Electrical Contractors v. Westwater Farms , 370 P.3d 949 ( 2016 )

2016 UT App 60THE UTAH COURT OF APPEALS
ELECTRICAL CONTRACTORS, INC.,
Appellee,
v.
WESTWATER FARMS, LLC,
Appellant.
Opinion
No. 20141166-CA
Filed March 31, 2016
Seventh District Court, Moab Department
The Honorable Lyle R. Anderson
No. 120700003
Craig C. Halls, Attorney for Appellant
Douglas E. Griffith and Adam L. Grundvig,
Attorneys for Appellee
SENIOR JUDGE RUSSELL W. BENCH authored this Opinion, in which
JUDGES J. FREDERIC VOROS JR. and MICHELE M. CHRISTIANSEN
concurred.1
BENCH, Senior Judge:
¶1 Westwater Farms, LLC (Westwater) appeals the district
court’s grant of summary judgment in favor of Electrical
Contractors, Inc. (ECI) and its denial of Westwater’s motion to
submit supplemental affidavits and documents in opposition to
summary judgment. We affirm.
1. Senior Judge Russell W. Bench sat by special assignment as
authorized by law. See generally Utah R. Jud. Admin. 11-201(6).
Electrical Contractors v. Westwater Farms
BACKGROUND
¶2 In September 2010, Westwater, through its managing
members, Thomas Warnes and Carl Borgstrom, allegedly
entered into an oral contract with ECI pursuant to which ECI
would provide general and electrical contracting services on a
cost-plus2 basis in connection with a water disposal system to be
constructed on Westwater’s property in Grand County, Utah
(the Project). Stewart Environmental Services, Inc. (Stewart
Environmental) joined the Project as Westwater’s engineering
representative in late 2010 or early 2011. Between late 2010 and
July 2011, ECI provided approximately $1,028,849 in
construction services on the Project and sent invoices to
Westwater for this work. Stewart Environmental made
payments to ECI in May and July 2011 totaling $152,061.24. On
August 8, 2011, ER&PWD Joint Venture—an LLC created by
Warnes and Dave Stewart, a principal of Stewart
Environmental—entered into a written agreement with ECI
regarding documentation of charges and a schedule for paying
ECI. However, other than the aforementioned payments made
by Stewart Environmental, no additional payments were made
to ECI by any party.
¶3 On January 19, 2012, ECI filed a complaint alleging
various causes of action against Westwater, Stewart
Environmental, ER&PWD Joint Venture, and several other
parties. On May 28, 2014, ECI moved for summary judgment on
its breach of contract claim against Westwater. In support of its
motion, ECI submitted an affidavit from Doyle Jensen, job
supervisor for ECI, describing the oral contract he entered into
with Borgstrom and Warnes. Westwater filed a response in
opposition to the motion for summary judgment on June 23,
2. A cost-plus contract is one ‚in which payment is based on a
fixed fee or a percentage added to the actual cost incurred.‛
Contract, Black’s Law Dictionary (9th ed. 2009).
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2014 (the Opposition Memo). The Opposition Memo was
supported by an affidavit from Warnes, but rather than denying
the allegations in Jensen’s affidavit, Warnes merely averred,
‚Neither I nor any other person on behalf of Westwater . . .
authorized Mr. Stewart or any entity under his control, to
engage Electrical Contractors, Inc. as the general contractor . . . .‛
¶4 Subsequently, on August 1, 2014, Westwater moved the
court, pursuant to rule 15(d) of the Utah Rules of Civil
Procedure, ‚to allow amendment and supplementation of
[additional] documents and affidavits to be considered by the
Court before consideration of summary . . . judgment.‛
Westwater claimed that it was unable to provide the documents
earlier because they were in the possession of Warnes, who had
been hospitalized on June 27, 2014. The district court denied
Westwater’s motion to supplement, concluding that Westwater
had ‚provided no persuasive explanation for failing to include
the documents or arguments in its original response.‛
¶5 The district court held a hearing on ECI’s motion for
summary judgment on September 23, 2014. Following the
hearing, the district court determined that Westwater’s
Opposition Memo did not ‚contain a verbatim restatement of
each of *ECI’s+ facts that is controverted‛ or ‚provide an
explanation of the grounds for any dispute,‛ as required by rule
7 of the Utah Rules of Civil Procedure. See Utah R. Civ. P.
