Summary of February 2017 Supreme Court Decisions

Appellate decisions within two weeks of 2/28/17:

Washington State Supreme Court Decisions:

  • In re Marriage of Zandi, 92296-9 (unanimous opinion)- Court held that out-of-network expenses are uninsured medical expenses and must be paid according to the parties’ child support order.
  • “The legislature defines ‘” [u]ninsured medical expenses”‘ as costs “not covered” by insurance. RCW 26.18.170(18)(d). WAC 388-14A-1020 clarifies that this includes costs “not paid” by insurance, even if those costs would be covered under other circumstances. Because the health care expenses in this case are unambiguously within the scope of RCW 26.18.170(18)(d), financial responsibility is allocated by the 2009 order and may not be modified absent evidence of changed circumstances or other evidence consistent with the requirements of RCW 26.09.170(6)-(7).”

    • In this case, it didn’t matter that the father had requested the mother get pre-approval from the insurance company, the mother thought that the issue was urgent enough to require immediate attention. Nothing in the record indicated that the mother acted in bad faith (she did request pre-approval and was assured by hospital staff it would be approved). The court said that to look at the fact that the father did not have a say in the incurrence of the out-of-network expense, “incorrectly introduces concepts of marital fault into the enforcement of a child support order.”
  •  Estate of Ackerley v. Dep’t of Revenue, 92791-0 , (5-4 opinion, Madison authored majority, Wiggins authored the dissent). This is a case concerning the Estate and Transfer Tax Act, chapter 83.100 RCW. There is something called the “gross-up rule” wherein the federal government assesses estate taxes on gift taxes paid within three years of death. The question was whether they also needed to be included as a part of the Washington taxable estate (this would result in more taxes being owed to the state). The majority said yes. The court held:
    • “Following the legislature’s clear mandate, we must also find that the gift tax paid is part of the Washington taxable estate and transferred upon death as part of the entire estate. Thus, the Washington State Department of Revenue (DOR) properly included the gift tax paid in its assessment of Barry Ackerley’s estate.”

    • The focus of the majority is on the concept of “transfer.”
    • The dissent argued that, “[w]here no transfer exists, Washington’s Constitution prohibits the imposition of an excise tax.” In this case, the federal gift taxes were fully and finally paid during life, so no transfer of gift occurred at death. This would mean exclusion of the gift tax from Washington’s estate tax. This focus of the dissent is on the concept of “direct tax:”
    • “Because the estate tax is imposed on a “transfer of property,” it is an excise tax, not a direct tax. And because the tax is not a direct tax, it is not subject to the uniformity requirement of the Washington Constitution.”

 

  • In re Disciplinary Proceeding Against Conteh, 201,448-8  (unanimous opinion – Madsen author). This case involves the suspension of an attorney and whether the Disciplinary Board should have reviewed the case on its own, even when the attorney did not appeal the suspension. The disciplined attorney appealed the decision of the Disciplinary Board not to review the suspension. The court noted that the attorney did not identify any specific assignments of error or any findings he disagreed with. Since unchallenged facts are assumed to be true on appeal, the attorney had no basis for his appeal.

 

  • Lundgren v. Upper Skagit Indian Tribe, 91622-5 (5-4 opinion – Johnson authored majority, Stephens authored dissent). This case involves a property dispute involving land that was purchased by a tribe and where there had been a long-term fence that was inconsistent with documented boundary lines.
    • Majority Opinion: There were issues of sovereign immunity because of the tribal ownership of the land. The issue involved In Rem jurisdiction and the right of Washington Courts to decide actions regarding property. The majority discussed CR 19 and whether the tribe was a necessary party and determined because the Lundgren’s obtained possession long before the Tribe acquired the disputed property, the Tribe was not a necessary party and therefore there was no concern regarding sovereign immunity. The majority also noted that there would be no other remedy without suit in Washington Superior Court.
    • Dissent: The dissent’s argument is captured succinctly with this quote:

      “While the existence of in rem jurisdiction gives a court authority to quiet title to real property without obtaining personal jurisdiction over affected parties, Civil Rule (CR) 19 counsels against exercising this authority in the face of a valid assertion of sovereign immunity. Proceeding without regard to the Tribe’s defense, the majority gives “insufficient weight” to the sovereign status of the Tribe and erroneously “reach[es] and discount[s] the merits of [the Tribe’s] claims.”

 

  • Peralta v. State, 92675-1  (Unanimous Opinion – Wiggins author). This case involved an admission during pretrial discovery (discovery is where both sides ask questions and provide documents relevant to the case). There is a part of discovery where you can be asked to admit or deny certain facts. This case involved an issue where a woman was hit while walking while intoxicated. She admitted in discovery that she was intoxicated and didn’t attempt to qualify it, like she had a drink, but didn’t think she was impaired. The trial court allowed the admission and required her to be bound by it, including it in a jury instruction. The jury found that Peralta’s intoxication was more than 50% of the reason why Peralta was hit. The Supreme Court upheld the trial court’s decision because the intoxication defense statute provides a complete defense to an action for personal injury when the person injured “was under the influence of intoxicating liquor” at the time of the injury.
  • State v. Arlene’s Flowers, Inc., 91615-2 (Unanimous Opinion –  McCloud author). This case involved the violation of the Washington Law Against Discrimination (WLAD) and the Consumer Protection Act (CPA) by a florist seeking to deny services for a same-sex wedding. I hope to blog about this case in more detail soon, but in the meantime, here are the basics.
    •  The court upheld the WLAD and the CPA and rejected the attempt to create an exception based on religious belief. The court held that the refusal to provide flowers was discrimination based on sexual orientation, rejecting the argument that it was marital status discrimination (and therefor permissible).
      • The florist attempted to argue (1) that it was marital status discrimination, not sexual orientation discrimination (and therefore okay for her to refuse services), (2) the WLAD already an express exemption to RCW 49.60.215 for “religious organization[s]” that object to providing public accommodations for same-sex weddings, thus the attempt to argue that WLAD didn’t cover marriages in secular public accommodations failed. The court also rejected the argument that the WLAD requires a balancing test between the rights of the protected class members (i.e., the public using the accommodation) and the business providing the service and the religious beliefs possibly held by the owner of the company.
      • The court also rejected the claim that the WLAD violated her right to Free Speech or Religious Exercise. The court held that the “WLAD is a neutral, generally applicable law subject to rational basis review.  And the WLAD clearly meets that standard: it is rationally related to the government’s legitimate interest in ensuring equal access to public accommodations.” (Citations omitted)

