Legal Research AI

Steve Fabre, Point Defiance Cafe, V Town Of Ruston

Court: Court of Appeals of Washington
Date filed: 2014-03-19
Citations:
Copy Citations
Click to Find Citing Cases

                                                                                                                    s   I     ED
                                                                                                                  DMI'
                                                                                                                            sIoN II

                                                                                                         7014 MAR 19           AN 8: 45
                                                                                                                        WA '
      IN THE COURT OF APPEALS OF THE STATE OF WASHING ,                                                      a                     11T1114

                                                                                                           Yw
                                                  DIVISION II                                                      MAWRIM


STEVE FABRE, individually; and POINT                                               No. 43459 -8 -II
                                                                                                                   v
DEFIANCE CAFE AND CASINO, LLC,


                 Appellants /Cross Respondents,


         0



TOWN OF RUSTON, a municipal
corporation;




                 Respondent /Cross Appellant,


ROBERT EVERDING, in his former capacity
as Ruston' s mayor, and individually; and
ROBERT and SALLY EVERDING' s
marital community; DAN ALBERTSON, in
his former capacity as Ruston' s
councilmember, and individually; and
DAN and PAULA ALBERTSON' s marital
community; JANE HUNT, in her capacity as
Ruston' s councilmember, and individually and
any marital community; and BRADLEY                                          PUBLISHED OPINION

HUSON, in his capacity as Ruston' s
councilmember, and individually,

                                      Defendants.




          WORSWICK, C. J. —      Steve Fabre appeals the summary judgment dismissal of his claims

against   the Town of Ruston after       it   passed   two   ordinances —  one taxing social card games and

one   prohibiting house -
                        banked        social card games — which         Fabre claims drove his Point Defiance


Cafe and Casino out of business. Fabre argues that the superior court erred by dismissing his

claims    because ( 1) the   public   duty    doctrine does   not   bar Fabre'   s claims, and ( 2)   Ruston is   not
No. 43459 -8 -II



entitled to immunity. We affirm because the public duty doctrine bars Fabre' s claims for

negligence and negligent misrepresentation and legislative immunity bars his claim for

intentional interference with business expectancy.

                                                      FACTS


A.        General Background


          Ruston is   a small   town with a   population of under      1, 000.   1 At the time of the actions that

precipitated this lawsuit, Ruston had a mayor / ouncil form of government with five council
                                              c

members.



          Fabre   opened   The Point Defiance Cafe       and   Casino in Ruston in 2003. Fabre' s casino


began to operate social card games, a form of gambling, in 2004. Fabre' s gambling activities

consisted of pull -abs, as well as " house banked" social card games ( where the players bet
                  t

against   the   casino) and social card games     that   were not "   house banked" ( where the players did


not bet against the casino). 2 Fabre was the only business within Ruston to operate social card

games. However, other businesses within Ruston had other forms of gambling such as pull tabs.

          After Fabre opened his " asino he came into-conflict with-
                                 c                                 two of Ruston' s organizations:
                                                                       -

the " Chinese Christian Church"       and a   local   newsletter called "   The Ruston Connection."        Clerk' s


Papers ( CP) at 436 -37. Fabre sued the Chinese Christian Church and The Ruston Connection for

defamation on August 24, 2007, alleging that both organizations wrongly defamed him by

accusing him of stealing electricity. To support his lawsuit against these two organizations,



 1
     U. S. CENSUS BUREAU, THE 2010 CENSUS ( 2010),                     available at


http:// factfinder2. census. gov.
2
     See RCW 9. 46. 0282.



                                                           2
No. 43459 -8 -II



Fabre had asked Ruston to disclose certain records, which led Fabre to file a complaint against


Ruston for violations of public disclosure laws. Fabre settled all of the above claims.


       Following these settlements, in 2008, Mayor Everding and four new council members

assumed office: Dan Albertson, Jane Hunt, Bradley Huson, and Jim Hedrick. The only

remaining council member was Wayne Stebner. Beyond the tension created between Fabre and

Ruston based on Fabre' s public disclosure action, Fabre alleges that these office holders had


three individual, additional sources of bias against Fabre. Specifically, Fabre alleges that ( 1)

Mayor Everding and some of the council members had connections to the organizations that

Fabre sued for defamation, (2) Wayne Stebner was motivated to shut Fabre' s casino down, and


 3) Bradley Huson expressed his strong personal dislike for Fabre in his deposition.

