(dissenting) — In holding that estoppel applies to bar an attack on or a refund of the fees paid to Bothell, the majority overlooks a number of significant facts and issues a license to municipalities to completely ignore the statutory prerequisites to imposing development fees. In addition, it distinguishes Robinson v. Seattle, 119 Wn.2d 34, 830 P.2d 318 (1992), on the ground that Robinson involved an invalid tax, whereas this case, it asserts, does not. Majority, at 204. To the contrary, in the absence of the statutory authority provided by RCW 82.02.020, Bothell has no authority to impose mitigation fees. Where, as here, a municipality fails to comply with any of the statutory requirements for imposing mitigation fees, the fees remain an invalid tax under the ruling in Hillis Homes, Inc. v. Snohomish Cy., 97 Wn.2d 804, 808, 650 P.2d 193 (1982). Thus, the 3-year statute of limitations adopted in Robinson, RCW 4.16.080(3), would apply equally to this case. Because the majority opinion ignores the language of RCW 82.02.020 and frustrates the intent of the Legislature in enacting the statute, I dissent.
Whether the correct statute of limitations is 3 years or 30 days, the analysis and result are the same. Therefore, I will assume that the 30-day limitations period applies and that respondents Dujardin, Conner and Henderson Homes may not directly challenge Bothell's actions in imposing the park impact mitigation fees. Because RCW 82.02.020 limits the expenditure of mitigation fees to the specific purpose for which they were initially imposed, the first step is to review those actions to determine whether the fees were imposed in compliance with the statute.
*209If the fees were not imposed for a permissible purpose, the next step is to determine whether Bothell could cure that illegality in a manner which would enable it to comply with the expenditure provisions of RCW 82.02.020. If not, the final question is whether a refund is the proper remedy for violations of the statute.
I
Imposition of Impact Mitigation Fees
RCW 82.02.020 provides in part:
This section does not prohibit voluntary agreements with counties, cities, towns, or other municipal corporations that allow a payment in lieu of a dedication of land or to mitigate a direct impact that has been identified as a consequence of a proposed development, subdivision, or plat.
The trial court found that Bothell failed to conduct a site-specific analysis to determine the direct impact of any of respondents' developments on the park system, and that references to the impact of the developments on the park system in the documents prepared by Bothell were merely general and conclusory. Bothell does not challenge these findings, thus conceding that it did not identify any direct impacts of any of the developments. Unchallenged findings are verities on appeal. Metropolitan Park Dist. v. Griffith, 106 Wn.2d 425, 433, 723 P.2d 1093 (1986). In addition, Bothell conceded at oral argument that it never asked the developers to dedicate any land for park purposes. In making these concessions, Bothell admits that it has not complied with either of the conditions precedent to the imposition of fees under the statute: it has neither identified a direct impact that the statute would then permit it to impose and spend fees to mitigate, nor has it requested the dedication of any land for which a fee in lieu would be authorized.
The illegality of Bothell's assessment of these park impact mitigation fees is further demonstrated by the lack of any relationship between the fee-per-lot charge and the location, *210value, configuration or impacts of any of the developments in question. If a fee is to be imposed in lieu of a dedication of land, the only rational, nonarbitrary way of determining the amount of the fee is to relate it to the value of the land which Bothell could require the developer to dedicate. If a fee is imposed to mitigate the impacts of a plat or other development, the only rational, nonarbitrary manner of determining the amount of the fee is to relate it to those identified impacts and to the specific measures Bothell may legally require developers to take to mitigate those impacts. Tb impose a flat fee of $400 per lot, regardless of the location of the proposed development in relation to existing or planned park facilities, the type of homes planned, the recreation facilities provided for within the plat, or the value of the land on which the development will be built, establishes that Bothell's method of assessing the fees is not impact specific as required by the statute.
In order to impose a park fee under RCW 82.02.020,8 Bothell must have authority under some other statute either to require a dedication of land9 or to require mitigation of "a direct impact that has been identified as a consequence of a proposed development, subdivision, or plat." RCW 82.02.020.10 The statute authorizing "voluntary agreements" does not, in and of itself, provide that authority. It is for this reason that Bothell's imposition of a flat $400-per-lot fee on these subdivisions, for which it has required no dedication of land or identified any development-specific impacts to be mitigated, is a clear violation of the plain and unambiguous language of RCW 82.02.020. The statute is not a fee statute *211like RCW 82.02.050.090. It is a fee-in-lieu statute.11 It is fundamental that, in the absence of authority to require either a dedication of land or the mitigation of an identified impact, these fees are not "in lieu" of anything. The statute does not authorize or condone municipal developer exaction ordinances or schemes such as this.12 None of the statutory prerequisites for imposing the fees was met here.
II
Expenditure of Park Mitigation Fees
With respect to the expenditure of the funds collected,13 RCW 82.02.020 provides:
(1) The payment shall be held in a reserve account and may only be expended to fund a capital improvement agreed upon by the parties to mitigate the identified, direct impact;
(2) The payment shall be expended in all cases within five years of collection; and
(3) Any payment not so expended shall be refunded ....
