No. 02-509
IN THE SUPREME COURT OF THE STATE OF MONTANA
2004 MT 70
GLACIER TENNIS CLUB AT THE SUMMIT, LLC,
Plaintiff, Respondent, and Cross-Appellant,
v.
TREWEEK CONSTRUCTION COMPANY, INC.,
Defendant and Appellant.
________________________________________________
TREWEEK CONSTRUCTION COMPANY, INC.,
Third-Party Plaintiff and Appellant,
v.
NUPAC/PACK AND COMPANY, a Montana Corporation;
LYNDON STEINMETZ, d/b/a LYNDON STEINMETZ
DRAFTING AND DESIGN, a Sole Proprietorship; JIM
THOMPSON d/b/a ARQUITECTNOS, a Sole Proprietorship,
Third-Party Defendants and Respondents.
APPEAL FROM: District Court of the Eleventh Judicial District,
In and For the County of Flathead, Cause No. DV 2000-433(B),
Honorable Stewart E. Stadler, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Robert H. Phillips & Fred Simpson, Phillips & Bohyer, Missoula, Montana
For Respondents:
Joe Bottomly, Sean Hinchey and Amy Eddy, Bottomly Law Offices,
Kalispell, Montana (Glacier Tennis Club)
Bruce A. Fredrickson and Kimberly S. More, Crowley, Haughey, Hanson
Toole & Dietrich, P.L.L.P., Kalispell, Montana (Nupac/Pack)
Jeffrey D. Ellingson, Ellingson Law Offices, Kalispell, Montana (Thompson)
Michael A. Ferrington, Attorney at Law, Whitefish, Montana (Steinmetz)
Submitted on Briefs: February 13,
2003
Decided: March
23, 2004
Filed:
__________________________________________
Clerk
2
Justice Jim Rice delivered the Opinion of the Court.
¶1 Glacier Tennis Club at the Summit, LLC (GTC) brought this action against Treweek
Construction, Inc. (Treweek), in the District Court of the Eleventh Judicial District, Flathead
County, claiming damages for various design and construction defects in its tennis facility.
In response, Treweek filed a third-party claim against the project architect, Jim Thompson,
d/b/a/Arquitectnos (Thompson), alleging that Thompson was negligent in his preparation and
review of plans for the construction of the tennis facility. Treweek also filed third-party
claims against various subcontractors, including, Nupac/Pack and Company (Nupac),
Lyndon Steinmetz, d/b/a Lyndon Steinmetz Drafting and Design (Steinmetz), and Steve
Seitz, d/b/a/Seitz Engineering (Seitz), seeking indemnity. The District Court entered
summary judgment in favor of Thompson, Nupac, and Steinmetz, dismissing them from the
lawsuit, and Treweek settled its claim with Seitz shortly before trial. A jury trial was
thereafter held on GTC’s claims against Treweek for negligence and breach of contract,
resulting in an $85,000 verdict in favor of GTC. Treweek appeals and GTC cross-appeals
on the issue of prejudgment interest. We affirm.
¶2 The following issues are raised on appeal:
¶3 1. Did the District Court err in granting summary judgment in favor of Third-Party
Defendant, Jim Thompson?
¶4 2. Did the District Court err in granting summary judgment in favor of Third-Party
Defendant, Nupac?
4
¶5 3. Did the District Court err in denying Treweek’s motion for judgment as a matter
of law regarding GTC’s claim for radon remediation damages?
¶6 4. Did the District Court err in excluding evidence that GTC had rejected an underslab
drain tile system?
¶7 5. Did the District Court err in admitting evidence of engineering fees reasonably
incurred to evaluate and remedy Treweek’s work?
¶8 6. Did the District Court err in denying GTC’s request for prejudgment interest?
FACTUAL AND PROCEDURAL BACKGROUND
¶9 This litigation arises out of the design and construction of a four court indoor tennis
facility for GTC, a limited liability corporation owned by Northwest Healthcare Corporation
and approximately thirty families interested in promoting tennis. Prior to soliciting bids for
construction of the facility, GTC retained the services of Jim Thompson, an architect, to
provide preliminary design parameters and building specifications of the tennis facility.
Thompson also assisted GTC in obtaining permits and evaluating bid proposals, among other
duties.