B.      Ruston' s Original Tax on Social Card Games


        When Fabre' s casino opened in 2003, Ruston had adopted a tax on social card games.


The tax rate resulted from direct negotiations between Fabre and Ruston' s then -
                                                                                Mayor Kim


Wheeler. During these negotiations, Mayor Wheeler committed to Fabre that Ruston would

allow - im to operate -
      h               his casino.


        Ruston' s 2003 tax required casinos operating social card games to pay a low, graduated

tax rate based on the total revenue from social card games. This graduated tax rate increased in

relation to the casino' s gross monthly card game revenue. The tax remained in the low single

digits, never exceeding five per cent.

C.      Ruston' s Tax Increase on Social Card Games


        In 2008, after Mayor Everding and the four new council members assumed office,

Stebner proposed Ordinance 1253 to replace the graduated tax on social card games with a 20




                                                   3
No. 43459 -8 - II



per cent flat tax rate. The Ruston Council later amended Stebner' s proposal so that Ordinance


1253 would increase the flat tax rate by only 12 per cent. The Ruston Council voted three to one

in favor   of the amended   Ordinance 1253       on   July 7,   2008. Stebner was absent for the vote.


James Wingard,      a regular   Ruston Council meeting          attendee   later   averred   in   a   declaration, " Based


upon my observations and listening to the input at the meetings of [Ruston] from the [ Ruston]

Council; and knowing Dan Albertson, Wayne Stebner, Jane Hunt, and Bradley Huson the tax

increase    was malicious ...    the tax   increase is   a vendetta against [      Fabre   and    his Casino]."    CP at




          Fabre filed a declaratory action against Ruston to have Ordinance 1253' s tax declared

void. Fabre sent a letter to Ruston on August 1, 2008, stating that he intended to pursue an

additional lawsuit for damages if Ruston enforced Ordinance 1253, and asking Ruston to

concede that Ordinance 1253 was void.


           On May 28, 2010, a court resolved Fabre' s declaratory action against Ruston by

declaring Ordinance 1253 void. The court determined that Ruston' s ordinances required the

Ruston Council to pass an ordinance with " one more than the majority" of the Ruston Council

and that a majority of Ruston' s Council was three votes, regardless of how many council.

members were present at         the meeting   when    the   vote was   taken. CP      at   105. Thus the court ruled


that three affirmative votes were insufficient to pass Ordinance 1253. Ruston did not appeal this


ruling.


           Following the superior court' s ruling that Ordinance 1253 was void, Ruston codified

Ordinance 1253 in the ordinary course of codification of its entire code. However, Ruston

eventually repealed Ordinance 1253 on December 23, 2010.



                                                            2
No. 43459 -8 -II



D.        Ruston' s Prohibition on House -Banked Social Card Games


          Shortly after the superior court ruled Ordinance 1253 void, Ruston' s Council voted

unanimously to pass Ordinance 1316, calling for the passage of "Referendum Measure No. l,"

Pierce County Official Local Voters' Pamphlet, General Election 38 ( approved Nov. 2, 2010),

prohibiting house -banked social card games in Ruston.

          To inform the Ruston voters about Referendum Measure No. 1, the Pierce County

Auditor' s Office compiled statements in support of and against the passage of Referendum

Measure No. 1.     The statement in support was written by a three- member committee, which

included council members Hedrick and Huson. The statement in support stated that passage

would " end          banked
               house -          card rooms ( casinos)   in Ruston forever.   Finally, ` We   the people of


Ruston' will decide the fate of casinos in our community and not have it decided by business

people who     don' t live in Ruston."'   CP at 1119.


          Referendum Measure No. 1 passed on November 2, 2010. Fabre then filed an action for


declaratory relief from Ordinance 1316. On February 7, 2011, before the superior court resolved

this case, Ruston repealed Ordinance 1316.


E.        Procedure


          On December 8, 2010, Fabre filed a lawsuit against Ruston alleging a variety of claims,

including negligence, negligent misrepresentation, and tortious intentional interference with

business expectancy. 4      Ruston' s answer pleaded defenses, including the public duty doctrine and


3 Fabre operated the only card room in Ruston, and did not reside in Ruston.
4
     The parties dispute whether Fabre sufficiently raised negligent misrepresentation in his
 complaint, when     his   complaint pleaded   only " negligence."   We assume without deciding that
Fabre sufficiently pleaded negligent misrepresentation, because it does not affect the result.