(Italics mine.) Each of the agreements with the developers here contained general language stating that the funds *212would be used for capital expenditures. However, because Bothell did not identify any direct impacts of these developments on its park system, there was and, indeed, could be no agreement between Bothell and these developers on capital improvements intended to mitigate an identified, direct impact. Since this is the only basis on which the funds may be expended, Bothell's expenditure of these funds violated RCW 82.02.020.
Because the 5-year period in which Bothell was to spend the funds had not yet expired at the time this action was brought, Bothell may argue that it is not yet precluded from entering into an appropriate agreement for expenditure of the funds with at least two of the three developers.14 A party would not normally be expected to challenge an expenditure before it has taken place.15 There are several reasons, however, why legally sufficient agreements governing the expenditure of the fees collected here are not possible under the facts of this case even if the 5-year expenditure period is tolled during the pendency of the lawsuit.
First, Bothell admits that it has already expended portions of the funds collected from each of these respondents on general park improvements and for non-capital improvement purposes within the city. Bothell cannot identify a single dollar in its "first in/first out" system of accounting for these and other park fees that was actually expended on any improvement that mitigated any direct impact of any of these developments. As the discussion above indicates, RCW 82.02.020 requires both identification of direct impacts and *213agreement on capital improvements to mitigate those impacts at the time the fees are imposed. The statute is clear and unambiguous, and any other construction would allow a municipality to avoid the underlying purpose of the statute: to restrict fees to those instances where the development is responsible for impacts which must be mitigated under authority of law.
Second, in view of the trial court's unchallenged finding that no direct impacts were identified and Bothell's failure to identify any such impacts by the time this appeal was brought, there is no basis on which this court can conclude that the required impacts can be identified even at this late date. There is absolutely nothing in the record to show that there was in fact a direct impact on parks in the areas of the proposed developments which would have justified imposition of fees in the amount assessed.
Third, it is apparent that Bothell approached these funds as a general revenue source for funding park improvements and equipment throughout the city, and not as a method for "fund[ing] a capital improvement agreed upon by the parties to mitigate the identified, direct impact" of the projects on which the fees were imposed. RCW 82.02.020. As noted above, it is Bothell's actual practice to use the park impact mitigation fees it collects to pay for park-related costs throughout the city in a manner that is totally unrelated to the plat upon which they were imposed. The boiler-plate language in the reports and agreements approving and imposing conditions on these developments is virtually identical in all the reports and agreements for all the plats. There is no site-specific discussion of the park and recreation impact of any of these proposals. Rather, Bothell simply recites the same general language in every staff report and authorizing ordinance. Finally, it is unlikely that, given the posture of this litigation, any true agreement is a realistic possibility.
For all these reasons, Bothell cannot satisfy the requirement of RCW 82.02.020(1) that the funds collected can only *214be expended "to fund a capital improvement agreed upon by the parties to mitigate the identified, direct impact." Thus, Bothell's expenditure of the park impact mitigation fees was unlawful.
III
Remedy
The question remains whether Bothell's failure to comply with the expenditure requirements of RCW 82.02.020 mandates a refund. In determining the appropriate remedy, we look first to the plain language of the statute. After establishing the requirements and conditions that apply to the expenditure of funds, the statute provides:
Any payment not so expended shall be refunded with interest at the rate applied to judgments to the property owners of record at the time of the refund . . ..
(Italics mine.) RCW 82.02.020(3). In order to give any meaning to the word "so" in this provision, it must be interpreted to incorporate the two requirements that immediately precede this paragraph; i.e., that the funds be expended within 5 years and then only to fund an agreed-upon capital improvement which will mitigate an identified, direct impact.16 Because Bothell failed to comply with these requirements, RCW 82.02.020 requires that the fees be refunded.
IV
Estoppel
Finally, Bothell contends that the trial court erred in denying its motion for reconsideration in which it first briefed its estoppel argument. The majority agrees with Bothell that respondents are estopped from claiming that payment of park impact mitigation fees was not reasonably necessary because they signed agreements stating that the *215fees were necessary and later built and sold the homes in their plats.
The majority's analysis notwithstanding, the required elements of estoppel are not met.
Equitable estoppel is not favored, and the party asserting estoppel must prove each of its elements by clear, cogent, and convincing evidence. Mercer v. State, 48 Wn. App. 496, 500, 739 P.2d 703, review denied, 108 Wn.2d 1037 (1987).
Robinson, 119 Wn.2d at 82.
[Ejquitable estoppel requires a showing that the party to be estopped (1) made an admission, statement or act which was inconsistent with his later claim; (2) that the other party relied thereon; and (3) that the other party would suffer injury if the party to be estopped were allowed to contradict or repudiate his earlier admission, statement or act.
PUD 1 v. Walbrook Ins. Co., 115 Wn.2d 339, 347, 797 P.2d 504 (1990). Nowhere in any of the agreements signed by respondents is there any language stating that Bothell may expend the funds for general capital improvements and park programs unrelated to respondents' developments. Bothell points us to nothing in the hearings, agreements, staff meetings or respondents' subsequent actions in developing their plats which could be so construed. Thus, the first element of equitable estoppel is not met. It follows a fortiori that, in the absence of an admission, statement or act by these respondents, there can be no reliance by Bothell. Although Bothell may be able to show an injury from having to refund the fee payments, it can establish only one of the three elements necessary to apply the doctrine of equitable estoppel to respondents' claim that Bothell has expended the fees charged for park purposes in violation of RCW 82.02.020.
