                                                                                                     FILED
                                                                                          COURT OF APPEALS
                                                                                              DIVISION II

                                                                                         2015 FEB 18 AM 9: 22
                                                                                         ST        O' ''   A ._     TON

                                                                                          BY




      IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

                                                DIVISION II

TOM MOYER THEATRES, an Oregon                                                No. 45433 -5 -II
partnership,


                                     Respondent,


          v.



MICHAEL J. WALKER, DEBORAH A.                                         UNPUBLISHED OPINION
 WRAY, and KRISTIN D. STUMP, Co-
 Trustees of the Amended and Restated Walker
 Family Trust dated August 18, 2001; and
 GREENWAY TERRACE, LLC, a Washington
 limited liability company,

                                      Appellants.


         JOHANSON, C. J. —      Greenway Terrace LLC and the Amended and Restated Walker Family

Trust ( the Trust) appeal the trial court' s order of specific performance allowing Tom Moyer

Theatres (TMT) to relocate utility lines onto Greenway' s property. Greenway' s primary argument

is that TMT did not prove by clear and unequivocal evidence that TMT had the right to move the

utilities onto Greenway' s property under a 2001 purchase and sale agreement. We conclude that

TMT failed to meet its burden to demonstrate that it had a clear and unequivocal contractual right


to   relocate   the utility lines   onto   Greenway' s   property.   We   reverse   the trial   court' s   orders   of
No. 45433 -5 -II



specific performance and for attorney fees in TMT' s favor and hold that TMT is not entitled to

specific performance. We also hold that, as the prevailing party, Greenway is entitled to reasonable

attorney fees       under   the Agreement.           Accordingly, we remand to the trial court for further

proceedings consistent with this opinion.


                                                              FACTS


          In 2001, the Trust sold approximately one -third of a parcel of land to TMT Development

Co., Inc.     TMT Development Co. assigned its interest in the land that it bought to TMT.1 The

Trust retained its interest in the other two -thirds of the parcel and later conveyed that land to


Greenway.

          This appeal is centered on the language of the purchase and sale agreement and an


addendum to that agreement that TMT' s and Greenway' s predecessors -in- interest executed in

2001 ( the Agreement).            The Agreement included an easement permitting Greenway to enter

TMT' s property to make repairs and perform maintenance on utility lines under TMT' s property

that serve a mobile home park on Greenway' s property. The disagreement in this case is over the

language of the easement' s relocation provision which states, in relevant part, that


           TMT] shall have the right to relocate or alter utilities which are located in the 6. 25
          acres after closing, but in no event shall such relocation or alteration interrupt
           Greenway' s] utility service without [ Greenway' s] prior express written consent.
          The cost for such alterations or relocation shall be the responsibility of [TMT].

Ex. 2    at   10.    The    purpose   of     this   easement    was    to " facilitate   future development" of both


Greenway'        s and   TMT'   s parcels.    Clerk'   s   Papers ( CP)   at   382.   The easement was also necessary


1
    We   refer   to the plaintiff respondents
                                  -                    as "   TMT"    and   the defendant -appellants
                                                                                        Greenway"       as "

because they were the parties -in-interest at the time that the actions that are the subject of this
appeal occurred.




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No. 45433 -5 -II



because at the time that the Agreement was signed, the land surrounding the parcels at issue had

not    yet    been developed,       and    it   was "    physically impossible"         to move the utility lines onto

Greenway' s property. 2 Report of Proceedings ( RP) at 174.

             Beginning in 2002, Greenway and TMT had several problems with the utilities that caused

service disruptions, including a contractor who tapped into the lines, leaking utilities, and new,

high -volume         construction   traffic     across    TMT'   s    property that damaged utility lines.          In 2008,


because new development had occurred and to avoid future disruptions of service, TMT and


Greenway began to discuss plans to move the utilities onto Greenway' s property. In order to avoid

incurring      any   costs   for the   relocation,       Greenway      asked   TMT to     sign   a "   Waterline Relocation


Agreement" before it          would allow         TMT to      move     the utilities   onto   Greenway' s    property.   TMT


refused to sign the Waterline Relocation Agreement, claiming that it did not need Greenway' s

consent to move the utilities and that the original Agreement gave it the right to move the utilities


onto    Greenway'      s   property.      In 2009, TMT sued Greenway for specific performance of the

Agreement.