¶10 Based upon the schematic drawings prepared by Thompson, Treweek submitted a bid
to GTC for the design and construction of the tennis facility in June 1997. At the request of
one of the GTC board members, Treweek additionally quoted the cost of installing an
underslab drain tile system within the facility, but the quote was not part of Treweek’s
original bid proposal, and was not adopted by GTC. Shortly after submitting its bid,
Treweek was awarded the contract to design and construct the tennis facility. Treweek
5
commenced construction of the facility early that fall, using subcontractors to complete
various aspects of the project. Among those hired to perform the work was Nupac, a
construction company who primarily prepared the ground surface and laid asphalt for the
tennis courts. Treweek also hired Steinmetz and Seitz, who provided drafting and design
services, respectively.
¶11 The facility was completed in the early part of 1998. However, shortly thereafter,
GTC began experiencing problems with the building. In particular, GTC representatives
reported a “bulge” in the surface playing area of one of the tennis courts, which caused tennis
players to occasionally stumble. They also noticed water seeping into the building from the
exterior walls–many of which are below ground–whenever the exterior ground became
saturated with moisture.
¶12 In response to these concerns, several meetings were held between representatives of
GTC, Treweek, and the subcontractors. While the parties disagreed as to the cause of the
bulge, they generally agreed that its existence was due to error.
¶13 Treweek also recognized GTC’s concerns with the draining system and acknowledged
that water should not be leaking into the building. In an effort to remedy this problem,
Treweek patched the interior walls several times. However, the leaking continued despite
their efforts. After nearly two years without a remedy, GTC retained the services of Jay
Billmayer (Billmayer), an engineer, to investigate the problem. Billmayer determined the
building was leaking due to a poor subsurface drainage design as well as defective
6
workmanship in the drainage system, including crushed drain pipes, squashed outlet
openings, and unsuitable backfill material.
¶14 Billmayer also discovered that a vapor barrier had not been installed beneath the
facility. The lack of a vapor barrier raised concerns about the presence of radon, since vapor
barriers have a secondary benefit of preventing gas from rising to the surface. As a result of
this concern, Billmayer and GTC performed radon tests in the facility which revealed that
radon levels were in excess of acceptable limits. Billmayer estimated the cost to remediate
the presence of radon was significant. However, Treweek responded that radon remediation
was neither contemplated by the parties at the time of contracting, nor required by the
standard of care at the time of the project.
¶15 On August 18, 2000, GTC brought suit against Treweek, claiming that it was
negligent and had breached its contract. In response, Treweek admitted the problems
associated with the bulge in the tennis court and leaking water, but denied that such problems
were caused by its negligence or breach. Treweek thereafter brought third-party claims
against Jim Thompson, Nupac, Steinmetz, and Seitz, alleging that Thompson had been
negligent in his preparation, review, and approval of the construction plans, and that Nupac,
Steinmetz, and Seitz had failed to perform their subcontracts in a good and workmanlike
fashion and had breached their contracts with Treweek. Treweek sought indemnification
from its third-party defendants for any claim upon which GTC prevailed.
¶16 In response to Treweek’s third-party claims, Nupac, Steinmetz, and Thompson filed
motions for summary judgment, each seeking to be dismissed from the lawsuit on the basis
7
that no genuine issues of material fact existed as to their alleged negligence or alleged failure
to perform the work according to contract. Following oral arguments, the District Court
concluded that Treweek had failed to bring forth evidence establishing issues of material fact
as to the third-party defendants’ liability, and granted summary judgment in favor of each
of them.
¶17 GTC requested summary judgment as to the issue of its comparative negligence,
which Treweek had counterclaimed in response to GTC’s first amended complaint.
According to Treweek, GTC was comparatively negligent by virtue of its affiliation with Jim
Thompson who, Treweek maintained, negligently failed to identify any errors or deficiencies
in the plans submitted for his review. The District Court rejected Treweek’s contentions,
finding no evidence that Thompson was GTC’s agent for any part of the project beyond
providing preliminary specifications, and awarded summary judgment in favor of GTC on
Treweek’s counterclaim.
¶18 The matter proceeded to trial between GTC and Treweek on April 15, 2002.1
Following GTC’s case-in-chief, Treweek moved for a directed verdict regarding damages for
the increased costs of radon remediation allegedly caused by its failure to place a vapor
barrier and proper subsurface gravel beneath the tennis facility. This motion was denied.
