Penny Arneson v. Gary Nordlund

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

PENNY ARNESON f/k/a PENNY
ARNESON SWEET, on behalf of herself DIVISION ONE
personally and on behalf of The 6708
Tolt Highlands Personal Residence No. 78053-1-I
Trust,
UNPUBLISHED OPINION
Appellant,

V.

GARY NORDLUND,

Respondent,

MFE, LLC; COLUMBIA NORTH WEST
MORTGAGE; MARK D. FLYNN; L80
COLLECTIONS, LLC; ALDENTE, LLC;
ROGER MAY and “JANE DOE” MAY;
McGAVICK GRAVES, P.S. and DOE
DEFENDANTS I through 20,

Defendants. FILED: September 3, 2019

DWYER, J. — Penny Arneson, in her capacity as trustee of the 6708 ToIt

Highlands Personal Residence Trust (the Trust), brought suit against Gary

Nordlund to enjoin Nordlund’s nonjudicial foreclosure of the Trust’s real property

and to allege that Nordlund committed usury and unlicensed lending—both

violations of the Consumer Protection Act (CPA).1 The trial court initially enjoined

I Chapter 19.86 RCW.
No. 78053-1-1/2

the foreclosure but subsequently granted summary judgment to Nordlund,

dismissing all claims. The Trust appealed. We reversed.

On remand, the trial court granted Nordlund’s motions for summary

judgment dismissal of the Trust’s usury and assumpsit claims and, following a

jury trial, entered judgment for Nordlund, dismissing the CPA claim predicated

upon a violation of the Consumer Loan Act (CLA).2 The Trust again appeals.

We reverse the trial court’s grants of summary judgment as to the usury and

assumpsit claims but affirm the judgment as to the dismissal of the CPA claim.

The underlying facts of the parties’ dispute are set forth in our opinion in

Arneson v. Nordlund (Arneson I), No. 71148-1-I (Wash. Ct. App. March 30, 2015)

(unpublished), http://www.courts.wa.qov/opinions/pdf/71 1482.rdf, but will be

briefly summarized here. Arneson’s former husband Kenneth Sweet, as a co

trustee of the Trust, arranged for a loan from Aldente, LLC, to the Trust. Then, to

facilitate repayment of this loan, he arranged a second loan from Gary Nordlund

to the Trust in the amount of $375,000.00. Nordlund’s loan was secured by a

deed of trust against the Trust’s real property at 6708 Tolt Highlands Road N.E.

in Carnation, Washington. The Trust defaulted on this loan and Nordlund

initiated a nonjudicial foreclosure on the deed of trust. Arneson, both as an

individual and in her capacity as trustee of the Trust, then filed this suit to enjoin

the trustee’s sale and to assert CPA claims against Aldente and Nordlund. The

trial court granted the Trust’s request to enjoin the trustee’s sale but ordered the

2 Chapter 31.04 RCW.

2
No. 78053-1-1/3

Trust to sell the property securing Nordlund’s loan and to deposit the sale

proceeds in the court registry.

The trial court later dismissed all of the other claims brought by Arneson

and the Trust on summary judgment. In the first appeal, we affirmed the trial

court in part and reversed in part. Arneson I, No. 71148-2-I, slip op. at 2.

Dismissal of Arneson’s individual claims was affirmed on the basis that the Trust,

not Arneson in her individual capacity, was the borrower on the Nordlund loan.

Thus, Arneson lacked standing to assert claims as an individual. Arneson I, No.

71 148-2-I, slip op. at 20. However, the trial court’s summary judgment dismissal

of the Trust’s claims against Nordlund and Aldente for violation of the CPA—

specifically, claims predicated upon violations of the CLA and the usury

statutes3—was reversed, as we held that the Trust had presented sufficient

evidence to raise competing inferences from the facts. Arneson I, No. 71148-2-I,

slip op. at 13, 18. Viewing the facts and all reasonable inferences therefrom in

the light most favorable to the Trust, we stated that a fact finder could infer that

Aldente and Nordlund were in the business of making qualifying loans, subjecting

them to the CLA licensing requirement, because they had made at least two

secured cash loans in the span of a year. Arneson I, No. 71148-2-I, slip op. at

13. Thus, the Trust’s claims were remanded for further proceedings.

The trial court’s original judgment had awarded Nordlund $604,371.72:

$375,000 in unpaid loan principal, $193,263.43 in prejudgment interest at the

default rate specified in the promissory note, $29,955.50 in attorney fees, and

~ Chapter 19.52 RCW.