             At trial, Greenway moved in limine to exclude certain correspondence between the parties'

attorneys and two TMT representatives, arguing that those exhibits were evidence of compromise

or    settlement negotiations          and,   therefore,     inadmissible      under   ER 408.         The trial court denied


Greenway' s motion, finding that the challenged exhibits were " indications of the carrying out of

the   contract and     interpretation     of    the   contract post- contract."    1 RP at 19.


             Following a bench trial, the trial court found that Greenway. "specifically requested that

TMT move all of the Utilities in response to TMT' s proposed plan to move the waterlines and

water meter off of the        TMT      Property and onto       the    Greenway Property."        CP at 382. The trial court



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No. 45433 -5 -II



also found that Greenway and TMT " evidenced mutual agreement that leaving the Utilities on the

TMT Property does not make sense and is contrary to their original intent. "2 CP at 382. Based on

these findings, the court concluded that TMT had met its burden of proving by clear and

unequivocal evidence         its   contract right     to   move    the    utilities onto    Greenway' s   property. The trial


court ordered specific performance, requiring Greenway to permit TMT to relocate the utility lines

onto Greenway' s property and awarded attorney fees to TMT. Greenway appeals.

                                                           ANALYSIS


                             I. CLEAR AND UNEQUIVOCAL EVIDENCE IS LACKING


             Greenway argues that the trial court erred when it awarded specific performance because

clear and unequivocal evidence does not support the trial court' s conclusion that TMT had a

contractual right     to    move   the utility lines       onto   Greenway' s         property. 3   We agree with Greenway

and hold that the trial court erred when it determined that TMT was entitled to specific performance

because the court' s findings of fact do not support its conclusion that TMT had a clear and


unequivocal contractual right to relocate the utilities onto Greenway' s property.




2
    Greenway     assigns error     only to findings        of   fact 11   and   15.    Therefore, the remainder of the trial
court' s findings are verities on appeal and are the source of most of the background facts in this
case.    Humphrey Indus.,          Ltd.   v.   Clay   Street Assocs., LLC, 176 Wn.2d 662, 675, 295 .P. 3d 231
    2013).


3 As a threshold issue, Greenway argues that the trial court abused its discretion when it admitted
exhibits 13 through 18 and exhibit 20. We conclude that even if exhibits 13 through 18 and 20 are
considered, there is still insufficient evidence to establish that TMT had a clear and unequivocal
contractual right      to   relocate   the utilities onto         Greenway' s         property.     Consequently, we do not
address      this issue further.
No. 45433 -5 -II



                                   A. STANDARD OF REVIEW AND RULES OF LAW


          We review a trial court' s findings of fact for substantial evidence to support the findings

and   then determine           whether    those    findings    of    fact   support        its   conclusions    of   law.     Scott' s


Excavating Vancouver, LLC v. WinlockProps., LLC, 176 Wn. App. 335, 341, 308 P. 3d.791( 2013),

review    denied, 179 Wn.2d 1011 ( 2014).                Unchallenged findings of fact are verities on appeal.


Humphrey Indus., Ltd. v. Clay Street Assocs., LLC, 176 Wn.2d 662, 675, 295 P. 3d 231 ( 2013).

We make all reasonable inferences from the facts in TMT' s favor as the prevailing.party below.

Scott' s Excavating, 176 Wn. App. at 342. We review the trial court' s conclusions of law de novo.

Scott' s Excavating, 176 Wn. App. at 342.

          Specific   performance         is   appropriate where "       there is     a valid     binding   contract; [   and] a party


has   committed or    is threatening to          commit a     breach     of   its   contractual     duty."    Crafts v. Pitts, 161


Wn.2d 16, 24, 162 P. 3d 382 ( 2007).              A party seeking specific performance of a contract right must

prove   that it has the    right   to the     performance     that it   seeks       by '   clear and unequivocal' evidence,"




leaving "'   no   doubt   as   to the terms,     character, and existence of the contract.'"                 Kruse v. Hemp, 121

Wn.2d 715, 722, 853 P. 2d 1373 ( 1993) (              quoting Powers v. Hastings, 93 Wn.2d.709, 717, 713, 612

P. 2d 371 ( 1980)).


                                                        B. ANALYSIS


          We are asked to determine whether TMT established that it had a clear and unequivocal


contractual right under the Agreement to move certain utilities from TMT' s property onto

Greenway' s property. Relying on the trial court' s findings of fact, we conclude that no such right

exists.




