Eastwood v. Horse Harbor Foundation, Inc., 241 P.3d 1256 (2010)

Citation: Eastwood v. Horse Harbor Foundation, Inc., 241 P.3d 1256 (2010)
Parent Document: Eastwood v. Horse Harbor Foundation, Inc., 241 P.3d 1256 (2010)
Jurisdiction: Washington (state)
Effective Date: 2010-11-04
Original Source: https://www.courtlistener.com/opinion/2372386/eastwood-v-horse-harbor-foundation-inc/ ↗

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¶ 31 But it was for these same reasons that the Court of Appeals concluded Eastwood's losses are nothing more than economic losses. There was a contract in the form of a lease, and several provisions defined Eastwood's contractual expectations. In the lease, Horse Harbor pledged to "keep and maintain the leased premises and appurtenances in good and sanitary condition and repair during the term of this lease." Ex. 101, at 2. Eastwood assumed responsibility for "[m]ajor maintenance and repair of the leased premises, not due to Lessee's misuse, waste, or neglect or that of his employee, family, agent, or visitor." Id. Eastwood was obligated to repair any part of the leasehold "partially damaged by fire or other casualty," unless the cause was Horse Harbor's "negligence or willful act." Id. Under the surrender covenant, if Horse Harbor did not exercise a purchase option, Horse Harbor promised to "quit and surrender the premises... in as good [a] state and condition as they were at the commencement of this lease, reasonable use and wear thereof and damages by the elements excepted." Id. at 3. These contractual terms indicate Eastwood's expected benefit of the bargain: Horse Harbor would be responsible for most maintenance, and Eastwood would have the leasehold returned to her in good condition. In fact, because Horse Harbor promised to maintain the farm at its own expense, Eastwood agreed to a monthly rent amount that was one-third less than the fair market value. The measure of Eastwood's losses was the cost of repairing the horse farm. Because Eastwood failed to obtain the benefit of her contractual bargain with Horse Harbor and because she sought damages in the form of the cost of repairs, Eastwood's injury was an economic loss by the Madsen concurrence's own definition. Its arguments underscore the difficulties of drawing a line between economic loss and property damage and applying product liability categories to new settings.

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