Wash. Court of Appeals published opinion — D2 59088-3-II Published Opinion.pdf

Citation: Wash. Court of Appeals published opinion — D2 59088-3-II Published Opinion.pdf
Jurisdiction: Washington (state)
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Original Source: https://www.courts.wa.gov/opinions/pdf/D2%2059088-3-II%20Published%20Opinion.pdf ↗

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No. 59088-3-II

Phase 2, to be applied to the Phase 2 purchase price. Therefore, based on the terms of the PSA,

LGI would be entitled to return of its Phase 2 deposit because Phase 2 never closed.11

CLS argues that because the superior court did not impose any terms or conditions on the

Receiver in the May 11, 2023 Order with respect to returning the Phase 2 deposit, the rejection of

the PSA is “simply treated ‘as a breach of contract’” without any further action necessary on the

part of the Receiver. Br. of Appellant at 8. CLS then argues that RCW 7.60.130(2) does not allow

for rescission of the PSA, which is the only “framework under which earnest money may actually

be returned in failed transactions.” Br. of Appellant at 9. CLS’s arguments are unpersuasive.

First, while RCW 7.60.130(1) allows a superior court to “condition . . . rejection of any

executory contract . . . on the terms and conditions the court believes are just and proper under the

particular circumstances of the case,” it does not require a court to impose conditions. Moreover,

the superior court’s decision to not impose terms and conditions following a receiver’s rejection

of an executory contract does not otherwise change a receiver’s statutory powers and duties. See

RCW 7.60.060; RCW 7.60.130.

CLS cites to Willener v. Sweeting12 for the proposition that the only framework under

which a deposit can be returned is when a contract is rescinded. Willener has no such holding. Id.

In Willener, both parties failed to perform according to their contract. Id. at 396. Further, the

Willener court’s discussion of rescission was in the context of a possible equitable remedy based