                                                        5
No. 43459 -8 -II



discretionary immunity. Fabre and Ruston made cross motions for summary judgment to

dismiss each other' s claims and defenses on summary judgment. The superior court summarily

dismissed all of Fabre' s claims against Ruston.5 Fabre appeals.

                                                      ANALYSIS


         We review summary judgment determinations de novo, engaging in the same inquiry as

the superior court. Harberd v. City ofKettle Falls, 120 Wn. App. 498, 507, 84 P. 3d 1241 ( 2004).

Superior court findings of fact and conclusions of law are superfluous on summary judgment.

Shoulberg v. Pub. Util. Dist. No. 1 ofJefferson County, 169 Wn. App. 173, 177, n. 1, 280 P. 3d

491, review denied, 175 Wn.2d 1024 ( 2012).


          Summary judgment is appropriate if there is no genuine issue of material fact and the

moving party is       entitled   to   judgment   as a matter of   law." Trimble    v.   Wash. State Univ., 140


Wn.2d 88, 93, 993 P. 2d 259 ( 2000).             When determining whether summary judgment is

appropriate, we consider the facts and all reasonable inferences from those facts in the light most

favorable to the nonmoving party. Harberd, 120. Wn. App. at 507.
                                                    .

                                 I. PUBLIC DUTY DOCTRINE: NEGLIGENCE CLAIMS


         Fabre argues that the superior court erred in granting summary judgment on his

negligence claims under the public duty doctrine, because ( 1) Ruston was performing a

proprietary function, and ( 2) Fabre and Ruston had a special relationship. We disagree.

         To    establish negligence, a plaintiff must prove (         1) the   existence of a   legal   duty, ( 2)

breach   of   that   duty, ( 3) injury to the plaintiff resulting from the breach, and (4) that the breach

5
 Fabre also sued Mayor Everding and numerous Ruston Council members as individuals.
However, the superior court granted summary judgment in favor of all these individuals as to all
claims, and Fabre does not challenge that decision on appeal.




                                                            r
No. 43459 -8 -II



proximately caused the plaintiff' s injury. Christensen v. Royal Sch. Dist. No. 160, 156 Wn.2d

62, 66, 124 P. 3d 283 ( 2005).          Whether a duty exists is a question of law we review de novo.

Hertog v. City ofSeattle, 138 Wn.2d 265, 275, 979 P. 2d 400 ( 1999).

           Governmental entities are liable for damages arising out of their tortious conduct, or the

tortious    conduct of   their   employees, "`        to the same extent as if they were a private person or

corporation. "'      Cummins      v.   Lewis   County,       156 Wn.2d 844, 853, 133 P. 3d 459 ( 2006) ( quoting


RCW 4. 96. 010( 1)).      However, under the public duty doctrine, when the defendant in a

negligence action is a governmental entity, the public duty doctrine provides that a plaintiff must

show the duty breached was owed to him or her in particular and was not the breach of a duty

owed to the public in general. Babcock v. Mason County Fire Dist. No. 6, 144 Wn.2d 774, 785,

30 P. 3d 1261 ( 2001). "[        A]    duty   owed    to    all   is   a   duty   owed    to   none."   Beal v. City ofSeattle, 134

Wn.2d 769, 784, 954 R. 2d 237 ( 1998).                 The public duty doctrine is a focusing tool used to

determine whether the defendant owed a duty to the public or a particular individual. Osborn v.

Mason County, 157 Wn.2d 18, 27, 134 P. 3d 197 ( 2006).

            There are, however, certain situations in which-the-public duty doctrine does not apply. -

We address two. First, the public duty doctrine does not apply when the government is

performing a proprietary function. Bailey v. Town ofForks, 108 Wn.2d 262, 268, 737 P. 2d 1257

 1987). "     A public entity acts in a proprietary rather than a governmental capacity when it

engages      in businesslike     activities    that   are   normally           performed       by   private enterprise."    Stiefel v.


City   of Kent, 132 Wn.     App.       523, 529, 132 P. 3d 1111 ( 2006).                       By   contrast, "[   g] overnmental


functions     are   those generally     performed          exclusively            by   governmental entities."        Stiefel, 132 Wn.


App.   at   529.    Governmental functions tend to involve activities ensuring compliance with state




                                                                           7
No. 43459 -8 -II



law;   issuing permits;        or   performing       activities   for the   public   health, safety,   and welfare. "   The


principal test in distinguishing governmental functions from proprietary functions is whether the

act performed is for the common good of all, or whether it is for the special benefit or profit of

the   corporate     entity."    Okeson v. City ofSeattle, 150 Wn.2d 540, 550, 78 P.3d 1279 ( 2003).