3
No. 78053-1-1/4

$6,152.79 in costs. Because, during the pendency of the action, the Trust had

sold the property and deposited the proceeds from that sale into the court

registry, the trial court e~tered an order directing the court clerk to disburse funds

from the registry so as to satisfy Nordlund’s judgment against the Trust. Thus,

Nordlund’s judgment against the Trust was paid in full.4 The remaining proceeds

from the Trust’s sale of the property were then distributed from the registry to the

Trust through its counsel.

After we remanded the case, the superior court directed both parties to

return to the registry the money that had been distributed to them. Nordlund did

so; the Trust did not. The trial court denied Nordlund’s motion for an order of

contempt after finding that the Trust was unable to comply with the restitution

order. Thus, only funds in the amount of Nordlund’s original judgment were

extant in the registry.

On remand, Nordlund again moved for summary judgment dismissal of

the Trust’s usury claim. He now argued that the Trust did not have standing to

assert a cause of action for usury because a usury statute, RCW 19.52.032,

states that “[t]he debtor, if a natural person,” may commence an action, and the

Trust was not a natural person. The trial court accepted this argument and

granted summary judgment dismissal of the statutory usury claim.

Thereafter, the trial court granted the Trust leave to amend its complaint to

add a common law assumpsit claim. Nordlund’s motion for summary judgment

~ The Trust filed a motion to stay enforcement of the trial court’s order. The trial court
determined that the motion was moot because the funds had already been disbursed.

4
No. 78053-1-1/5

dismissal of this claim was also subsequently granted. Before trial, the Trust

voluntarily dismissed its claims against Aldente.

The subsequent jury trial concerned the question of whether Nordlund had

committed a violation of the CLA and, thus, a per se violation of the CPA, in

failing to obtain a lending license. Both parties submitted proposed jury

instructions. Among the factual questions submitted to the jury was whether

Nordlund was in the business of making qualifying loans under the CLA. The

Trust’s proposed instruction on this question sought to invoke our statement in

Arneson I that, viewing the evidence in the light most favorable to the Trust,

making two secured cash loans in a year supported the inference that one was in

the business of making qualifying loans. This proposed instruction was not

given.

The jury was instructed, instead, that:

A violation of the Washington Consumer Loan Act relating to
consumer lending is an unfair or deceptive act or practice in the
conduct of trade or commerce. A violation of this statute also
affects the public interest.
Gary Nordlund has admitted and you must accept as true
that he did not hold a license under the Consumer Loan Act.
Under the Washington Consumer Loan Act, no person may
engage in the business of making secured or unsecured consumer
loans of money in excess of 12% per annum without first obtaining
and maintaining a license from the Washington State Department
of Financial Institutions, unless exempt. The Washington
Consumer Loan Act exempts lenders from the Act who made loans
“primarily for commercial purposes.”
Commercial purpose means actions taken for the purpose of
obtaining anything of value for oneself, for an entity or individual for
which the individual acts. Consumer transactions are transactions
primarily for personal, family or household purposes.
A loan’s purpose is principally established by the
representations that the borrower makes the lender at the time the
loan is procured.

5
No. 78053-1-1/6

The burden is on the Lender to show the commercial
exception applies.
If you find that a violation of the Consumer Loan Act has
occurred, then you must find that the first three elements of a
Consumer Protection Act violation have been proved.

Jury Instruction 11.

On its special verdict form, the jury answered the question of whether

Nordlund was “engaged in the business of making qualified secured or

unsecured loans of money in January 201 0{]” in the negative. This finding

vitiated the viability of the Trust’s CLA claim and, with it, its remaining CPA claim.

The trial court entered judgment on this verdict in Nordlund’s favor and awarded

him attorney fees and costs, plus additional interest accruing from the date of

remand to the date of entry of final judgment. Following the trial court’s entry of

judgment, the funds in the court registry were again disbursed to Nordlund.