7(c)(3)(B) (2014).3 In light of these shortcomings, the district court
deemed ECI’s statement of material facts admitted for purposes
3. Rule 7 of the Utah Rules of Civil Procedure was repealed and
reenacted in 2015, and ‚the special requirements for a motion for
summary judgment‛ were moved to rule 56. See Utah R. Civ. P. 7
advisory committee notes; id. R. 56. Thus, we cite the 2014
version of both rules.
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of the summary judgment motion.4 The district court further
determined, based on the undisputed facts, that ECI had
established its breach of contract claim as a matter of law, and
the court therefore awarded damages in the amount of
$876,788.10, plus interest, for a total award of $1,165,084.09. The
district court certified the judgment as final under rule 54(b) of
the Utah Rules of Civil Procedure, and Westwater now appeals.
ISSUES AND STANDARDS OF REVIEW
¶6 Westwater first argues that the district court erred in
granting ECI’s motion for summary judgment. ‚Because a
district court’s ruling on summary judgment is a question of law,
we review it for correctness.‛ Rupp v. Moffo, 2015 UT 71, ¶ 5, 358
P.3d 1060.
¶7 Westwater further asserts that the district court erred by
declining to accept Westwater’s proffered supplemental
affidavits and documents. We review the district court’s ruling
for an abuse of discretion. See United Park City Mines Co. v.
Greater Park City Co., 870 P.2d 880, 893 (Utah 1993).
4. The district court also observed that even if it had not deemed
ECI’s facts admitted, Westwater’s Opposition Memo and
Warnes’s affidavit did not establish the existence of a genuine
issue of material fact because they asserted only that Stewart did
not have the power to contract on behalf of Westwater, not that
Westwater had not itself entered into a contract. Since ECI
alleged that it had contracted with Westwater through Warnes
and Borgstrom, the district court concluded that ‚it’s a red
herring whether Mr. Stewart was acting on behalf of
Westwater.‛
20141166-CA 4 2016 UT App 60Electrical Contractors v. Westwater Farms
ANALYSIS
I. Summary Judgment
¶8 Westwater raises several arguments in support of its
assertion that the district court erred in granting ECI’s summary
judgment motion. First, Westwater argues that the allegations in
ECI’s complaint failed to establish the elements of its breach of
contract claim as a matter of law. Second, Westwater asserts that
documents attached to ECI’s amended complaint established a
genuine issue of material fact. Third, Westwater argues that the
district court should not have considered evidence relating to the
oral contract because such evidence violated the parol evidence
rule. Summary judgment is appropriate when ‚there is no
genuine issue as to any material fact and . . . the moving party is
entitled to a judgment as a matter of law.‛ Utah R. Civ. P. 56(c)
(2014).
A. Breach of Contract Claim
¶9 Westwater first argues that ECI did not adequately allege
a breach of contract claim, because it did not establish the
existence of an enforceable contract. See Orvis v. Johnson, 2008 UT
2, ¶ 19, 177 P.3d 600 (‚If the moving party would bear the
burden of proof on the relevant issue, . . . then the movant has an
affirmative duty to provide the court with facts that demonstrate
both that the party is entitled to judgment as a matter of law and
that there are no material issues of fact that would require
resolution at trial.‛); Bair v. Axiom Design, LLC, 2001 UT 20, ¶ 14,
20 P.3d 388 (indicating that the first element of a breach of
contract claim is the existence of a contract). Westwater asserts
that the terms of the alleged oral contract were too indefinite to
be enforced, see Nielsen v. Gold’s Gym, 2003 UT 37, ¶ 11, 78 P.3d
600, because they did not include ‚the price to be paid and work
to be done.‛
¶10 First, Westwater does not appear to have preserved this
argument. In its Opposition Memo, Westwater alleged only that
20141166-CA 5 2016 UT App 60Electrical Contractors v. Westwater Farms
there were genuine issues of fact precluding summary judgment,
not that there was no contract as a matter of law. See generally
Brookside Mobile Home Park, Ltd. v. Peebles, 2002 UT 48, ¶ 14, 48
P.3d 968 (‚*I+n order to preserve an issue for appeal the issue
must be presented to the trial court in such a way that the trial
court has an opportunity to rule on that issue.‛). But even if this
argument was preserved, we agree with ECI that Jensen’s
affidavit adequately alleged the existence of an enforceable oral
contract.
¶11 ‚‘A contract may be enforced even though some contract
terms may be missing or left to be agreed upon’‛ so long as ‚‘the
essential terms are [not] so uncertain that there is no basis for
deciding whether the agreement has been kept or broken.’‛
Nielsen, 2003 UT 37, ¶ 12 (quoting Academy Chicago Publishers v.