          Second, under the special relationship exception to the public duty doctrine, a

government entity may be liable to an individual where a relationship either exists, or has

developed, between the plaintiff and the agents of the government entity such that a duty to

perform a mandated act for a particular person or class exists. Chambers —
                                                                         Castanes, 100 Wn.2d

275, 285, 669 P. 2d 451 ( 1983).                  A special relationship' exists where the plaintiff can show all

three of the    following       elements: (        1) there is direct contact or privity between the public official

and    the injured    plaintiff     that   sets   that   plaintiff apart   from the   general public, ( 2)   a public official


gives the plaintiff express assurances, and ( 3) the plaintiffjustifiably relies upon those express

assurances. Beal, 134 Wn.2d at 785.


          This third element, justifiable reliance, asks whether the plaintiff justifiably relied upon

the express -
            assurances of the government entity. Beal, 134 Wn.2d-at 785. Reliance is justified if

it is reasonable under the surrounding circumstances, which is a question of fact. Lawyers Title

Ins.   Corp.   v.   Baik, 147 Wn.2d 536, 551, 55 P. 3d 619 ( 2002); see also Havens v. C &D Plastics,


124 Wn.2d 158, 181, 876 P. 2d 435 ( 1994).


          We hold that the superior court did not err in determining that the public duty doctrine

precluded Fabre' s claims for negligence and negligent misrepresentation because ( 1) Ruston was

not performing a proprietary function in prohibiting house -banked social card games in Ruston

and ( 2) no special      relationship        existed      between Fabre      and   Ruston.
No. 43459 -8 -II



A.     Proprietary Function

       Fabre argues that Ruston' s actions in passing the two ordinances constituted proprietary

functions. We disagree.


       Ruston' s acts that Fabre challenges are the passage of two ordinances: one that taxes an


activity, and one that prohibits an activity. Private entities have no authority to engage in

taxation or prohibition of activities; the acts of taxation and prohibition are unique to


governmental entities. Thus Ruston' s passage of its taxing ordinance and its prohibition

ordinance were both governmental functions, rather than proprietary functions.

B.      The Special Relationship Exception

        Fabre next argues that his case falls under the special relationship exception to the public

duty doctrine. We disagree. We assume without deciding that Fabre could establish privity and

express assurances, and hold as a matter of law that one cannot justifiably rely on the express

assurances of a mayor as to how future Ruston Councils will legislate. This is for two reasons.

        First, Ruston' s mayor does not have the authority to establish a tax or pass a prohibition

on social card games; only the RustonCouncil has that authority. Thus Fabre' s reliance on-

Mayor Wheeler' s assurances constituted reliance, at best, on the mayor' s mere prediction of the


Ruston Council' s actions. We hold that reliance on such a prediction is not justifiable.


        Second, even if Fabre could have justifiably relied on Mayor Wheeler' s prediction of

how the existing Ruston Council would vote, Fabre could not justifiably rely on the Mayor' s

assertion that a future Ruston Council would maintain those policies after new council members


took office.   A legislature   cannot   bind   a   future legislature.   Wash. State Hosp. Ass' n v. State, 175

Wn.   App.   642, 648, 309 P. 3d 534 ( 2013).        To hold otherwise would burden legislative bodies




                                                           9
No. 43459 -8 -II



with a duty to legislate consistently with the promises of previous office holders. Thus, Fabre' s

reliance that a mayor' s promises would last beyond the tenure of the sitting Ruston Council is

not justifiable.


         We hold that the public duty doctrine bars Fabre' s claims of negligence and negligent

misrepresentation, because Ruston' s actions were not proprietary, and Fabre' s claim does not fall

under the special relationship exception. Thus we affirm the superior court' s grant of summary

judgment to Ruston on Fabre' s claims for negligence and negligent misrepresentation.

                           II. LEGISLATIVE IMMUNITY: INTENTIONAL TORT CLAIM


         Fabre argues that the superior court erred in granting summary judgment on his

intentional interference with business expectancy claim. Ruston argues that it is protected by

legislative   immunity. 6 We agree with Ruston.

