Key Points

  • RCW 19.86.093, enacted in 2009, uses the permissive word "may" and gives Consumer Protection Act claimants an alternative way to prove the public-interest element. It did not abrogate the Hangman Ridge factors.
  • The Homestead homeowners failed the public-interest element under both Hangman Ridge and RCW 19.86.093, so the summary-judgment dismissal of their CPA claim was affirmed.
  • The trial court abused its discretion by refusing a money judgment under RCW 7.24.080 after declaring the special assessment and maintenance fee increases void, because without it the declaratory judgment would be hollow.
  • Plaintiffs who obtained a declaratory judgment did not need to have pleaded or litigated damages to obtain a money judgment as further relief under RCW 7.24.080.
  • Neither side received appellate attorney fees because each partially prevailed.

A Washington appeals court on Oct. 19 rejected a homeowner class's argument that a 2009 statute replaced the state Supreme Court's 1986 test for whether a business's conduct affects the public interest, a showing required to sue under the state Consumer Protection Act, which bars unfair or deceptive practices in trade or commerce.

The ruling ended the homeowners' consumer-protection claim against the owner and the manager of a golf-course community in Lynden, Washington. The same court ordered the trial judge to enter a money judgment refunding fees that the judge had already declared unlawfully collected.

Bowman wrote the published opinion for Division One of the Washington Court of Appeals, which affirmed in part, reversed in part and remanded. The homeowners won the refund but lost the consumer-protection claim.

The decision keeps in force Hangman Ridge Training Stables, Inc. v. Safeco Title Insurance Co., the 1986 Washington Supreme Court decision that sets factors for judging whether a private transaction affects the public interest. The homeowners had argued that it was "long past time" for the court to declare the 2009 statute, RCW 19.86.093, the only test. The panel read the statute instead as an alternative route. It also held that a court that declares fees unlawful may order them repaid even though the plaintiffs never pleaded a claim for money.

The dispute concerns the Homestead Planned Residential Development, a roughly 250-acre development with homes, a golf course and common open space. Under a 1992 master declaration, the developer kept ownership of the open space and let residents use it in exchange for a monthly maintenance fee, which it could raise by "up to" five percent a year.

18 Paradise LLP bought the development in 2013. In 2017 it hired MJ Management LLC, which does business as Homestead Farms Golf Course, to maintain the open space, run the golf course and collect fees. In 2019, MJ purported to amend the master declaration to impose a one-time special assessment of $83 per resident and to raise the monthly maintenance fee from $36 to $93.

The homeowners sued in May 2020, and the trial court certified a class of every record owner of a lot or condominium unit subject to the master declaration. The court later established that MJ acted as 18 Paradise's agent and failed to obtain the express permission that the management agreement required before MJ could raise the charges.

In 2024, the trial court dismissed the consumer-protection claim, concluding that the "actions at issue were between a fixed set of participants." After a bench trial, it declared the assessment and fee increases void. In November 2025, however, it refused to enter a money judgment, finding that relief was "neither necessary nor proper" because the homeowners had not pleaded monetary claims or sought monetary determinations at trial.

On appeal, the panel applied the Hangman Ridge factors, which ask whether the defendant acted in the course of its business, advertised to the public, actively solicited the plaintiff and held an unequal bargaining position. The panel agreed that MJ collected the charges in the course of business. But the homeowners failed to show that 18 Paradise advertised to the public, actively solicited them or enjoyed an unequal bargaining position, the court held.

The 2009 statute provides that a claimant "may" establish that a private act is injurious to the public interest by showing a violation of certain statutes or that the act injured, or had the capacity to injure, other persons. Bowman wrote that the word "may" is generally permissive and that the statute's language "does not provide that the statute is the sole means to satisfy the public interest prong of the CPA."

The court presumed that lawmakers knew of the Hangman Ridge factors when they passed the 2009 law. Even so, "the legislature chose to use permissive rather than mandatory language in its application," the opinion said. The homeowners cited legislative reports showing that the statute responded to criticism that the factors were too burdensome for private plaintiffs. Bowman wrote that "the legislative history shows a desire to provide an alternative to the Hangman Ridge factors," adding, "Nothing in the history amounts to clear evidence of an intent to abrogate them."

The claim failed under the statute as well, the panel held. The homeowners did not show that 18 Paradise violated a qualifying statute, and they offered no evidence that the charges injured anyone other than the homeowners or had the capacity to do so.

The panel reached the opposite result on the refund. RCW 7.24.080 provides that "[f]urther relief based on a declaratory judgment or decree may be granted whenever necessary or proper." A declaratory judgment is a ruling that states the parties' rights. The panel relied on Pacific Market International, LLC v. TCAM Core Property Fund Operating LP, a 2017 unpublished decision of the same court, which held that a landlord's declaratory judgment "would be hollow" without a money judgment to enforce it.

In this case, the trial court's ruling left 18 Paradise and MJ in possession of the unlawfully collected assessments and fees, and the homeowners had tried unsuccessfully for a year to obtain a refund, the opinion said. "As a result, a money judgment is both necessary and proper to avoid leaving the homeowners with a hollow declaratory judgment," Bowman wrote.

18 Paradise and MJ argued that the homeowners never sought a money judgment at trial, that further fact-finding would be needed to determine offsetting obligations, and that the petitions amounted to "new money claims." The panel responded that a declaratory judgment action "is by nature a request for a declaration of the parties' rights, not a lawsuit for money damages." It added that 18 Paradise cited no authority requiring the homeowners to litigate damages before seeking further relief.

"It is untenable to require the homeowners to bear the cost and burden of seeking an alternative forum to bring about the return of funds that the trial court declared MJ had unlawfully collected," Bowman wrote.

Both sides sought appellate fees under a master declaration provision that awards fees to the prevailing party. "Because both parties have partially prevailed on appeal, we decline to award attorney fees to either," the court wrote. The homeowners' separate request for fees under the Consumer Protection Act failed with their claim.

The case now returns to the trial court, which the panel directed to issue a money judgment for the special assessment and maintenance fees collected under the invalid amendments to the master declaration.