Russell v. New Mexico Interstate Stream ( 2015 )

  •                                                                                 FILED
                                                                        United States Court of Appeals
                          UNITED STATES COURT OF APPEALS                        Tenth Circuit
                                 FOR THE TENTH CIRCUIT                       December 2, 2015
                                                                            Elisabeth A. Shumaker
                                                                                Clerk of Court
          Plaintiffs - Appellants,
                                                               No. 15-2042
    v.                                             (D.C. No. 1:13-CV-00760-KG-LAM)
                                                                (D. N.M.)
    DEPARTMENT, State Parks Division;
    ESTEVAN LOPEZ, Individually and in his
    official capacity as Director of the New
    Mexico Interstate Stream Commission;
    TOMMY MUTZ, Individually and in his
    official capacity as Director of the New
    Mexico State Parks Division,
          Defendants - Appellees.
                                 ORDER AND JUDGMENT*
    Before TYMKOVICH, Chief Judge, HOLMES and PHILLIPS, Circuit Judges.
            After examining the briefs and appellate record, this panel has determined
    unanimously that oral argument would not materially assist in the determination of
    this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
    ordered submitted without oral argument. This order and judgment is not binding
    precedent, except under the doctrines of law of the case, res judicata, and collateral
    estoppel. It may be cited, however, for its persuasive value consistent with
    Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
          This case involves the termination of dock license agreements on New
    Mexico’s Ute Reservoir. Plaintiffs appeal from three orders of the district court, the
    combined effect of which was to grant summary judgment in favor of defendants on
    plaintiffs’ state and federal claims challenging the terminations. We dismiss part of
    this appeal for lack of jurisdiction, and, exercising jurisdiction under 28 U.S.C.
    § 1291 over the remainder of the appeal, affirm the judgment.
    I. Background
          Plaintiffs entered into license agreements with the New Mexico Interstate
    Stream Commission that permitted them to maintain private boat docks at Ute
    Reservoir in Ute Lake State Park. Ute Reservoir is managed by the Commission and
    the State Parks Division of the New Mexico Energy, Minerals, and Natural Resources
    Department (“Division”). In May 2013, defendants informed plaintiffs by letter that
    their license agreements were being terminated because the Division had determined
    that the docks had become a threat to public safety. A drought had yielded extremely
    low water levels at the reservoir, “grounding” the docks and causing them structural
          Plaintiffs sued, asserting a federal claim for violation of their due process
    rights under 42 U.S.C. § 1983 and a state claim for breach of contract. Both sides
    moved for summary judgment. In short, the court determined plaintiffs did not have
    a cognizable property interest in the license agreements, and it granted summary
    judgment in defendants’ favor on the due process claim. It dismissed the contract
    claim without prejudice. And it awarded defendants their costs and attorney fees
    pursuant to the indemnity provision in the license agreements.
          Plaintiffs filed a Motion to Alter or Amend Judgment, arguing 42 U.S.C.
    § 1988 prohibited awarding attorney fees incurred in connection with their § 1983
    claim based on the license agreements’ indemnity provision and that the indemnity
    provision was unconscionable. The court agreed with the former but not the latter,
    and amended its previous award by limiting defendants to costs and attorney fees
    incurred in connection with the contract claim only.
          Plaintiffs contend the district court erred by concluding (1) they did not have a
    property interest in the license agreements and (2) the indemnity provision of license
    agreements was neither procedurally nor substantively unconscionable.
          Defendants, in turn, argue that we lack jurisdiction to consider plaintiffs’ first
    argument because they did not timely appeal the district court’s August 2014 orders
    disposing of their due process claim. As explained below, we agree with defendants’
    jurisdictional argument and therefore dismiss the appeal in part as to the due process
    claim. In addition, we reject plaintiffs’ contention that the indemnity provision is
    II. Jurisdiction
          Where the United States is not a party, a civil notice of appeal must be filed
    within thirty days of the order or judgment being appealed. Fed. R. App. P. 4(a)(1).
    “A timely filed notice of appeal is an absolute prerequisite to our jurisdiction.” Utah
    Women’s Clinic, Inc. v. Leavitt, 
    75 F.3d 564
    , 566 (10th Cir. 1995). Here, the orders
    granting summary judgment on plaintiffs’ due process claim were entered on
