin & Patterson PS
701 Pike St Ste 1800
Seattle, WA, 98101-3929
Matthew F. Davis
Attorney at Law
5224 Wilson Ave S Ste 200
Seattle, WA, 98118-2587
Counsel for Respondent/Cross-Appellant
John Wentworth Phillips
Phillips Law Group PLLC
315 5th Ave S Ste 1000
Seattle, WA, 98104-2682
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION ONE
G. THOMAS RUEBEL AND DIANE E. RUEBEL,
Respondents,
v.
[Windermere] CAMANO ISLAND REALTY, INC., a CORPORATION, AND SONYA EPPIG,
Appellants.
UNPUBLISHED OPINION
No. 58533-9-I
FILED: October 1, 2007
SCHINDLER, A.C.J. Based on the failure to disclose inspection and permitting problems with the house they purchased, Thomas and Diane E. Ruebel (the Ruebels) sued Windermere/Camano Island Realty, Inc. (Camano Realty) and its real estate agent, Sonya Eppig, for breach of fiduciary duty, negligence, fraudulent concealment, misrepresentation, and violation of the Consumer Protection Act, chapter 19.86 RCW (CPA). At the conclusion of a two-week trial, the jury rejected the Ruebel’s claim for fraudulent concealment, but found in their favor on negligence, breach of fiduciary duty, and violation of the CPA. The jury awarded the Ruebels approximately $126,300 for the CPA claim and approximately $34,000 for the negligence and breach of fiduciary duty claims, attributing 30 percent of the fault to Camano Realty. Camano Realty and Eppig appeal the trial court’s decision denying their motion for judgment as a matter of law on the CPA claim and the court’s entry of judgment on the verdict against them. Camano Realty and Eppig also challenge the trial court’s award of approximately $311,000 in attorney fees on the CPA claim. In their cross appeal, the Ruebels challenge the court’s decision to not include the amount the jury awarded for the negligence and breach of fiduciary duty claims.
Because substantial evidence supports the jury’s determination that Camano Realty and Eppig violated the CPA and the jury’s decision to attribute fault to Camano Realty and Eppig, we affirm the court’s denial of the motion for judgment as a matter of law and entry of the judgment on the verdict. We also affirm the trial court’s decision to not include the amount awarded on the negligence and breach of fiduciary duty claims. But because the trial court did not enter findings of fact and conclusions of law to support the award of attorney fees, we reverse the attorney fee award and
remand.
FACTS
Mike and Marilyn Hovis (Hovis) owned a Victorian-style waterfront house on Camano Island with a detached three car garage and loft apartment on a four acre parcel of property. In 1995, Hovis obtained a permit from the Camano Island County Building Department (Building Department) to remodel the main house. Mike Hovis acted as the general contractor for the remodel. In January 1996, the Building Department told Hovis that he needed to address several framing issues and the structural engineering requirements for the two-story house. The Building Department told Hovis he needed to submit approved engineering plans and framing specifications. Without submitting the requested information, Hovis proceeded with the installation of the interior wallboard and exterior siding. In 1997, the building permit expired.
From 2000 to 2001, Hovis listed the property for sale with Windermere/Camano Island Realty (Camano Realty). Camano Realty advertised the property as a Victorian waterfront estate with an unfinished interior. During the two years that Camano Realty listed the Hovis property for sale, two offers were made and then rescinded. In the spring 2001, Hovis, one of the potential buyers, and a Camano Realty agent met with the Building Department about the status of the expired building permit. The Building Department examiner, Ben VanDuine, described the outstanding inspections that still needed to be done, including the framing, plumbing, and electrical inspections. In addition, VanDuine told Hovis, the prospective buyer, and the Camano Realty agent that the work had to comply with the Uniform Building Code (UBC) and approved plans and updated engineering calculations had to be submitted to the Building Department.
In late 2001, Hovis hired a contractor, Stephen Redmond, to finish the remodel. Redmond applied for a new building permit for the remodel. Although Hovis had not obtained the necessary inspections or submitted engineering plans and calculations, in December 2001, the Building Department issued a new building permit to Redmond.
In 2002, Hovis listed the property for sale with Preview Realty and real estate agent Roger Nelson. In early spring, the Ruebels contacted their Seattle neighbor, Rene Stern, a Windermere real estate agent, about their interest in purchasing the Hovis property. Stern agreed to act as the Ruebels? agent for the Seattle house but referred them to Sonja Eppig, a Windermere real estate agent with Camano Realty, for the Hovis property. In April 2002, Eppig met with the Ruebels. At the meeting she gave them a copy of the Real Property Transfer Disclosure Statement for the Hovis Property, Puget Sound Multiple Listing Form 17 (Form 17). In Form 17, Hovis states that they had been remodeling the house since 1996 and all the building permits are current. Hovis also states that they did not know if there were any restrictions on the property that would affect future construction or remodeling or any other material defects affecting the property that a prospective buyer should know about. On April 16, the Ruebels made an offer to purchase the Hovis property contingent on an inspection and study to determine the feasibility of the floor plan and the cost of finishing the remodel.
In the April 27 addendum to the Purchase and Sale Agreement, Hovis represented that: [t]o the best of seller’s knowledge, seller states that all work performed to date has passed all inspections. Any work that has not passed inspection will be corrected, reinspected and approved prior to closing at sellers [sic] expense. Purchaser to verify to own satisfaction within feasibility time.
The inspection report raised a number of concerns, including questions about the status of the building permit and inspections for the remodeling work. The report specifically notes that there was no framing inspection certificate and recommended checking with the Building Department.
On April 29, the Ruebels met with Eppig to go over the inspection report. According to Tom Ruebel, Eppig agreed to check with the Building Department on the status of the permit and the inspections. Eppig denied agreeing to check on the status of the permit and the inspections, but admitted that she met with VanDuine and learned that the Building Department needed building and engineering plans.
Hovis’ contractor, Redmond, testified that at approximately 11:15 a.m. on May 6, Eppig called to tell him that the Building Department was going to send him a letter suspending the building permit because updated building and engineering plans were never submitted.1 Tom Ruebel testified that Eppig unexpectedly called him on May 6 to recommend extending the deadline for the feasibility study because the Building Department needed some engineering plans, which she agreed to obtain.
On May 6, the Building Department suspended the permit. In the May 6 letter to Redmond, the Building Department states that the permit was erroneously issued. The letter also states that the permit will not be reinstated unless Hovis addressed the issues identified during the framing consultation in 1996 and provided updated engineering plans that complied with the 1997 UBC. Eppig did not tell the Ruebels that the Building Department had suspended the building permit. Sometime after May 6, Eppig obtained some engineering information from Preview Realty and requested building plans from Hovis’ architect.
On May 7 or 8, Eppig sent the Ruebels an extension until May 15 for the feasibility study and assured them that there was no problem with complying with the Building Department's request for the engineering information.
Enclosed are copies of the engineers [sic] report. I talked
with Ben at County. They are okay. He does want the engineer's
stamp and license number, so I will get that. Also included are the
signatures from the seller re: the extension of the feasibility study.
Sincerely, Sonya.
1 Redmond’s phone log was introduced as an exhibit and the log showed an incoming call from Eppig on May 6, 2002, at 11:16 a.m.
Contrary to Eppig’s assurances, VanDuine testified that he told Eppig the engineering data she provided was inadequate and that before reinstating the permit, the Building Department needed additional data, including lateral engineering calculations.
Tom Ruebel testified that Eppig called him before May 14 to tell him that the issues with the Building Department were resolved and they could release the feasibility contingency. On May 15, the Ruebels waived the feasibility contingency.
Nelson testified that sometime after May 15, Eppig told him the Building Department had identified problems with the building permit and the required inspections on the house. She asked Nelson to meet with the Building Department because the Ruebels were concerned about the status of the building permit and they were going to refuse to close on June 17 unless the problem was solved.