However, part of Nordlund’s judgment remains unsatisfied.

The Trust appeals.

The first question is whether a claim or defense of usury can only be

advanced by a natural person. The trial court ruled that the answer is yes. We

rule that the answer is no.

We review summary judgment rulings de novo, engaging in the same

inquiry as the trial court. Ruvalcaba v. Kwanq Ho Baek, 175 Wn.2d 1, 6, 282

P.3d 1083 (2012). Summary judgment is warranted only when there is no

genuine issue as to any material fact and the moving party is entitled to judgment

as a matter of law. CR 56(c); Wilkinson v. Chiwawa Cmtys. Ass’n, 180 Wn.2d

6
No. 78053-1 -117

241, 249, 327 P.3d 614 (2014). The facts and all reasonable inferences

therefrom are viewed in the light most favorable to the nonmoving party.

Ruvalcaba, 175 Wn.2d at 6.

Construction of a statute is a question of law. State v. Wentz, 149 Wn.2d

342, 346, 68 P.3d 282 (2003). When the language of a statute is clear,

legislative intent is derived.from the language of the statute alone. Wentz, 149

Wn.2d at 346. The ‘plain meaning” of a statutory provision is to be discerned

from the ordinary meaning of the language at issue, the context of the statute in

which that provision is found, related provisions, and the statutory scheme as a

whole. State v. Jacobs, 154 Wn.2d 596, 600, 115 P.3d 281 (2005).

Additionally, our Supreme Court has stated that

“Whenever a legislature had used a word in a statute in one
sense and with one meaning, and subsequently uses the same
word in legislating on the same subject-matter, it will be understood
as using it in the same sense, unless there be something in the
context or the nature of things to indicate that it intended a different
meaning thereby.”

Champion v. Shoreline Sch. Dist. No. 412 of King County, 81 Wn.2d 672, 677,

504 P.2d 304 (1972) (quoting State ex rel. Am. Piano Co. v. Superior Court for

King County, 105 Wash. 676, 679, 178 P.827(1919)).

The trial court stated as follows in granting summary judgment dismissal

of the Trust’s usury claim:

IT IS HEREBY ORDERED, ADJUDGED AND DECREED
that Mr. Nordlund’s Motion for Partial Summary Judgment is
GRANTED and any statutory usury claims under chapter 19.52
RCW asserted by the Plaintiff, Penny Arneson, f/kla Penny
Arneson Sweet, on behalf of The 6708 Tolt Highlands Personal
Residence Trust against Defendant Gary Nordlund are hereby
DISMISSED WITH PREJUDICE. The Trust, as the debtor who is

7
No. 78053-1-1/8

not a natural person, does not have standing to pursue a claim
under RCW 19.52.032, under the plain language of that statute.

The trial court’s ruling stems from a misreading of the statute cited. This

statute provides:

The debtor, if a natural person, or the creditor may bring an action
for declaratory judgment to establish whether a loan or forbearance
contract is or was usurious, and such an action shall be considered
an action on the contract for the purposes of applying the
provisions of RCW 19.52.030. Such an action shall be brought
against the current creditor or debtor on the contract or, if the loan
or debt has been fully repaid, by the debtor against the creditor to
whom the debtor was last indebted on the contract. No such an
action shall be commenced after six months following the date the
final payment becomes due, whether by acceleration or otherwise,
nor after six months following the date the principal is fully paid,
whichever first occurs. If the debtor commences such an action
and fails to establish usury, and if the court finds the action was
frivolously commenced, the defendant or defendants may, in the
court’s discretion, recover reasonable attorney’s fees from the
debtor.

RCW 19.52.032 (emphasis added).