      • The court also noted that the WLAD withstands strict scrutiny review – rejecting the florist’s argument that the couple suffered no real harm:
        • We emphatically reject [the argument the couple suffered no real harm.] We agree with Ingersoll and Freed that “[t]his case is no more about access to flowers than civil rights cases in the 1960s were about access to sandwiches.” Br. of Resp’ts Ingersoll and Freed at 32. As every other court to address the question has concluded, public accommodations laws do not simply guarantee access to goods or services. Instead, they serve a broader societal purpose: eradicating barriers to the equal treatment of all citizens in the commercial marketplace. Were we to carve out a patchwork of exceptions for ostensibly justified discrimination, that purpose would be fatally undermined.

      • Finding that Supreme Court has never held that a commercial enterprise, open to the general public, is an ‘”expressive association'” for purposes of First Amendment protections, the court rejected the florist’s Free Association claim.

Washington State Supreme Court – Estate Case

The Washington State Supreme Court released an opinion in an Estate case:

In re Estate of Jepsen, Docket No. 90874-5; Opinion Author – Yu; joined by Madsen, Fairhurse, Wiggns, Gonzalez; Dissent Author – Stephens, joined by Johnson, Owens, and McCloud. Attorney for Petitioners  –  Susan L. Caulkins and Ingrid Linnea Daun Mcleod of Davies Pearson, P.C.; Counsel for Respondent – Robert P. Dickson, Dickson Law Group, P.S.

Basics of Decision: While this case concerned an estate dispute the appellate issue was a procedural issue. The question was whether the there was timely personal service of the will contest petition on the estate’s personal representative. Person service was not served on the personal representative and the State Supreme Court majority found that the case was never fully commenced and should have been dismissed.

Basic Facts: Jespen wrote her will on 7/1/09 and died on 11/16/11. On 12/20/11 her will was admitted to probate and appointed Julie Miles as PR with nonintervention powers. On 3/22/12 Jespsen’s adult son Mack filed a petition to contest the validity of the will. Mack’s attorney e-mailed the petition to the PR’s attorney the same day it was filed. Nothing in the record showed that the PR affirmatively agreed to accept e-mail service on her attorney in lieu of personal service on the PR. On 4/27/12, the PR filed a response denying its substantive allegations but not raising any affirmative defenses (i.e., did not at this time raise the issue of lack of service).

On 10/31/12, the PR filed a motion to dismiss Mack’s petition because it was not personally served within 90 days of filing. The trial court initally granted but then reversed itself on reconsideration holding that service under 11.24.010 went solely to personal jurisdiction and that the objection had been waived. The PR appealed and the Court of Appeals affirmed the trial court and it was appealed to the State Supreme Court.

The Majority

The court identified two issues: (A) Did the Court of Appeals correctly hold that the PR waived any objection to Mack’s failure to comply with RCW 11.24.010? and (b) Is either party entitled to attorney fees and costs on appeal? The court’s simple answer was that RCW 11.24.010 is clear that personal service is required in order to commence a will contest, but to express its disapproval of PR’s delay in raising the issue, the court denied the parties’ request for attorney fees and costs on appeal.

The son’s argument around the plain language of the statute was to argue that personal service was only required to gain personal jurisdiction over the PR and that the PR waived any objection on that basis under CR 12(h)(1) (waiver of a defense of lack of jurisdiction over the person, improper venue, insufficiency of process, or insufficiency of service is waived if it is neither made by motion under the rule nor included in a responsive pleading).

The court’s response to this argument is there is a difference between notice of and the commencement of a will contest. Washington Courts have always strictly enforced the requirements for commencing a will contest action and their holding adhering to the language of the RCW requiring personal service in order to commence a will contest action is consistent with the history of strictly enforcing the requirements. The court also adds a footnote 7 that says that the PR’s response was superfluous and that an automatic waiver under CR 12(h)(i) is inconsistent with the plain language of RCW 11.24.010 and so would not have been applied anyway.

The son also made an argument that RCW 11.24.010 would conflict with CONST. art. IV, § 6 and divest the superior courts of their constitutional jurisdiction over “all matters probate.” The majority disagreed with this argument stating that the legislature may prescribe reasonable regulations without divesting the court of its jurisdiction and that RCW 11.24.010 does just that.

The Dissent

The dissent frames the case as a dispute concerning whether the statutory personal service requirement speaks to the superior court’s subject matter jurisdiction over will contest proceedings or to personal jurisdiction over the PR. For the dissent, this distinction is crucial as subject matter jurisdiction can be raised at any time, but personal jurisdiction  can be waived. The dissent feels that the case involves personal jurisdiction and the defense of lack of personal service was waived.

The dissent also acknowledged that there is a significant amount of confusion in the difference of personal jurisdiction and subject matter jurisdiction and that they disagree with the majority in this case regarding what is at issue here (which speaks volumes about how profound this confusion is since it was a 5-4 decision, so the confusion still abounds).