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IN THE SUPERIOR COURT OF THE STATE OF WASHINGTON IN AND FOR THE COUNTY OF KING

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NO. 94-2-05717-1 SEA

CORA E. EDMONDS,
      Plaintiff,

      vs.

JOHN L. SCOTT REAL ESTATE,
      Defendant.

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ORAL OPINION

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November 17, 1998

Before:  The Honorable PETER D. JARVIS


APPEARANCES:

For the Plaintiff:

JOHN W. HATHAWAY
Attorney at Law

For the Defendant:

DOUGLAS TINGVALL
Attorney at Law


Reported by:

Velma Haynes
Official Court Reporter



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THE COURT: When I fixed attorneys' fees, after trial in the original action in this case, as pointed out by the court of appeals, I was clearly in error in reducing the amount of the award for attorneys' fees principally spent pursuing an unsuccessful summary judgment.

Now, this matter, which seemed at the outset to be a very simple one -- first-time home buyer puts up $5,001 earnest money to buy a house. The earnest money is improperly prepared by the John L. Scott agent. The house has water in the basement. The problem is not corrected. She requests her money back and John L. Scott, unlike any other real estate agency I am familiar with, takes the unique action of deciding whether or not she gets it back, ignoring their obvious conflict of interest because, if they decide in favor of the seller of the property, which they did in this case, their agent gets half of the earnest money. Their office shares in that, a clear conflict of interest which they totally ignored and gave little attention to in the court.

Well, going back, the standard way that most real estate agents handle this, we see it all the time, if they can't get both the buyer and the seller to sign a rescission agreement, they simply file a very simple, quick action, interplead the money into the superior court and say, here, you two people, here is the money, you go fight about it, we are out of it, and the court will decide where the money goes. We see those all the time. They are simple actions that real estate offices don't get involved in after they have taken that first step to deposit the money with the Court, with the interpleader pleadings.

But, no, this $5,001 case has now gone through a trial and an appeal to the court of appeals and an appeal to the Supreme Court. John L. Scott, with the exception of prevailing in the court of appeals to the extent that there was only one consumer protection violation permitted to be compensated for, lost 100 percent.

Furthermore, the testimony at trial, as pointed out by the court of appeals, pointed out that they had been performing this unreasonable activity in what was estimated to be hundreds of other cases. So, what seemed like a simple case to begin with is a case of considerable importance. Cora Edmonds led the way. I have no idea whether John L. Scott has changed its practice, but it's clear that there will be others who will challenge it if they have not.

Reviewing all of Mr. Hathaway's attorneys fee bills, using the lode star method, I find that there is no time spent on work done for unsuccessful claims or irrelevant claims. This was a difficult case; difficult to find the facts and present them, difficult in the battle that John L. Scott put up all the way along. As outlined by Mr. Hathaway, it involved substantial risks on the part of the plaintiff. She could have just said, at the beginning, oh, it's only five thousand bucks, I can't hang myself on the line, so to speak, for all of these additional risks when the amount in controversy is only $5,000. But she did. So, I am going to award 100 percent of the attorneys' fees that were prayed for and are set forth on the illustrative exhibit handed up by Mr. Hathaway.

The idea that the Court cannot award prejudgment interest on either the attorneys fees and the principal judgment is totally without merit. It would be correct if I were going to reduce those fees, but I am not. I'm going to increase them. So, I will sign the judgment in the form proposed by Mr. Hathaway, most recently proposed, after he. removed the $610 of additional costs. So, a matter that began as a $5,000 case ends up $154,000 case.

Now, if that doesn't bear out my original statement to you, Mr. Tingvall, at the trial, nothing else will. I'm signing the judgment.




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