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No. 45433 -5 -II



        The trial court' s findings on this point are as follows:


        10.        The Easement    states   in   part: "   Buyer shall have the right to relocate or alter
                   utilities which are located in the 6.25 acres after closing but in no event shall
                   such relocation or alteration interrupt Seller' s utility service without Seller' s
                   prior express written consent."

        11.        Greenway specifically requested that TMT move all of the Utilities in
                   response to TMT' s proposed plan to move the waterlines and water meter
                   off of the TMT Property and onto the Greenway Property.
        12.        The purpose of TMT moving the Utilities, as intended by the parties as part
                   of the Agreement, was to facilitate future development.
        13.        In the years following execution of the Agreement, the purpose of future
                   development continued to be a primary factor for both parties.
        14.        No location for movement of the Utilities was specified in the Agreement,
                   however the parties intended that the new location of the Utilities would
                   facilitate future development.
        15.        The parties have evidenced mutual agreement that leaving the Utilities on
                   the TMT Property does not make sense and is contrary to their original
                   intent.
        16.        The evidence, common sense, and the history of the case indicates that in
                   every way the parties are benefitted by moving the Utilities off of the TMT
                   property and onto the Greenway Property.

CP at 382. Based on these findings, the trial court concluded that


        Plaintiff has met its burden of proving by clear and unequivocal evidence its
        contract right to move the Utilities off of the TMT Property and onto the Greenway
        Property, which right is consistent with the parties [ sic] original intention to move
        the Utilities in a manner that would facilitate the development of each parcel of
        property.


CPat383.


        We examine these relevant findings in turn and as a whole, making all reasonable

inferences in TMT' s favor, to determine whether the trial court' s findings of fact support its


conclusion that TMT is entitled to an order of specific performance permitting it to move the




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No. 45433 -5 -II


                                                 4
utilities onto         Greenway' s   property.       Finding of fact 10 simply establishes that under the 2001

Agreement, TMT has the right to relocate the utilities. Notably, the Agreement does not give TMT

the   right   to   relocate   the   utilities   to any   specific   location.   The terms of the Agreement do not


provide TMT with the express right to move the utilities onto Greenway' s property.

         Finding of fact 11 states that Greenway specifically requested that the utilities be moved

onto   its property. But the          record shows       that this   request was made   in 2008.   And the fact that


Greenway may have requested that the utilities be moved onto its property does not mean that

TMT had a contractual right to move them onto Greenway' s property. This finding is insufficient

to establish the parties' intent in 2001 or TMT' s claimed right to specific performance under the


2001 Agreement by clear and unequivocal evidence.

         Findings 12, 13, and 14 are uncontested and simply demonstrate that relocation of the

utilities was always intended to facilitate future development of the property. In addition, finding

of fact 14 explicitly states that the Agreement does not specify a location to which the utilities may

be    moved.       While these findings suggest that the parties should consider relocating the utilities




4 As a threshold matter, TMT argues that Greenway should be precluded from assigning error to
the trial court' s findings of fact 11 and 15 and conclusions of law 1 and 2 because during a
summary judgment hearing Greenway argued that " I think Greenway wants [ the utilities] moved
off of   TMT'      s   property."    RP ( June 7, 2013) at 20. TMT argues that Greenway cannot now assert
a   contrary   position on appeal.
                                           However, TMT' s argument fails because Greenway argued in the
trial court, and here on appeal, that TMT does not have a specific right under the Agreement to
relocate the utilities onto Greenway' s property, not simply that Greenway agrees the utilities
should    be   moved off       TMT' s property. Whether the Agreement gives TMT the specific right to

relocate the utilities onto Greenway' s property is a separate question from whether TMT and
Greenway could agree between themselves on a plan to relocate the utilities off of TMT' s property.
Greenway has not asserted a contrary position on appeal.

                                                                7
No. 45433 -5 -II



when planning future development, they do not support the conclusion that TMT has a clear and

unequivocal contractual right to move the utilities onto Greenway' s property.

