      IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON


ALASKA USA FEDERAL CREDIT                            No. 70313-7-1
UNION,                                                                           5?     o-4
                                                     DIVISION ONE                "**"   ~^ ,'.."
                    Respondent,            ]
                                                                                  2*.    rr>'
             v.                            ;
                                                                                          —to

DWIGHT M. HOLLAND,                         ;         UNPUBLISHED

                    Appellant.             ]         FILED: January 13. 2014




      Cox, J. —Alaska USA Federal Credit Union sued Dwight Holland for

breach of contract after he defaulted on his car payments. Holland, acting pro

se, appeals the trial court's order of summary judgment in favor of Alaska.

Because Holland fails to show the existence of any genuine issue of fact

precluding summary judgment, we affirm the trial court's order.

       In May 2009, Holland purchased a 2006 Dodge Dakota truck from the

Puyallup Auto Center. Holland entered into a retail installment contract with the

dealership. The dealership assigned the contract to Alaska.

       In January 2012, Holland sent a check for $6,100, just short of the

principal balance on the loan, payable to Alaska. On the memo line, Holland

wrote, "EFT only! For Discharge of Debt." On the back of the check, he wrote:

"Not for Deposit[,] EFT only[,] For Discharge of Debt." Holland signed the back of

the check "Without Recourse" as an "Authorized Representative." In a
No. 70313-7-1/2




subsequent letter to him, Alaska explained that it could not accept Holland's

payment due to the "irregular negotiability requirements." Alaska did not deposit

the check or apply it to the balance of Holland's loan.

       In February 2012, Holland wrote to Alaska and took the position that

because the annotated check had not been returned to him, the debt must be

discharged according to the terms of the instrument. Holland did not make a

payment in March. In April, he sent Alaska a check for $120.00. On the memo

line of this check, he wrote, "Final Payment for Loan." Because Alaska did not

agree that this amount represented the final payment, it did not deposit this

check either. Having not received a payment since February, Alaska referred the

matter to its attorney.

       In April 2012, Alaska's counsel notified Holland by letter that his default on

the loan entitled the credit union to accelerate the balance owed under the

contract. Alaska demanded payment in full of the balance then due, $6,256.05,

or surrender of the vehicle within 10 days. Holland responded, demanding proof

of counsel's representation of Alaska and various forms of proof that he is an

attorney. Holland also continued to claim that the unreturned "E.F.T. instrument"

discharged the debt.

       Holland did not comply with Alaska's demand for payment. After

complying with the Fair Debt Collection Practices Act (FDCPA), U.S.C. § 1692 et

seq., Alaska commenced this action for breach of contract.
No. 70313-7-1/3




       Acting pro se, Holland answered the complaint. He claimed that his

January 2012 annotated instrument satisfied the debt obligation. He raised

various other affirmative defenses including failure to state a claim for relief,

"standing" of Alaska's counsel, lack of consideration, contributory negligence,

and estoppel. Holland also propounded discovery requests and moved to

dismiss.

       Alaska responded to Holland's discovery requests and motion to dismiss.

In July 2012, Alaska moved for prejudgment replevin to take possession of the

vehicle.

       On July 13, the court heard Alaska's motion. The court determined that

Alaska had established its right to take possession of the vehicle pending the

disposition of the case. However, the court delayed for 5 days enforcement of its

order awarding possession of the vehicle, providing that if Holland paid Alaska

$6,100 before 5:00 p.m. on July 18, Alaska would present an order to vacate the

replevin order. Holland paid Alaska the required amount, and Alaska presented

an order vacating the replevin order.

       After this payment was applied, Holland still had an unpaid balance of

$246 for the vehicle, exclusive of other amounts due under the contract.

Specifically, Holland was also liable for the attorney fees and costs incurred by
Alaska in this action. As of August 2012, those costs and fees amounted to

$2,208.
No. 70313-7-1/4




       On August 9, 2012, Alaska sent a letter to Holland, offering to negotiate a

discounted settlement to avoid further litigation, but stated that if Holland did not

respond within 10 days, it would withdraw its offer and move for summary

judgment. Holland did not respond to Alaska's offer to settle. Instead, he sent

Alaska requests for production.

       Holland also moved for an order seeking recusal of the judge who had

previously ruled on the replevin motion. The court denied the motion.

       Alaska moved for summary judgment. The day before the hearing on the

motion, Holland filed a response. The court declined to consider this untimely

response. After hearing oral argument, the court granted the motion and entered

judgment against Holland for the unpaid balance for the purchase plus attorney

fees and costs.

       Holland appeals.

                          ACCORD AND SATISFACTION

       Holland argues that the trial court improperly granted summary judgment

because Alaska accepted his January 2012 annotated instrument and thereby

entered into an accord and satisfaction of the debt obligation. We disagree.

       This court reviews summary judgment de novo.1 A motion for summary
judgment is properly granted ifthe pleadings, affidavits, depositions, and

admissions on file demonstrate the absence of any genuine issues of material



       1 TracFone Wireless. Inc. v. Dep't of Revenue. 170 Wn.2d, 273, 280-81, 242
P.3d 810 (2010).
No. 70313-7-1/5




fact and the moving party is entitled to judgment as a matter of law.2 We
consider all facts and reasonable inferences in the light most favorable to the

nonmoving party.3
      Chapter 62A.3 RCW governs negotiable instruments. According to the

definitions set forth in RCW62A.3-104, Holland's annotated instrument was

neither a check nor any other negotiable instrument. A check must be payable

on demand.4 A "negotiable instrument" is an "unconditional promise or order to

pay a fixed amount of money," and must not "state any other undertaking or

instruction by the person promising or ordering payment to do any act in addition

to the payment of money."5 Nor is an instrument negotiable if it "contains a
conspicuous statement, however expressed, to the effect that the promise or

order is not negotiable."6 Because ofthe annotations "EFT Only," "Not for
Deposit" and "For Discharge of Debt," Holland's instrument was not an

unconditional promise to pay, nor payable on demand. It also contained

additional instructions in addition to the payment of money. Alaska was within its

rights not to deposit this check, and Holland does not assert otherwise.