Its companion statute provides:

(1) If a greater rate of interest than is allowed by statute shall be
contracted for or received or reserved, the contract shall be
usurious, but shall not, therefore, be void. If in any action on such
contract proof be made that greater rate of interest has been
directly or indirectly contracted for or taken or reserved, the creditor
shall only be entitled to the principal, less the amount of interest
accruing thereon at the rate contracted for; and if interest shall have
been paid, the creditor shall only be entitled to the principal less
twice the amount of the interest paid, and less the amount of all
accrued and unpaid interest; and the debtor shall be entitled to
costs and reasonable attorneys’ fees plus the amount by which the
amount the debtor has paid under the contract exceeds the amount
to which the creditor is entitled: PROVIDED, That the debtor may
not commence an action on the contract to apply the provisions of
this section if a loan or forbearance is made to a corporation
engaged in a trade or business for the purposes of carrying on said
trade or business unless there is also, in connection with such loan
or forbearance, the creation of liability on the part of a natural

8
No. 78053-1-1/9

person or that person’s property for an amount in excess of the
principal plus interest allowed pursuant to RCW 19.52.020. The
reduction in principal shall be applied to diminish pro rata each
future installment of principal payable under the terms of the
contract.
(2) The acts and dealings of an agent in loaning money shall
bind the principal, and in all cases where there is usurious interest
contracted for by the transaction of any agent the principal shall be
held thereby to the same extent as though the principal had acted
in person. Where the same person acts as an agent of the
borrower and lender, that person shall be deemed the agent of the
lender for the purposes of this chapter. If the agent of both the
borrower and lender, or of the lender only, transacts a usurious
loan for a commission or fee, such agent shall be liable to the
principal for the amount of the commission or fee received or
reserved by the agent, and liable to the lender for the loss suffered
by the lender as a result of the application of this chapter.

RCW 19.52.030 (emphasis added).

These two statutes speak to a related question: when may a borrower,

who takes out a loan for a business purpose, assert a claim of usury either as an

affirmative cause of action or as a defense to a claim? The answer provided is

that this may be done when the loan evinces a liability on the part of a natural

person.

The trial court plainly misconstrued these statutes as holding that only a

natural person could sue or defend on the basis of a claim of usury—regardless

of the purpose of the loan. This was wrong, as shown by the plain language of

the statutes. Consumer loans do not fall within the ambit of either statute.

But the ruling was wrong for other reasons.

RCW 19.52.080 provides that:

Profit and nonprofit corporations, Massachusetts trusts,
associations, trusts, general partnerships, joint ventures, limited
partnerships, and governments and governmental subdivisions,
agencies, or instrumentalities may not plead the defense of usury

9
No. 78053-1 -1/10

nor maintain any action thereon or therefor, and persons may not
plead the defense of usury nor maintain any action thereon or
therefor if the transaction was primarily for agricultural, commercial,
investment, or business purposes: PROVIDED, HOWEVER, That
this section shall not apply to a consumer transaction of any
amount.

Consumer transactions, as used in this section, shall mean
transactions primarily for personal, family, or household purposes.

Obviously, RCW 19.52.080 is inconsistent with RCW 19.52.030 and RCW

19.52.032. The latter statutes were enacted into law in 1 967.~ RCW 19.52.080

was enacted into law in 19696 and reenacted on several occasions.

One case is dispositive. The Supreme Court addressed the conflict

between RCW 19.52.080 and RCW 19.52.030 in Paulman v. Filtercorp, 127

Wn.2d 387, 899 P.2d 1259 (1995). RCW 19.52.030(1) permits usury as a claim

or defense for corporate debtors when the underlying business loan creates

“liability on the part of a natural person . . . for an amount in excess of the

principal plus interest allowed.” Filtercorp asserted that this allowed it to bring a

usury action based on a business transaction, notwithstanding RCW 19.52.080’s

prohibition, because the loan was guaranteed by a natural person. Paulman,

127 Wn.2d at 391. The Supreme Court rejected this argument, concluding

instead that “the enactment of RCW 19.52.080 represents a calculated legislative

decision not to afford the protection of the usury laws to either a corporation or a

natural person who borrows money for business purposes.” Paulman, 127

Wn.2d at 392.

~ LAWS OF 1967, Ex. Sess., ch. 23, § 5, 6.
6 LAWS OF 1969, 1st Ex. Sess., ch. 142, § 1.

10
No. 78053-1-I/li

Thus, the Supreme Court rejected the notion that a borrower’s status (as a

corporation or a natural person) has significance. Instead, the court stressed that

it is the borrower’s purpose in obtaining the loan that is the paramount question

in determining whether the borrower may employ usury as a claim or defense.

