     IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                                    DIVISION ONE

UNIFUND, CCR, LLC,                             No. 73510-1-1
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                      Respondent,
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AMY ELYSE,                                     PUBLISHED OPINION


                      Petitioner.              FILED: July 18, 2016


       Verellen, C.J. — A debt collector seeking to enforce a written credit card

agreement must prove the debtor's assent to the material terms of the agreement. The

only cardholder agreement Unifund proffered in its action against Amy Elyse was a

cardholder agreement issued in 2010. Unifund relies on use of the card in 2008 and a

payment in 2009 to prove assent by conduct. But those acts do not establish assent to

a document that did not exist until 2010.

       The district court properly granted Elyse's motion for summary judgment and

dismissed Unifund's claims. We reverse the superior court's judgment on RALJ appeal

in favor of Unifund and award Elyse her attorney fees on appeal to both this court and

the superior court.
No. 73510-1/2


                                          FACTS


      The material facts are undisputed. Elyse opened a Citibank credit card account

in October 2007.1 The card was last used in July 2008. The last payment was made in

November 2009. Citibank sold the account to Pilot Receivables Management in March

2013 with $1,910.11 due. Pilot sold the account to Unifund in July 2013.

      In September 2013, Unifund sued Elyse in district court to recover unpaid credit

card debt "for goods, services, and monies loaned" in the amount of $1,871.11 plus

costs and interest.2 After discovery, both parties moved for summary judgment.

      Among the affidavits attached to Unifund's summary judgment motion was an

affidavit of its records custodian, Joseph Doup. Doup's affidavit attached copies of 26

monthly account statements issued by Citibank from November 2007 to November

2009 and in May 2010. The statements were addressed to Elyse, showed the same

account number, and detailed the purchases made. The November 2009 statement

showed a balance of $1,456.77. The May 2010 statement showed a previous balance

of $1,822.58 and a new balance of $1,871.11. Doup's affidavit also attached the "most

recent" cardholder agreement for Elyse's account.3 The agreement was neither signed

nor dated. The agreement's first page states "© 2010 Citibank (South Dakota), N.A."

and "3/10."4




       1In July 2011, Citibank (South Dakota), N.A. merged with Citibank, N.A. We
refer to issuer of the credit card account as Citibank.
       2 Clerk's Papers (CP) at 304-05.
       3 CP at 215, H11.
       4 CP at 252.
No. 73510-1/3


       Elyse submitted her declaration stating that she had "no memory" and "no

records" of receiving any credit card agreement from Citibank.5

      At the summary judgment hearing, Unifund urged the district court to apply either

South Dakota's six-year statute of limitations for any contract6 or Washington's six-year

statute of limitations for written contracts.7 Unifund acknowledged that the only

agreement it submitted in support of its argument was the 2010 cardholder agreement.

The district court granted Elyse's motion for summary judgment and dismissed

Unifund's action as barred by the Washington three-year statute of limitations applicable

to oral contracts. The court noted Unifund's failure to produce a written credit card

agreement in effect when Elyse's account was opened in October 2007. The court

awarded Elyse attorney fees.

       Unifund appealed to superior court. The superior court on RALJ appeal reversed

the district court and entered a judgment in favor of Unifund. The court gave no

reasoning for its decision. We granted Elyse's motion for discretionary review.8
                                        ANALYSIS


       We review a summary judgment order de novo.9 Summary judgment is proper if

there are no genuine issues of material fact.10 "'A material fact is one that affects the




       5 CP at 50, H 2.
       6 South Dakota Codified Laws (SDCL) § 15-2-13.
       7 RCW 4.16.040(1).
       8 The Northwest Consumer Law Center, Northwest Justice Project, and Columbia
Legal Services each filed an amicus curiae brief in this court.
       9 McDevitt v. Harborview Med. Ctr., 179 Wn.2d 59, 64, 316 P.3d 469 (2013).
       10 CR 56(c); Lowman v. Wilbur, 178 Wn.2d 165, 168-69, 309 P.3d 387 (2013).
No. 73510-1/4


outcome of the litigation.'"11 We view the facts and all reasonable inferences in the light

most favorable to the nonmoving party.12 Whether a claim is barred by a statute of

limitations is a question of law we review de novo.13

      We need not address the parties' arguments as to the admissibility of the

documents Unifund offered on summary judgment under the business records act,

chapter 5.45 RCW.14 Even assuming the documents were properly admitted, Unifund

failed to prove Elyse's assent to a written cardholder agreement.