On June 7, Nelson faxed a proposed addendum to Eppig. According to Nelson, the purpose of the addendum was to notify the Ruebels that the construction was not approved by the Building Department. The addendum states that the engineering work is not complete, the building plans may not meet the 1997 UBC requirements, and the seller is not responsible for meeting the UBC requirements.2 Eppig told Nelson the addendum was unacceptable and helped draft a revised addendum. The revised addendum states that the framing inspection consultation
2 The addendum states:
Seller and Purchaser acknowledge that plan engineering work for Island County Building Dept. is not complete regarding wall sheer and lateral calculations, and the plans may not meet all of 1997 Uniform Building Code (U.B.C.) requirements. Purchaser intends to complete further remodeling before completion, which will require additional/new calculations. Purchaser is responsible to complete such work as part of home completion process. Seller is not required to bring existing improvements on premises to meet 1997 U.B.C.
are not complete according to Island County, and that engineering calculations of structure were still needed, but that Hovis agreed to pay the Ruebels $1,000 for costs related to additional lateral engineering calculations.? The revised addendum also notes that intended changes by purchaser . . . may require additional work to comply with current UBC requirements.3
Tom Ruebel testified that Eppig called about the addendum and told him that it would benefit them because Hovis agreed to set aside $1000 at closing for any future engineering necessary in finishing the remodel. But the Ruebels did not see the written addendum until closing on June 17. Tom Ruebel testified that from May 15 until closing on June 17, he was not aware of any permitting or inspection concerns. The Ruebels purchased the property on June 17. The Ruebels signed the revised addendum as part of the paperwork at the closing, but did not carefully read it.
After purchasing the property, the Ruebels’ contractor, Richard King, identified a number of problems, including the framing work, which undermined the structural integrity of the house. The Ruebels also learned for the first time that on May 6 the Building Department had suspended the building permit for failure to submit the necessary engineering plans, obtain necessary inspections or comply with the UBC. Rather than proceed with remodeling, the Ruebels decided it was less costly to
3 The revised addendum states:
Seller and Purchaser acknowledge that the framing inspection/consultations are not complete according to Island County. Engineered lateral calculations of structure are needed. Seller and Purchaser agree that closing agent shall hold back $1,000 from seller?s proceeds of closing. This money shall pay for costs related to additional lateral engineering calculations of existing structure and will be returned to seller if not spent within six months from date of closing. Seller and Purchaser acknowledge that the structure, along with intended changes by purchaser as part of the completion process, may require additional work to comply with current UBC requirements. Any future work and engineering costs (excepting the $1,000 described above) to complete the structure, is the responsibility of the purchaser.
demolish the house and build a new house.
In July 2003, the Ruebels sued Hovis alleging negligent and fraudulent misrepresentation and constructive fraud. In April 2004, the Ruebels sued Washington Builders and its owner, Terry Moran for negligent and defective construction. In addition, the Ruebels sued Preview Realty, Nelson, Camano Realty, and Eppig alleging negligent and fraudulent misrepresentation and fraud. The Ruebels also alleged Camano Realty and Eppig breached their fiduciary duty and Preview Realty and Nelson breached their duty of good faith and fair dealing. In an amended complaint, the Ruebels alleged breach of fiduciary duty, negligence, fraudulent concealment, misrepresentation of material facts, and violation of the Consumer Protection Liability Act, chapter 19.86 RCW (CPA), as against Camano Realty and Eppig. Camano Realty denied the existence of an agency relationship with Eppig and denied liability.
Shortly before trial, the Ruebels settled with all the defendants except Camano Realty and Eppig. During the 9-day trial, a number of witnesses testified, including the Ruebels, Eppig, Nelson, Redmond and VanDuine. Contrary to the testimony of Nelson, Redmond, VanDuine, and Tom Ruebel, Eppig unequivocally denied that she knew the building permit was suspended or that she agreed to check on the status of the permits.
At the conclusion of the trial, the jury found that the Ruebels proved an agency relationship between Camano Realty and Eppig. While the jury concluded the Ruebels did not prove fraudulent concealment, the jury found the Ruebels proved a violation of the CPA, breach of fiduciary duty and negligence. As to negligence and breach of fiduciary duty, the jury attributed 10 percent of the fault to Eppig and 30 percent to Camano Realty. Camano Realty and Eppig filed a motion for judgment as a matter of law to set aside the jury verdict on the CPA violation. The trial court denied the motion and the court entered a final judgment on the jury verdict of approximately $145,000. The trial court also awarded the Ruebels $311,304.67 in attorney fees, $3,561.49 in costs, and $10,000 in exemplary damages under the CPA.
ANALYSIS
Camano Realty and Eppig contend the trial court erred in denying their motion for judgment as a matter of law, arguing that substantial evidence does not support the jury verdict that Camano Realty and Eppig violated the CPA.
Standard of Review
Viewing the evidence most favorable to the nonmoving party, a trial court should grant a motion for judgment as a matter of law when the court concludes there is no substantial evidence or reasonable inference to sustain a verdict for the nonmoving party. Sing v. John L. Scott, 134 Wn.2d 24, 948 P.2d 816 (1997). Substantial evidence exists if the evidence is sufficient to persuade a fair-minded, rational person of the truth of the declared premise. Guijosa v. Wal-Mart Stores, Inc., 144 Wn.2d 907, 915, 32 P.3d 250 (2001) (quoting Brown v. Superior Underwriters, 30 Wn. App. 303, 306, 632 P.2d 887 (1980)). We apply the same standard as the trial court when reviewing a motion for judgment as a matter of law. Guijosa, 144 Wn.2d at 915.
CPA
Under the CPA, unfair or deceptive acts or practices in the conduct of any trade or commerce are unlawful. RCW 19.86.020. To prove a CPA violation, a plaintiff must establish five elements: (1) an unfair or deceptive act or practice; (2) that occurs in trade or commerce; (3) public interest impact; (4) injury to plaintiff in his or her business or property; and (5) causation. Guijosa, 144 Wn.2d at 917; Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wn.2d 778, 784, 719 P.2d 531 (1986).
The CPA does not define the term “deceptive,” but implicit in that term is the understanding that the actor misrepresented something of material importance. Hiner v. Bridgestone/Firestone, Inc., 91 Wn. App. 722, 730, 959 P.2d 1158 (1998), rev’d on other grounds, 138 Wn.2d 248, 978 P.2d 505 (1999). For an unfair or deceptive act, plaintiff need not show that the act in question was intended to deceive, but that the alleged act had the capacity to deceive a substantial portion of the public. Hangman, 105 Wn.2d at 785. Whether a party committed an unfair or deceptive act is reviewed for substantial evidence. Whether an act violates the CPA is a question of law. Griffith v. Centex Real Estate Corp., 93 Wn. App. 202, 214, 969 P.2d 486 (1998) (citing Leingang v. Pierce County Med. Bureau, Inc., 131 Wn.2d 133, 150, 930 P.2d 288 (1997)). It is well established that a real estate agent who knowingly fails to disclose known material defects in the sale of real property violates the CPA. Svendsen v. Stock, 143 Wn.2d 546, 23 P.3d 455 (2001).
Unfair or Deceptive Act or Practice
Relying on Guijosa, Camano Realty and Eppig argue that the jury’s rejection of the Ruebels fraudulent concealment claim requires setting aside the jury’s CPA verdict because the Ruebels did not allege or prove an unfair or deceptive act or practice other than fraudulent concealment.