       2CR 56(c).
       3 Mason v. Kenvon Zero Storage. 71 Wn. App. 5, 8-9, 856 P.2d 410 (1993).

       4RCW62A.3-104(f).

       5 RCW 62A.3-104(a), (a)(3).

       6RCW62A.3-104(d).
No. 70313-7-1/6




       A party asserting the defense of accord and satisfaction bears the burden

to prove that (i) in good faith he tendered an instrument to the claimant as full

satisfaction of the claim, (ii) the amount of the claim was unliquidated or subject

to a bona fide dispute, and (iii) the claimant obtained payment of the instrument.7

Holland argues that because Alaska did not return his January 2012 annotated

check, it accepted his payment. Holland does not establish, much less allege,

that the amount of the debt obligation was the subject of a bona fide dispute.

And, as explained, Holland's annotated check was not a negotiable instrument

and Alaska did not deposit it. Alaska's failure to return the annotated check to

Holland, even if true, does not establish that Alaska obtained payment on the

instrument. Accordingly, there was no accord and satisfaction.

                      STANDING OF ALASKA'S COUNSEL

       Holland argues that Alaska's attorney lacked standing "at the inception of

the case" to pursue the claim for breach of contract. This argument does not

create any genuine issue of material fact for summary judgment purposes.

       It is undisputed that the plaintiff in this case is Alaska, not its counsel.

Thus, it is irrelevant to assert that its counsel lacks standing.

       Holland also maintains that counsel was acting as a debt collector under

FDCPA and in doing so, violated provisions of the FDCPA. Because this




       7RCW62A.3-311(a).
No. 70313-7-1/7




argument was not raised below and Holland does not identify any specific

violation in his opening brief, we decline to consider the argument.8
                              BREACH OF CONTRACT

       Holland contends that Alaska failed to establish a breach of contract

because it was required and failed to provide the original installment contract and

could not rely on a Xerox copy. He also maintains that Alaska failed to prove it

was the lienholder. But nothing in CR 56 requires the submission of original

documents.9 And beyond his assertion that Alaska relied on an
"unauthenticated" and "unverified" copy, Holland did not dispute the existence of

the contract nor its specific terms. In addition, Alaska proved that it was the

lienholder by means of the electronic vehicle title and the declaration of its

enforcement officer.

       Holland also claims Alaska's suit should have been dismissed on the

ground that he was entitled, but did not receive, notice of default and acceleration

of the maturity of the debt. To the contrary, Alaska's counsel's April 2012 letter

to Holland prior to filing Alaska's complaint provided such notice. No authority

supports Holland's position that this notice was insufficient.




        8See RAP 9.12 (arguments not brought to the attention of the trial court at the
time of summary judgment may not be considered); see also Cowiche Canyon
Conservancv v. Bosiev. 118 Wn.2d 801, 809, 828 P.2d 549 (1992) (appellate court need
not consider issues raised for the first time in reply brief).

       9See ajso ER 1003 (duplicate is admissible to the same extent as an original
unless a genuine question is raised as to authenticity).
No. 70313-7-1/8




                                       RECUSAL


        Finally, Holland challenges the trial court's denial of his motion for recusal.

In his motion, Holland cited RCW 4.12.050. But an affidavit of prejudice under

that statute must be filed "before the judge presiding has made any order or

ruling involving discretion." Holland's motion and affidavit were untimely under

RCW 4.12.050(1).

        Holland also relied on the Code of Judical Conduct and alleged that during

the hearing on Alaska's replevin motion, the judge exhibited bias against him,

failed to seriously consider his arguments, and aligned herself with the plaintiff.

Later, during the summary judgment hearing, Holland explained that he believed

the judge was "prejudicial and biased" because she did not agree with his
argument that the annotated check constituted an accord and satisfaction of the

debt.

        The record before this court does not remotely support his claims. In fact,

although Alaska established its right to immediate possession of Holland's
vehicle, on its own initiative, the trial court delayed enforcement of the order to

provide Holland the opportunity to cure the deficiency and retain possession of
the vehicle. Because Holland failed to substantiate his claims of bias, the trial

court did not abuse its discretion when it denied his motion to recuse.10




        10 See Wolfkill Feed & Fertilizer Corp. v. Martin. 103 Wn. App. 836, 840, 14P.3d
877 (2000) (whether to recuse is within the trial judge's sound discretion).
                                             8
No. 70313-7-1/9




                            ATTORNEY FEES ON APPEAL

          Alaska requests attorney fees on appeal under the contract. A provision

in a contract that allows attorney fees in an action to collect payment due under a

contract includes reasonable fees for the trial court action as well as fees

incurred on appeal.11 Because Alaska prevails on appeal, it is entitled to
reasonable appellate attorney fees, subject to compliance with RAP 18.1.

          We affirm the summary judgment order and grant fees on appeal, subject

to compliance with RAP 18.1.

                                                            &JX, J-
WE CONCUR:




    * 3- >^VvV '^




          11 Granite Equip. Leasing Corp. v. Hutton. 84 Wn.2d 320, 327, 525 P.2d 223
(1974).
