Andreas Kischel v. Public Storage ( 2019 )

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION ONE
ANDREAS KISCHEL, individually, ) No. 77975-3-I
Appellant, )
v. ) UNPUBLISHED OPINION
PUBLIC STORAGE, )
)
Respondent. ) FILED: June 3, 2019
ScHINDLER, J. — Andreas Kischel filed a Complaint against Public Storage for
declaratory judgment and violation of the Consumer Protection Act (CPA), chapter
19.86 RCW. Kischel appeals summary judgment dismissal of the lawsuit. Kischel
contends the court erred in ruling the Public Storage advertisements were not an unfair
or deceptive act or practice under the CPA and denying his request for a declaratory
judgment. We affirm.
FACTS
On November 2, 2014, Andreas Kischel executed a “Lease/Rental Agreement”
with Public Storage to rent storage space at the Bellevue facility located at 131 05 S.E.
30th Street. The term of the Lease/Rental Agreement was month-to-month ‘until
terminated.” Kischel initialed and acknowledged he “has read” and “understands and
No. 77975-3-1/2
agrees to” a number of provisions in the Lease/Rental Agreement, including limitation of
“Owner’s’ liability:
LIMITATION OF OWNER’S LIABILITY: INDEMNITY. Owner and
Owner’s Agents will have no responsibility to Occupant or to any
other person for any loss, liability, claim, expense, damage to
property or injury to persons (“Loss”) from any cause, including
without limitation, Owner’s and Owner’s Agents[’j active or passive
acts, omissions, negligence or conversion, unless the Loss is
directly caused by Owner’s fraud, willful injury or willful violation of
law. Occupant shall indemnify and hold Owner and Owner’s Agents
harmless from any loss incurred by Owner and Owner’s Agents in
any way arising out of Occupant’s use of the Premises or the
Property including, but not limited to, claims of injury or loss by
Occupant’s visitors or invitees. Occupant agrees that Owner’s and
Owner’s Agents’ total responsibility for any Loss from any cause
whatsoever will not exceed a total of $5,000.[hl
The Lease/Rental Agreement expressly states Public Storage ‘disclaims any
implied or express warranties, guarantees or representations of the . . . safety or
security of the Premises and the Property.”2
NO WARRANTIES: ENTIRE AGREEMENT. Owner hereby disclaims
any implied or express warranties, guarantees, or representations of
the nature, condition, safety or security of the Premises and the
Property and Occupant hereby acknowledges that Occupant has
inspected the Premises and the Property and hereby acknowledges
and agrees that Owner does not represent or guarantee the safety or
security of the Premises or the Property or of any personal property
stored therein, and this LeaselRental Agreement does not create any
contractual obligation for Owner to increase or maintain such safety
or security.[31
After signing the lease on November 2, 2014, Kischel moved personal articles
into the storage unit with the help of his friend Valeriy Sakk. Kischel used a combination
lock to secure entry to the storage unit.
1 Boldface in original.
2 Boldface omitted.
~ Boldface in original.
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No. 77975-3-113
Almost a year later on October 5, 2015, Kischel and Sakk returned to the Public
Storage facility to retrieve the items from the storage unit. The lock on the storage unit
had been replaced with a “Public Storage’ lock. The Lease/Rental Agreement states
that “in the event of suspected criminal activity” or “an emergency,” the Owner’s Agent
has “the right, but not the obligation, to remove Occupant’s locks and enter the
Premises” for purposes of taking such “action as may be necessary and appropriate to
preserve the Premises.”
The Public Storage employee told Kischel he could wait for the district manager
to open the lock to the storage unit or remove the lock in the presence of a Public
Storage employee. Kischel called a friend to remove the lock in the presence of a
Public Storage employee. When Kischel went into the storage unit, he “noticed that
some of my articles had been ransacked and items were missing.” Kischel estimated
the “approximate market value of my stolen articles” was “about $1 500.”
On October 11, 2015, Kischel terminated the Lease/Rental Agreement.