In Guijosa, the plaintiffs did not allege or prove any act or practice that violated the CPA other than discrimination. While the jury rejected the plaintiffs' claims for false imprisonment, battery, malicious prosecution, and discrimination, the jury found Wal-Mart violated the CPA. Guijosa, 144 Wn.2d at 912-913. The trial court granted Wal-Mart’s motion for judgment as a matter of law to set aside the jury’s verdict on the CPA claim because the record presented no substantial evidence or reasonable inference to support the jury’s verdict that Wal-Mart violated the CPA.? Id. at 913. On appeal, the supreme court affirmed the trial court’s decision to set aside the jury verdict on the CPA claim. While the court concluded the jury instructions did not prevent the jury from finding a CPA violation separate and apart from discrimination, because the plaintiffs only presented evidence of discrimination practice, there was insufficient evidence to support a violation of the CPA.
Here, as in Guijosa, the jury instructions allowed the jury to find that Camano Realty and Eppig violated the CPA by failing to disclose known material problems with the Hovis house separate and apart from fraudulent concealment.4 But unlike in
4 Jury Instruction No. 16 provides:
The Ruebels claim that Ms. Eppig and Camano Island Realty violated the Washington Consumer Protection Act. To prove this claim, the Ruebels must prove by preponderance of the evidence each of the following propositions:
(1) That Ms. Eppig engaged in an unfair or deceptive act or practice;
(2) That the act or practice occurred in the conduct of Ms. Eppig’s trade or commerce.
(3) That her act or practice affected the public interest;
(4) That the Ruebels were injured with respect to their property, and
(5) That Ms. Eppig’s acts or practices were a proximate cause of the Ruebels’ injury.
If you find from your consideration of all of the evidence that each of these propositions has been proved, your verdict should be for the Ruebels on this claim. On the other hand, if any of these propositions has not been proved, your verdict should be for defendants on this claim.
Guijosa, the evidence supports the jury’s finding that Camano Realty and Eppig engaged in unfair and deceptive acts that violated the CPA. Both Eppig and Camano Realty knew the necessary inspections and permits were not obtained and failed to disclose that information to the Ruebels. And even though Eppig denied seeing the May 6 letter or knowing that the permit was suspended, her testimony was contradicted by Redmond and Nelson. Redmond testified that Eppig contacted him on May 6 and told him that ?Ben? at the Building Department was going to send a letter suspending the building permit. Nelson testified that Eppig referred to the May 6 letter during conversations with him. Eppig also admitted obtaining and submitting the engineering reports and assuring the Ruebels that the Building Department was “okay.” In addition, Eppig did not tell the Ruebels about the addendum Nelson prepared disclosing that the engineering work was not complete and that the building plans did not meet the UBC requirements. Instead, Eppig helped draft a revised addendum that did not so unequivocally set forth the permitting and inspection problems. And when Camano Realty listed the Hovis property for approximately two years, Camano learned about the permitting and inspection problems but did not inform the Ruebels.
Camano Realty and Eppig also argue that, as a matter of law, only the listing agent for the seller has a duty to disclose material facts related to the purchase and sale of property under the CPA. We disagree. The duty also applies to a buyer’s agent who knows and fails to disclose material adverse facts.5 Edmonds v. Scott Real
5 Camano Realty’s and Eppig’s attempt to distinguish Robinson v. McReynolds, 52 Wn. App. 635, 762 P.2d 1166 (1988), is unpersuasive. Here, the evidence supports the jury’s finding that Camano Realty and Eppig knew about the problems with the Hovis house.
Estate, 87 Wn. App. 834, 848, 942 P.2d 1072 (1997). In Edmonds, this court held that where the buyer’s agent knew the seller’s assertions in the property information form were false but failed to disclose that information, as a matter of law, the buyer’s agent violated the CPA. Edmonds, 87 Wn. App. at 848-49.
Public Interest Impact
In the alternative, Camano Realty and Eppig contend that the evidence fails to support the jury’s finding that the Ruebels proved an act or practice that impacted the public interest. Specifically, Camano Realty and Eppig assert the Ruebels did not prove that there is a likelihood other buyers would be harmed in exactly the same fashion.
A private dispute has an impact on the public interest where there is a likelihood that additional plaintiffs have been or will be injured in exactly the same fashion. Hangman, 105 Wn.2d at 790. Whether the act complained of has an impact on the public interest is determined based on several nonexclusive factors that are considered in the context in which the alleged acts were committed. Id. at 789-90.
(1) Were the alleged acts committed in the course of defendant’s business? (2) Did defendant advertise to the public in general? (3) Did defendant actively solicit this particular plaintiff, indicating potential solicitation of others? (4) Did plaintiff and defendant occupy unequal bargaining positions?
Hangman, 105 Wn.2d at 790-791. None of the factors is dispositive and not all of the factors need be present. The factors represent indicia of an effect on public interest from which a trier of fact could reasonably find public interest impact. Hangman at 791. Consistent with Hangman, the court instructed the jury that:
An act or practice affects the public interest if it is likely that additional plaintiffs have been or will be injured in exactly the same fashion. In deciding whether Ms. Eppig’s actions affected the public interest in this case, you may consider, among other things:
(1) whether her acts or practices were done in the course of her business;
(2) whether Ms. Eppig advertises to the public in general;
(3) whether Ms. Eppig actively solicited the Ruebels, indicating potential solicitation of others.
(4) Whether Ms. Eppig and the Ruebels had unequal bargaining positions, which can be shown by inequality of knowledge about the property. In reaching your decision no one factor is decisive; you do not need to find that all factors are present, and you are not limited to considering only these factors.
Camano Realty and Eppig do not challenge the jury instruction. Rather, they assert that the Ruebels did not prove Eppig’s acts have an impact on the public interest because the Ruebels did not prove that Eppig did or will commit any similar act. But the instructions do not require the jury to find plaintiffs have been or will be injured in exactly the same fashion before considering the four nonexclusive factors. Here, substantial evidence supports the jury’s determination that Eppig’s acts impacted the public interest.6 There is no dispute that Eppig’s failure to disclose that the building permit was suspended, that inspections were not done, and the information provided to the Building Department was incomplete and inadequate, occurred in the course of business. There is also no dispute that Camano Realty and
6 Camano Realty and Eppig rely on several cases holding the plaintiff failed to establish the public interest element. But because the determination of whether there is a public interest impact turns on the circumstances and facts specific to each case, Camano Realty’s and Eppig’s reliance on these cases is not persuasive. Sloan v. Thompson, 128 Wn. App. 776, 115 P.3d 1009 (2005), rev. denied, 157 Wn.2d 1003 (2006) (sale of home did not occur within course of seller’s business); Cashmere Valley Bank v. Brender, 128 Wn. App. 497, 116 P.3d 421 (2005), aff’d, 158 Wn.2d 655 (2006) (no evidence that bank advertised loans to the public); Goodyear Tire & Rubber Co. v. Whiteman Tire, 86 Wn. App. 732, 935 P.2d 628 (1997) (tire dealer, a franchisee, did not have unequal bargaining power); Pac. Northwest Life Ins. Co. v. Turnbull, 51 Wn. App. 692, 754 P.2d 1262 (1988) (sophisticated land investor did not have unequal bargaining power with real estate agent); and Broten v. May, 49 Wn. App. 564, 744 P.2d 1085 (1987) (no evidence that defendant solicited plaintiff’s business and the two parties occupied equal bargaining positions). Eppig advertised to the general public and solicited and obtained referrals through membership in the Windermere referral network.7 And while Eppig knew about the permitting, inspection and engineering problems with the Hovis house, Eppig did not disclose these problems to the Ruebels.8
Apportionment of Fault
Camano Realty and Eppig also claim the jury instructions did not permit the jury to attribute 30 percent fault to Camano Realty and the trial court erred in entering judgment on the jury verdict. Relying on the jury instruction defining vicarious liability, Camano Realty and Eppig argue that was the only basis that allowed the jury to find Camano Realty liable. But Camano Realty’s and Eppig’s argument ignores the jury instruction on apportionment of fault, the Special Jury Verdict form, and the evidence that supported the jury’s attributing 30 percent fault to Camano Realty.