¶19 On April 19, 2002, the jury returned a verdict in favor of GTC in the amount of
$85,000. The District Court entered judgment on the verdict on April 23, 2002, and GTC
1
Seitz resolved his dispute with Treweek shortly before trial and is not a party on
appeal.
8
subsequently filed a motion seeking prejudgment interest. The District Court denied GTC’s
motion, concluding that the amount of damages was incapable of being ascertained prior to
trial. Treweek appeals from the April 23, 2002 judgment and GTC cross-appeals from the
District Court’s denial of prejudgment interest.
DISCUSSION
¶20 Did the District Court err in granting summary judgment in favor of Third-Party
Defendant, Jim Thompson?
¶21 We review a district court’s grant of summary judgment de novo, applying the same
evaluation under Rule 56, M.R.Civ.P., as the district court. Bos v. Gallatin County, 2003
MT 162, ¶ 8, 316 Mont. 292, ¶ 8, 71 P.3d 1209, ¶ 8. That is,
The party moving for summary judgment has the initial burden of proving that
there are no genuine issues of material fact that would permit a non-moving
party to succeed on the merits of the case. . . . If the moving party meets this
burden, then the non-moving party must provide substantial evidence that
raises a genuine issue of material fact, to avoid summary judgment in favor of
the moving party. . . . “Material issues of fact are identified by looking to the
substantive law which governs the claim.”
Babcock Place P’ship v. Berg, Lilly, Andriolo & Tollefsen, P.C., 2003 MT 111, ¶ 15, 315
Mont. 364, ¶ 15, 69 P.3d 1145, ¶ 15 (citations omitted). Once it is established that no
genuine issues of material fact exist, the court then must determine whether the moving party
is entitled to judgment as a matter of law. Bruner v. Yellowstone County (1995), 272 Mont.
261, 264-65, 900 P.2d 901, 903. We review the legal determinations made by a district court
to determine whether the court erred. Bruner, 272 Mont. at 265, 900 P.2d at 903.
9
¶22 The underlying premise of Treweek’s claim against Thompson is that Thompson was
negligent in his preparation of plans for construction of the facility and/or his review and
approval of plans and designs submitted for his review. Thompson denies that he owed any
duty of care to Treweek, contractually or otherwise, and maintains that Treweek was
unjustified in relying upon him as the project architect.
¶23 The District Court, relying upon our holding in Jim’s Excavating Service, Inc. v.
HKM Associates (1994), 265 Mont. 494, 878 P.2d 248, held that Thompson could not be
held liable for negligence because Treweek had failed to establish that Thompson owed it
a duty of care. Jim’s Excavating involved a claim by a third-party contractor against a project
engineer, HKM, for economic damages. HKM argued that there could be no tort liability
because there was no privity between HKM and the contractor, particularly since the
negligence complained of (preparation of plans and specifications) occurred before HKM
actually knew the contractor would be part of the project. Jim’s Excavating, 265 Mont. at
501, 878 P.2d at 252. We rejected HKM’s contentions that it could not be liable because it
did not know the contractor would receive the bid. Applying § 552 of the Restatement
(Second) of Torts, we held that a third-party contractor may successfully recover for
economic loss against a project engineer or architect when the design professional knew or
should have foreseen that the particular plaintiff or an identifiable class of plaintiffs were at
risk in relying on the information supplied. Jim’s Excavating, 265 Mont. at 506, 878 P.2d
at 255. We additionally concluded that when a contractor brings suit against the project
engineer or architect, the approach set forth in § 552 of the Restatement should control.
10
Jim’s Excavating, 265 Mont. at 504-05, 878 P.2d at 254. Section 552 of the Restatement
provides:
(1) One who, in the course of his business, profession or employment,
or in any other transaction in which he has a pecuniary interest, supplies false
information for the guidance of others in their business transactions, is subject
to liability for pecuniary loss caused to them by their justifiable reliance upon
the information, if he fails to exercise reasonable care or competence in
obtaining or communicating the information.
(2) Except as stated in Subsection (3), the liability stated in Subsection
(1) is limited to loss suffered
(a) by the person or one of a limited group of persons for whose benefit
and guidance he intends to supply the information or knows that the recipient
intends to supply it; and
(b) through reliance upon it in a transaction that he intends the
information to influence or knows that the recipient so intends or in a
substantially similar transaction.
(3) The liability of one who is under a public duty to give the
information extends to loss suffered by any of the class of persons for whose
benefit the duty is created, in any of the transactions in which it is intended to
protect them.
