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Broom v. Morgan Stanley, No. 82311-1 (briefs and argument). The Supreme Court held that an arbitration panel erred by applying state statutes of limitations to bar the a claim. Michael, Kevin, and Andrea Broom sued Morgan Stanley DW, Inc. for mismanaging an investment account. Their claims were rejected by an arbitration panel because they were barred by the statute of limitations. The Brooms appealed to King County Superior Court, and the court held that statute of limitations in Washington do not apply to claims in arbitration. The court vacated the arbitration panel’s decision as an error of law. The Court of Appeals (Div. 1) affirmed. Morgan Stanley argues both that statutes of limitations do apply to arbitration, and that courts cannot vacate arbitration decisions because of “errors of law.” The Supreme Court, with Justice Charles Johnson writing, affirmed the Court of Appeals. Chief Justice Barbara Madsen dissented.

Little Mtn. Estates Tenants Ass’n v. Little Mtn. Estates MHC LLC, No. 82574-2 (briefs and argument). The Supreme Court held that under the Manufactured/Mobile Home Landlord-Tenant Act (MHLTA), chapter 59.20 RCW, a landlord and tenant can lawfully agree to a 25-year lease that will convert to a one-year lease if the tenant assigns it. Mobile home tenants and association brought an action against the mobile home park, alleging that leases violated the Manufactured/Mobile Home Landlord-Tenant Act (MHLTA) and the Consumer Protection Act (CPA). The trial court ruled for the park. Writing for the majority, Justice Richard Sanders said that the MHLTA preserves the right of a landlord and tenant to negotiate and agree to the term of a rental agreement and thus the provision does not violate the MHLTA. Justice Gerry Alexander wrote a dissenting opinion.

Sound Infiniti v. Snyder, No. 81923-8 (briefs and argument). Richard Snyder, David Hannah, and Afshin Pisheyar were joint owners (as shareholders) of Sound Infiniti and Infiniti of Tacoma. They had a falling out, and Pisheyar sued the others individually and on behalf of the corporation (a derivative suit). Snyder and Hannah set up a reverse stock split to take away all of Pisheyar's stocks. The trial court allowed the split to proceed after an initial injunction, and dismissed Pisheyar's derivative suit because he was no longer a shareholder. The Court of Appeals confirmed the ruling, and found that the sole remedy for all Pisheyar's claims is the appraisal process, in which he can obtain fair market value for the shares that were taken away. The Supreme Court agreed, with Justice Susan Owens writing the majority opinion. The court held: (1) that the appraisal proceeding in RCW 23B.13.020 is a dissenting shareholder’s exclusive remedy unless a corporate action is procedurally defective or fraudulent and (2) that a divested shareholder does not have standing in a derivative suit. Justice Sanders wrote a dissenting opinion.

State v. Harvill, No. 82358-8 (briefs and argument). At trial, Joshua Harvill claimed that he sold the drugs because he was afraid of the informer. The trial court refused to instruct the jury on the defense of duress because there was no evidence that the informer had threatened Harvill. The trial court did instruct the jury on the defense of entrapment, and the jury rejected the defense. The Supreme Court unanimously ruled that the trial court abused its discretion by refusing to instruct the jury on the duress defense. The court reversed the conviction and remanded for a new trial. Justice Debra Stephens wrote the opinion.

State v. Nonog, No. 82094-5 (briefs and argument). Cipriano Bahit Nonog was convicted in King County Superior Court of felony violation of a domestic violence protection order, residential burglary-domestic violence, and interfering with domestic violence reporting. Defendant appealed. The Court of Appeals (Div. I) upheld the conviction, and ruled that the information charging the defendant sufficiently defined the charges. The Supreme Court affirmed the decision below, with Justice Debra Stephens writing the unanimous opinion.

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The Supreme Court will issue opinions in several cases tomorrow.

Broom v. Morgan Stanley, No. 82311-1 (briefs and argument). Michael, Kevin, and Andrea Broom sued Morgan Stanley DW, Inc. for mismanaging an investment account. Their claims were rejected by an arbitration panel because they were barred by the statute of limitations. The Brooms appealed to King County Superior Court, and the court held that statute of limitations in Washington do not apply to claims in arbitration. The court vacated the arbitration panel’s decision as an error of law. The Court of Appeals (Div. 1) affirmed. Morgan Stanley argues both that statutes of limitations do apply to arbitration, and that courts cannot vacate arbitration decisions because of “errors of law.”