A party has a duty to propose an appropriate verdict form and failure to object precludes consideration of issues concerning the verdict form on appeal. Lahmann v. Sisters of St. Francis of Philadelphia, 55 Wn. App. 716, 723, 780 P.2d 868 (1989); Wickswat v. Safeco Ins. Co., 78 Wn. App. 958, 966-67, 904 P.2d 767 (1995).
Jury Instruction 23 tells the jury that it must apportion fault for the Ruebels negligence and breach of fiduciary duty claim:
7 Citing Jackson v. Harkey, 41 Wn. App. 472, 704 P.2d 687 (1985), Camano Realty and Eppig also argue that this factor requires proof of false advertisement. Because Jackson was decided before Hangman, the court did not expressly consider whether the construction company advertised to the general public. In addition, the act complained of in Jackson was misleading advertisement whereas, here, the act complained of is failure to disclose material facts in a real estate transaction.
8 In supplemental briefing, Camano Realty and Eppig contend that under Alejandre v. Bull, 159 Wn.2d 674, 153 P.3d 864 (2007), the Ruebels CPA claim fails as a matter of law because as a tortbased claim, the economic loss rule bars the Ruebels from recovering economic damages. But here, the CPA is a statutory based remedy that allows a plaintiff to recover damages. See e.g. Griffith, 93 Wn. App. 202; Sign-O-Lite v. DeLaurenti Florists, Inc., 64 Wn. App. 553, 825 P.2d 714 (1992).
If you find for plaintiffs for their claims for negligence or breach of fiduciary duty (other than fraudulent concealment or violation of the Consumer Protection Act), you must apportion fault to other persons who you find are at fault.
First, you must determine the dollar amount of damages caused by Ms. Eppig’s negligence or breach of fiduciary duty. The court will provide you with a special verdict form for this purpose.
Before you determine that another person is at fault for such damages, defendants must prove each of the following propositions by a preponderance of the evidence:
First, that the person is at fault; and
Second, that the person’s fault was a proximate cause of the plaintiffs? damages.
Third, that those damages are in addition to damages caused by Ms. Eppig’s fraudulent concealment or violation of the Consumer Protection Act.
The court will provide you with a special verdict form for this purpose. Your answers to the questions in the special verdict form will furnish the basis by which the court will apportion liability, if any.
Consistent with Instruction 23, the Special Jury Verdict form also tells the jury to determine whether anyone else is at fault for the negligence and breach of fiduciary duty damages and if so, to attribute a percentage of fault. The Special Jury Verdict form states:
QUESTION 5: Did the Ruebels prove their claim for negligence or breach of fiduciary duty?
ANSWER: (Write “yes” or “no”) Yes
(INSTRUCTION: If you answered “No” to Question No. 5, then sign this verdict and notify the bailiff. If you answered “Yes” to Question 5, proceed to Question No. 6.[)]
QUESTION 6: What is the total amount of damages proximately caused to the Ruebels by Ms. Eppig’s negligence or breach of fiduciary duty?
ANSWER: $33,750.00
QUESTION NO. 7: Was any one else at fault and did that fault proximately cause part or all of the Ruebels’ damages?
ANSWER: (Write “yes” or “no”) Yes
QUESTION NO. 8: Assume that 100% represents the total combined fault which proximately caused the plaintiffs? damages. What percentage of this 100% is attributable to Sonya Eppig and other persons whose fault proximately caused plaintiffs’ damages? Your total must equal 100%.
Answer:
Sonya Eppig 10%
Other (list names and percentage)
Camano Island Realty/Windermere Realty 30%
Rene Stern 5%
Steve Redmond 15%
Watson Mike Hovis 20%
Roger Nelson 15%
Island County Building Division 4%
Thomas and Diane Ruebel 1%
Substantial evidence also supports the jury’s finding attributing fault to Camano Realty. Camano Realty was the listing agent for the Hovis property from 2000 to 2001. VanDuine testified that in April 2001 he had a meeting with Hovis, a Camano Realty agent, and the potential buyers. At the meeting, VanDuine described the permitting problems including inadequate framing inspections and incomplete engineering information. The trial court did not err in entering judgment on the jury verdict against Camano Realty.
Attorney Fees
Last, Camano Realty and Eppig challenge the trial court’s decision to award approximately $311,300 in attorney fees on the CPA claim because the court did not segregate and deduct the fees incurred on unrelated legal theories and claims and did not enter findings and conclusions to support the award of attorney fees. They also argue the trial court failed to take into account time spent on unsuccessful claims and duplicative and wasted effort.9
9 Specifically, Camano Realty and Eppig contend the trial court failed to properly segregate and deduct fees for time spent (1) prior to amending the complaint in April 2004 and in March 2005; (2) pursuing claims against the other defendants; and (3) pursuing unsuccessful claims against Camano Realty and Eppig.
To reverse an attorney fee award, an appellate court must find that the trial court manifestly abused its discretion. Pham v. City of Seattle, 159 Wn.2d 527, 538, 151 P.3d 976 (2007). The trial court abuses its discretion when it is exercised on untenable grounds or for untenable reasons. Pham, 159 Wn.2d at 538. Trial courts must create an adequate record for review of fee award decisions. Mahler v. Szucs, 135 Wn.2d 398, 435, 957 P.2d 632 (1998). Findings of fact and conclusions of law are required to establish such a record. Mahler, 135 Wn.2d at 435. Failure to create an adequate record will result in a remand of the award to the trial court to develop such a record. Mayer v. City of Seattle, 102 Wn. App. 66, 79, 10 P.3d 408 (2000).
Under the CPA, a successful plaintiff is entitled to recover reasonable attorney fees and costs. RCW 19.86.090. If attorney fees are only reasonable for certain claims, the court must segregate the time spent on other theories and claims on the record, even if the other theories and claims are interrelated or overlap. Hume v. Am. Disposal Co., 124 Wn.2d 656, 673, 880 P.2d 988 (1994) (quoting Travis v. Washington Horse Breeders Ass’n, Inc., 111 Wn.2d 396, 411, 759 P.2d 418 (1988)). An attorney fee award must properly reflect the segregation of time spent on other claims, except when the trial court finds that no reasonable segregation of successful and unsuccessful claims can be made. Hume, 124 Wn.2d at 672.10 The burden of
10 See also Mayer v. Sto Industries, Inc., 156 Wn.2d 677, 692, 132 P.3d 115 (2006) (not an abuse of discretion when trial court did not segregate based on its finding that the plaintiffs requested CPA fees could not realistically be separated from time spent pursuing their Product Liability Act claims?). But see Loeffelholz, 119 Wn. App. at 692 (holding that the record does not show that the claims were so interrelated as to excuse segregation and the case embodied many claims and issues and an award of nearly half the total fees incurred represents too high a proportion to be reasonable); Mayer, 102 Wn. App. 66 (abuse of discretion when court awarded fees for time spent on discovery that was not relevant to plaintiff’s Model Toxics Control Act claim which provided attorney fees).
segregating, like the burden of showing reasonableness overall, rests on the one claiming such fees. Loeffelholz, et. al v. Citizens for Leaders with Ethnic and Accountability Now (C.L.E.A.N), 119 Wn. App. 665, 690, 82 P.3d 1199 (2004); Katanis v. Educ. Employees Credit Union, 122 Wn.2d 483, 501-502, 859 P.2d 26 (1993).