            Finding   of   fact 15 is equally        unhelpful.        It   states, "   The parties have evidenced mutual


agreement that leaving the Utilities on the TMT Property does not make sense and is contrary to

their   original   intent."     CP    at   382.   Again, this finding falls short of what is needed to clearly and

unequivocally define TMT' s right to relocate the utilities onto Greenway' s property under the

2001 Agreement. This             finding' s    mention of     the   parties' "   original intent" acknowledges finding of

fact 14, which states that the Agreement did not specify where TMT was permitted to relocate the

utilities   but that future      flexibility      in development       was     the   goal of   the   relocation provision.     The


issue here, however, is not what option would be the most flexible or what plan would be the most

reasonable     or make         the   most sense     today.     Instead, the issue is whether the 2001 Agreement


provided TMT with a clear and unequivocal right to relocate utilities onto Greenway' s property.

            In addition, the evidence of " mutual agreement that leaving the Utilities on the TMT

Property     does   not make sense,"           CP at 382, comes from the parties' discussions and proposals to


relocate     the   utilities   that began in 2008 and               continued until       this   suit was   filed.    Admittedly,

Greenway may have agreed in 2008 and thereafter that moving the utilities off of TMT' s property

makes the most sense, but this subsequent agreement does not mean that the language of the 2001


Agreement gave TMT the right to move the utilities onto Greenway' s property over Greenway' s

obj ection.


            Similarly, finding        of   fact 16 fails to   support       the trial   court' s conclusion.       The trial court


found that "[ t]he      evidence, common sense, and the history of the case indicates that in every way

the   parties are    benefitted      by    moving the Utilities      off of    the TMT     Property     and onto     the   Greenway
No. 45433 -5 -II



Property."    CP   at   382.   While the record may support this fact, it misses the point of this case:

TMT' s suit is for specific performance of the 2001 Agreement. The issue at trial was not whether


the parties would benefit from moving the utilities off of TMT' s property and that fact is not

relevant to establishing that TMT had a specific, contractual right under the 2001 Agreement.

         Specific performance of the terms of the Agreement required the trial court to make


findings that the Agreement clearly and unequivocally provides for the specific remedy sought—

relocating the    utilities onto    Greenway' s        property —and that there is      no   doubt   as   to the "` terms,


character, and existence of        the   contract.'"     Kruse, 121 Wn.2d at 722 ( quoting Powers, 93 Wn.2d

at   717, 713).    Here, the trial court made no findings of fact that support a conclusion that the


Agreement clearly and unequivocally gives TMT the right to relocate the utilities onto Greenway' s

property. Instead, the 2001 Agreement is silent regarding where the utilities would be relocated.5
Because the trial       court' s   findings do     not    support    conclusion   of   law 1,   an   order    of specific




performance was erroneous because the evidence does not clearly and unequivocally establish that

TMT had a contractual right under the Agreement to relocate the utilities onto Greenway' s

property.    Accordingly, we reverse the trial court' s judgment ordering specific performance in

TMT' s favor.


                                                 II. ATTORNEY FEES


          Greenway requests reasonable           attorney fees      on appeal and at   trial. RAP 18. 1( b).     Where a


contract provides for an award of attorney fees at trial, the prevailing party may seek to recover




5 Here, Greenway assigns error to findings of fact 11 and 15 and to conclusions of law 1 and 2.
However, even if we assume that findings of fact 11 and 15 are supported by substantial evidence,
the totality of the trial court' s findings fail to support its conclusions of law 1 and 2. Accordingly,
we do not address whether substantial evidence supports findings of fact 11 and 15.

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No. 45433 -5 -II



reasonable   attorney fees incurred      on appeal.     First- Citizens Bank & Trust Co. v. Reikow, 177 Wn.


App.    787, 799, 313 P. 3d 1208 ( 2013).            The addendum to the Agreement, which explains the


easement,    specifically   provides   that "[   i] f any arbitration, suit, or action is instituted to interpret or

enforce the provisions of this Agreement, to rescind this Agreement, or otherwise with respect to


the   subject matter   of this Agreement,"       the prevailing party " on an issue" is entitled to " reasonable"

attorney fees. Ex. 2 at 11. As the prevailing party, Greenway is entitled to the reasonable attorney

fees it incurred at trial and in this appeal.


         Accordingly, we reverse the trial court' s orders of specific performance and for attorney

fees in TMT' s favor, hold that Greenway is entitled to reasonable attorney fees under the

Agreement, and remand this case for further proceedings consistent with this opinion.


         A majority of the panel having determined that this opinion will not be printed in the

Washington Appellate Reports, but will be filed for public record in accordance with RCW 2. 06.040,


it is so ordered.




 We concur:




 MAXA




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