Applying § 552 and the holding of Jim’s Excavating to this case, Thompson may be held to
a duty of care only if he communicated professional information to Treweek with the
intention or knowledge that such information would be relied upon by Treweek, or a party
similarly situated. Absent a duty, no breach of duty can be established and no negligence
action can be maintained. Debcon, Inc. v. City of Glasgow, 2001 MT 124, ¶ 29, 305 Mont.
391, ¶ 29, 28 P.3d 478, ¶ 29.
¶24 In support of his motion for summary judgment, Thompson offered evidence that his
responsibilities for the design of the tennis facility were limited to preparing an initial site
plan, which was used to solicit bids for “design and build” services. Based upon
11
Thompson’s preliminary specifications, Treweek submitted a bid for the design and
construction of the facility and received the contract. The parties agreed, however, that
Thompson had no contractual relationship with Treweek.
¶25 After commencing construction of the facility, Thompson periodically reviewed
Treweek’s plans and progress for GTC to confirm that Treweek was entitled to receive
progress payments. According to Thompson, he had no involvement in the design of the
drainage system, which contributed to the leaking water problem. Thompson also
maintained that he never intended, knew, or reasonably should have known that Treweek was
relying upon him for assistance in the design and construction of the facility.
¶26 In response, Treweek offered evidence of Thompson’s continuing involvement in the
project, including attendance at board meetings, and his monitoring of the project’s progress
and quality of work. Essentially, Treweek maintained that Thompson’s continuing
involvement in the project made it reasonable for Treweek to believe that Thompson was
reviewing and approving its plans and designs, and would notify Treweek of any potential
defects. Treweek claimed Thompson breached his duty of care by failing to properly advise
it of such defects.
¶27 Upon our review of the record, we conclude the District Court was correct in deciding
that Thompson owed no duty of care to Treweek. Treweek admittedly had not contracted
for Thompson’s services as a project architect and there was no evidence that Thompson
offered any guidance to Treweek in this regard. Although the parties agreed that Thompson
periodically reviewed Treweek’s progress, any certification by Thompson was done for
12
purposes of making interim payments, and was made to GTC, not Treweek. Assuming
arguendo that Treweek provided all elements of the design to Thompson for his review and
approval, there remains to be seen any evidence that Thompson actually communicated
professional information to Treweek, much less evidence of intention or knowledge that such
information would be relied upon by Treweek.
¶28 Because Treweek failed to offer any evidence showing that Thompson communicated
professional information to Treweek with the intention or knowledge that such information
would be relied upon by Treweek, and no contractual relationship existed, there is no duty
of care. Absent a duty, there can be no breach, and Treweek’s negligence claim fails as a
matter of law. Accordingly, summary judgment in favor of Thompson was proper.
¶29 Did the District Court err in granting summary judgment in favor of Third-Party
Defendant, Nupac?
¶30 As a threshold matter, Nupac challenges Treweek’s notice of appeal as deficient, and
argues that this Court lacks jurisdiction to determine whether summary judgment in favor of
Nupac was proper because Treweek failed to designate in its notice of appeal that it was
appealing from the District Court’s order granting summary judgment to the third-party
defendants. In support of its argument, Nupac relies upon Rule 4(c), M.R.App.P., which,
at the time of this appeal,2 provided as follows:
2
On October 23, 2003, we amended Rule 4(c), M.R.App.P., to provide as follows:
Content and notice of appeal. The notice of appeal shall specify the
party or parties taking the appeal; and shall designate the judgment, or order
appealed from. An appeal from a judgment draws into question all previous
orders and rulings excepted or objected to and which led up to and produced
the judgment. [Emphasis added.]
13
Content of the notice of appeal. The notice of appeal shall specify the party
or parties taking the appeal; and shall designate the judgment, order or part
thereof appealed from.
¶31 As Nupac correctly notes, in applying Rule 4(c), M.R.App.P., we have consistently
held that “we will not consider an appeal from an order not designated in the notice of
appeal.” Lewis v. Puget Sound Power & Light Co., 2001 MT 145, ¶ 27, 306 Mont. 37, ¶ 27,
29 P.3d 1028, ¶ 27; see also State v. Delap (1989), 237 Mont. 346, 350-51, 772 P.2d 1268,
1271. However, we have also recognized that “non-appealable intermediate orders or
decisions properly excepted or objected to which involve the merits or necessarily affect the
judgment are reviewable on appeal from a final judgment.” Ruana v. Grigonis (1996), 275
Mont. 441, 452, 913 P.2d 1247, 1254.
