Opinion
No. 64806-3-I.
Filed: January 31, 2011.
Appeal from a judgment of the Superior Court for Skagit County, No. 09-2-01013-0, Susan K. Cook, J., entered December 14, 2009.
Affirmed by unpublished opinion per Dwyer, C.J., concurred in by Appelwick and Lau, JJ.
Zeco Development Group, Inc. entered into an agreement with Coldwell Banker American Tradition, Inc. pursuant to which the statute of limitations was tolled as to particular claims brought by Zeco against Coldwell Banker. Zeco thereafter filed this lawsuit against Coldwell Banker, believing it to be covered by the terms of the parties' agreement. Finding that the agreement did not toll the limitation period as to the claims raised herein, we affirm the trial court's dismissal of Zeco's action.
I
In early 2004, Carl Loeb, the owner of Summersun Greenhouse Corporation, informed Ron Halterman, a real estate agent with Coldwell Banker, that he intended to sell several parcels of land in Skagit County. Loeb owned several contiguous parcels on College Way, including a parcel containing a retail nursery (the retail parcel) and four parcels that were leased to Color Spot Nurseries, Inc. (the Color Spot parcels). Loeb intended to sell only the Color Spot parcels, but Halterman believed that all five parcels were for sale.
Halterman marketed the Summersun property to other agents at Coldwell Banker. Terri Heynsten, a real estate agent in the same office, informed Corey Zembruski, the owner of Zeco Development, Inc., that the property was available. Heynsten prepared an offer for Zeco to purchase the property. Because she understood that all five parcels were for sale, she included the retail parcel in the offer. After receiving Zeco's offer, Loeb counteroffered. Zeco executed the counteroffer that same day.
The parties soon discovered that a misunderstanding had occurred regarding what property was included in the sale. Loeb contended that only the Color Spot parcels were for sale, while Zeco maintained that all five parcels were included in the purchase and sale agreement. Due to this misunderstanding, Loeb sued Zeco for a declaratory judgment that no agreement had been reached. Zeco counterclaimed for specific performance of the purchase and sale agreement.
In March 2007, Zeco filed a separate lawsuit against Terri Heynsten, Dee Donaldson, and Coldwell Banker (the real estate defendants), alleging that Heynsten and Donaldson were "negligent in failing to adequately prepare and complete legal documents affecting the rights of Zeco Development and in giving advice on legal matters." Clerk's Papers (CP) at 41. Halterman was not named as a defendant in the complaint. Because both actions arose from the same real estate transaction, they were consolidated in the trial court.
Donaldson was the designated broker at Coldwell Banker during the relevant period. Zeco contended in its complaint that both Halterman and Heynsten "worked under the direction and control of" Donaldson. Clerk Papers at 37.
Prior to trial, Zeco and the real estate defendants entered into a tolling agreement pursuant to which Zeco's claims against the real estate defendants were dismissed. In addition to allowing dismissal of the lawsuit, the tolling agreement reserved to Zeco the right to refile the action against the real estate defendants within a limited period of time following the resolution of the suit between Zeco and Summersun. The tolling agreement provides:
The purpose of this agreement is to allow the lawsuit filed by Zeco Development Group Inc., against Coldwell Banker American Tradition Inc., Dee Donaldson and John Doe Donaldson and Terri Heynsten and John Doe Heynsten, to be dismissed without prejudice reserving to Zeco a limited right to refile the action against Coldwell Banker American Tradition Inc., Dee Donaldson and John Doe Donaldson and Terri Heynsten and John Doe Heynsten, during a limited period of time following the resolution of the suit between Zeco Development Group Inc. and Summersun Greenhouse Corp.
CP at 64. The agreement tolled the statute of limitations with regard to the claims asserted by Zeco in its original complaint against the real estate defendants:
Subject to the terms and conditions of this Agreement, any and all statutes of limitations and contractual limitations periods relating to the claims asserted by Zeco in its first Amended Complaint filed March 14, 2007, shall be suspended or tolled during the effective period of this Agreement, as defined herein.
CP at 64. The agreement "permit[ted] Zeco to reinstate only those causes of action that it was maintaining at the signing of th[e] Agreement." CP at 65.
In February 2009, Zeco and Summersun proceeded to trial. The trial court concluded that Zeco and Summersun had "never formed a binding purchase and sale transaction because . . . there never was a meeting of the minds on the sale of the Retail Parcel." CP at 80.
In May 2009, Zeco filed the current action against Coldwell Banker. Coldwell Banker is the only defendant named in this second complaint, which alleges that Halterman was negligent in "fail[ing] to read correspondence and determine the identity of the property that Loeb intended to sell" and "fail[ing] to present the legal descriptions with Zeco's Offer to Loeb." CP at 11. The complaint further alleges that Coldwell Banker is vicariously liable for Halterman's negligence.
Coldwell Banker moved for summary judgment to dismiss Zeco's complaint, contending that the tolling agreement does not apply to Zeco's current claim, and, thus, the statute of limitations bars the claim. In December 2009, the trial court granted Coldwell Banker's motion and dismissed Zeco's complaint.
Coldwell Banker also contended in its motion for summary judgment that (1) Zeco's claim is barred by collateral estoppel due to findings made by the trial court in the trial between Zeco and Summersun and (2) Halterman owed no duty to Zeco because Halterman was Summersun's, not Zeco's, agent. Because we resolve this case on the issue of whether the tolling agreement applies to Zeco's current claim, we do not reach these other issues.
Zeco appeals.