Here in June 2003, the Ruebels sued Hovis for negligent and fraudulent misrepresentation and constructive fraud. In April 2004, the Ruebels added Windermere Real Estate, Camano Realty, Sonja Eppig, Preview Realty, Roger Nelson, Washington Builders and its owner Terry Morgan. In addition to negligent and fraudulent misrepresentation, the amended complaint alleges breach of fiduciary duty against Camano Realty and Eppig, breach of good faith and fair dealing against Preview and Nelson, and negligent and defective construction against Washington Builders and Morgan. Yet the Reubels attorney stated that only approximately $7,200 could be deducted for time spent on the unrelated CPA claims and theories. The trial court agreed but did not enter written findings of fact and conclusions of law in support of the attorney fee award of $311,305.11
Relying on the trial court’s oral ruling and a recent supreme court decision, Mayer v. Sto Industries, Inc., 156 Wn. 2d 677, 692, 132 P.3d 114 (2006), the Ruebels argue that the court did not abuse its discretion in deciding segregation was not reasonable. But here, unlike in Mayer, the trial court’s oral decision does not provide a clear explanation that the CPA work could not be segregated from the WPLA work,
11 The cases the Ruebels cite to argue that oral findings are sufficient are not persuasive. Neither Goodman v. Darden, Doman & Stafford Assoc., 100 Wn.2d 476, 670 P.2d 648 (1983) nor Malfait v. Malfait, 54 Wn.2d 413, 341 P.2d 154 (1959) address the need for findings to support an award of attorney fees.
Mayer, 156 wn.2d at 693.12
On attorney’s fees, there is no challenge to the loadstars being reasonable. The only challenge is to the segregation. I am somewhat concerned about the attorney’s fees before Ms. Eppig or Camano Island Realty were included in the -- included in the complaint, however, there was a great deal of work at the time about the damages, about what -- what happened to the house, the house left, and whether or not we were going to have pictures and what that -- would happen. And those were obviously questions and -- and I’m not sure if I’m correct on that. Those -- those things may have come up once the realty defendants were entered into the action. But I can see that it was a record that was being built on this CPA claim. I don’t see how these could be segregated myself and I believe that the court cases say that if it’s not reasonable to be segregated then it will not be segregated.
Because the trial court failed to enter findings of fact and conclusions of law to support the award of attorney fees, we reverse and remand.13 On remand, the Ruebels have the burden to segregate the time spent on the CPA claim from the time spent on the unrelated legal theories and claims and the court must enter written findings to support an award of attorney fees.
Cross Appeal
On cross appeal, the Ruebels claim the trial court erred by not including the $13,500 the jury awarded for the negligence claim. Specifically, the Ruebels argue that the stipulation to not award negligence damages was void because it was based on misrepresentation and mutual mistake.
12 See also Brand v. Dep’t of Labor & Indus., 139 Wn.2d 659, 674, 989 P.2d 1111 (1999) (while the court concluded that the trial court properly refused to segregate the fees attributable to plaintiff’s unsuccessful claim, because the trial court failed to enter written findings or to articulate specific reasons supporting the amount of the attorney fees award, the court remanded for it was unable to judge whether the trial court abused its discretion). And in Pham, 159 Wn.2d 527, the trial court entered thirty-five findings of fact justifying its fee award, including the court’s reason for segregating and deducting hours that were unproductive or not sufficiently related to the successful claim. Pham, 159 Wn.2d at 539-40.
13 On remand, the court should also consider whether there was any duplicative or wasted effort and the reasonableness of the fee award.
During deliberations, the jury asked whether it should answer Question 5 “Did the Ruebels prove their claim for negligence or breach of fiduciary duty?”, if it answered Question 4 “What is the amount of damages proximately caused to the Ruebels by Ms. Eppig’s fraudulent concealment and/or violation of the Consumer Protection Act?” The attorney for Camano Realty and Eppig expressed the concern that the jury could award double damages. In response,the Ruebels’ attorney agreed that if the jury awarded damages under the negligence claim that were not greater than the amount under the fraudulent concealment and CPA claims, the damages should not be included in the award.
. . . that I only argued one theory of damages, so maybe the best way of dealing with this is to do this. I really do think this is going to be confusing to the jury if we add this double damages stuff because we haven’t talked about it and it’s not in the instructions.
I agree that if there are any damages that are awarded under the negligence count and they’re not greater than the amount under the fraud and Consumer Protection Act counts, then they will be subsumed within the first one, and that will settle the matter, I would think.
Based on the stipulation of Ruebels’ attorney, the court responded to the jury question by answering, “yes”.
In the Special Jury Verdict form, the jury found the amount of damages proximately caused by Eppig's violation of the CPA was $126,319.51. The jury also found the amount of damages proximately caused by Eppig?s negligence and breach of fiduciary duty was $33,750. Based on the stipulation, the trial court did not include the damages for the negligence and breach of fiduciary claims in the award.
A valid stipulation is binding unless fraud, mistake, or misunderstanding is established. De Lisle v. Fmc Corp., 41 Wn. App. 596, 597, 705 P.2d 283 (1985) (citing Baird v. Baird, 6 Wn. App. 587, 494 P.2d 1387 (1972).
To support their claim that the stipulation is void, the Ruebels cite to a criminal case, State v. Schaupp, 111 Wn.2d 34, 757 P.2d 970 (1988) concerning entry of a plea agreement based on an alleged misrepresentation. In Schaupp, the court rejected the State’s claim that the plea agreement was void because there was no evidence of misrepresentation. Schaupp, 111 Wn.2d at 38-39. Here, as in Schaupp, the record does not support misrepresentation. Based on a concern about awarding double damages, Ruebels’ attorney agreed with the concern and suggested a means to avoid it.
To support their claim that the stipulation is void based on mutual mistake, the Ruebels cite several cases for the general proposition that contract principles apply to determine whether a stipulation is enforceable.14 But a party with constructive knowledge of the facts giving rise to an alleged mistake cannot claim mistake as a basis to avoid a stipulation. Denaxas v. Sandstone Court of Bellevue, LLC, 148 Wn.2d 654, 668, 63 P.3d 125 (2003). Because Ruebels’ attorney had constructive knowledge of the jury instructions, the claim that the stipulation is void based on mutual mistake also fails.
Conclusion
We affirm the trial court’s entry of judgment on the jury verdict but reverse and
14 Wm. Dickson Co. v. Pierce County, 128 Wn. App. 488, 493, 116 P.3d 409 (2005) (“Contract principles govern final judgments entered by stipulation or consent.”); Haller v. Wallis, 89 Wn.2d 539, 546, 573 P.2d 1302 (1978) (trial court’s decision not to vacate a stipulated order under CR 60(b) affirmed where there was no evidence of fraud or collusion and none of the irregularities charged is attributable to the respondent); and Harford v. Harford, 86 Wn. App. 259, 266, 936 P.2d 48 (1997) (trial court’s decision to vacate a stipulated order under CR 60(b) reversed where court found only that a unilateral mistake was made).
remand on the attorney fees award. Because the Ruebels prevailed as to the merits of their CPA claim, upon compliance with RAP 18.1, the Ruebels are entitled to attorney fees on appeal. RCW 19.86.090; Sevendson v. Stock, 143 Wn.2d at 250.
WE CONCUR:
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The Windermere Real Estate Relocation Rape Case:
Court Declares that Windermere "...condoned a rape by a business colleague..."
Editorial Preface: The incredibly violent and insidious psychological ramifications of rape, connected through an “abusive work environment” serves as an unfortunate yet credible subtext for the way in which Windermere Real Estate treats employees and damaged customers alike: Windermere’s application of aggressive, wasteful and mendacious litigation to stall and ruin innocent consumers, serves as the coercive metaphor of corporate power and arrogance: Windermere has no concern for the social damage it has done to people or communities. It cares only about how to manipulate the law and the courts to avoid any legal responsibility.