¶32 Here, Treweek seeks review of an order granting summary judgment. As a general
rule, summary judgment orders are interlocutory, and therefore not appealable until the final
judgment is rendered. Trombley v. Mann, 2001 MT 154, ¶ 7, 306 Mont. 80, ¶ 7, 30 P.2d
355, ¶ 7, citing Cechovic v. Hardin & Assoc., Inc. (1995), 273 Mont. 104, 118, 902 P.2d
520, 528. Pursuant to Rule 2(a), M.R.App.P., this Court may review “the verdict or decision,
and any intermediate order or decision excepted or objected to within the meaning of Rule
46 of the Montana Rules of Civil Procedure, which involves the merits, or necessarily affects
the judgment, except a decision or order from which an appeal might have been taken.”
(Emphasis added.) Here, the District Court’s order granting summary judgment in favor of
Nupac preceded, and necessarily affected, the final–and appealable–judgment entered in
14
favor of GTC. Because Treweek’s objection to the motion was also preserved, the District
Court’s order granting summary judgment in favor of Nupac is reviewable on appeal.
¶33 Turning to the issue on appeal, Treweek maintains the District Court erred in
awarding summary judgment in favor of Nupac because genuine issues of material fact
existed with regard to the cause of the bulge in the tennis court, as well as Nupac’s alleged
failure to perform the work according to contract. Pursuant to its contract with Treweek,
Nupac agreed to indemnify Treweek against all damages arising out of its work, and further
agreed to perform “all work in a first-class and workmanlike manner and to the entire
satisfaction of the Owner, Contractor, and Architect.” Treweek asserts that Nupac’s failure
to so perform constitutes negligence and a breach of its contract. Nupac responds that
summary judgment was appropriate due to Treweek’s failure to establish a prima facie case
of negligence.
¶34 We have held that to survive a motion for summary judgment in a negligence action,
a plaintiff must raise genuine issues of material fact with regard to a legal duty on the part
of the defendant, a breach of that duty, causation, and damages. Butler v. Domin, 2000 MT
312, ¶ 21, 302 Mont. 452, ¶ 21, 15 P.3d 1189, ¶ 21. If a party seeking summary judgment
establishes the absence of a genuine issue of material fact as to any one of the elements
constituting the cause of action, and the opposing party fails to come forward with proof
establishing the existence of a genuine issue as to that element, summary judgment is proper.
Debcon, ¶ 21. As in the previous issue, our standard of review of a district court’s grant of
summary judgment is de novo, and we use the same standards as used by the district court:
15
first whether issues of material fact exist, and, if not, whether the moving party is entitled
to judgment as a matter of law. Rule 56, M.R.Civ.P.; Abraham v. Nelson, 2002 MT 94, ¶
9, 309 Mont. 366, ¶ 9, 46 P.3d 628, ¶ 9.
¶35 Upon review of the record, we conclude the District Court correctly granted summary
judgment in favor of Nupac. In support of its motion, Nupac offered deposition testimony
from Treweek’s project coordinator, Tony Haverkorn (Haverkorn), who confirmed that
Nupac’s work was tested by Treweek’s engineers prior to paving, and was found to meet or
exceed design strength requirements. Haverkorn further testified that after Nupac finished
paving, Treweek’s representatives inspected Nupac’s work, and found that no problem
existed with regard to the asphalt, and issued payment. By presenting Haverkorn’s testimony
that no problem existed with regard to the asphalt at the time of payment, Nupac successfully
satisfied its burden as the moving party. It then became incumbent upon Treweek to
establish a disputed issue of material fact as to Nupac’s alleged negligence and failure to
perform in a workmanlike manner.
¶36 However, Treweek’s only evidence in response to Nupac’s motion came from Richard
Thompson (Richard), who applied the tennis court surfacing material over the asphalt.
Richard testified that he noticed a bulge in one of the tennis courts prior to surfacing, but did
not view the irregularity as a major concern, and nonetheless proceeded with surfacing. In
Richard’s opinion, the bulge was the result of too much asphalt being placed at the paving
seam. However, Richard admittedly had no experience laying asphalt, and conceded that
other causes, such as a frost heave or subsurface water seepage, might have been responsible
16
for the bulge. Moreover, Richard made no bore holes in the asphalt to objectively determine
whether there was, in fact, an area where there might be too much asphalt.