On May 15, 2017, Kischel filed a “Complaint for Declaratory Judgment.” Kischel
sought a declaratory judgment on the obligation of Public Storage, his rights as a user
of a Public Storage facility, and validity of the terms of the Lease/Rental Agreement that
limited the liability of Public Storage. Kischel alleged Public Storage had an obligation
to refund rental fees and should pay “the estimated amount of $1 800” for the stolen
items.
On June 14, Public Storage filed an answer to the complaint. Public Storage
denied the allegations. Public Storage asserted a number of affirmative defenses,
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No. 77975-3-1/4
including the lawsuit did not state a claim upon which relief may be granted and the
express terms of the Lease/Rental Agreement barred the claims.
On November 6, the court granted Kischel’s motion to amend the complaint to
add a cause of action alleging Public Storage violated the Consumer Protection Act
(CPA), chapter 19.86 RCW.
Kischel filed the amended complaint on November 15. The amended complaint
alleged the Public Storage advertisements were unfair and deceptive. Kischel alleged
he “reasonably assumed and relied on defendant’s representation that defendant’s
storage facility was secured from theft and intruders.” Kischel cites Internet
advertisements that state, “‘Public Storage is a respected and trusted operator of self-
storage facilities,’ ““ ‘Our Facilities are clean and well-lit,’ ““ ‘[Y]ou’ll get a personalized
entry code for the electronic security gate,’ and “‘You’ll find property managers at
“
each location who are self-storage experts.’ “ Kischel alleged Public Storage had a duty
to provide notice that “the storage facility was in fact not secure and open to theft.”
The amended complaint attached as an exhibit records produced by the Bellevue
Police Department in response to a Public Records Act, chapter 42.56 RCW, request.
The records reflect 243 reports of “theft or loss of property” in the previous five years at
the seven Public Storage locations in Bellevue, including 31 reports of “theft or loss of
property” in the previous five years at the Public Storage location in Bellevue where
Kischel rented a storage unit.
On November 17, two days after Kischel filed the amended complaint, Public
Storage filed a motion for summary judgment dismissal of the lawsuit. Public Storage
noted the hearing on the motion for summary judgment for December 15.
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No. 77975-3-115
Public Storage argued as a matter of law Kischel was not entitled to a declaratory
judgment and the advertisements did not violate the CPA.
In support of the motion, Public Storage submitted the declaration of regional
manager JC Reed, the Lease/Rental Agreement Kischel signed, and the ledger for
Kischel’s storage unit. Reed described the specific security features at the Bellevue
storage facility in 2014 and 2015, including a daily lock check, individual customer gate
codes for secure access to the facility, a CCTV4 system to monitor access, and an on-
site resident property manager. Reed states Public Storage “cannot and does not
guarantee that a theft may never occur at a Public Storage facility.”
On December 4, Kischel filed a response to the summary judgment motion.
Kischel argued he was entitled to a declaratory judgment and there were disputed
material issues of fact, including “Defendant’s deliberate non-disclosure to Plaintiff of
numerous documented instances of burglary and theft” and whether Public Storage
denied Kischel access to his unit.5 Kischel asserted the Public Storage advertisements
were unfair and deceptive, affecting the public interest. Kischel cites the following
Internet advertisements:
Why We’re Number One
• Over 1 million people trust their things to Public Storage
• Our facilities are clean and well-lit
• You keep the only key to your unit
• We offer climate controlled units
• We give you 7 days a week access
• We offer a wide variety of sizes and features.~6~
~ Closed-circuit television.
~ Emphasis in original; boldface omitted.
6 Boldface omitted.
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No. 77975-3-1/6
Kischel alleged:
[T]he website extolls the virtues of Defendant’s company over others in
the market by claiming that:
“Public Storage is the leading provider of storage units for your
personal, business and vehicle needs with thousands of locations
nationwide.”
“Once you move in, you keep the only key to your self-storage unit,
which you can access on your schedule.”
“On your first day, you’ll get a personalized entry code for the
electronic security gate. You’ll then be free to come and go
anytime during Gate Hours.”
