Alex Ravikovich v. V-squared, Llc ( 2014 )

IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON
ALEX RAVIKOVICH, No. 69612-2-1
Appellant, DIVISION ONE
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ROBERT LONG and JANE DOE TP "."--
LONG, and their marital community UNPUBLISHED OPINION
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composed thereof,
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Defendants,
V-SQUARED, LLC, a Washington
Limited Liability Company,
Respondent. FILED: March 17, 2014
Schindler, J. —Alex Ravikovich appeals summary judgment dismissal of his
lawsuit against V-Squared LLC for violation ofthe Consumer Protection Act, chapter
19.86 RCW. Because the same facts and issues were previously litigated in a binding
mandatory arbitration, we affirm.
FACTS
On April 28, 2006, Alex Ravikovich entered into a contract with V-Squared LLC to
construct a single family residence in Bellevue, Washington. The contract contained a
mandatory arbitration provision. Ravikovich provided V-Squared with site plans he had
obtained from a previous contractor.
No. 69612-2-1/2
At some point after construction began, V-Squared discovered the site plans
depicted elevations which differed from actual elevations by more than six feet.
Consequently, the slope of the driveway exceeded the maximum allowed by the city of
Bellevue. Redesign options for the driveway were greatly limited by the site's
topography. In an effortto address this problem, V-Squared asked the adjacent
property owner Robert Long for permission to construct retaining walls on his property
to laterally support construction of a redesigned driveway on Ravikovich's property.
In late July or early August 2006, Long orally agreed that V-Squared could
construct retaining walls on his property on the condition that certain landscaping and
other improvements were completed, and that Long and Ravikovich execute and record
an easement agreement. V-Squared constructed the driveway and retaining walls.
Long asserted that the conditions had not been met and refused to sign a
proposed easement agreement. As a result ofthis and other problems, Ravikovich
disputed the amount owed for the construction project. V-Squared filed a lien
foreclosure and breach of contract complaint against Ravikovich.
On August 16, 2007, Ravikovich and V-Squared submitted their dispute to the
American Arbitration Association. V-Squared asserted claims for "unpaid charges for
workmanship and materials." Ravikovich asserted claims against V-Squared for "filing
excessive lien under RCW 60.04.081, and for excessive demand for payment, failure to
obtain proper permits, failure to obtain proper approval ofchange orders, failure to
obtain and/or follow site engineering plans and reports, failure to inform homeowner of
site problems."
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On July 2, 2008, the arbitrator issued a decision. The arbitrator found that "[bjoth
parties contributed not only to the creation of some of the problems but also to the
difficulty of resolving them because of their departure from the requirement for clear
written documents." The arbitrator awarded damages plus attorney fees and costs for a
total judgment of $159,353.10 to V-Squared. The superior court denied Ravikovich's
motion to vacate the award and entered a judgment against Ravikovich.
On July 11, 2008, Long filed a lawsuit against Ravikovich alleging trespass,
breach of agreement, damages, and ejectment. On June 18, 2010, the court dismissed
the Long lawsuit without prejudice for failure to prosecute.
On June 6, 2011, Ravikovich filed a lawsuit against V-Squared alleging violation
of the Consumer Protection Act (CPA), chapter 19.86 RCW, and unfair or deceptive
acts or practices. V-Squared filed a motion for summary judgment arguing Ravikovich's
claims were barred by collateral estoppel, res judicata, and the statute of limitations.
The trial court granted summary judgment dismissal. The court ruled that the claims
were barred by collateral estoppel based on the issues decided in the prior arbitration.
Ravikovich appeals.
ANALYSIS
Ravikovich contends the court erred in dismissing his lawsuit on summary
judgment and ruling collateral estoppel barred his CPA claims.1
" 'The standard of review of an order of summary judgment is de novo, and the
appellate court performs the same inquiry as the trial court.'" Smith v. Safeco Ins. Co.,
150 Wash. 2d 478, 483, 78 P.3d 1274 (2003) (quoting Jones v. Allstate Ins. Co., 146
Wash. 2d 291, 300, 45 P.3d 1068 (2002)). Summary judgment is proper if the pleadings,
1Ravikovich's arguments on appeal are directed specifically to the CPA claims.
3
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affidavits, depositions, and admissions on file demonstrate that there are no genuine
issues of material fact, and that the moving party is entitled to judgment as a matter of
law. CR 56(c).
"Under the doctrine of collateral estoppel, once 'an issue of ultimate fact has ...
been determined by a valid and final judgment, that issue cannot be relitigated between
the same parties in any future lawsuit.'" Lopez-Vasquez v. Dep't of Labor & Indus.. 168
Wash. App. 341, 345, 276 P.3d 354 (2012)2 (quoting State v. Williams. 132 Wash. 2d 248,
253-54, 937 P.2d 1052 (1997)). "The purpose of the doctrine is to promote the policy of
ending disputes." Nielson v. Spanawav Gen. Med. Clinic. Inc.. 135 Wash. 2d 255, 262,
956 P.2d 312 (1998). Reninqer v. Department of Corrections. 134 Wash. 2d 437, 449, 951
P.2d 782 (1998), identified the elements of collateral estoppel as follows:
(1) identical issues; (2) a final judgment on the merits; (3) the party against
whom the plea is asserted must have been a party to or in privity with a
party to the prior adjudication; and (4) application of the doctrine must not
work an injustice on the party against whom the doctrine is to be applied.