¶37 It is well established that “a suspicion, regardless of how particularized, is insufficient
to sustain an action or defeat a motion for summary judgment,” and that “unsupported,
conclusory, or speculative statements do not raise a genuine issue of material fact.”
Abraham, ¶ 26. In this case, Richard’s testimony was insufficient to create a genuine issue
of material fact as to the cause of the purported bulge in the tennis court. Therefore,
implicating Nupac’s work as the cause of the defect required speculation. Causation being
a material element in sustaining a cause of action for negligence or breach, we conclude that
summary judgment in Nupac’s favor was appropriate.
¶38 Did the District Court err in denying Treweek’s motion for judgment as a matter
of law regarding GTC’s claim for radon remediation damages?
¶39 Treweek contends that the issue of radon remediation should not have been submitted
to the jury because neither the contract with GTC, nor the Uniform Building Code (UBC)
provision requiring installation of a subsurface vapor barrier, contemplated radon
remediation. In response, GTC maintains that Treweek was obligated to install a subsurface
vapor barrier under both the UBC and its construction contract with GTC, and that the need
for radon remediation was simply the foreseeable consequence of Treweek’s failure to satisfy
this duty.
¶40 Considering all evidence in the light most favorable to the opposing party, judgment
as a matter of law is properly granted only when there is a complete absence of any evidence
17
which would justify submitting an issue to the jury. Armstrong v. Gondeiro, 2000 MT 326,
¶ 26, 303 Mont. 37, ¶ 26, 15 P.3d 386, ¶ 26. “If there is any evidence in support of the
verdict and if the party opposing the motion can recover on any view of the evidence and
legitimate inferences, then the court must exercise self-restraint, credit the constitutionally
mandated process of jury decision, and deny the motion.” Sandman v. Farmers Ins.
Exchange, 1998 MT 286, ¶ 46, 291 Mont. 456, ¶ 46, 969 P.2d 277, ¶ 46. We review a
district court’s decision regarding a motion for judgment as a matter of law to determine
whether the district court abused its discretion. Onstad v. Payless Shoesource, 2000 MT
230, ¶ 25, 301 Mont. 259, ¶ 25, 9 P.3d 38, ¶ 25.
¶41 At trial, Treweek’s owner and project coordinator each conceded that Treweek was
obligated by contract to comply with all applicable uniform building codes. According to
the uncontradicted testimony of Jay Billmayer, GTC’s expert witness, at the time of
constructing the tennis facility, the UBC required installation of a vapor barrier as well as
a layer of properly sized gravel beneath the flooring system. Due to the lack of a subsurface
vapor barrier and a properly sized gravel base, GTC experienced increased levels of radon
within its facility.
¶42 On these facts alone, we conclude the District Court was correct to submit the
question of Treweek’s liability for radon remediation to the jury. GTC presented sufficient
evidence to raise an inference that Treweek owed a contractual duty to adhere to the UBC
and breached that duty by failing to install a subsurface vapor barrier and properly sized
18
gravel base, which resulted in damages. Accordingly, we hold the District Court did not
abuse its discretion in denying Treweek’s motion for judgment as a matter of law.
¶43 Did the District Court err in excluding evidence that GTC had rejected an
underslab drain tile system?
¶44 Shortly after submitting its original bid to GTC for the design and construction of the
tennis facility, one of the GTC board members requested a price quote on the installation of
an underslab drain tile system. In response, Treweek submitted an attachment to its original
bid proposal, detailing the cost of several options, including the requested quote for a drain
tile system. GTC did not adopt the quote and awarded Treweek the contract based upon the
original bid proposal.
¶45 At trial, the District Court granted GTC’s motion to exclude evidence that Treweek
had offered to install an underslab drain tile system, and that GTC had rejected such option
on the basis of cost. In its subsequent offer of proof, Treweek maintained that the proposed
subsurface drainage system would have solved any moisture problems, if any existed, and
might also have satisfied the UBC requirements for a vapor barrier, as well as constituted
radon remediation.
¶46 On appeal, Treweek argues the District Court erred in excluding evidence of its
proposal. Treweek contends that its proffered evidence was relevant for purposes of
responding to Billmayer’s testimony that remediating the radon problem required a
“manifold,” or underslab set of pipes, which would help vent the radon out of the facility.