“You’ll find property managers at each location who are self-storage
experts.”~7~
Kischel and Valeriy Sakk filed declarations in opposition to summary judgment.
Sakk stated that on October 5, 2015, Kischel’s combination lock had been replaced with
a Public Storage lock and when Kischel opened the door to the storage unit, “we both
noticed that it was not packed to the limits the way we left it originally one year ago.”
Kischel states he “fully relied on the defendant’s representation that defendant’s
storage facility was secured from theft and intruders.”
Based on advertisement, that people trust Defendant’s expertise, that
Defendant was best storage solution, that Defendant was respected and
had successful history of storage operations, Defendant’s storage facility
had an on-site manager, I had formed an opinion that Defendant’s storage
facility was safe for my storage needs and I fully relied on the defendant’s
representation that defendant’s storage facility was secured from theft and
intruders.
Kischel cites the following representations:
I looked up on [the] [l]nternet and found Public Storage units
advertised in Bellevue, Washington.
Public Storage advertised itself as: “trusted, with expertise, providing
best storage solution, largest self-storage company in the world, long
and successful history, leadership position in the self-storage industry,
~ Emphasis in original; boldface omitted.
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No. 77975-3-1/7
respected and trusted, a member of the S&P~8~ 500 and FT[91 Global
500, Number One, clean and well-lit facilities, customer keeps the only
key to his or her unit, 7 days a week access to storage units, leading
provider of storage units, personalized entry code for electronic
security gate, on-site property managers who are self-storage
experts.”
Kischel states, “I would not have entered into any contract with Public Storage had it
informed me that its storage facility was in fact not secure, readily open to theft and that
it had history of theft and burglary.”
Kischel filed a ‘Notice” to take judicial notice of the Bellevue Police Department
records attached to the amended complaint. In response, Public Storage stipulated:
[Flor the purposes of summary iudgment only, the court can take judicial
notice that:
During a five year period, there were as many as 243 reported
incidents of potential theft and/or burglary occurring at all of Public
Storage’s facilities within Bellevue, WA.~101
However, Public Storage objected to “the court taking notice that any alleged thefts or
burglaries in fact occurred, or the exact facts or circumstances surrounding any alleged
thefts or burglaries.”
The court granted the motion to dismiss the lawsuit on summary judgment. The
court entered an “Order Granting Defendant’s Motion for Summary Judgment.”
The order states that even assuming for purposes of summary judgment that the
reported Public Storage thefts are true, Kischel could not prove a CPA violation. The
court concluded as a matter of law that the Public Storage advertisements were not
unfair or deceptive and did not have the capacity to deceive the public.
The Defendant’s advertising claims, as recounted in the Plaintiff’s
declaration, cannot reasonably be interpreted as being false, or as
8 Standard and Poor’s.
~ Financial Times.
10 Emphasis in original; boldface omitted.
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No. 77975-3-1/8
justifying consumers in concluding that there have been no thefts at the
Defendant’s storage facility. The Plaintiff’s assertions do not justify an
inference that the Defendant has undertaken to guarantee the security of
its storage facility.
The court concluded Kischel was not entitled to a declaratory judgment because
the Lease/Rental Agreement ‘is no longer in effect.”
The court agrees with the Defendant that it would be inappropriate
for the court to make a declaratory ruling with respect to this claim. The
parties’ Lease/Rental Agreement is no longer in effect, and so there is no
reason to bring a claim with respect to that contract pursuant to the
Declaratory Judgments Act, Chap[ter] 7.24 RCW.
The court concluded that “to the extent that the Plaintiff believes that the Defendant has
caused the Plaintiff to sustain monetary harm based on the chronology of the
Lease/Rental Agreement, the Plaintiff’s proper remedy is to bring a claim for damages.”
ANALYSIS
Consumer Protection Act
Preliminarily, Kischel contends the court erred by denying his motion to deem the
CPA allegations in the amended complaint admissions under CR 8(d).