       11 Morgan v. Kingen, 166 Wn.2d 526, 533, 210 P.3d 995 (2009) (quoting Owen v.
Burlington N.& Santa FeR.R.. 153 Wn.2d 780, 789, 108 P.3d 1220 (2005)).
       12 Fulton v. Dep't of Soc. & Health Servs., 169 Wn. App. 137, 147, 279 P.3d 500
(2012).
       13 Kelly v. Allianz Life Ins. Co. of North America, 178 Wn. App. 395, 398, 314
P.3d 755 (2013); Nieshe v. Concrete Sch. Dist., 129 Wn. App. 632, 638, 127 P.3d 713
(2005).
       14 Elyse and amici question the ability of an unaffiliated debt buyer to provide an
adequate foundation for admission of card agreements and records created by the
original creditor. Compare Discover Bank v. Bridges, 154 Wn. App. 722, 726, 226 P.3d
191 (2010) (card agreement properly admitted under business records act when
employees of an affiliated entity that collected obligations for Discover Bank "collectively
stated" that they had access to the Bridges' account records in the course of
employment and made their statements based on personal knowledge and review of
records made in the ordinary course of business) with State v. Weeks, 70 Wn.2d 951,
952, 425 P.2d 885 (1967) (third-party record of an out-of-state hospital inadmissible
because records custodian lacked personal knowledge); see also Peter A. Holland, The
One Hundred Billion Dollar Problem in Small Claims Court: Robo-Signing and Lack of
Proof in DebtBuyer Cases, 6 J. Bus. &Tech. L. 259, 280 (2011) ("'A debt buyer's
affidavit has no probative value when the affiant's claimed familiarity with the assignor's
business records is derived solely from the affiant's review of those records after they
came into the debt buyer's possession.'" (quoting Nat'l Consumer LawCtr.,
Collection Actions 45 (1sted. 2008 &Supp. 2010^: Midland Funding LLC v.
Valentin, 40 Misc.3d 266, 966 N.Y.S.2d 656, 659 (2013) (An assignee's records
custodian "almost always lacks the requisite knowledge to lay the proper foundation to
establish the documents ... are business records of the original creditor."); CACH. LLC
v. Askew, 358 S.W.3d 58, 62-64 (Mo. 2012) (debt buyer's records custodian not
qualified to lay foundation for business records rule when custodian had never worked
for business that prepared the records and was not familiar with their preparation);
Commonwealth Fin. Svs. v. Smith, 15 A.3d 492, 494-500 (Pa. Super. Ct. 2011) (affidavit
No. 73510-1/5


      To establish a claim for the unpaid credit card debt, Unifund had to show that

Elyse assented to a contract with Citibank by accepting the cardmember agreement and

personally acknowledging the account.15 Unifund failed to meet this burden. The only

written contract Unifund proffered was the 2010 cardmember agreement. But Unifund

failed to prove that Elyse assented to that agreement. Unifund did not produce a signed

credit card agreement, a signed credit card application, or any other express written

assent by Elyse to the terms of a specific credit card agreement. Nor did Unifund

produce any cancelled checks evidencing Elyse's payments on the account.16
       Unifund argued on summary judgment and here that Elyse assented to the 2010

agreement through her use of the credit card.17 "The use of a credit card, if sufficiently