(Above L to R) Windermere CEO Geoff Wood (far left) is currently listed as a Governing Person of Windermere Relocation. Peggy Scott (second from left), also a current Governing Person of Windermere Relocation, "... did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little." Windermere General Counsel, attorney Paul Drayna (third from left) is listed as the registered agent of RELO LLC, the current entity name of Windermere Relocation. Windermere Founder John W. Jacobi (fourth from left) along with Gayle Glew (far right) are listed as Governing Persons of Windermere Relocation during the Little case. Glew told Ms. Little he did not want any "clouds in the office," and subsequently, after she would not accept a pay cut, that she should clean out her desk.
All citizens who abhor such treatment of women in the workplace should recall Maureen Little v. Windermere Relocation when choosing real estate services. WindermereWatch visitors will also want to read the United States District Court of Appeals Ninth Circuit's Order and Amended Opinion from the Little case.
Summarized and excerpted from a decision by the U.S. Court of Appeals
Maureen Little was employed by Windermere Relocation Services (“Windermere”) as a Corporate Services Manager, a position that required her “to develop an ongoing business relationship and relocation contacts with corporations in order to obtain corporate clients needing relocation services for their employees.” Until she was terminated, she received only positive feedback from her supervisors. Windermere’s records confirm that during the relevant period, Little had the best transaction closure record of all corporate managers by a large margin.
Unlike the other managers, Little’s employment contract provided that Little would receive $2,000 monthly, plus a $1,000 monthly override and $250 per closed sale. The override was based on the assumption that Little would close four transactions per month, with a provision for rollover when she did not make the target. According to Windermere President Gayle Glew, the other managers had not received the $1,000 override.
One of Windermere’s clients was the Starbucks Corporation. Some time in 1997, Little performed some relocation services for Starbucks Human Resources Director, Dan Guerrero, on a contract basis, and she learned from him that Starbucks was dissatisfied with its primary relocation provider. Glew told Little that he would “do whatever it takes to get this account” and that Little should “do the best job she could.” Thus, little believed that, as part of her job, she was to build a business relationship with Guerrero to try and get the Starbucks account, and she had at least two business lunches with Guerrero toward this end.
On October 14, Little accepted Guerrero’s invitation to discuss the account at a restaurant. After eating dinner with Guerrero and having a couple of drinks, Little suddenly became ill and passed out. She awoke to find herself being raped by Guerrero in his car. She fought him off and jumped out of the car, but again she became violently ill. Guerrero put her back in the car and took her to his apartment, where he raped her again. Little fell asleep, and when she awoke he was raping her again. Afterward, he showered and drover her to her car.
Little was reluctant to tell anyone at Windermere about the rape because, in her own words, “I knew how important the Starbucks account was to Mr. Glew. Mr. Glew would ask me on a consistent basis the status of the account and I was afraid that if I told him about the rape, he would see me as an impediment to obtaining the Starbucks account.” This belief was reinforced when, a few days after the rape, Little reported the rape to Chris Delay, Director of Relocation Services (apparently not one of Little’s supervisors), and Delay advised her not to tell anyone in management. Little believed that Delay feared “what might happen to [Little] if [she] did tell.”
On October 23, about nine days after the rape, Little reported it to Peggy Scott, the Vice President of Operations, who was designated in Windermere’s Harassment Policy as a complaint-receiving manager. Little described Scott’s response:
She came out around the desk and I could tell she was upset and she just gave me a hug and said she wished there was something she could do. She didn't understand what I was going through. She asked me if I was in therapy. Then she proceeded to tell me she wouldn't say anything to [Glew] unless I proceeded to seek legal action [against Dan Guerrero].
Scott told Little that "[s]he thought it would be best that [Little] try to put it behind [her] and to keep working in therapy," and that she should discontinue working on the Starbucks account. She did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little. Scott testified in her deposition that, because the rape occurred outside the "working environment," she believed that it fell outside the scope of Windermere's Harassment Policy.
Despite Little's supposed removal from the Starbucks account, Glew continued to ask her about the status of the Starbucks account during the next six weeks. "[As of December 2,] Gayle was asking me questions about Starbucks ... a couple of times every month to see what the status was." Concerned by Glew's questions, Little told her immediate supervisor, Linda Bellisario, the Vice President of Sales and Marketing, on December 2, 1997, about the rape. Little had been reluctant to tell Bellisario because she "felt that [Bellisario] would immediately go to Gayle and Gayle would terminate my position.... I knew how much this account meant to him. He said he would do whatever it took to get this account." Bellisario told Little to inform Glew of the incident.
When Little told Glew of the rape, which, according to Glew, was the first he had heard of it, Glew's" immediate response was that he did not want to hear anything about it." He told Little that she would have to respond to his attorneys. Glew then informed her that he was restructuring her salary from $3,000 monthly to $2,000 monthly plus $250 per closed transaction. The pay reduction was effective immediately and non-negotiable. Bellisario, who was present at that portion of the meeting, appeared "surprised and upset" to Little.
Little found the pay cut unacceptable, and Glew told her to go home for two days to think it over "because he did not want any `clouds in the office.'" When Little still found the pay cut unacceptable two days later, Glew told her it would be best if she moved on and that she should clean out her desk.
Little brought suit against Windermere, alleging unlawful discrimination and retaliation in violation of Title VII, 42 U.S.C. § 2000e, and the Revised Code of Washington § 49.60; wrongful discharge in violation of public policy; and intentional, reckless, and/or negligent infliction of emotional distress. The district court granted summary judgment in favor of Windermere on all four claims.
Little appealed dismissal of her claims, and the appeals court reversed in part, and ruled:
In sum, taking the facts in the light most favorable to Little, because her employer effectively condoned a rape by a business colleague and its effects, Little was subjected to an abusive work environment that "detract[ed] from [her] job performance, discourage[d] [her] from remaining on the job, [and kept her] from advancing in [her] career[]."
Incredibly, Windermere asked for a rehearing, but "...the panel has voted to deny the petition for rehearing and to reject the suggestion for rehearing en banc.
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WINDERMERE: AMERICA'S PREDATORY REAL ESTATE ENTERPRISE
Consumer advocates, legal experts and elected lawmakers all agree that the American real estate industry demands greater regulation to protect consumers from the human disaster of real estate fraud perpetrated by unethical realtors employed at companies like Windermere Real Estate. Windermere manipulates our clogged, inundated courts and the justice system to stall, wear down and financially exhaust victimized consumers, many of whom are wiped-out by the cost of pursuing civil justice in a process where innocent victims must CHASE perpetrators of real estate fraud through the courts AFTER a fraudulent offense has been committed. Acts of fraud are so common and widespread throughout the Windermere real estate network, that the defense of real estate fraud has become has become just another bottomline expense on the Windermere balance sheet. And the litigation nightmare of real estate fraud can happen to anyone who deals with Windermere Real Estate. It could happen to you. Windermere is by far the most unethical, deceitful, and culturally toxic real estate company operating in the United States. Windermere knowingly, deliberately, and unabashedly profits on corrupt franchise owners, brokers and agents with proven histories of fraud and ethical misconduct, many of whom are profiled in the pages of WindermereWatch.com. Despite Windermere's well-documented assault on victim speech rights, more and more unconscionable cases of Windermere fraud continue emerging.
Windermere is headquartered in Seattle, at franchiser Windermere Services Company. It was founded by John W. Jacobi, and he has kept the company a private, family-owned enterprise, eluding the transparency and ethical accountability required by stockholders. For decades, Windermere has harnessed the art of positive PR, affixing itself—however superficially—to community art events, the homeless, and even an annual college rowing competition which opens Seattle's boating season—the Windermere Cup—irresponsibly promoted by, and in conjunction with, the University of Washington. But those are the disingenuous and cynical sideshows created by an adept market manipulator, shown only briefly to the public, to obscure and obfuscate Windermere's true predatory nature.