For the first time at the summary judgment hearing on December 15, Kischel
argued that because Public Storage did not file an answer to the amended complaint,
the CPA allegations should be deemed admitted under the civil rules. Public Storage
argued, “[T]here is no pending motion before the court.” Public Storage asserted
Kischel filed the amended complaint on November 15 and it had 10 days to file an
answer to the amended complaint, but instead filed a motion for summary judgment
dismissal. Public Storage argued the summary judgment motion explicitly denied the
CPA allegation.
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No. 77975-3-1/9
The court ruled, “I agree with defense . . , but that is not an issue before me.”
We decline to consider an argument that the party did not properly raise below. Hikel v.
City of Lynnwood, 197 Wash. App. 366, 378, 389 P.3d 677 (2016). We also note the
record establishes Kischel did not comply with the notice requirements of the Civil
Rules, resulting in no time for Public Storage to prepare for the motion or submit case
authority. See Goucherv. J.R. SimplotCo., 104 Wash. 2d 662, 665, 709 P.2d 774 (1985).
Kischel contends the court erred in concluding the Public Storage advertisements
are not unfair and deceptive in violation of the CPA.
We review summary judgment de novo. Hearst Commc’ns, Inc. v. Seattle Times
Co., 154 Wash. 2d 493, 501, 115 P.3d 262 (2005). Summary judgment is appropriate
when there is no genuine issue of material fact and the moving party is entitled to
judgment as a matter of law. CR 56(c).
To prevail on the CPA claim, Kischel must establish each of the following
elements: “(1) [U]nfair or deceptive act or practice; (2) occurring in trade or commerce;
(3) public interest impact; (4) injury to plaintiff in his or her business or property; [and]
(5) causation.” Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105
Wash. 2d 778, 780, 719 P.2d 531 (1986); Guiiosa v. Wal-Mart Stores, Inc., 144 Wash. 2d
907, 917, 32 P.3d 250 (2001). The failure to establish any of the elements is fatal to a
CPA claim. Hangman Ridge, 105 Wash. 2d at 793.
Kischel argues the failure of Public Storage to disclose instances of burglary or
theft is an unfair or deceptive practice under the CPA.
The CPA prohibits “[u]nfair methods of competition and unfair or deceptive acts
or practices in the conduct of any trade or commerce.” RCW 19.86.020. A party can
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No. 77975-3-1/10
establish an unfair or deceptive act in one of three ways: (1) Per se unfair or deceptive
conduct, KIem v. Washington Mutual Bank, 176 Wash. 2d 771, 785, 295 P.3d 1179 (2013);
(2) an act that has the capacity to deceive a substantial portion of the public, Hangman
Ridge, 105 Wash. 2d at 785-86; Behnke v. Ahrens, 172 Wash. App. 281, 290, 294 P.3d 729
(2012); or (3) an unfair or deceptive act or practice not regulated by statute but in
violation of the public interest, Klem, 176 Wash. 2d at 787; Panag v. Farmers Insurance
Co. of Washington, 166 Wash. 2d 27, 37 n.3, 204 P.3d 885 (2009). A plaintiff does not
need to show that the act intended to deceive, “only that it had the capacity to deceive a
substantial portion of the public.” Panag, 166 Wash. 2d at 47. “Deception exists ‘if there is
a representation, omission or practice that is likely to mislead’ a reasonable consumer.”
Panag, 166 Wash. 2d at 50 (quoting Sw. Sunsites, Inc. v. Fed. Trade Comm’n, 785 F.2d
1431, 1435 (9th Cir. 1986)); Rush v. Blackburn, 190 Wash. App. 945, 963, 361 P.3d 217
(2015).
The CPA does not define “deceptive,” but “the implicit understanding is that ‘the
actor misrepresented something of material importance.’ “ State v. Kaiser, 161 Wn.
