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Eagle Point Condominium Owners Association v. Coy9/18/2000
A condominium association obtained judgment against a developer for breach of express and implied warranties under the Condominium Act, RCW ch. 64.34. Although the Association did not prove all of its claims, and refused a pretrial settlement offer greater than the net damages awarded at trial, the trial court did not err in finding the Association to be the prevailing party for purposes of awarding attorney fees under the statute. We affirm the judgment and remand for entry of findings and conclusions explaining the calculation of the fee award.
FACTS
The Eagle Point Condominiums are an eight-unit development on the south shore of Lake Whatcom. Peter Coy was the developer, seller, and declarant. He was also a one-third owner and president of Brixx Design and Development, the contractor that constructed the buildings. Between 1993 and 1994 five of the eight units were sold. The other three units are owned by Coy, who maintains them as rental properties.
The owners of the five units, following occupancy, complained about construction defects. Brixx responded by performing certain repair work under its one and two year warranties. Brixx did not remedy all complaints, and the quality of the repair work did not always satisfy the owners.
Brixx ceased doing business in 1995. Coy and the owners were unable to agree at that time on what should be done to resolve the owners' remaining complaints. The Eagle Point Owners Association, together with several individual unit owners, sued Coy and Brixx in 1996. To document their damages, the Association retained a construction consultant. The consultant identified various problems which he attributed to defects in construction and installation. His report evaluated the total damages at approximately $750,000.
A mediation in November 1998 achieved a release of the Association's claims against Brixx in exchange for a payment of $65,000 to the Association. A four-day bench trial in February, 1999 resulted in a judgment on the claims against Coy under the Washington Condominium Act, RCW ch. 64.34. The court found Coy, as the declarant, liable to the Association for breach of express and implied warranties to the extent of $77,441. Two unit owners received individual judgments against Coy for $1,000 and $3,000.
Coy asked the court to offset the judgment against him by $65,000, the amount of the Brixx settlement. And both sides claimed to be entitled to an award of attorney fees as the prevailing party. At the court's request, the parties provided post-trial briefing on both issues. In findings and conclusions entered on April 28,1999, the court allowed Coy an equitable setoff of $55,000 for the Brixx settlement, for a net damage award to the Association of $22,441. The court found that the Association was the prevailing party in the lawsuit under the Condominium Act, and awarded $25,000 in attorney fees and $176 in statutory costs, for a total judgment of $47,617. Coy appeals the judgment in favor of the Association but not the judgments in favor of the individual owners. The Association cross appeals.
OFFSET
Both parties appeal the court's decision to offset the amount of the judgment by $55,000. The Association contends the offset was too large while Coy contends the court should have given him credit for the entire $65,000 Brixx paid in settlement. We review a trial court's decision to grant an offset for abuse of discretion. See Robinson v. McReynolds, 52 Wn. App. 635, 640, 762 P. 2d 1166 (1988). A court abuses its discretion if its decision is not based on tenable grounds or tenable reasons. Layne v. Hyde, 54 Wn. App. 125, 135, 773 P.2d 83 (1993).
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