## Facts

- A real estate developer, Parkridge, bought several adjacent houses in Seattle intending to construct a 60-unit high-rise apartment building permitted under existing zoning.
- Neighborhood groups opposed the project and sought to stop or change it, including requesting special notice of demolition permits; city leadership directed the building department to provide that notice.
- When Parkridge applied for a demolition permit, the City notified the neighborhood group and, through an informal arrangement involving a mayoral staffer aligned with the opponents, required an Environmental Impact Statement (EIS) as a precondition to permits.
- The EIS condition was imposed outside standard state environmental review procedures, which ordinarily require prescribed review steps before an official significance determination.
- The City Council later downzoned the property to single-family use; a court invalidated that downzone as arbitrary and ordered proper processing of Parkridge’s applications.
- After the court order, the City continued to demand an EIS and otherwise delayed or obstructed permit processing.
- Parkridge eventually completed the project about a decade later and sued the City for intentional interference with a business expectancy, claiming lost profits, loss of favorable financing, and increased construction costs due to delay.
- The trial court entered judgment for Parkridge and awarded nearly $1 million; the Court of Appeals reversed; the Washington Supreme Court granted review.

## Issues

1. Whether a municipality can commit intentional interference with a business expectancy by using procedurally irregular, politically motivated administrative actions to delay or obstruct a permitted development.
2. Whether the challenged conduct was “improper” and unprivileged, as distinct from immune legislative activity such as rezoning.
3. Whether substantial evidence supported proximate causation and damages attributable to actionable municipal conduct.

## Decision

- The Washington Supreme Court reversed the Court of Appeals and remanded to the superior court.
- The court held Parkridge proved the elements of intentional interference with a business expectancy, including improper interference.
- The City did not establish a privilege or justification for the administrative conduct challenged (aside from the immune legislative act of rezoning).
- The trial court’s findings supported proximate causation linking the City’s wrongful administrative actions to Parkridge’s losses.
- The case was remanded for recalculation of damages consistent with legislative immunity for the rezoning decision.

## Legal Principles

- Intentional interference with a business expectancy requires: (1) a valid expectancy, (2) defendant’s knowledge, (3) intentional interference, (4) improper interference, and (5) resulting damages.
- Impropriety may be shown where government actors depart from established procedures, grant favoritism, or use administrative power primarily to satisfy political pressure rather than apply lawful standards.
- Legislative acts such as rezoning are immune from tort liability, but nonlegislative administrative actions may be actionable when they misuse regulatory processes.
- Once wrongful interference is shown, the defendant bears the burden to prove privilege or justification for the interference.
- Proximate cause and damages may be established where substantial evidence links administrative obstruction and delay to lost profits, loss of financing opportunities, and increased project costs.

## Conclusion

The court held that Seattle could be liable for intentional interference with a developer’s business expectancy where city officials, responding to political pressure, used irregular administrative measures and delay tactics to obstruct permitting, while reaffirming that legislative rezoning itself is immune and requiring damages to be recalculated to exclude losses attributable solely to that immune act.


Pleas v. City of Seattle, 112 Wash. 2d 794, 774 P.2d 1158 (1989)