Glogowski Law Firm, Pllc. v. City First Mortgage Services, Llc., 74266-3

Background

Glogowski Law Firm (Katrina Glogowski) represented City First in a suit brought by the Collingses alleging equity skimming and violations of the CSOA, CLA, and CPA; jury found City First liable and awarded punitive damages under the CSOA.
Glogowski sued City First for unpaid fees; City First counterclaimed for legal malpractice alleging Glogowski’s trial counsel errors caused the adverse Collings verdict.
At the Collings trial, Glogowski argued City First was exempt from the CSOA under Washington licensing language but did not assert a separate federal/HUD/FHA exemption or object to a jury instruction that omitted the federal exemption.
On summary judgment in the malpractice suit, the trial court initially denied Glogowski’s motion but later granted it on proximate-cause grounds, dismissing City First’s malpractice claim; City First appealed.
On appeal, City First produced a declaration (Brian Hunt, general counsel) asserting City First and its branch managers were HUD/FHA-approved and federally regulated, creating a genuine issue whether City First was exempt from the CSOA and thus whether punitive damages (only available under CSOA) could have been avoided.
The Court of Appeals held that a triable issue exists on proximate cause because, if the federal exemption had been raised, the CSOA-based punitive damages might not have been available; summary judgment for Glogowski was reversed and the case remanded.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether proximate cause can be decided as a matter of law on summary judgment in legal malpractice claim	Glogowski: No proximate cause — even if exemption argued, City First would still be vicariously liable for agents, so outcome unchanged	City First: Genuine issue whether failure to assert federal HUD/FHA exemption to CSOA caused punitive damages	Reversed: Triable issue exists; proximate cause not resolved as matter of law because federal-exemption evidence could have prevented CSOA punitive damages
Whether City First was exempt from CSOA such that punitive damages would be unavailable	Glogowski: City First argued only state-law licensing exemption at trial; federal exemption not argued, so no basis	City First: Produced declaration suggesting FHA/HUD approval and supervision creating federal exemption under CSOA	Exists factual dispute on federal-exemption status precluding summary judgment in malpractice case
Whether failure to object to jury instruction waived challenge to omission of federal exemption	Glogowski: No specific objection to instruction so appellate courts did not consider federal exemption earlier	City First: Trial counsel’s failure to press federal exemption is the malpractice at issue and Hunt declaration creates a factual dispute	Court treated failure to object as procedural but found that, for malpractice proximate-cause analysis, City First’s evidence raises a genuine factual issue
Whether vicarious liability for agents forecloses application of federal exemption	Glogowski: Corporate vicarious liability means individual agents cannot invoke federal regulation; thus exemption would not save City First	City First: If agents acted within scope and City First was federally approved, exemption could apply to the corporation and change jury’s analysis	Court: Rejected Glogowski’s shortcut — vicarious-liability findings don’t make CSOA exemption irrelevant; issue for jury given factual dispute

Key Cases Cited

Loeffelholz v. University of Washington, 175 Wn.2d 264 (standard of review for summary judgment)
Klinke v. Famous Recipe Fried Chicken, Inc., 94 Wn.2d 255 (view evidence in light most favorable to nonmoving party)
Jones v. Allstate Ins. Co., 146 Wn.2d 291 (summary judgment standard)
Halvorsen v. Ferguson, 46 Wn. App. 708 (elements of legal malpractice claim)
Smith v. Preston Gates Ellis, LLP, 135 Wn. App. 859 (proximate cause usually for jury; can be decided as a matter of law only when indisputable)
Collings v. City First Mortgage Services, LLC, 177 Wn. App. 908 (underlying liability and appellate disposition in original suit)
Walker v. State, 121 Wn.2d 214 (requirements for stating distinct grounds when objecting to jury instructions)
Diaz v. Washington State Migrant Council, 165 Wn. App. 59 (corporate action through agents)
Mauch v. Kizzling, 56 Wn. App. 312 (scope of authority and imputation of agent acts to corporation)