II
Zeco contends that the parties' tolling agreement applies to its current claim against Coldwell Banker and, thus, that this claim is not barred by the statute of limitations. Because the plain language of the tolling agreement states that the statute of limitations is tolled only as to the specific claims that were dismissed pursuant to the agreement, we disagree.
Following the objective manifestation theory of contracts, we "determine the parties' intent by focusing on the objective manifestations of the agreement." Hearst Commc'ns., Inc. v. Seattle Times Co., 154 Wn.2d 493, 503, 115 P.3d 262 (2005). To determine intent, we "`impute to a person an intention corresponding to the reasonable meaning of his words and acts.'" Santos v. Dean, 96 Wn. App. 849, 854, 982 P.2d 632 (1999) (quoting Hall v. Custom Craft Fixtures, Inc., 87 Wn. App. 1, 9, 937 P.2d 1143 (1997)). Words are given "their ordinary, usual, and popular meaning unless the entirety of the agreement evidences a contrary intent." State v. R.J. Reynolds Tobacco Co., 151 Wn. App. 775, 783, 211 P.3d 448 (2009), review denied, 168 Wn.2d 1026 (2010). Contract interpretation is a question of law that we review de novo. Knipschield v. C-J Recreation, Inc., 74 Wn. App. 212, 215, 872 P.2d 1102 (1994).
Zeco's claim arises out of the real estate transaction that occurred in March 2004. Zeco filed its current complaint in May 2009. Thus, the three-year limitation period applicable to negligence actions, set forth in RCW 4.16.080, bars the current action unless the parties' tolling agreement applies.
The tolling agreement explicitly states that the limitation period "relating to the claims asserted by Zeco in its first Amended Complaint filed March 14, 2007" is tolled during the effective period of the agreement. CP at 64. Moreover, the agreement identifies the lawsuit that is to be dismissed and the action that may be refiled specifically as that "against Coldwell Banker American Tradition Inc., Dee Donaldson and John Doe Donaldson and Terri Heynsten and John Doe Heynsten." CP at 64. Thus, the plain language of the agreement demonstrates that the parties intended to limit Zeco to refiling only the specific complaint that was dismissed pursuant to the agreement. Because the agreement tolled only those claims contained in the first complaint, only those particular claims can be refiled after the limitation period has expired.
By using parallel language in reference to both the dismissal of the previous lawsuit and Zeco's right to refile another lawsuit, the agreement further evidences intent by the parties to allow the refiling only of those particular claims. The agreement states that its purpose is "to allow the lawsuit" filed by Zeco against the real estate defendants to be dismissed. CP at 64 (emphasis added). In parallel language, it states that Zeco retains a limited right "to refile the action" against those same defendants. CP at 64 (emphasis added).
Because the provision regarding dismissal of the action necessarily refers to the specific complaint dismissed, the parallel language regarding Zeco's right to refile the action similarly demonstrates intent to refer to the original complaint.
Moreover, the parties' use of the definite article "the" further indicates their intent to refer to a specific, known cause of action. "The" is "used as a function word to indicate that a following noun . . . refers to someone or something previously mentioned or clearly understood from the context or the situation." Webster's Third New International Dictionary 2368 (1993). The parties' use of this word in the context of "refil[ing] the action" indicates that the parties were referring to the specific action known to them when they entered into the agreement.
Finally, the parties' repeated use in the tolling agreement of the prefix "re" further demonstrates intent to limit Zeco to refiling the specific complaint that it dismissed pursuant to the agreement. The agreement allowed Zeco to " re file the action against [Coldwell Banker, Donaldson, and Heynsten]" and to " re instate only those causes of action that it was maintaining at the signing of [the agreement]." CP 64-65. The prefix "re-" means "again" or "anew." Webster's at 1888. Based on the ordinary meaning of the prefix chosen by the parties, Zeco was permitted only to "file again" the specific action dismissed and to "instate again" only the causes of action that were dismissed.
Zeco contends that the term "cause of action" refers only to the type of action — here, a negligence action — not to the specific factual allegations on which the action is based. In some cases, this is true; in others, it is not. See Black's Law Dictionary 251 (9th ed. 2009) (defining "cause of action" both as "[a] group of operative facts giving rise to one or more bases for suing; a factual situation that entitles one person to obtain a remedy in court from another person" and as "[a] legal theory of a lawsuit"). However, the issue here is not resolved based on the dictionary definition of a term, but rather is determined by the intention of the parties. The language of the agreement demonstrates that the parties intended to permit Zeco to refile only the original complaint against Coldwell Banker, Donaldson, and Heynsten.
Zeco's argument that the tolling agreement applies to this action focuses only on the meaning of Washington's notice pleading rule and the meaning of "cause of action" as used in specific Washington court opinions. Although the notice pleading rule and typical uses of "cause of action" could be useful in determining the parties' intent, resort to such information cannot be made where the plain language of the agreement clearly indicates a different meaning. See R.J. Reynolds, 151 Wn. App. at 783 (explaining that extrinsic evidence may be used in interpreting a contract where it is relevant for determining mutual intent, but may not be used "to show an intention independent of the instrument or to vary, contradict, or modify the written word").
The plain language of the tolling agreement indicates that the parties intended to toll the statute of limitations only as to allegations of the complaint existing when they entered into the tolling agreement. Because Zeco's current complaint is not within the terms of the tolling agreement, it is barred by the statute of limitations. Thus, the trial court properly dismissed Zeco's complaint.
Affirmed.