FRANCHISER WINDERMERE SERVICES' MANAGEMENT TEAM AND DESIGNATED GOVERNING PEOPLE: EXPERTS IN MARKETING FRAUD, ABUSE OF THE LEGAL PROCESS, AND AT COERCING DAMAGED WINDERMERE CLIENTS INTO SILENCE BY SUPPRESSING THEIR SPEECH RIGHTS
The shameless greed and repugnant ethics of Seattle's Jacobi family, deliberately profiting on the loss and suffering of Windermere victims through commissions on the fraudulent home deals and unlawful misconduct of dishonest Windermere agents, brokers and franchise owners. Forget human decency, commercial reputation or social responsibility—it's all about the money.
Before turning the business over to his children and son-in-law, Windermere founder John W. Jacobi (left) simply ignored any complaints of fraud from Windermere victims, sending them straight to the lawyers. Yet despite claims of retirement, Jacobi is still indeed quite active at franchiser Windermere Services Company:
In Complaint 10-2-36192-8 SEA, filed in King County Superior Court on October 12, 2010, Windermere Services Company has sued former Windermere Puyallup Canyon Road owner Joe Maxwell for default on an “Unconditional Guaranty of Payment” promissory note. The Maxwell Answer and Counterclaims state that the “Plaintiff's [Windermere Services Company] claims are barred by Plaintiff’s fraud, duress, and unclean hands,” and alleges $4,000,000 in damages and violation of Washington's Franchise Investment Protection Act; and also that "The alleged Note and Guarantee are unconscionable and unenforceable." Maxwell's Counterclaims state "6. The WPCR Operating Agreement contains a provision granting Jacobi a special veto power which among other things, states that the company shall conduct its business and manage its affairs in accordance with the directions of Jacobi and all management decisions are subject to Jacobi’s review," and "13. In early 2006, WSC and Jacobi decided to open another WSC office in the territory in which WPCR was operating, despite the objections of Maxwell. As a result of the opening of this new WSC office, WPCR lost a significant number of its real estate agents and revenue that transferred to the new office in Graham, Washington," and "14. As a direct result of these actions taken by WSC and Jacobi, WPCR was left with a large debt burden and overhead, and WPCR’s revenue was significantly reduced... 22. On September 14, 2010, Maxwell heard from a real estate agent working at WPCR that the agent had received and email from WSC notifying him WPCR’s franchise had been terminated. This notice was sent to WPCR’s real estate agents before Maxwell learned of the termination of WPCR’s franchise." Read the complete report on this case here.
Jacobi's Washington Loan Company is also currently being sued for Intentional Misrepresentation—read that report here. And the Windermere affiliated service company, Commonwealth Land Title Company of Puget Sound, has recently been found negligent by a jury who awarded the third-party plaintiffs $1,190,000. Read the Commonwealth report here.
Current Governing Person and Windermere Services Company CEO Geoffrey P. Wood (left) is married to John W. Jacobi's daughter, Jill Jacobi-Wood. Wood is the chief architect of Windermere marketing fraud, inducing business volume through—among other fraudulent promotion—an express warranty of "The highest ethical standards. Uncompromising honesty and integrity." When called upon to honor his company's warranty, Wood instructs Demco lawyers—led by Matthew F. Davis–to sue vocal victims for libel and defamation. Wood is also a Governing Person of Windermere Relocation, the subject enterprise of Windermere's employee rape case. He was briefly a real estate sales person in 1994, but that license was CANCELLED in 1995, and Wood currently has no real estate license of any kind that WindermereWatch can find.
Governing Person Jill Jacobi-Wood (left), Windermere Services President, is a licensed real estate broker in Washington State, and as such is subject to the statutory condition of RCW 18.86.030 "(d) To deal honestly and in good faith." For her part in Windermere's marketing fraud and malfeasance, Jacobi-Wood's RE license should be cancelled by the Washington State DOL's real estate division. By promoting honesty and integrity—while in reality—she is suing and coercing Windermere victims to shutup about their Windermere experience, Jacobi-Wood is hardly dealing honestly and in good faith.
Governing Person John O'Brien "OB"Jacobi (left) is General Manager of franchiser Windermere Services Company and also has many Windermere realty brokerage offices. He's a licensed real estate broker who is also called upon by statutory law to "Deal honestly and in good faith." But John "OB" Jacobi instead promotes fraudulent claims of honesty and integrity, and falsely sues victims of Windermere misconduct for libel and defamation to intimidate them and coerce their silence. Then this junior Jacobi runs away and voluntarily dismisses his own mendacious lawsuit when a victim refuses to sign Windermere's dark clause settlement agreement that has cost the victimized party so much distress and money and to defend.
Windermere Services Governing Person and attorney—WSBA# 26636—Paul Drayna (left) has even more stringent ethical requirements placed upon him through his collateral professions of Lawyer and Notary Public; and Drayna is also bound by the Model Rules of Professional Conduct. But Mr. Drayna is not just practicing marketing fraud at Windermere. As Windermere in-house counsel, Drayna oversees Windermere's legal strategy of abusing process by falsely suing victims for libel and defamation, and then attempting to intimidate and coerce those victims out of their speech rights and into Windermere's Dark Clause silence agreement. When victims WON'T sign the Windermere Dark Clause, Drayna runs away too, and voluntarily dismisses his own company's lawsuit under Civil Rule 41—but only after first costing the victim thousands to defend the phony lawsuit. Drayna is even copied on the mendacious, Demco-authored settlement documents meant to quash speech rights and be signed by Windermere victims.
WINDERMERE'S DEMCO LAW FIRM: ESCHEWING ETHICS and DOING WHAT OTHER LAWYERS JUST WON'T DO
Attorney and multi-office Windermere broker John Demco (left) is the ethically-elastic Windermere kingpin lawyer who operates Demco Law, Windermere’s in-house legal firm, whose primary job is to stall and outspend small fry consumers damaged by dishonest Windermere brokers, agents and franchise owners. When an innocent real estate consumer has the misfortune to suffer one of Windermere’s many bad apples, Demco Law Firm will refuse to settle the matter forthrightly, no matter what conspicuously unlawful or offensive conduct the agent or broker has committed. Demco and Windermere will force the aggrieved party to sue or swallow their damage and go away—standard Windermere operating procedure.
WindermereWatch has compiled voluminous evidence that Windermere-Demco attorney Matthew F. Davis (left), WSBA# 20939, is the kind of lawyer about which jokes are coined. Davis is franchiser Windermere Services' frontline bully—the guy in the legal trenches actually wrecking lives, making threats, and suing victims who speak out. When Shakespeare was recommending "The first thing we do, let's kill all the lawyers," in Henry the Sixth, Part 2, he was talking about egomaniacal lawyers like Matt Davis.
Attorney Matt Davis of Windermere's Demco Law Firm is so unethical, so deceitful and intimidating, that he's famous in law circles. As Windermere-Demco's lead attorney, Matthew F. Davis is renown for his dishonesty, dubious legal tactics, lack of decency and disrespect for the rules of professional conduct. He will do absolutely anything to win—without regard for truth or justice. He will lie to courts and opposing parties. He will file fallacious and erroneous documents with the court. He will email opposing parties telling them not to hire a lawyer when he has just served them a lawsuit. He will call a judge's chambers and request more time without informing the opposing party. He will file orders for a bench trial when he knows a jury trial has been demanded and paid for. He will trick, stall, coerce, menace and threaten. He will invent and extend mendacious Windermere litigation and abuse the legal process for no other reason than to exhaust an opponent’s pocketbook. If he can, he will get YOUR attorney to quit—a favorite tactic.