According to Treweek, the court’s ruling effectively prevented it from arguing to the jury that
19
GTC had explicitly rejected a design component which would have helped reduce the
presence of radon in the facility. Treweek contends that it was prejudiced as a result.
¶47 We review a district court’s evidentiary rulings for abuse of discretion. Englin v.
Board of County Commissioners, 2002 MT 115, ¶ 38, 310 Mont. 1, ¶ 38, 48 P.3d 39, ¶ 38.
A district court has broad discretion in determining whether evidence is relevant and
admissible, and we will not overturn its determination absent an abuse of that discretion.
Somont Oil Co., Inc. v. A & G Drilling, Inc., 2002 MT 141, ¶ 20, 310 Mont. 221, ¶ 20, 49
P.3d 598, ¶ 20. Furthermore, the question is not whether this Court would have reached the
same decision, but, whether the district court abused its discretion in reaching the decision
to deny admissibility. Simmons Oil Corp. v. Wells Fargo Bank, N.A., 1998 MT 129, ¶ 17,
289 Mont. 119, ¶ 17, 960 P.2d 291, ¶ 17.
¶48 Relevant evidence is defined at Rule 401, M.R.Evid., as that “. . . having any tendency
to make the existence of any fact that is of consequence to the determination of the action
more probable or less probable than it would be without the evidence.” Christofferson v.
City of Great Falls, 2003 MT 189, ¶ 34, 316 Mont. 469, ¶ 34, 74 P.3d 1021, ¶ 34. In this
case, evidence that GTC rejected a proposal for radon remediation would have been relevant
only to Treweek’s counterclaim against GTC for comparative negligence. However, in an
order dated April 2, 2002, the District Court granted GTC’s motion for summary judgment
as to the issue of its comparative negligence, and Treweek has not taken issue with this ruling
on appeal. Given the dismissal of Treweek’s counterclaim, and the fact that Treweek had
not recommended the drainage system to GTC, but had only provided a price quote for the
20
system in response to a request from a GTC board member, we cannot conclude the District
Court abused its discretion in excluding this evidence at trial.
¶49 Did the District Court err in admitting evidence of engineering fees reasonably
incurred to evaluate and remedy Treweek’s work?
¶50 Prior to trial, Treweek moved in limine for an order excluding evidence of the amount
GTC paid its expert witness, Jay Billmayer, for his consulting work in relation to the case.
The court did not immediately rule on Treweek’s motion. However, at trial, the court
admitted Billmayer’s invoices into evidence over Treweek’s objection. GTC’s manager,
Brad Roy, thereafter testified that GTC paid Billmayer in excess of $15,000 to assess the
problems with the tennis facility and propose a solution.
¶51 Treweek argues that the District Court erred in allowing GTC to introduce evidence
of Billmayer’s fees because under § 26-2-505, MCA, expert witness fees are limited to the
amount paid other witnesses, or $10 per day. This is true notwithstanding the fact that the
actual fees may be higher. In response, GTC contends that Billmayer’s fees are not witness
fees, subject to the statutory per diem, but damages incurred in an effort to remediate the
facility.
¶52 A district court’s ruling on a motion in limine is an evidentiary ruling. Somont Oil,
¶ 20. As we stated in the previous issue, a district court has broad discretion in determining
whether evidence is relevant and admissible, and we will not overturn its determination
absent an abuse of discretion. Spinler v. Allen, 1999 MT 160, ¶ 29, 295 Mont. 139, ¶ 29,
983 P.2d 348, ¶ 29.
21
¶53 From our review of the record, we conclude that Billmayer’s fees were properly
submitted to the jury as part of GTC’s damage claim. The relevant measure of damages for
injuries to real property is the cost of repair, plus damages for loss of use up to the time when
the damage reasonably could have been repaired. See Burk Ranches, Inc. v. State (1990),
242 Mont. 300, 307, 790 P.2d 443, 447. Here, the fees submitted for the jury’s review were
incurred prior to the commencement of litigation and reflected Billmayer’s time spent
investigating the cause of the construction defects and preparing a proposal for radon
remediation. Billmayer’s fees were relevant to the measure of damages because his services
were necessary to ascertain the cause of the water leaking within the facility, as well as to
formulate a plan for radon remediation. The invoice submitted to the jury did not reflect
Billmayer’s time expended for trial preparation or testimony and there is no indication that
Billmayer was retained solely for litigation purposes. Accordingly, we hold the District
Court did not abuse its discretion in admitting this evidence.