of assignee debt buyer's employee held inadmissible because there was no foundation
testimony that the employee had personal knowledge of the "preparation and
maintenance" of the account statements and purported card agreement); Palisades
Collection LLC v. Kalal. 324 Wis.2d 180, 781 N.W.2d 503, 509-10 (Wis. Ct. App. 2010)
(affidavit of assignee debt buyer's authorized representative held inadmissible because
she had no personal knowledge of how the account statements were prepared and
whether they were prepared in the ordinary course of the original creditor's business);
Asset Acceptance v. Lodge, 325 S.W.3d 525, 528-29 (Mo. Ct. App. 2010) (testimony
from assignee debt buyer's legal director held inadmissible because the employee had
no personal knowledge of how or when the records were prepared and if the records
were prepared in the ordinary course of business); Martinez v. Midland Credit Mgmt.,
Inc., 250 S.W.3d 481, 485 (Tex. App. 2008) (affidavit of assignee debt buyer's
custodian of records held inadmissible because employee had no personal knowledge
ofthe predecessor's recordkeeping practices); Simien v. Unifund CCR Partners, 321
S.W.3d 235, 244-45 (Tex. App. 2010) (third-party debt buyer's employee can
authenticate documents it purchased despite having no personal knowledge or any
other showing of reliability as to the original creditor's recordkeeping practices).
       15 Bridges, 154 Wn. App. at 727.
       16 A defendant may assent to an agreement's terms by personally acknowledging
a credit card account "through evidence of cancelled checks or online payment
documentation." jd.
       17 The 2010 agreement provided that use of the credit card constituted
acceptance of the terms ofthe agreement: "This Card Agreement is your contract with
us. It governs the use of your card and account. . . . You agree to use your account in
No. 73510-1/6


detailed and itemized, constitutes acceptance of terms clearly stated in a cardmember

agreement."18 In order to prove Elyse's assent to the terms of the 2010 cardmember

agreement by use of a credit card, Unifund had to document Elyse's use of a credit card

when governed by that specific agreement. But Elyse could not have assented to the

terms of the 2010 cardholder agreement by her conduct since her credit card was last

used in July 2008 and the last payment was made on the card in November 2009.

Therefore, Unifund did not prove Elyse assented to the terms of the 2010 cardmember

agreement and failed to prove the existence of a written contract on which its claim

against Elyse for unpaid credit card debt could be based.

      And, contrary to Unifund's argument, this does not equate to a requirement to

submit every version of a credit card agreement that applied during the period the

account was open. Rather, a debt collector relying on assent by conduct in the form of

continuing use of a credit card proves assent to the version of the card agreement in

existence at the time of the card's most recent use.




accordance with this Agreement. You must pay us for all amounts due on your account.
This Agreement is binding on you unless you close your account with 30 days after
receiving the card and you have not used or authorized use of the card." CP at 252.
      18 American Exp. Centurion Bank v. Stratman. 172 Wn. App. 667, 673, 292 P.3d
128 (2012); see also Citibank S.D.. N.A. v. Rvan. 160 Wn. App. 286, 290-94, 247 P.3d
778 (2011) (Citibank employee's affidavit, unsigned cardmember agreement, and
account statements did not establish as a matter of law that the defendant assented to
the agreement's terms); Bridges, 154 Wn. App. at 727-28 (unsigned card agreement in
effect when the defendant opened the account and defaulted on the debt and a generic
summary of the purported account balance and payments, as opposed to detailed,
itemized proof of the cardholder card use did not establish as a matter of law that the
defendants assented to the agreement's terms).
No. 73510-1/7



       To the extent the record suggests a claim in the nature of an oral agreement

between Elyse and Citibank, the Washington three-year statute of limitations on oral

contracts had run when Unifund sued Elyse in 2013.19 Any such claim is time barred.

       We reject Unifund's argument that two South Dakota statutes apply based on the

choice of law provision in the 2010 cardholder agreement. The 2010 agreement

provides that "[fjederal law and the law of South Dakota . . . govern the terms and

enforcement of this Agreement."20 Relying on that provision, Unifund cites South

Dakota's six-year limitation period for oral or written contract claims,21 as well as South

Dakota's statute that a cardholder is bound to a credit card agreement if the cardholder

fails to cancel the account within 30 days after issuance of the credit card agreement.22

But the 2010 contract choice of law provision is not relevant absent proof by Unifund

that Elyse assented to that agreement. As discussed, there is no such evidence.