Cheever, 578 N.E.2d 981, 984 (Ill. 1991)). Jensen’s affidavit
indicated that ECI and Westwater agreed that ECI would ‚serve
as the Project’s general contractor and electrical contractor.‛
Thus, any services that would normally be performed by a
general contractor or an electrical contractor on a project such as
the one at issue would be included in the contracted services;
these services did not need to be explicitly enumerated in order
for the parties to determine whether ECI had provided them.
Further, Jensen indicated that the parties agreed to a cost-plus
payment structure ‚such that ECI would charge Westwater the
actual costs that ECI incurred in providing the requested
services, plus a 1% administrative fee markup on certain items, a
3% bonding fee markup on certain items, and a 12% profit
markup on other items.‛ The fact that the parties did not know
what the ultimate cost would be does not demonstrate, as
Westwater asserts, that there was no meeting of the minds.
While the cost-plus terms did not establish a precise price to be
paid, they did provide a clear method for calculating the price
once the work was completed. Thus, the essential terms of the
oral contract were established and the district court did not err
in determining that ECI established its claim as a matter of law.
20141166-CA 6 2016 UT App 60Electrical Contractors v. Westwater Farms
B. Genuine Issue of Material Fact
¶12 Westwater next asserts that Exhibits A, B, and C of ECI’s
amended complaint contained documents that established
genuine issues of material fact that would preclude summary
judgment. But even assuming that these exhibits contained
evidence sufficient to create a factual dispute, it was ultimately
Westwater’s burden, under rule 7 of the Utah Rules of Civil
Procedure, to dispute the facts asserted in ECI’s summary
judgment motion with ‚an explanation of the grounds for any
dispute, supported by citation to relevant materials.‛ Utah R.
Civ. P. 7(c)(3)(B) (2014); see also Orvis, 2008 UT 2, ¶ 10 (explaining
that where the moving party would bear the burden of proof at
trial, once the moving party has ‚present*ed+ evidence sufficient
to establish . . . that no material issues of fact remain,‛ the
burden ‚shifts to the nonmoving party to identify contested
material facts‛). Westwater did not refer to any of these exhibits
in its Opposition Memo. Indeed, the Opposition Memo was so
incomplete that the district court ultimately deemed ECI’s
statement of undisputed material facts admitted for purposes of
the summary judgment motion. See Utah R. Civ. P. 7(c)(3)(A)
(2014); see also Bluffdale City v. Smith, 2007 UT App 25, ¶¶ 8–11,
156 P.3d 175. Westwater has not challenged the district court’s
rule 7 ruling, yet it asks us to hold that the district court, having
deemed ECI’s facts admitted, should have nevertheless reviewed
the record sua sponte in an effort to find evidence supporting a
dispute of fact.5 But ‚*a+ district court is not obliged to comb the
record to determine whether a genuine issue as to any material
5. Much of Westwater’s discussion focuses on the question of
whether it could rely on the exhibits in disputing ECI’s
statement of facts when the exhibits were submitted as part of
ECI’s pleadings rather than Westwater’s. This argument is
beside the point, as Westwater made no attempt to rely on those
exhibits in its Opposition Memo.
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fact exists to prevent summary judgment.‛6 Jennings Inv., LC v.
Dixie Riding Club, Inc., 2009 UT App 119, ¶ 26, 208 P.3d 1077.
Given that ECI’s statement of facts was deemed admitted, the
district court needed only to examine whether those facts
established ECI’s breach of contract claim as a matter of law, not
whether those facts could be disputed by other evidence in the
record.7
C. Parol Evidence Rule
¶13 Westwater next argues that the district court violated the
parol evidence rule by considering ECI’s evidence regarding the
oral agreement. As with Westwater’s other arguments,
Westwater failed to preserve its parol evidence argument in the
district court. But in any event, the parol evidence rule does not
apply in this case. ‚The parol evidence rule operates to exclude
6. Indeed, the current version of the Utah Rules of Civil
Procedure provides that although the district court ‚may
consider other materials in the record,‛ it ‚need consider only
the cited materials‛ in ruling on a motion for summary
judgment. Utah R. Civ. P. 56(c)(3) (emphasis added).
7. We also observe that it is by no means clear that any of the
exhibits actually establish a dispute of fact. Exhibit A shows that
ECI had a written agreement with ER&PWD Joint Venture
regarding a payment schedule for services ECI had provided.
Exhibit B is a document titled ‚Scope of Work‛ that is not
addressed to anyone in particular. And Exhibit C shows that ECI
asserted a claim of lien against Stewart Environmental relating
to work done on the Project. To even begin to construe these
documents as contradicting ECI’s assertion that it had an oral
contract with Westwater, a number of inferences must be made.