App. 705, 719, 254 P.3d 850 (2011)11 (quoting Hinerv. Bridgestone/Firestone, Inc., 91
Wash. App. 722, 730, 959 P.2d 1158 (1998), rev’d in part on other grounds, 138 Wash. 2d
248, 978 P.2d 505 (1999)). We measure a deceptive act or practice by “the ‘net
impression’ “on a reasonable consumer. Panag, 166 Wash. 2d at 50 (quoting Fed. Trade
Comm’n v. Cyberspace.com LLC, 453 F.3d 1196, 1200 (9th Cir. 2006)).
Where, as here, there is no factual dispute about the content of the
advertisements, whether the advertisements constitute “an unfair or deceptive act” is a
11 Emphasis in original.
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No. 77975-3-1/1 1
question of law we decide de novo. Leingang v. Pierce County Med. Bureau, Inc., 131
Wash. 2d 133, 150, 930 P.2d 288 (1997); Panag, 166 Wash. 2d at 47.
Kischel asserts the advertisements misrepresent the safety and security of the
Public Storage facility by failing to disclose thefts or burglaries that have occurred.
Kischel claims the Public Storage advertisements led him to believe the storage facility
was absolutely secure from theft. Kischel cites the statements in the advertisements
that Public Storage” ‘provide[s] the best storage solution’ “and is “‘respected and
trusted.’ “ Neither of these statements is misleading or deceptive. Kischel also cites
statements in the advertisements that he claims could lead a consumer to believe
Public Storage provides a secure storage facility protected from theft:
-Daily Lock Check Completed by Property or Relief Manager
-Individual Customer Gate Code Providing Secure Access to the Facility
-CCTV System to Monitor Access
-On-Site Resident property Manager.
But unlike in Eifler v. Shurgard Capital Management Corp., 71 Wash. App. 684,
696-97, 861 P.2d 1071 (1993), the uncontroverted testimony of JC Reed establishes
that the statements in the Public Storage advertisements are accurate. We also note
the Lease/Rental Agreement unequivocally states:
Owner does not represent or guarantee the safety or security of the
Premises or the Property or of any personal property stored therein,
and this Lease/Rental Agreement does not create any contractual
obligation for Owner to increase or maintain such safety or
security.[12]
We conclude the Public Storage advertisements do not constitute an unfair or
deceptive act or practice in violation of the CPA.
12 Boldface in original.
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Reciuest for Declaratory Judgment
Kischel contends the court erred in dismissing his declaratory judgment action.
In the “First Cause of Action—Declaratory Judgment,” Kischel asserts, “Ajusticiable
controversy exists between Plaintiff and Defendant regarding Public Storage obligation
to Plaintiff with relation to assuring secure storage facility as represented and advertised
to Plaintiff.” The “Second Cause of Action—Declaratory Judgment,” states, “A
justiciable controversy exists between Plaintiff and Defendant as to Plaintiff’s rights as a
user of PUBLIC STORAGE facility and plaintiff’s reliance that such facility would allow
plaintiff [a] secure and theft-free storage unit.” The “Third Cause of Action—Declaratory
Judgment,” states, “A justiciable controversy exists between Plaintiff and Defendant
regarding Public Storage obligation to allow Plaintiff immediate access to his storage
unit, replacing plaintiff’s lock and interference with plaintiff’s access to his unit.” The
“Fourth Cause of Action—Declaratory Judgment,” states:
A justiciable controversy exists between Plaintiff and Defendant regarding
Public Storage’s liability to Plaintiff based on defendant’s failure to
disclose, properly inform and/or notify plaintiff that [the] Public Storage
facility was in fact un-secure to theft, so that Plaintiff could make [an]
informed decision whether to use such defendant’s un-secure storage
facility.
And the “Fifth Cause of Action—Declaratory Judgment,” states:
A justiciable controversy exists between Plaintiff and Defendant with
relation to validity of the Lease/Rental Agreement, Section 7.
LIMITATION OF OWNER’S LIABILITY; INDEMNITY CLAUSE. Plaintiff
requests this court to make [a] determination of validity of such clause per
RCW4.24.115.[13]
13 ROW 4.24.115 addresses the “[v]alidity of agreement to indemnify against liability for
negligence relative to construction, alteration, improvement, etc., of structure or improvement attached to
real estate or relative to a motor carrier transportation contract.”
