Hi-Country Estates Homeowners Ass'n v. Bagley & Co.

AMENDED MEMORANDUM DECISION 1

VOROS, Judge:

T1 This appeal represents the latest episode in a course of litigation spanning a *1189quarter of a century. We last ruled in this case in Hi-Country Estates Homeowners Ass'n v. Bagley & Co., 2008 UT App 105, 182 P.3d 417, cert. denied, 199 P.8d 970 (2008). That appeal arose from a counterclaim filed by Foothills Water Company, J. Rodney Dansie, the Dansie Family Trust, Richard P. Dansie, Boyd W. Dansie, Joyee M. Taylor, and Bonnie R. Parkin (collectively, the Dan-sies) against the Hi-Country Estates Homeowners Association (the Association). See id. 1. The Dansies sought damages for breach of a 1977 well lease agreement (the Well Lease). See id. 12.

12 The trial court entered an omnibus order somewhat optimistically titled Final Judgment. See id. T6. First, the court ruled that the Well Lease was an enforceable contract, neither void as against public policy nor unconscionable. See id. Second, the trial court denied the Dansies' breach of contract claims. See id. In the context of these claims, the trial court ruled that, pursuant to a 1986 order of the Public Service Commission (PSC), the Dansies were entitled to receive water under the Well Lease only upon payment of their pro rata share of fees and costs and not, as stated in the Well Lease itself, "at no cost." See id. Because the Dansies had refused to pay these fees, the trial court ruled that the Association had not breached its obligation under the Well Lease. See id. In addition, the trial court found no evidentiary basis for the Dansies' claim of damages in the form of an orchard withering, loss of landscaping, and loss of property value. See id. 117. Third, the trial court awarded the Dansgies judgment in the sum of $16,834.99 as reimbursement for improvements to the water system. See id. 16. Finally, the trial court denied the Dansies' claim for attorney fees. See id.

13 The Dansies appealed. We affirmed the trial court's order that the Well Lease was not void as against public policy. See id. 113. In doing so, we stated in a footnote that, because the PSC no longer exercised jurisdiction over the Association, "we now interpret the Dansies' rights and obligations under the Well Lease according to its plain language." Id. 112 n. 2. We also affirmed the trial court's order that the Well Lease was not unconscionable. See id. T15. And we affirmed the trial court's denial of the Dansies' breach of contract claims relating to the severing of the water systems. See id. 16. We did so under the rules of appellate procedure, holding that in challenging on appeal the trial court's factual findings on damages, the Dansies had failed to marshal the evidence as required by rule 24(a)(9) of the Utah Rules of Appellate Procedure. See id. 20; see also Utah R.App. P. 24(a)(9). We also affirmed the trial court's judgment in favor of the Dansies in the sum of $16,834.99. See Hi-Country Estates, 2008 UT App 105, ¶ 21, 182 P.3d 417. Finally, we affirmed the trial court's denial of attorney fees. See id. 122. Our opinion concluded, "We therefore affirm the trial court on all issues." Id. ¶ 24. The Utah Supreme Court denied cross-petitions for certiorari.

T4 After remittitur, the Dansies filed a motion with the trial court to modify the Final Judgment to conform to footnote 2 of our opinion as they understood it. The Association resisted the motion, and the trial court denied it. The Dansies appeal. We conclude that our 2008 opinion appropriately resolved the issues before us under relevant principles of appellate review. Furthermore, the trial court properly read our opinion as a complete affirmance.

15 "The mandate rule dictates that pronouncements of an appellate court on legal issues in a case become the law of the case and must be followed in subsequent proceedings of that case. The mandate rule . binds both the district court and the parties to honor the mandate of the appellate court." Utah Dep't of Transp. v. Ivers, 2009 UT 56, ¶ 12, 218 P.3d 588 (omission in original) (citation and internal quotation marks omitted). "The lower court must implement both the letter and the spirit of the mandate, taking into account the appellate court's opinion and the cireumstances it embraces." Id. (internal quotation marks omitted).

T6 For reasons we explain below, we do not believe the language in footnote two of our opinion conflicts with our ultimate *1190order. Nevertheless, to the extent a real or apparent conflict exists in a judicial opinion, the opinion's "directions" control. See Amax Magnesium - Corp. v. Utah State Tax Comm'n, 848 P.2d 715, 718 (Utah Ct.App.1998) ("Where the language used in the body of an appellate opinion conflicts with directions on remand, the latter controls."), rev'd on other grounds, 874 P.2d 840 (Utah 1994). And the only directions in our 2008 opinion indicate that we are affirming the trial court on all issues. The opening paragraph of that opinion states, "Counterclaim Plaintiffs appeal several of the trial court's determinations. Counterclaim Defendant ... filed a cross-appeal challenging other determinations. We affirm." Hi-Country Estates Homeowners Ass'n v. Bagley & Co., 2008 UT App 105, ¶ 1, 182 P.3d 417. The final sentence of the opinion states, "We therefore affirm the trial court on all issues." Id. 124. Nowhere in the opinion do we use the words "reverse," "vacate," "modify," or (except in reciting the history of the litigation) "remand." We therefore agree with the trial court that, "in the face of the unequivocal affirmance by the Court of Appeals, [the trial court] lacks authority to modify the final judgment." The trial court thus properly refused to interpret an opinion that states, "We therefore affirm the trial court on all issues" as having actually affirmed on some issues and reversed on others. A contrary approach would risk eroding the clarity of the mandate rule and the authority of the appellate courts of this state.