Without the benefit of Westwater’s argument on the subject, the
district court could not have been expected to construe the
documents the way Westwater does on appeal.
20141166-CA 8 2016 UT App 60Electrical Contractors v. Westwater Farms
[extrinsic] evidence of contemporaneous conversations,
representations, or statements offered for the purpose of varying
or adding to the terms of an integrated contract.‛ DCH Holdings,
LLC v. Nielsen, 2009 UT App 269, ¶ 8, 220 P.3d 178 (alteration in
original) (citation and internal quotation marks omitted). The
only written contract related to this case is the agreement
between ECI and ER&PWD Joint Venture.8 There is no
integrated written contract between Westwater and ECI, and the
evidence of an oral agreement between Westwater and ECI was
not offered to vary or add to the terms of ECI’s written
agreement with ER&PWD Joint Venture. Thus, we are at a loss
to see how the parol evidence rule could apply to exclude ECI’s
evidence of an oral contract with Westwater.
II. Motion to File Supplemental Documents
¶14 Finally, Westwater challenges the district court’s denial of
its motion to file supplemental affidavits and documents in
support of its Opposition Memo. Westwater claims that its
motion was made pursuant to rule 56(f) of the Utah Rules of
Civil Procedure. ‚Rule 56(f) motions opposing a summary
judgment motion on the ground that discovery has not been
completed should be granted liberally unless they are deemed
dilatory or lacking in merit.‛ Energy Mgmt. Servs., LLC v. Shaw,
2005 UT App 90, ¶ 10, 110 P.3d 158 (citation and internal
quotation marks omitted). Westwater asserts that the district
8. Although Westwater attempts to characterize this agreement
as an integrated contract relating to the same subject matter as
the alleged oral agreement, it cannot really be characterized as
such. The agreement was entered into after ECI had completed
its work on the Project, says nothing about the work ECI agreed
to perform, and mentions the cost-plus terms only in a note
explaining ECI’s invoice. Indeed, this document is more
properly characterized as an agreement regarding a payment
schedule than a contract for services.
20141166-CA 9 2016 UT App 60Electrical Contractors v. Westwater Farms
court exceeded its discretion by denying Westwater’s motion on
the ground that Westwater had ‚provided no persuasive
explanation for failing to include the documents or arguments in
its original response,‛ because the district court made no
determination that its motion was meritless or dilatory. We
disagree.
¶15 First, Westwater did not indicate to the district court that
it was making its motion to supplement pursuant to rule 56(f).
To the contrary, Westwater explicitly stated that its motion
relied on rule 15(d) of the Utah Rules of Civil Procedure,
governing supplemental pleadings. Thus, Westwater’s rule 56(f)
argument was not preserved. See Brookside Mobile Home Park, Ltd.
v. Peebles, 2002 UT 48, ¶ 14, 48 P.3d 968.
¶16 Furthermore, we agree with ECI that Westwater’s motion,
even if had been a rule 56(f) motion, was dilatory and/or lacking
in merit on its face. Westwater submitted its Opposition Memo
on June 23, 2014, which included an affidavit by Warnes.
Westwater did not indicate to the court at that time that it was
unable to ‚present by affidavit facts essential to justify *its+
opposition‛ to the summary judgment motion. Utah R. Civ. P.
56(f) (2014). Rather, it asserted, both in its Opposition Memo and
in a later response to ECI’s reply memorandum, that the facts
alleged in Warnes’s affidavit evidenced a factual dispute
sufficient to preclude summary judgment. Further, Westwater’s
proffered reason for its failure to provide the court with the
supplemental documents sooner was that Warnes had been
hospitalized, but Warnes was not hospitalized until after
Westwater had filed its Opposition Memo, and he actually
provided an affidavit that was submitted with the memo. Thus,
it is unclear why Warnes’s hospitalization prevented Westwater
from submitting the supplemental documents with its
Opposition Memo. For these reasons, it does not appear that
Westwater was precluded from adequately opposing ECI’s
motion for summary judgment in its Opposition Memo.
20141166-CA 10 2016 UT App 60Electrical Contractors v. Westwater Farms
CONCLUSION
¶17 For the foregoing reasons, we conclude that the district
court did not err in granting ECI’s motion for summary
judgment and denying Westwater’s motion to submit
supplemental affidavits and documents. Accordingly, we affirm.
20141166-CA 11 2016 UT App 60