¶54 Did the District Court err in denying GTC’s request for prejudgment interest?
¶55 A district court’s award of prejudgment interest is a question of law, and therefore,
we examine whether the court was correct in its application of the law. Semenza v. Bowman
(1994), 268 Mont. 118, 127, 885 P.2d 451, 456.
¶56 On cross-appeal, GTC maintains that the District Court erred in denying its motion
for prejudgment interest by misinterpreting § 27-1-210(1), MCA, which allows the payment
of prejudgment interest on certain tort claims. Section 27-1-210, MCA, provides:
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Interest on torts. (1) Subject to subsection (2), in an action for recovery on
an injury as defined in 27-1-106, a prevailing claimant is entitled to interest at
a rate of 10% on any claim for damages awarded that are capable of being
made certain by calculation, beginning from the date 30 days after the claimant
presented a written statement to the opposing party or his agent stating the
claim and how the specific sum was calculated.
According to the statute, prejudgment interest is only allowed for claims which are “capable
of being made certain by calculation.” Furthermore, this Court has consistently held that
prejudgment interest is inappropriate when the amount of a party’s damages is uncertain or
disputed. Northern Mont. Hosp. v. Knight (1991), 248 Mont. 310, 320-21, 811 P.2d 1276,
1282; see also Morning Star Enter., Inc. v. R.H. Grover, Inc. (1991), 247 Mont. 105, 116,
805 P.2d 553, 559 (involving damages for failing to perform a construction contract in a
workmanlike manner); Heitz v. Heitz (1990), 244 Mont. 12, 15-16, 795 P.2d 486, 489
(damages for breach of an oral rental contract); McPherson v. Schlemmer (1988), 230 Mont.
81, 87, 749 P.2d 51, 54 (damages for negligence). In each of these cases, uncertain damages
precluded an award of prejudgment interest.
¶57 Determining whether or not the amount of a particular claim was ascertainable in
advance of trial may often prove a difficult task. However, we find guidance in the
following excerpt discussing prejudgment interest in the context of a builder’s recovery in
an action for breach of a construction contract:
[I]t may perhaps be said, as a broad generalization from the various cases, that
the amount of a builder’s claim will ordinarily be deemed capable of
ascertainment when there is some standard or measure of compensation fixed
in the contract itself, and only the amount of labor performed or the quantity
of materials furnished is at issue between the parties, or where market values,
upon which it would be possible to base a reasonably accurate computation,
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are well known and established and not a matter of real dispute. Conversely,
and again speaking in broad terms, it would seem fair to conclude that where
no standards of calculation or computation are fixed in the contract itself, and
applicable market values or other factors affecting the amount owing to the
builder can only be established by judicial determination upon consideration
of conflicting evidence, or where the builder’s claim or some substantial part
thereof includes prospective or contingent damages, then the amount of such
claim will be deemed incapable of ascertainment.
J.R. Kemper, LL.B., Allowance of Prejudgment Interest on Builder’s Recovery in Action for
Breach of Construction Contract, 60 A.L.R.3d 487, 514-15 (1974).
¶58 In this case, much evidence was presented at trial concerning Treweek’s general
liability for defective construction of the tennis facility. However, the only evidence of costs
for remediating the facility was a proposal prepared by Billmayer, which Treweek disputed.
Since no standards of computation or calculation were fixed in the parties’ contract, any
determination of the amount owed to GTC necessarily would have depended upon a judicial
determination after consideration of conflicting evidence.
¶59 We also note that there was a considerable difference between the amount of damages
claimed by GTC at trial, approximately $170,500, and the amount ultimately awarded by the
jury, $85,000. We have held that when a claimant alleges an award which is substantially
different from the amount ultimately awarded by the trial court, the damages are not capable
of being made certain by calculation. Jim’s Excavating, 265 Mont. at 516, 878 P.2d at 261.
Here, the District Court concluded that the damages were incapable of being ascertained
prior to trial, and based upon our review of the record, we cannot conclude otherwise.
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¶60 Affirmed.
/S/ JIM RICE
We concur:
/S/ JAMES C. NELSON
/S/ PATRICIA O. COTTER
/S/ JIM REGNIER
/S/ W. WILLIAM LEAPHART
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