We employ the same analysis. The “natural person” language in RCW

19.52.032—relied upon by the trial court in dismissing the Trust’s usury claim—is

a nullity for the same reason as that language in RCW 19.52.030 is a nullity.

Under the rule announced in Paulman, it is the purpose of the loan that controls.

The borrower’s existence as a natural person or a corporation is without

significance.

The parties continue to dispute whether the Nordlund loan was a business

loan or a consumer loan. This presents a question of fact for the trier of fact.

The trial court erred by dismissing the statutory usury claim.7

Ill

Next, we address the trial court’s dismissal of the Trust’s common law

assumpsit claim. Nordlund urges that we affirm the trial court, averring that the

Trust presented no evidence to support its claim. This assertion is baseless.

Because the Trust presented evidence to support each element of its claim, the

trial court erred by dismissing it.

~ As an alternative ground for dismissal, Nordlund argued below that any statutory usury
claim was barred by a six-month statutory limitation period. The Trust, for its part, argued that the
CPA’s four-year limitation period, and not the usury statute’s shorter period, governed this action.
The trial court did not rule on Nordlund’s limitation period defense. Nevertheless, Nordlund urges
this as an alternative basis for affirmance. However, there is no ruling for us to review. We
decline to weigh in on the question in the first instance.
The assumpsit claim, of course, is subject to a three-year limitation period. Flannery v.
Bishop, 81 Wn.2d 696, 702, 504 P.2d 778 (1972).

11
No. 78053-1-1/12

Again, we review summary judgment rulings de novo. Ruvalcaba, 175

Wn.2d at 6. The party seeking summary judgment must demonstrate the

absence of a genuine question of material fact, Ruvalcaba, 175 Wn.2d at 6, and

the moving party is entitled to summary judgment only when there is a “‘complete

failure of proof concerning an essential element of the nonmoving party’s case

[which] necessarily renders all other facts immaterial.” Cho v. City of Seattle,

185 Wn. App. 10, 15, 341 P.3d 309 (2014) (internal quotation marks omitted)

(quoting Young v. Key Pharms., Inc., 112 Wn.2d 216, 225, 770 P.2d 182 (1989)).

The essential elements of an assumpsit claim are: “(1) a loan or

forbearance, either expressed or implied, of money, or of something circulating

as such; (2) an understanding between the parties that the principal shall be

repayable absolutely; (3) the exaction of a greater profit than is allowed by law;

and (4) an intention to violate the law.” Flannery v. Bishog, 81 Wn.2d 696, 698,

504 P.2d 778 (1972).

The availability of assumpsit as a cause of action has not been foreclosed

by enactment of the usury statutes. Lee v. Hillman, 74 Wash. 408, 412, 133 P.

583 (1913). A plaintiff’s remedy on a successful assumpsit claim is “in assumpsit

for money had and received.” Edwards v. Surety Fin. Co. of Seattle, 176 Wash.

534, 536, 30 P.2d 225 (1934) (citing Lee, 74 Wash. at 412).

Assumpsit is an equitable remedy.

“Assumpsit will lie whenever the defendant has received money
which is the property of the plaintiff, and which the defendant is
obliged by natural justice and equity to refund.”

“Whenever a man receives money belonging to another without any
reason, authority, or consideration, an action lies against the

12
No. 78053-1-1/13

receiver as for money received to the other’s use; and this as well
where the money is received through mistake, under color, and
upon an apprehension though a mistaken apprehension of having
good authority to receive it, as where it is received by imposition,
fraud, or deceit in the receiver.”

Soderberci v. King County, 15 Wash. 194, 199-200, 45 P. 785 (1896) (quoting

Bayne v. United States, 93 U.S. 642, 642, 23 L. Ed. 997 (1876) and Attorney

General v. Perry, 2 Com. 481 (Gr. Brit. 1725)).

Here, Nordlund premised his motion for summary judgment dismissal on

the contention that the Trust could not establish any of the last three elements of

the assumpsit claim. To the contrary, the Trust presented evidence on each.

