620, Llc v. Meridian, Inc., 75331-2

Background

620 LLC contracted with Meridian Construction in 2012 to build a commercial building for $986,700; after completion Meridian sought an extra $180,000 for change orders, and filed a lien.
Meridian and 620 (through managing member Luay Joudeh) executed a written settlement agreement (Addenda D) dated June 9, 2014 resolving the lien; it required a $30,000 payment, mutual "hold each other harmless" for future claims, released Meridian from "warranty work on this building," and included a separate residential-build commitment.
Meridian removed the lien after the settlement; 620 continued to identify construction defects and requested repairs; Meridian sent an e-mail indicating it planned certain repairs but 620 alleges Meridian never fixed them.
620 sued in June 2015 alleging Meridian breached the original construction contract by poor workmanship and unauthorized changes; Meridian denied liability and moved for summary judgment.
The trial court granted summary judgment for Meridian, holding the settlement's hold-harmless clause barred 620's breach-of-contract claims; 620 appealed.
The Court of Appeals reversed, finding genuine factual disputes about the scope and meaning of the hold-harmless provision and surrounding circumstances precluded resolution on summary judgment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the settlement's "hold each other harmless for any future claims on this project" provision bars 620's breach-of-contract suit	The clause was limited to resolving the lien and warranty/repair obligations; it did not release Meridian from liability for construction defects	The clause was a mutual, global release/"walk away" agreement barring any future claims related to the project, including this suit	The clause is ambiguous in context; reasonable interpretations conflict, so summary judgment is improper and the issue must go to trial
Whether extrinsic evidence may be considered in contract interpretation on summary judgment	620: Extrinsic evidence (draft changes, parties' conduct, emails) shows limited scope and intent	Meridian: The plain hold-harmless language is dispositive as a global release	Court: Extrinsic evidence is admissible and demonstrates reasonable alternative meanings, so it cannot be resolved as a matter of law
Whether parties' post-agreement conduct (offers to repair) is consistent with a global release	620: Meridian's offers to repair show the parties treated the settlement as limited and did not intend a full release	Meridian: Post-settlement communications are not dispositive against plain contract language	Court: Subsequent acts support 620's interpretation and create a factual issue for trial
Appropriateness of summary judgment on contract interpretation	620: Single-meaning rule does not apply; multiple reasonable meanings exist	Meridian: Language is clear and judgment appropriate	Court: Because reasonable competing interpretations exist, summary judgment was improper and must be reversed

Key Cases Cited

Mahoney v. Shinpoch, 107 Wn.2d 679 (1987) (standard of review for summary judgment)
Spradlin Rock Prods., Inc. v. Pub. Util. Dist. No. 1 of Grays Harbor County, 164 Wn. App. 641 (2011) (contract interpretation on summary judgment proper only if one reasonable meaning)
Interstate Prod. Credit Ass'n v. MacHugh, 90 Wn. App. 650 (1998) (ambiguity presents factual question)
City of Tacoma v. City of Bonney Lake, 173 Wn.2d 584 (2012) (objective is to effectuate parties' mutual intent in contract interpretation)
Scott Galvanizing, Inc. v. Nw EnviroServices, Inc., 120 Wn.2d 573 (1993) (use of extrinsic evidence and surrounding circumstances to determine intent)
Berg v. Hudesman, 115 Wn.2d 657 (1990) (extrinsic evidence admissible regardless of ambiguity)
Snohomish County Pub. Transp. Benefit Area Corp. v. FirstGroup Am., Inc., 173 Wn.2d 829 (2012) (interpretation should give effect to all contract provisions)
Kelley v. Tonda, 198 Wn. App. 303 (2017) (some disputes cannot be resolved by dispositive motion; must be tried)