## Facts

- The State of Washington sued A.N.W. Seed Corporation and individual defendants under the Washington Consumer Protection Act (CPA), alleging deceptive promotion and sale of Jerusalem artichokes.
- Defendants appeared in the action, but their counsel withdrew; the trial court entered a default judgment against defendants and denied a motion to vacate.
- Defendants appealed the default judgment but did not post a supersedeas bond.
- While the appeal was pending, the State obtained a writ of execution; the sheriff seized and sold defendants’ personal property (including farm machinery and vehicles) in a statutorily compliant sale.
- The sheriff’s sale generated $16,588.50 in proceeds.
- The Court of Appeals vacated the default judgment.
- On remand, defendants sought restitution to restore the executed property or, alternatively, its value and related losses; the trial court awarded restitution measured by the property’s fair market value at the time of sale, found to be $57,631.50 after an evidentiary hearing.
- After a trial on the merits of the CPA claim, the trial court found no intent to deceive and no actual deception of the testifying farmers, but found the overall promotional program had a tendency to mislead or deceive, and concluded the CPA was violated.
- The Court of Appeals affirmed the fair-market-value restitution measure, reversed the CPA violation finding, and reversed the trial court’s prevailing-party determination.
- The Washington Supreme Court granted review on (1) restitution measure after execution on an unsuperseded judgment later reversed, (2) the CPA “tendency to mislead or deceive” standard absent intent or actual deception, and (3) the standard of review for prevailing-party determinations.

## Issues

1. After execution on an unsuperseded judgment later reversed, is restitution measured by the sheriff’s sale proceeds or by the property’s fair market value at the time of sale?
2. Under the CPA, may conduct be found to have a tendency or capacity to mislead or deceive despite findings of no intent to deceive and no actual deception of testifying consumers?
3. What is the standard of appellate review for a trial court’s determination of the prevailing party?

## Decision

- Restitution following execution on an unsuperseded judgment later reversed is measured by the fair market value of the property at the time of sale, not merely the sheriff’s sale proceeds.
- A CPA violation may be found based on the objective tendency or capacity of conduct to mislead or deceive; intent to deceive and proof of actual deception are not required.
- A trial court’s prevailing-party determination is reviewed for abuse of discretion.

## Legal Principles

- When a judgment is reversed after the judgment creditor has executed on it, equitable restitution generally requires restoring the judgment debtor to the position it would have occupied absent the judgment and execution.
- For executed personal property, restitution may be awarded in the amount of the property’s fair market value at the time of the execution sale, even if the sale was lawfully conducted and yielded a lower price.
- Failure to post a supersedeas bond does not, by itself, shift the economic risk of enforcement of an erroneous judgment onto the appellant so as to limit restitution to execution-sale proceeds.
- Under Washington’s CPA (RCW 19.86), the deceptive-act element is satisfied by an act or practice with a tendency or capacity to mislead or deceive a substantial portion of the public; subjective intent and actual deception of particular witnesses are unnecessary.
- Whether conduct has a tendency or capacity to mislead or deceive is a fact question reviewed with deference to the trial court’s supported findings.
- Prevailing-party determinations, particularly in mixed-result litigation affecting fees and costs, rest in the trial court’s discretion and are reviewed for abuse of discretion.

## Conclusion

The court held that a judgment creditor who executed on an unsuperseded judgment later reversed must provide restitution measured by fair market value of the property taken, confirmed that CPA liability turns on an objective capacity-to-deceive standard rather than intent or actual deception, and ruled that prevailing-party determinations are reviewed for abuse of discretion.


State v. A.N.W. Seed Corp., 802 P.2d 1353 (Wash. 1991)