First, it pointed to the terms of the promissory note to support the proposition that

the loan was repayable absolutely.8

8 There is no genuine dispute that the loan was repayable absolutely.” Nordlund’s

assertion that such a dispute exists is premised on the Trust’s alternative pleading, in its second
amended complaint, of a claim for rescission. The practice of pleading in the alternative is
accounted for in our civil rules:
A party may set forth two or more statements of a claim or defense alternatively
or hypothetically, either in one count or defense or in separate counts or
defenses. When two or more statements are made in the alternative and one of
them if made independently would be sufficient, the pleading is not made
insufficient by the insufficiency of one or more of the alternative statements. A
party may also state as many separate claims or defenses as the party has
regardless of consistency and whether based on legal or on equitable grounds or
on both.
CR 8(e)(2).
“‘[l]n light of the liberal policy embodied in Rule 8(e)(2), we hold that a pleading should
not be construed as an admission against another alternative or inconsistent pleading in the
same case.” Port of Seattle v. Lexington Ins. Co., 111 Wn. App. 901,919,48 P.3d 334 (2002)
(quoting Molsbergen v. United States, 757 F.2d 1016, 1019 (9th Cir. 1985)). Nordlund’s
argument relies on the notion that a claim, once pleaded by a party, effectively estops that party
from asserting any inconsistent claims. This notion is without any merit.
Nordlund also misunderstands the term “repayable absolutely.” This phrase means that
the repayment obligation is not conditional and does not depend on a contingency. ~ Embola
v. Tuppella, 127 Wash. 285, 287, 220 P. 789 (1923) (“If it is payable only on some contingency,
then the transaction is not usurious.” (quoting 27 R.C.L. § 21, p. 220)). The Trust has never
claimed that the obligation to repay the principal amount due was conditioned on an event that
did not occur.

13
No. 78053-1-1/14

Next, it offered a HUD-19 Settlement Statement to show that the effective

interest rate was 28 percent, tending to prove that the loan was constructed to

exact a profit greater than that allowed by law. In addition, it pointed to the trial

court’s 2013 award of principal and accrued interest at the contract rate of 18

percent to show that Nordlund did in fact exact this profit.1° The Trust also

offered the parties’ Private Money Term Sheet to show that Nordlund intended to

violate the law by mischaracterizing a personal loan as one for business

purposes.

The only element genuinely in dispute is whether Nordlund has exacted a

greater profit than that allowed by the law. An inference exists that Nordlund has

already received, from the court registry, a sum of money that, viewed in the light

most favorable to the Trust, included the challenged interest. If, on remand, the

Trust can prove this, prove that the usury statutes apply to its loans, and prove

that the interest rate charged was greater than that permitted by the usury

statutes, it will have established all elements of its assumpsit claim. There is

evidence or inferences on each of these elements. The trial court erred by

dismissing this claim.

Iv
The Trust next assigns error to the trial court’s refusal to give its proposed

jury instruction. We find no error in the trial court’s decision.

~ United States Department of Housing and Urban Development.
10 Although the money once disbursed to Nordlund was refunded to the court registry, it

has again been disbursed to Nordlund.

14
No. 78053-1-1/15

Whether to give a proposed jury instruction is within a trial court’s

discretion. We review the decision for an abuse of discretion. Christensen v.

Munsen, 123 Wn.2d 234, 248, 867 P.2d 626 (1994); Seattle W. Indus., Inc. v.

David A. Mowat Co., 110 Wn.2d 1,9,750 P.2d 245 (1988); Thomas v. Wilfac,

~ 65 Wn. App. 255, 264, 828 P.2d 597 (1992) (citing Petersen v. State, 100

Wn.2d 421, 440, 671 P.2d 230 (1983)). The propriety of a jury instruction is

governed by the facts of the particular case. Housel v. James, 141 Wn. App.

748, 759, 172 P.3d 712 (2007). As a whole, jury instructions are generally

sufficient if they are supported by the evidence, allow each party to argue its

theory of the case, and properly inform the jury of the applicable law. Housel,

141 Wn. App. at 758.

At trial, the Trust requested the following instruction:

A lender making at least two secured cash loans within a year
supports the inference that the lender is engaged in the business of
making qualifying loans under the Washington State Consumer
Loan Act.

