Opinion
No. 19332-2-III.
Filed: June 14, 2001. DO NOT CITE. SEE RAP 10.4(h). UNPUBLISHED OPINION.
Appeal from Superior Court of Spokane County, No. 97-2-00692-3, Hon. Michael E. Donohue, April 13, 2000, Judgment or order under review.
Counsel for Appellant(s), Mark E. Lehinger, P.O. Box 30397, 421 W Riverside, Spokane, WA 99223-3006.
Counsel for Respondent(s), Richard J. Roberts, 101 E Augusta, Spokane, WA 99207.
American Northwest Construction, Inc. (ANC), had a contractor's deposit bond account with Spokane Teachers Credit Union (STCU). STCU satisfied judgments against this account even though its balance was zero. Claiming unjust enrichment, STCU sued ANC. The court granted summary judgment to the credit union. We affirm. On August 16, 1991, Delbert Mallery of ANC deposited $6,000 into an account with STCU to fulfill the contractor's bonding requirement under RCW 18.27.040. The account was assigned to the Washington State Department of Labor and Industries as required by statute. On January 22, 1992, Leroy Allen, an officer of ANC, replaced Mr. Mallery as the sole authorized signatory on the account.
In November 1993, STCU received a tax levy for $1,963.45 from the Washington State Department of Revenue against ANC. STCU paid the levy from the deposit account and notified ANC. The remaining balance of $4,683.19 was then sent to Mr. Allen on behalf of ANC. The account was not closed.
On March 15, 1996, STCU received notice that a judgment of $3,470.57 had been entered against ANC. STCU paid the judgment creditor, who assigned its judgment to STCU.
On April 11, 1996, STCU received another judgment against ANC for $2,003.51. STCU paid the judgment creditor, who also assigned its judgment to STCU. On August 16, 1996, STCU received notice of a third judgment against ANC for $525.92 in favor of the Department of Revenue. STCU paid the amount to the clerk of the court for payment to the Department.
Because ANC's account had no funds, STCU paid each judgment from its own funds. It then filed suit against ANC, Delbert and Jane Doe Mallery, and Leroy and Jane Doe Allen for $6,000 on the theory of unjust enrichment.
STCU moved for summary judgment. The defendants argued that there was no unjust enrichment because they had made no promise to reimburse STCU for any amounts paid out in excess of the original $6,000. They also contended the three-year statute of limitations had run because STCU's claim accrued when the account balance reached zero in November 1993.
The court held that these claims accrued in 1996 when STCU paid the three judgments, so the statute of limitations had not expired. It granted summary judgment to STCU against only ANC for $6,000. The Mallerys and Allens were eventually dismissed from the action. This appeal follows. ANC first claims that the statute of limitations had run. Claims for unjust enrichment are subject to a three-year statute of limitations. Seattle Prof'l Eng'g Employees Ass'n v. Boeing Co., 139 Wn.2d 824, 837-38, 991 P.2d 1126 (2000); RCW 4.16.080(3).
The question is when STCU's claim accrued. A cause of action accrues when a party has a right to apply to a court for relief. Malnar v. Carlson, 128 Wn.2d 521, 529, 910 P.2d 455 (1996). STCU claimed ANC was unjustly enriched when it paid ANC's creditors even though the account balance was zero. Until it received and paid the judgments, STCU had no cause of action against ANC. The claims therefore accrued in 1996 and suit was timely filed in 1997. ANC next argues the court erred by granting summary judgment to STCU. In reviewing an order of summary judgment, this court engages in the same inquiry as the trial court, construing the facts and reasonable inferences therefrom most favorably to the nonmoving party to ascertain whether there exists an issue of material fact. deLisle v. FMC Corp., 57 Wn. App. 79, 82, 786 P.2d 839, review denied, 114 Wn.2d 1026 (1990).
STCU sued ANC on the theory it was unjustly enriched. To prevail on a claim of unjust enrichment, two elements must be established: (1) the party conferring the benefit must not be a volunteer; and (2) the party receiving the benefit must be unjustly enriched. Ellenburg v. Larson Fruit Co., 66 Wn. App. 246, 250, 835 P.2d 225, review denied, 120 Wn.2d 1011 (1992).
Whether a party acts as a volunteer is determined after considering all the surrounding circumstances. Id. at 251. Those circumstances include (1) whether the party who benefited asked the other party to act; (2) if the party who benefited knew of the payment but stood back and allowed the other party to make the payment; and (3) if the benefits were necessary to protect either party's interests. Id. at 251-52. The facts before the court established as a matter of law that STCU was not a volunteer. By opening the contractor's deposit account at STCU, ANC agreed that the credit union would make payments from the account as required by title 18.27 RCW. ANC knew of the payments because it was a named defendant in each of the judgments paid in 1996. Payment of these judgments protected both parties' interests. The first element of an unjust enrichment claim was established.
ANC refers to the withdrawals from the account in 1993 as well as 1996. But this case only seeks reimbursement for the 1996 withdrawals.
We must next determine if ANC was unjustly enriched. Unjust enrichment occurs when a person has and retains money or benefits, which in justice and equity belong to another. Bailie Communications, Ltd. v. Trend Bus. Sys,. Inc., 61 Wn. App. 151, 159, 810 P.2d 12, 814 P.2d 699, review denied, 117 Wn.2d 1029 (1991). The satisfaction of a debt is a 'benefit.' Chandler v. Washington Toll Bridge Auth., 17 Wn.2d 591, 602-03, 137 P.2d 97 (1943). The retention of the benefit must be unjust. See Farwest Steel Corp. v. Mainline Metal Works, Inc., 48 Wn. App. 719, 732, 741 P.2d 58, review denied, 109 Wn.2d 1009 (1987).
ANC opened an account with STCU to satisfy its contractor's bonding requirements. STCU was required to pay claims and judgments against ANC and the account. In 1993, it made such a payment for a tax levy. STCU then notified ANC that it made payment and asked ANC to bring the account balance back to $6,000. Thereafter, STCU tendered a check to Mr. Allen for the remaining balance, but the account was not closed. In 1996, STCU received three judgments against ANC, STCU, and the account. STCU paid each judgment even though ANC's account balance was then zero. ANC benefited from these payments and the benefit was unjust. The court did not err by finding ANC was unjustly enriched.
ANC claims STCU's complaint is barred by the doctrine of election of remedies. But STCU pleaded only one remedy. Therefore, this doctrine does not apply. See Birchler v. Castellow Land Co., 133 Wn.2d 106, 112, 942 P.2d 968 (1997).
ANC nonetheless claims that equity precludes STCU from prevailing because it improperly released funds from the account in 1993. Unjust enrichment is an equitable action. See Auburn Mechanical, Inc. v. Lydig Constr., Inc., 89 Wn. App. 893, 904, 951 P.2d 311, review denied, 136 Wn.2d 1009 (1998). Courts will not apply equitable remedies on behalf of a party whose conduct in connection with the transaction was unconscientious, unjust, or marked by want of good faith. Kim v. Lee, 102 Wn. App. 586, 598, 9 P.3d 245 (2000), review granted on other grounds, 142 Wn.2d 1024 (2001). There is no evidence that STCU's conduct was unconscientious, unjust, or in bad faith. Equity does not preclude STCU from prevailing, but rather allows it to do so.
Affirmed.
A majority of the panel has determined this opinion will not be printed in the Washington Appellate Reports, but it will be filed for public record pursuant to RCW 2.06.040.
WE CONCUR: BROWN, A.C.J., SWEENEY, J.