Opinion
Editorial Note:
This opinion appears in the Federal reporter in a table titled "Table of Decisions Without Reported Opinions". (See FI CTA9 Rule 36-3 regarding use of unpublished opinions)
Argued and Submitted Aug. 9, 1999.
Appeal from the United States District Court for the Western District of Washington John C. Coughenour, District Judge, Presiding.
Before CANBY, BRUNETTI, and O'SCANNLAIN, Circuit Judges.
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as may be provided by 9th Cir. R. 36-3.
The facts are known to the parties and need not be repeated here.
A grant of summary judgment is reviewed de novo. Margolis v. Ryan, 140 F.3d 850, 852 (9th Cir.1998). Our review is governed by the same standard used by the district court under Federal Rule of Civil Procedure 56(c). Ghotra v. Bandila Shipping, Inc., 113 F.3d 1050 (9th Cir.1997), cert. denied, 118 S.Ct. 1034 (1998). Thus, we must determine whether, viewing the evidence in the light most favorable to the non-moving parties, there are any genuine issues of material fact, and whether the district court correctly applied the relevant substantive law. See Margolis, 140 F.3d at 852.
Because the issue before us is whether American Eagle's insurance was still effective when the vessel capsized on May 15, 1996, we must first determine if there is a genuine issue of material fact as to whether the vessel had been delivered to Hone Heke by that time. Five days earlier, on May 10, 1996, the parties exchanged a number of documents that were drafted purportedly to clarify either the physical transfer of the vessel or the responsibility for the vessel.
We conclude that one of those documents--the Mutual Release of Guarantors (the "Mutual Release")--is of controlling significance to the dealings of May 10 because it alone contains unequivocal language describing the agreement in the past tense. See, e.g., Vacova Co. v. Farrell, 62 Wash.App. 386, 396 (1991). The Mutual Release recites that the vessel "has been " accepted for delivery by Hone Heke and that American Eagle has completed "all construction tasks, including minor tasks after sea trials." Mutual Release at 1 (emphasis added). Furthermore, these recitals are supported by several overt acts that corroborate the agreement. First, Hone Heke accepted the bill of sale; second, Hone Heke obtained insurance effective May 10, 1996; and third, Hone Heke simultaneously hired a security guard to protect the vessel from that point forward. These actions clearly comport with the fact that Hone Heke took possession of and legal title to the vessel on May 10, as the Mutual Release makes clear. The aggregation of these events and the unequivocal language of the Mutual Release eliminate any genuine issue as to the material fact of delivery effective May 10, 1996, and the contemporaneous termination of exposure under the Builder's Risk Policy.
The district court declined to consider the other documents signed on May 10 because it held that they were inconsistent with the parties' written agreement in the form of the Mutual Release. In accordance with Washington law, the district court concluded that the parol evidence rule barred the use of such documents. We agree. The parol evidence rule in Washington law provides that "parol or extrinsic evidence is not admissible to add to, subtract from, vary or contradict written instruments which are contractual in nature and which are valid, complete, unambiguous, and not affected by accident, fraud, or mistake." Emrich v. Connell, 105 Wash.2d 551, 555-56 (1986) (quoting Buyken v. Ertner, Wash.2d 334, 341 (1949)). In this matter, Hone Heke itself agreed that the terms of the Mutual Release were contractual in nature and not mere recitals. See Mutual Release at 2. Because the additional agreements of May 10 are barred by the parol evidence rule, they are "surplusage which cannot support or defeat a motion for summary judgment." Vacova Co., 62 Wash.App. at 395 (citing Henry v. St. Regis Paper Co., 55 Wash.2d 148 (1959)).
Furthermore, suggestions of an escrow account are defeated by the fact that the operative documents were delivered and accepted on the morning of May 10. To create an escrow under Washington law, the document must be held until the occurrence of the event at issue, and then delivered to take effect. See Lechner v. Halling, 35 Wash.2d 903, 912 (1950); see also Rest. (2d) of Contracts § 103(1) (stating that an instrument is delivered in escrow when a party "manifests an intention that the document is to take effect according to its terms upon the occurrence of a stated condition but not otherwise"). Here, there was no conditional delivery of the Mutual Release, and we cannot therefore reach the conclusion that there could be an escrow account.
Finally, because the Mutual Release effectively released both parties from further obligations, the district court did not err in granting summary judgment as to the allocation of the final $10,000 payment held by Skagit State Bank.
AFFIRMED.