Ravikovich argues the issues are not identical because the contract claims
adjudicated in the arbitration and the CPA claims advanced in the current lawsuit are
distinct legal theories with different elements and remedies. Ravikovich's argument
conflates collateral estoppel with res judicata. The doctrine of collateral estoppel differs
from res judicata. Instead of preventing a second assertion of the same claim or cause
of action, collateral estoppel prevents relitigation of issues between the parties even
though a different claim or cause of action is asserted. Seattle-First Nat'l Bank v.
Kawachi. 91 Wash. 2d 223, 225-26, 588 P.2d 725 (1978). Accordingly, while the contract
and CPA claims have differing elements, that has no bearing on the collateral estoppel
(Alteration in original.)
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analysis. Collateral estoppel prevents relitigation of ultimate facts and issues regardless
of the specific cause of action.
Ravikovich claims V-Squared failed to meet its burden of showing "that the fact
determined in the first action is essential, and not merely collateral or incidental, to the
right asserted in the second." Beagles v. Seattle-First Nat'l Bank. 25 Wash. App. 925,
930, 610 P.2d 962 (1980). Although the arbitrator did not specifically rule on
encroachment and trespass, in order to resolve the dispute regarding the amount owed
for construction of the residence, the arbitrator had to address the responsibility of the
parties regarding easements. Ravikovich argued to the arbitrator that V-Squared failed
"to request from owner or obtain easements from adjacent owners prior to grading for
driveway." The arbitrator specifically ruled that "[t]he easement and short plat problems
relate to title difficulties which are the responsibility of the Owner, not the Contractor.
There is no requirement in the contract for the Contractor to apply for easements."
Under the CPA, "[ujnfair methods of competition and unfair or deceptive acts or
practices in the conduct of any trade or commerce are . . . unlawful." RCW 19.86.020.
Ravikovich's complaint thatV-Squared's actions and omissions in failing to obtain a
proper easement is the crux of his CPA claims:
3.9. V-Squared LLC omitted, misrepresented and/or concealed
material fact from Mr. Ravikovich that necessary easement registration
and recording with King County was [a] necessary requirement to begin
construction work.
On appeal, Ravikovich characterizes the issue in the current lawsuit as "whether
V-Squared, LLC, violated [the] Consumer Protection Act by building Ravikovich's house
so that it intruded on the Long's property and required removal or reconstruction to
correct the problem." Ravikovich also claims Long's lawsuit against Ravikovich is a
No. 69612-2-1/6
"different factual issue" that was not present or litigated during the arbitration. However,
the record shows that Ravikovich was well aware of problems concerning the placement
ofthe driveway prior to the arbitration.3 Because the essential factual basis ofthe CPA
claim was resolved against Ravikovich in the prior arbitration, the court did not err in
concluding that Ravikovich's CPA claims were barred by collateral estoppel.
Ravikovich next argues that the decision of the arbitrator is not a final judgment
for purposes of collateral estoppel. We disagree. In Neff v. Allstate Insurance Co.. 70
Wash. App. 796, 799-800, 855 P.2d 1223 (1993), we held that an arbitration decision is a
prior adjudication for purposes of collateral estoppel.
Similarly, Ravikovich's argument that the trial court lacked a proper record to
apply collateral estoppel because it did not have a copy of V-Squared's original
complaint for breach of contract against Ravikovich lacks merit. Ravikovich has not
explained why the original complaint was necessary for the trial court to determine
whether issues adjudicated in the arbitration precluded his CPA claims.
Both parties seek attorney fees and costs on appeal based on the contract. The
contract between Ravikovich and V-Squared provides that "[i]n the event of any
arbitration or litigation relating to the project, project performance or this contract, the
prevailing party shall be entitled to reasonable attorney fees, costs and expenses." "We
may award attorney fees under RAP 18.1(a) if applicable law grants to a party the right
to recover reasonable attorney fees and if the party requests the fees as prescribed by
RAP 18.1." Wachovia SBA Lending. Inc. v. Kraft. 165 Wash. 2d 481, 493, 200 P.3d 683
3Ravikovich also argues that in April 2006, V-Squared's president Vadim Tsemekhman
misrepresented thathe had a license. But the arbitrator ruled that "[b]ecause there are no documents
reflecting what was said, not a contemporaneous memorandum of the negotiations, Icannot conclude
that there was any misrepresentation."
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(2009). A contract provision for an award of attorney fees supports an award of
attorney fees on appeal under RAP 18.1. W. Coast Stationary Enq'rs Welfare Fund v.
City of Kennewick. 39 Wash. App. 466, 477, 694 P.2d 1101(1985).
Upon compliance with RAP 18.1, as the prevailing party under the contract, V-
Squared is entitled to an award of reasonable attorney fees and costs on appeal.
Affirmed.
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WE CONCUR:
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