         The Washington State legislature abolished sovereign immunity in 1961, which permitted

tort suits against government entities to the same extent that tort suits are permitted against


individuals. RCW 4. 96. 010( 1);   see also   Babcock, 144 Wn.2d     at   784 -86. This abolition of


sovereign immunity applies to municipal corporations. Kelso v. City ofTacoma, 63 Wn.2d 913,

916 -19, 390 P. 2d 2 ( 1964)


         However, two exceptions to this broad abolition of sovereign immunity exist. First, the

government maintains immunity for its discretionary acts. Avellaneda v. State, 167 Wn. App.

474, 480 -81, 273 P. 3d 477 ( 2012).   Second, the government maintains its immunity when it




6
    The public duty doctrine does not apply to Fabre' s claim of intentional interference with
business expectancy because the doctrine does      not   apply to intentional torts.   Vergeson v. Kitsap
 County,. 145 Wn. App. 526, 543 -44, 186 P. 3d 1140 ( 2008).

                                                    10
No. 43459 -8 - II



conducts purely legislative acts. Miller v. Pacific County, 91 Wn.2d 744, 747 -48, 592 P. 2d 639

 1979).


          In Miller, our Supreme Court held that when a governmental act is a purely legislative

act, it can never face liability for torts, including intentional torts. See Miller, 91 Wn.2d at 746-

48.   This remains true even where the government legislates arbitrarily, with improper

motivations, in bad faith, or without making a considered and reasoned policy analysis. Miller,

91 Wn.2d     at   746 -48.      The government has absolute immunity for purely legislative acts, no

matter how misconceived or misexecuted, because immunity is necessary to avoid rendering " the

legislative process inoperable and involve this court in a flagrant invasion of the prerogatives of


the legislative branch          of government."       Miller, 91 Wn.2d at 746 -48.


          In this case, Fabre challenges Ruston' s passage of ordinances. The legislature' s role is to

set policy and to draft and enact laws. Ruston' s passage of its ordinances constitutes purely

legislative acts, which entitles Ruston to immunity from tort claims that were directly related to

its passing of the two ordinances. Miller; 91 Wn.2d at 747.

          Whether Ruston had legal authority to pass the ordinances has no effect-on the

government' s immunity for passing the laws, but, rather, it is relevant only to whether Ruston

may legally enforce those laws. See Miller, 91 Wn.2d at 746 -48. Likewise, whether Ruston

implemented the ordinances has no effect on the government' s immunity for its purely

legislative acts. See Miller, 91 Wn.2d at 746 -48; Avellaneda, 167 Wn. App. at 481 -83.

                                                                                              and Westmark
          Citing Pleas         v.   City   of Seattle, 112 Wn.2d 794, 774 P. 2d 1158 ( 1989),


Dev.   Corp.      v.   City   of Burien, 140 Wn.     App.   540, 166 P. 3d 813 ( 2007), Fabre argues that Ruston


can be held liable for tortious interference with business expectancy. However, in Pleas and



                                                               11
No. 43459 -8 -II



Westmark, the government faced liability for arbitrarily delaying the processing and approval of

permits, not for arbitrarily passing ordinances. Pleas, 112 Wn.2d at 799, 807; Westmark Dev.

Corp.,   140 Wn.        App.   at   543 -45, 558 -59.     Thus, the governmental acts were not purely

legislative acts.


         Because Ruston' s passage of its two ordinances constitutes purely legislative acts, Ruston

was entitled to legislative immunity from Fabre' s action for tort claims, including the intentional

tort of intentional interference with business expectancy. We therefore affirm summary
            7
judgment.       Ruston is entitled to costs under RAP 14. 2, subject to compliance with RAP 14. 4.




                                                                                       Worswick, CJ




7 Without citation to authority, and without reasoned argument, Fabre argues that the trial court
erred in refusing to consider his motion to sanction Ruston for its alleged improper refusal to
produce information during discovery. Fabre' s passing treatment of this issue is insufficient to
merit   judicial   consideration, and we         do     not address   it. RAP 10. 3(   a)(   6);    Cowiche Canyon

Conservancy        v.   Bosley,     11,8 Wn.2d 801, 809 -10, 828 P. 2d 549 ( 1992).                Additionally, Fabre
argues that the superior court erred when it (1) failed to fully consider his countermotion for
summary judgment, ( 2) improperly interpreted his countermotion as a concession that no
material facts were in dispute, and ( 3) failed to make sufficiently specific findings to justify its
conclusion that summary judgment was appropriate. Because we review the trial court' s
decision de novo, we decline to address these assignments of error which attack the bases for the
trial court' s decision. Harberd v. City ofKettle Falls, 120 Wn. App. 498, 507, 84 P. 3d 1241
 2004).




                                                                12