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No. 77975-3-1113
Kischel contends he was entitled to a declaratory judgment under the Uniform
Declaratory Judgments Act (UDJA), chapter 7.24 ROW. We review a trial court’s
decision on a request for a declaratory judgment for abuse of discretion. Nollette v.
Christianson, 115 Wash. 2d 594, 600, 800 P.2d 359 (1990). A court abuses its discretion
when it bases the decision on untenable grounds, for untenable reasons, or the decision
is manifestly unreasonable. Mayer v. Sto Indus., Inc., 156 Wash. 2d 677, 684, 132 P.3d
115 (2006).
Under the UDJA, the court has the power to “declare rights, status and other
legal relations.” ROW 7.24.010. The UDJA provides, in pertinent part:
A person whose rights, status or other legal relations are affected by a
. . .
statute, may have determined any question of construction or validity
. . .
arising under the statute and obtain a declaration of rights, status
. . . . .
or other legal relations thereunder.
ROW 7.24.020.
The court did not abuse its discretion in concluding Kischel was not entitled to a
declaratory judgment because there was no justiciable controversy. In Diversified
Industries Development Corp. v. Ripley, 82 Wash. 2d 811, 814-15, 514 P.2d 137 (1973)14
the Washington Supreme Court held that in order to obtain a declaratory judgment
under the UDJA, there must be a justiciable controversy:
This court, in applying the [UDJA], has, in the absence of the
intrusion of issues of broad overriding public import, steadfastly adhered to
the virtually universal rule that, before the jurisdiction of a court may be
invoked under the act, there must be a justiciable controversy.
The court defined a ‘justiciable controversy” as follows:
(1) [Am actual, present and existing dispute, or the mature seeds of
. . .
one, as distinguished from a possible, dormant, hypothetical, speculative,
14 Footnote omitted.
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No. 77975-3-1/14
or moot disagreement, (2) between parties having genuine and opposing
interests, (3) which involves interests that must be direct and substantial,
rather than potential, theoretical, abstract or academic, and (4) a judicial
determination of which will be final and conclusive.
Diversified Indus., 82 Wash. 2d at 815.
Inherent in these four requirements are the traditional limiting doctrines of
standing, mootness, and ripeness, as well as the federal case-or-
controversy requirement. In sum, the four justiciability factors must
‘coalesce” to ensure that the court will be rendering a final judgment on an
actual dispute between opposing parties with a genuine stake in the
resolution.
To-Ro Trade Shows v. Collins, 144 Wash. 2d 403, 411, 27 P.3d 1149 (2001)15 (quoting
Diversified Indus., 82 Wash. 2d at 815).
Because the court dismissed the CPA claim as a matter of law, the court did not
abuse its discretion in concluding there was no justiciable controversy. The court also
concluded the undisputed record shows Kischel terminated the Lease/Rental
Agreement approximately 19 months before he filed the Complaint for Declaratory
Judgment. However, “to the extent that the Plaintiff believes that the Defendant has
caused the Plaintiff to sustain monetary harm based on the chronology of the
Lease/Rental Agreement, the Plaintiff’s proper remedy is to bring a claim for damages.”
Kischel cites CR 57 to argue the existence of another adequate remedy does not
preclude a declaratory judgment. CR 57 states, “The existence of another adequate
remedy does not preclude a judgment for declaratory relief in cases where it is
appropriate.” ~ Ronken v. Bd. of County Comm’rs of Snohomish County, 89 Wash. 2d
304, 310, 572 P.2d 1(1977). But as noted, because the court dismissed the CPA claim
and Kischel terminated the Lease/Rental Agreement, declaratory relief was not
15 Footnote omitted.
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No. 77975-3-1/15
appropriate. The court did not abuse its discretion in dismissing the request for a
declaratory judgment.
We affirm summary judgment dismissal of the amended complaint.
WE CONCUR:
~Z~1h197~
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