      We also reject Unifund's argument that Washington's six-year limitations period

for accounts receivable applies. Unifund did not argue in district court that Elyse's

account was an account receivable governed by RCW 4.16.040(2). It attempted to

raise this legal theory for the first time on appeal. But RALJ 2.2(d) expressly limits the

issues that may be raised for the first time in superior court on RALJ appeal just as

RAP 2.5(a) limits the issues that may be raised for the first time on appeal to this court

from superior court.23 Although RAP 2.5(a) and RALJ 2.2(d) are phrased permissively


       19 RCW 4.16.080(3).
       20 CP at 257.
       21 SDCL§ 15-2-13.
       22SDCL§54-11-9.
        23 Compare RALJ 2.2(d) ("The superior court may refuse to review any claim of
error that was not raised in the court of limited jurisdiction. However, a party may raise


                                             7
No. 73510-1/8



that the court "may refuse to review,"24 it is the rare exception when an appellate court

will entertain a new legal theory that the opposing party and the trial court did not have

an opportunity to fully explore.25 We decline to consider a legal theory Unifund raised

for the first time in superior court on its RALJ appeal.26 The district court was correct in

dismissing Unifund's action on Elyse's motion for summary judgment. The superior

court erred in reversing the district court and entering judgment in favor of Unifund.

       Elyse requests an award of attorney fees on appeal and properly devotes a

section of her brief to her request.27 A defendant is deemed the prevailing party and

may be entitled to an award of attorney fees when the plaintiff recovers nothing in a

damage action for less than $10,000.28 If a statute allows a party to recover attorney


the following claimed errors for the first time on appeal: (1) lack of jurisdiction, (2) failure
to establish facts upon which relief can be granted, and (3) manifest error affecting a
constitutional right.") with RAP 2.5(a) ("The appellate court may refuse to review any
claim of error which was not raised in the trial court. However, a party may raise the
following claimed errors for the first time in the appellate court: (1) lack of trial court
jurisdiction, (2) failure to establish facts upon which relief can be granted, and
(3) manifest error affecting a constitutional right.").
       24 Pulcino v. Fed. Express Corp, 141 Wn.2d 629, 649, 9 P.3d 787 (2000)
(RAP 2.5(a) "is permissive in nature and does not automatically preclude the
introduction of an issue at the appellate level") (overruled in part on other grounds,
McClartv v. Totem Electric, 157 Wn.2d 214, 137 P.3d 844 (2006))
       25 Washburn v. Beatt Eguip. Co., 120 Wn.2d 246, 291, 840 P.2d 860 (1992)
("While new arguments are generally not considered on appeal, the purpose of
RAP 2.5(a) is met where the issue is advanced below and the trial court has an
opportunity to consider and rule on relevant authority.")
        26 RAP 9.12 (on review of summary judgment, "the appellate court will consider
only . . . issues called to the attention of the trial court"); Cano-Garcia v. King County.
168 Wn. App. 223, 248, 277 P.3d 34 (2012) ("Issues and contentions neither raised by
the parties nor considered by the trial court when ruling on a motion for summary
judgment may not be considered for the first time on appeal.").
       27 See RAP 18.1(b).
     28 RCW 4.84.250, .270; see also LRS Elec. Controls. Inc. v. Hamre Const, Inc.,
153 Wn.2d 731, 744-45, 107 P.3d 721 (2005).
No. 73510-1/9


fees in a court of limited jurisdiction, a party may recover attorney fees on appeal to the

superior court.29 Similarly, if allowed by statute, we may award attorney fees to the

prevailing party on appeal under RAP 18.1(a). Because Elyse is the prevailing party on

appeal, we award her reasonable attorney's fees and direct the district court to

determine the amount of the award on remand.30

       We reverse the superior court's judgment and remand with directions that the

superior court vacate its judgment and remand this matter to the district court for
reinstatement of its judgment dismissing the case and for an award to Elyse of her
reasonable attorney fees at trial and on appeal to both this court and the superior court.




WE CONCUR:




    )j)f^fr^^\) i




        29 RALJ 11.2(b); Elyse also requested attorney's fees in her briefing to the
 superior court as required by RALJ 11.2(c).
        30RAP18.1(i).