The language of this instruction is lifted from our prior opinion, in which we

stated that evidence of Aldente making two cash loans within a year “supports at

least an inference that Aldente was, in fact, in the business of making qualifying

loans.” Arneson I, No. 71148-2-I, slip op. at 13. The Trust asserts that this

language reflects the law of the case and, thus, the trial court’s refusal to give the

proposed instruction was reversible error. This argument is without merit.

The law of the case doctrine provides that “once there is an appellate

holding enunciating a principle of law, that holding will be followed in later stages

of the same litigation.” State v. Schwab, 134 Wn. App. 635, 644, 141 P.3d 658

15
No. 78053-1 -1116

(2006), aff’d, 163 Wn.2d 664, 185 P.3d 1151(2008). The doctrine is not

applicable here because the language in our previous holding did not enunciate a

principle of law. Rather, we merely stated that evidence of a lender making two

secured loans within a year—when viewed in the light most favorable to the

Trust—raised an inference sufficient to create an issue of fact that precluded

summary judgment. Arneson I, No. 71148-2-I, slip op. at 13.

This does not mean that the trier of fact was required to draw that

inference. “Since the jury may have drawn such an inference, it takes the

plaintiffs’ case past a nonsuit and to the jury. However, when the case is tried to

the court, the trier of the facts is in a position to say, at the conclusion of the

plaintiffs’ case, that it does or does not, draw an inference [supporting plaintiffs].”

Tuenqel v. Stobbs, 59 Wn.2d 477, 477-78, 367 P.2d 1008 (1962) (citations

omitted). That the trier of fact was a jury changes nothing.

Moreover, both parties were able to argue their theories of the case to the

jury. The Trust was not barred from making arguments encouraging the jury to

draw the inference it wished. Indeed, in its closing argument, the Trust urged:

There’s a secondary issue that we need to address, and that
is whether or not Mr. Nordlund was in the business of doing loans.
So what do we have for that? Well, first of all, as I mentioned just a
few minutes ago, Mr. Nordlund was, in fact, involved in a boat
building business, but he was also involved in other businesses.
His testimony, he admitted it freely and accurately.
But we have more than that. Aside from those businesses, it
would appear that Mr. Nordlund was, in fact, engaged in the
business of making loans, to the extent that he made two loans for
profit. One was paid, and from the testimony, one is to be paid,
based upon the jury’s determination, from money that’s sitting in the
court registry.

16
No. 78053-1-1/17

So what are we asking for? We’re asking for the jury to
determine that Mr. Nordlund was in the business of providing loans.
In fact, both loans were done by Mr. Flynn, brokered by Mr. Flynn.
We’re asking the jury to find that the loan violated the
Consumer Loan Act; that the loan itself exceeded the 12 percent
interest rate that was permissible for such loans; that the loan was
for consumer purposes, not commercial purposes, as based upon
the orders of the Court in the family law proceedings, and render a
decision and judgment in favor of my client, Ms. Arneson.

Here, the trial court’s jury instructions both presented an accurate

summary of the law and allowed the Trust’s counsel to extensively argue the

Trust’s theory of the case (that making two loans within one year constituted

engagement in the business of making loans under the CLA). The trial court did

not abuse the discretion afforded to it. There was no error.

V

Finally, we address the issue of attorney fees and costs. The trial court

awarded attorney fees and costs to Nordlund after entering judgment on the

jury’s verdict. On appeal, both parties request an award of fees. “A party is

entitled to attorney fees on appeal if a contract, statute, or recognized ground of

equity permits recovery of attorney fees at trial and the party is the substantially

prevailing party.” Hwanc~ v. McMahill, 103 Wn. App. 945, 954, 15 P.3d 172

(2000).

As two of the Trust’s claims are remanded for further proceedings, an

award of appellate attorney fees is premature—the substantially prevailing party

has not yet been determined. In addition, our conclusion that such an award is

premature also requires that the trial court’s previous award of attorney fees and

costs to Nordlund be vacated.

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The judgment of dismissal of the CLA claim, and the CPA claim premised

upon a violation of the CLA, is affirmed. The dismissals of the statutory usury

and assumpsit claims are reversed. The award of attorney fees and costs is

ordered to be vacated.

Affirmed in part, reversed in part, and remanded.

WE CONCUR:

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