T7 Mandate rule aside, we do not read our 2008 opinion as a partial reversal. Footnote two appears in section I of the opinion. We there rejected the Association's claim that the Well Lease's "provisions for free water and water connections" are void as against public policy. We explained in footnote two that, because the 1986 order of the PSC was no longer in effect, we would interpret the Well Lease "according to its plain language." Id. 112 n. 2. We thus clarified that the precise question we were treating was whether the Well Lease as writien-not as superseded by PSC directives-was contrary to public policy. We concluded that it was not. See id. TT12-18. A contrary ruling-that the Well Lease as written was unenforceable because it was unconscionable or against public policy-would have barred all the Dansies' past and future breach of contract claims. Our determination that the Well Lease did not offend public policy left unresolved the question of breach of contract.

T8 We resolved the breach of contract claim in section III. See id. 116. We noted there that the trial court had addressed both breach and damages.2 We first summarized the trial court's ruling with respect to breach; in so doing, we noted that "iln dismissing the claims, the trial court relied on the 1986 PSC order." Id. We then summarized the trial court's ruling with respect to damages, noting that the trial court had "determined that the Dansies had failed to prove damages proximately caused by the alleged breach." Id. We resolved this issue on the element of damages, "affirm[ing] the dismissal of the breach of contract claims based on this failure to prove damages." Id. We properly did so on the ground that the Dansies had not "adequately marshalled] the evidence." Id. 120. Resolving the claim on the element of damages made it unnecessary for us to address whether a breach of the contract had been otherwise established. See id. % 20.

9 Our 2008 opinion thus resolved all outstanding issues in favor of the trial court's order. It explicitly resolved all issues enumerated in the concluding paragraph. See id. 124. Any remaining challenges to the trial court's order, whether or not we addressed them on the merits, were also necessarily resolved in favor of the trial court's order. See Piacitelli v. Southern Utah State Coll., 686 P.2d 1068, 1065 (Utah 1981) (noting that a final order, "unless reversed on appeal, is res judicata and binding upon [the] parties"). Finally, any challenges to prior trial court rulings that the parties might have *1191appealed, but did not, were at that point waived. See DeBry v. Cascade Enters., 935 P.2d 499, 502 (Utah 1997) (failing to raise issues ripe for appeal results in waiver of the right to raise them at a later time).3

10 The opinion made no attempt to resolve future issues that might arise between the parties, including future claims of damages against the Association for future breaches of the Well Lease. The opinion did establish that, so long as the PSC does not exercise jurisdiction over the water system, the rights of the parties are as set forth by the plain language of the Well Lease. The Association contends that this can never happen, because as soon as it delivers a drop of water to the Dansies at no cost as required by the Well Lease, the PSC will exercise jurisdiction and require payment. Perhaps the Association is correct.4 But none of us can foretell the future-statutes can be amended; regulations can be repealed; administrative policies and attitudes can change. Thus, our opinion wisely hazarded no guess as to whether the PSC could or would exert jurisdiction in the future, and thus made no effort to adjudicate the rights of the parties or the enforceability of the Well Lease going forward.

4 11 In sum, our 2008 opinion properly and consistently resolved all issues before us on appeal. Moreover, we see no error in the trial court's refusal to modify the Final Judgment after remittitur and therefore affirm its disposition.

. This Amended Memorandum Decision supersedes the Amended Memorandum Decision in *1189Case No. 20090433-CA issued on January 27, 2011.

. Proof of damages is an element of a claim for breach of contract. See Bair v. Axiom Design, 2001 UT 20, ¶ 14, 20 P.3d 388 ("The elements of a prima facie case for breach of contract are (1) a contract, (2) performance by the party seeking recovery, (3) breach of the contract by the other party, and (4) damages.").

. - Notwithstanding our 2008 opinion stating that we affirmed the trial court "on all issues," the Dansies did not file a petition for rehearing. The Association filed a petition for rehearing on a question unrelated to the instant appeal. See Utah R.App. P. 35(a) (permitting the filing of a petition for rehearing within fourteen days after the entry of an appellate decision drawing the court's attention to "points of law or fact which the petitioner claims the court has overlooked or misapprehended"). We denied that petition.

. The trial court seems to have accepted this argument. In its Memorandum Decision and Order dated November 5, 2001, the trial court ruled that, "because there was no way for The Association to provide water service to the Dan-sies without violating the 1986 PSC order, the damages thai arose after February 5, 1996 are also not attributable to The Association." We did not, and did not need to, grapple with the vagaries of this argument on appeal. We resolved all issues on other grounds.