Finally, it should be noted that, as a prerequisite to asserting equitable estoppel, the party seeking the benefits of the doctrine must be free from fault in the transaction at issue. "Appellant must, at a minimum, make a showing of blamelessness or reasonable conduct under the circumstances or [they are] without standing to assert estoppel as a defense." Stohr v. Randle, 81 Wn.2d 881, 884-85, 505 P.2d 1281 (1973) (quoting Kozak v. Fairway Finance-Seattle, Inc., *21660 Wn.2d 500, 504, 374 P.2d 1011 (1962)); Puget Sound Bank v. Richardson, 54 Wn. App. 295, 773 P.2d 429 (1989). As our Supreme Court recently described this "clean hands" doctrine,
The doctrine of estoppel is for the protection of innocent persons, and only the innocent may invoke it. . . .
A person may not base a claim of estoppel on conduct, omissions, or representations induced by his own conduct, concealment, or representations . . ..
(Footnotes omitted.) 31 C.J.S. [Estoppel § 75,] at 453-54 [(1964)].
Mutual of Enumclaw Ins. Co. v. Cox, 110 Wn.2d 643, 651, 757 P.2d 499 (1988).
Bothell does not come to the court with clean hands in this transaction. It made acceptance of agreements to pay park fees of $400 per lot a condition of plat approval without complying with the requirements of RCW 82.02.020. Respondents had no choice but to execute those agreements in the form provided by Bothell. Had they refused, their plats would have been denied. By its own admission, Bothell has also expended the funds it collected from respondents in 'violation of the statute. Its own inequitable actions were the sole cause of this lawsuit. See Del Guzzi Constr. Co. v. Global Northwest Ltd., 105 Wn.2d 878, 885, 719 P.2d 120 (1986). Having induced respondents to sign agreements which do not satisfy the statutory requirements as a quid pro quo for plat approval, and having ignored the expenditure requirements of RCW 82.02.020, Bothell is not now in a position to ask this court to use an equitable doctrine to rescue it from its own folly.
I would affirm the trial court.
Review granted at 120 Wn.2d 1018 (1993).
Impact fees for numerous other municipal services may now be imposed directly pursuant to RCW 82.02.050-.090.
This may be done, for example, under RCW 58.17.110(1), as amended, in order to assure that "appropriate provisions are made for . . . open spaces, . . . parks and recreation . . .." Laws of 1990, 1st Ex. Sess., ch. 17, § 52.
RCW 43.21C (State Environmental Policy Act of 1971) is an example of a grant of authority for mitigating the environmental impacts of a plat. The developer and the municipality may then agree, under the provisions of RCW 82.02.020, that a fee may be paid in lieu of constructing an improvement or taking other measures to mitigate that identified direct impact.
RCW 82.02.020 provides:
This section does not prohibit voluntary agreements with counties, cities, towns, or other municipal corporations that allow a payment in lieu of a dedication of land or to mitigate a direct impact that has been identified as a consequence of a proposed development, subdivision, or plat.
(Italics mine.) "In lieu of" means "in the place of: instead of". See Webster's Third New International Dictionary 1306 (1971).
While R/L Assocs., Inc. v. Seattle, 113 Wn.2d 402, 780 P.2d 838 (1989), makes it clear that we look to RCW 82.02.020 rather than Hillis Homes for the pertinent analytical framework, Hillis Homes continues to stand for the proposition that general fees cannot be imposed irrespective of the direct impacts of a development. 97 Wn.2d at 810. In this context, it is important to note that the scheme Bothell employs in assessing park impact mitigation fees is virtually identical to that invalidated in Hillis Homes.
While there is some question of whether this issue was properly raised in the complaint, CR 15(b) provides in part:
When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings.
It is clear from the record and from the findings and conclusions entered by the court below that this issue was fully tried after it came to light in the course of pretrial discovery.
The fees were paid on the following dates: May 20, 1986 (Dujardin); June 30, 1987, and August 20, 1987 (Henderson); and May 18, 1987, and September 18, 1987 (Conner). The 5 years since Dujardin's payment expired on or about May 20, 1991; the others all expired in the summer of 1992.
The majority apparently takes the position that an action challenging expenditure of the fees must, like a challenge to their imposition, be brought within 30 days of plat approval. Majority, at 207. This is clearly impossible because the fees will not have been spent so soon sifter approval of the plat.
It is for this reason that the remedy suggested by Bothell — to order Bothell to appropriate funds to build capital improvements — is not available. The statute itself prescribes the only remedy for a violation. The legislative selection of an exclusive remedy, as set forth in RCW 82.02.020, distinguishes this case from American Legion Post 32 v. Walla Walla, 116 Wn.2d 1, 802 P.2d 784 (1991), which held that, under general taxing statutes, taxpayers are not entitled to a refund when gambling tax funds are spent for purposes outside the statute.