    August 29, 2014, yet plaintiffs did not file their notice of appeal until March 4, 2015.
    Plaintiffs contend that their Motion to Alter or Amend Judgment, properly construed
    as a Rule 59(e) motion, tolled the thirty-day period until the entry of the order
    disposing the motion. However, even if we construe plaintiffs’ motion as a
    Rule 59(e) motion, it is well established that “a Rule 59(e) motion, challenging only
    the award of costs and attorney’s fees, does not toll the time for a merits appeal.” Id.
    at 567. In an attempt to circumvent this clear precedent, plaintiffs assert that their
    motion is distinguishable from a typical challenge to an award of costs and attorney
    fees because it addressed the substantive correctness of the district court’s legal
    reasoning. But the correctness of plaintiffs’ legal argument does not change the fact
    that their motion challenged only costs and attorney fees. See Yost v. Stout, 
    607 F.3d 1239
    , 1243 (10th Cir. 2010) (concluding that a motion to alter or amend the judgment
    challenging only the court’s denial of fees – and not the court’s judgment on its
    merits – did not toll the time in which an appeal could be taken on the merits).
    Therefore, Yost and Utah Women’s Clinic compel the conclusion that we lack
    jurisdiction to reach the merits of plaintiffs’ due process claim in this appeal.
    III. Indemnity Provision
          In awarding defendants their attorney fees and costs, the district court relied on
    the indemnity provision in the license agreements, which provides, in relevant part:
    “Licensee shall further indemnify the Commission for any attorneys’ fees incurred in
    connection with, and/or staff attorneys’ salaries allocable to, any action the
    Commission takes to enforce this Agreement.” Aplt. App., Vol. 1, at 50. Plaintiffs
    argue this provision should not be enforced because it is both procedurally and
    substantively unconscionable. We are not persuaded.
          We review de novo issues relating to unconscionability of a contract provision.
    Figueroa v. THI of New Mexico at Casa Arena Blanca, LLC, 2013-NMCA-077, ¶ 23,
    306 P.3d 480
    . To determine whether a contract is unconscionable, we apply state
    law. THI of New Mexico at Hobbs Center, LLC v. Patton, 
    741 F.3d 1162
    , 1169
    (10th Cir. 2014). Under New Mexico law, a court may decline to enforce a contract
    provision if it is procedurally unconscionable, substantively unconscionable, or a
    combination of both. Strausberg v. Laurel Healthcare Providers, LLC,
    2013-NMSC-032, ¶ 32, 
    304 P.3d 409
    . Procedural unconscionability depends on “the
    particular factual circumstances surrounding the formation of the contract, including
    the relative bargaining strength, sophistication of the parties, and the extent to which
    either party felt free to accept or decline terms demanded by the other.” Figueroa,
    2012-NMCA-077, ¶ 22, 
    306 P.3d 480
     (internal quotation marks omitted).
    Substantive unconscionability concerns “the legality and fairness of the contract
    terms themselves, including whether the contract terms are commercially reasonable
    and fair, the purpose and effect of the terms, the one-sidedness of the terms, and
    other similar public policy concerns.” Id. (internal quotation marks omitted).
    Because unconscionability is an affirmative contract defense, the party alleging
    unconscionability has the burden of proving a contract provision is unenforceable on
    that basis. Strausberg, 2013-NMSC-032, ¶ 39, 
    304 P.3d 409
          In support of their argument that the indemnity provision is procedurally
    unconscionable, plaintiffs state in their brief that by the time they were presented
    with copies of the license agreement containing the provision, their docks were
    already floating on Ute Reservoir at a cost of tens of thousands of dollars each, and
    thus plaintiffs were offered the license agreements on a take-it-or-leave-it basis. But
    plaintiffs point to no evidence in the record that they did not freely and willingly
    enter into the license agreements. Their conclusory assertion, devoid of factual
    support, is insufficient to prove procedural unconscionability. Plaintiffs’ argument
    concerning substantive unconscionability also is underdeveloped. Rather than
    arguing that the provision is unconscionable as applied to them in this case, they raise
    various arguments as to how it might be applied in a way that is one-sided and
    unconscionable, such as by billing them for the time spent drafting the termination
    letters. In the absence of any evidence that plaintiffs’ were actually billed for this
    time or that the indemnity provision was actually applied to them in an unfair
    manner, they have not met their burden of proving substantive unconscionability.
    The appeal is dismissed in part, and the judgment is affirmed.
                                        Entered for the Court
                                        Timothy M. Tymkovich
                                        Chief Judge

Document Info

DocketNumber: 15-2042

Filed Date: 12/2/2015

Precedential Status: Non-Precedential

Modified Date: 12/2/2015