Windermere, Davis and Demco Law will push a $5 cat poop case all the way to the state supreme court just to avoid paying damages—because it’s all in the Windermere operating budget. And in the end, Windermere and Davis will try to coerce silence about your Windermere experience by trying to make you sign a "settlement" agreement that terminates your speech rights, so you can't ever inform the public about your Windermere debacle. What if you DON'T sign that you'll shut up, and then SPEAK UP instead? Windermere-Demco's Matt Davis will sue you for libel and defamation, then run away and dismiss his own lawsuit on the eve of trial—because after all—you're telling the truth.
Windermere's Clear and Overt Marketing Fraud:
"THE HIGHEST ETHICAL STANDARDS. UNCOMPROMISING HONESTY AND INTEGRITY."
—The Windermere Real Estate Mission Statement
Windermere widely promotes its deceptive express warranty in sales documents and on the internet which states "We are committed to... The highest ethical standards. Uncompromising honesty and integrity." In other Windermere promotion, like the Puget Sound Business Journal, Windermere CEO Geoff Wood is quoted as saying "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." The article goes on to say, "Geoff oversees marketing, legal, financial and internet development services throughout the Windermere network..." Mr. Wood claims absolute dominion over both Windermere legal and internet strategy, making him chief architect of Windermere marketing fraud.
Effective reportage can be harsh in recounting facts, but it must be said in consideration of all the Windermere victims profiled here who truly sought Windermere's vaunted honesty and integrity, that Windermere Services CEO Geoffrey P. Wood is simply lying when he states his company's utterly false and fraudulent commitment to honesty and integrity. He both lies and deceives again when he says that "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." Wood clearly doesn't do what he says he's going to do—be committed to uncompromising honesty and integrity. Wood himself is indeed IN the real estate business and his word is absolutely no good at all. He sues victims of Windermere misconduct for trade libel and defamation to shut them up, and then he tries to use the legal system to suppress victims' speech rights when they ask him to actually perform on the warranty he promotes. As this website proves, Mr. Wood does anything BUT what he says he's gonna do. Far from providing victimized Windermere customers a commitment to high ethical standards, honesty and integrity, Wood and Windermere run away and hide behind their lawyers when innocent consumers are ruined by their Windermere experience.
John W. Jacobi, Geoff Wood, his wife Jill Jacobi-Wood, and governing cohorts John O'brien "OB" Jacobi and attorney Paul Drayna have gone to the absolute ends of the earth in stonewalling, ignoring, denying and fleeing any and all responsibility for Windermere wrongdoing and misconduct. When called upon by victimized Windermere consumers to make good on its warranty of honesty and integrity, Windermere even states in legal pleadings that Windermere agents are NOT agents of Windermere at all—but independent contractors. As the legally-designated Governing People and top managers of the Windermere empire who drive policy, ethics and market promotion, it demands repeating that John W, Jacobi, Geoff Wood, Jill Jacobi-Wood, John OB Jacobi and attorney Paul Drayna are all clearly lying when they promise high ethical standards and uncompromising honesty to the public and consumers of real estate services.
Protect your life, home, family and future by cancelling or not renewing your Windermere listing. Don't risk doing business with Windermere Real Estate, the brand built on lies, fraud and ruined lives. Refuse to fund public predator Windermere Real Estate with commission from the sale of your home.
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Is WindermereWatch.com of social benefit to consumers and the public? You decide:
Windermere Real Estate is one of our country’s largest real estate companies and widely promotes a fraudulent express warranty that states “We are committed to... The highest ethical standards. Uncompromising honesty and integrity.” The definition of an express warranty from Black's Law Dictionary is: "A warranty created by the overt words or actions of the seller. • Under the UCC, an express warranty is created by any of the following: (1) an affirmation of fact or promise made by the seller to the buyer relating to the goods that becomes the basis of the bargain."
But when customers are victimized by dishonest Windermere brokers and agents, and complain in writing through legal counsel to franchiser Windermere Services Company, it is absolutely silent in the face of clear and convincing evidence, and forces the customer to sue or go away. In many cases, unsuspecting consumer lives are thrown into complete chaos through costly litigation; and also because the subject homes may actually be uninhabitable or unserviceable for reasons about which Windermere knew and had a legal obligation to disclose—but did not. For some victims, the long and expensive litigation forced upon them even results in bankruptcy and homelessness. Despite their clear evidence, many victims go on to lose in court because they can't afford attorneys or have no legal experience, and Windermere exploits those impediments to endless advantage—lives, homes, and personal finances are ruined forever. And Windermere expects those victims to just go away without their lives and homes, merely for buying a house through Windermere Real Estate, innocently.
Although such irrefutable evidence of Windermere broker/agent misconduct has been presented to franchiser Windermere Services Company, it knowingly continues collecting commissions from dishonest agents and brokers by deliberately passing them on to other unwitting consumers. Just one example is Windermere S.C.A. Redmond's Paul Stickney, who received a $522,200 court judgment for not disclosing a conflict of interest, but is still producing commissions for his Windermere SCA franchise, and Windermere Services Company. Is that the "Highest ethical standards. Uncompromising honesty and integrity?" You may want to search and visit more websites about Windermere's predatory business conduct.
When victims use the media to report their Windermere experiences honestly, Windermere sues them for libel and defamation through false lawsuits to intimidate, silence, and hush bad PR—read one of those lawsuits here. It then tries to coerce victims into signing a “dark clause settlement agreement” that permanently terminates their speech rights—read some of those "settlement" agreements here. Through an expensive and emotionally distressing roller coaster ride with Windermere's nasty Demco lawyers, a victim of Windermere fraud is told they will be taken all the way to trial on trumped-up libel and defamation charges, and if they don't sign the dark clause, their life and future will be ruined. When a victim persists in refusing to sign, Windermere voluntarily dismisses its own lawsuit under Civil Rule 41, just before trial, after costing the victim years and yet thousands more to defend against the false action. This predatory legal tactic is known as abuse of process or malicious prosecution. In one example cited below, franchiser Windermere Services Company served an outspoken victim a lawsuit for libel and defamation, and then immediately sent them an email instructing that they "...need not hire an attorney," and further stating, “…we will try to resolve this directly and outside the legal system.”
Every Windermere office in every state is legally tied to franchiser Windermere Services Company's fraudulent express warranty, false advertising, predatory conduct and policies through privity and its pecuniary franchise agreement. Some legal observers believe that Windermere's conduct has RICO and Civil Rights violation implications. If you have recently purchased a Windermere franchise without having been disclosed Windermere's falling brand value, PR decline, and its adverse website problems, click here for its duty of disclosure under Federal Trade Commission rules. Proof that Windermere Services Company knew about WindermereWatch.com in March of 2007 is in this document.
Windermere Real Estate is a textbook corporate predator who operates franchises in Washington State, Oregon, California, Arizona, Nevada, Utah, Idaho, Montana, Hawaii and British Columbia. Windermere repeatedly makes the false claim that it has offices in Wyoming, but it does not. If you’re buying or selling property through ANY Windermere office, a percentage from your transaction will be used by franchiser Windermere Services Company to silence and financially ruin innocent parties who’ve encountered Windermere fraud. Windermere won't pay legitimate damages or acknowledge wrongdoing, and will stall settlement of cases all the way to state supreme courts, a legal strategy that Windermere routinely employs to bankrupt victims and exhaust their resources.
We believe the information presented here is of profound social benefit to consumers and the community, and we are dedicated to providing it.
THROUGH FEES AND COMMISSIONS PAID TO FRANCHISER WINDERMERE SERVICES COMPANY, EVERY WINDERMERE NETWORK OFFICE IN EVERY STATE IS AN ENTHUSIASTIC PARTNER AND KNOWING ACCESSORY TO WINDERMERE MARKETING FRAUD AND ITS PREDATORY POLICIES