Little Mtn. Estates Tenants Ass’n v. Little Mtn. Estates MHC LLC, No. 82574-2 (briefs and argument). Mobile home tenants and association brought an action against the mobile home park, alleging that leases violated the Manufactured/Mobile Home Landlord-Tenant Act (MHLTA) and the Consumer Protection Act (CPA). The trial court ruled for the park. The Court of Appeals (Div. I) affirmed the ruling in part, and reversed in part, and remanded the case for further proceedings.

Sound Infiniti v. Snyder, No. 81923-8 (briefs and argument). This case concerns what remedies are available to a minority shareholder whose shares are taken away, and whether that shareholder can bring a derivative suit against the corporation after he has lost his shareholder status. Richard Snyder, David Hannah, and Afshin Pisheyar were joint owners (as shareholders) of Sound Infiniti and Infiniti of Tacoma. They had a falling out, and Pisheyar sued the others individually and on behalf of the corporation (a derivative suit). Snyder and Hannah set up a reverse stock split to take away all of Pisheyar's stocks. The trial court allowed the split to proceed after an initial injunction, and dismissed Pisheyar's derivative suit because he was no longer a shareholder. The Court of Appeals confirmed the ruling, and found that the sole remedy for all Pisheyar's claims is the appraisal process, in which he can obtain fair market value for the shares that were taken away. The Association of Washington Businesses filed an amicus brief supporting Snyder.

State v. Harvill, No. 82358-8 (briefs and argument). At trial, Joshua Harvill claimed that he sold the drugs because he was afraid of the informer. The trial court refused to instruct the jury on the defense of duress because there was no evidence that the informer had threatened Harvill. The trial court did instruct the jury on the defense of entrapment, and the jury rejected the defense. On appeal, the Court of Appeals (Div. 2) noted that if the elements of duress had been proved, then the contested elements of entrapment would also have been proved. Since the jury rejected entrapment, it would also have rejected duress even had the instruction been given. Thus, even if the lack of a duress instruction was in error, it did not prejudice Harvill.

State v. Nonog, No. 82094-5 (briefs and argument). Cipriano Bahit Nonog was convicted in King County Superior Court of felony violation of a domestic violence protection order, residential burglary-domestic violence, and interfering with domestic violence reporting. Defendant appealed. The Court of Appeals (Div. I) upheld the conviction, and ruled that the information charging the defendant sufficiently defined the charges.

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The Supreme Court will hear arguments in three cases today (docket, briefs):

In the morning session: 

Broom v. Morgan Stanley, No. 82311-1. Michael, Kevin, and Andrea Broom sued Morgan Stanley DW, Inc. for mismanaging an investment account. Their claims were rejected by an arbitration panel because they were barred by the statute of limitations. The Brooms appealed to King County Superior Court, and the court held that statute of limitations in Washington do not apply to claims in arbitration. The court vacated the arbitration panel’s decision as an error of law. The Court of Appeals (Div. 1) affirmed. Morgan Stanley argues both that statutes of limitations do apply to arbitration, and that courts cannot vacate arbitration decisions because of “errors of law.”

State v. Regan, No. 82476-2. Francis Regan was convicted of fourth degree assault. Most of his sentence was suspended and he received 24 months of probation. One of the conditions of probation was that he commit “no criminal violations of the law.” During the probationary period, Regan was accused of another assault. He was brought to court for trial and a probation hearing. A jury acquitted him, but the judge at the probation hearing believed that Regan had committed the assault and revoked Regan’s probation.

Probation violations normally have a lower burden of proof than criminal trials. But Regan argues that the term “no criminal violations of the law” requires criminal conduct, and that criminal conduct must be proven beyond a reasonable doubt. Since he was not found guilty beyond a reasonable doubt, he says his probation should not have been revoked. The Grays Harbor Superior Court reversed the probation ruling, but the Court of Appeals (Div. 1) reversed the superior court. Defendant now appeals to the Supreme Court.

Then in the afternoon session: 

McGuire v. Bates, No. 82659-5. Whether a settlement for “all claims” includes attorney fees. Julianne McGuire hired Robert Bates to remodel her kitchen. After it was done, she claimed that he had done the work improperly and sued him. The case went to mandatory arbitration, but before the arbitration the parties settled “all claims” for $2180.

RCW 18.27.040 allows the prevailing party in a suit by a homeowner against a contractor to recover attorney fees. McGuire moved for attorney fees based on this statute. The arbitrator denied the motion because the parties had agreed to settle “all claims.” However, the courts held that attorney fees are a cost, not a claim, and were thus not included in the settlement agreement. Bates appealed, and also argues that McGuire is not a “prevailing party” because the case was settled.

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