Case Title: Anderson Excavating and Wrecking Co. v. Certified Welding Corp.,

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1988-12-28T00:00:00Z

Document:
Anderson Excavating and Wrecking Co. v. Certified Welding Corp.,1988 WY 161769 P.2d 887Case Number: 88-80Decided: 12/28/1988Supreme Court of Wyoming
ANDERSON 
EXCAVATING AND WRECKING COMPANY, a Nebraska corporation, Appellant 
(Defendant)

 
 
v.

 
 
CERTIFIED 
WELDING CORPORATION, a Wyoming corporation, Appellee 
(Plaintiff)

 
 
J. Dudley Butler and Jamie Smith of 
Skiles, Hageman & Butler, Laramie, for Appellant.

 
 
Mark A. Bishop of Lathrop, Rutledge 
& Boley, P.C., Cheyenne, for Appellee. 

 
 
Before Cardine, C.J., and Thomas, 
Urbigkit, Macy and Golden, JJ. 

 
 
Golden, 
Justice.

 
 

[¶1.]     Appellant Anderson 
Excavating & Wrecking Company (Anderson) challenges the trial court's 
findings and judgment in a contract action. The underlying case involved a 
dispute between Anderson and appellee Certified Welding 
Corporation (Certified) over the terms of a lease agreement for a crane. After a 
bench trial, the trial court found that a contract existed between the parties 
and was evidenced by an unambiguous writing. It ruled generally in favor of 
Certified based on the terms of that written contract. Anderson argues that: (1) no contract existed; (2) the 
crane operator was Certified's employee and his negligence was the proximate 
cause of damage to the crane; (3) Anderson was not liable for the entire lease 
payment because Certified terminated the lease and the trial court calculated 
the damages incorrectly.

 
 

[¶2.]     We 
affirm.

 
 

[¶3.]     In April 1985, the vice 
president of Anderson, Mr. Lanny LaVelle, contacted the president of Certified, 
Mr. Don Chick, inquiring about leasing a crane. Anderson needed the crane for demolition work in Laramie, Wyoming. This initial telephone conversation 
resulted in an oral agreement that Certified would lease an eighty-two and 
one-half ton link-belt crane to Anderson at $ 6,500 per month for two months. 
Certified drafted a lease agreement including those terms, which was signed by 
Chick. The signed agreement was delivered to LaVelle on April 18, 1985. Gary 
Mills, a crane operator for Certified, transported the crane and the lease 
document to Laramie; the crane was used in 
Anderson's 
project on April 18, 19, and 22, 1985. LaVelle testified at trial that he 
reviewed the contract signed by Chick and telephoned Chick again to discuss the 
maximum hours the crane would be used per month and the hourly overtime rate for 
using the crane beyond that limitation. In that discussion, they agreed on 
several changes to those terms. Based on the additional negotiations, LaVelle 
changed the maximum hours term on the front of the lease document from 178 hours 
per month to 173 hours per month; LaVelle also altered the overtime rate term on 
the back of the lease document from $ 130 per hour to $ 38 per hour. LaVelle 
initialed both changes on the lease document and returned it to Chick. Chick 
reviewed the alterations made by Lavelle and initialed the change in the maximum 
hours term on the front of the lease document. He did not initial LaVelle's 
change to the overtime rate term on the back of the lease 
document.

 
 

[¶4.]     Mills was provided with 
the crane by Certified under the lease document terms. On April 22, 1985, Mills 
was operating the crane for Anderson under the 
supervision of David Rogers, Anderson's superintendent. Mills was using the 
crane to pull down a steel truss so that it could be loaded into a railroad car. 
When Mills tried to grasp the truss with the bucket of the crane, the bucket 
slipped and recoiled into the boom of the crane. The boom was damaged and had to 
be replaced. Certified ordered and installed the new boom section at a cost of $ 
15,503.22. The repairs were completed on May 1, 1985.

 
 

[¶5.]     Certified tried for 
several days to get the name and address of Anderson's insurance company to file a claim 
for reimbursement on the crane repair. During a telephone conversation on April 
29, 1985, an Anderson employee in Omaha, Nebraska, told 
Certified that Anderson would not pay for the 
repairs and that the crane should be removed from the job site in Laramie. Certified never 
received written notice to remove the crane, but complied with the oral notice 
and moved the crane back to Cheyenne on May 1, 1985. At that time, the 
crane was repaired and Certified was willing to continue under the terms of the 
lease agreement. Anderson never reimbursed Certified for the 
cost of repairs to the crane. LaVelle's partial explanation for this was that 
Anderson decided 
it should not have to pay for repairs to the crane because it did not have its 
own crane operator controlling the equipment at the time of the accident. 
Anderson also 
refused to pay lease rental and operator's wages claimed by Certified under the 
lease and never provided Certified with certificates of insurance as the lease 
agreement required.

 
 

[¶6.]     Certified filed a 
complaint alleging breach of the written lease agreement on June 19, 1986. 
Anderson 
answered and counterclaimed on July 28, 1986. Certified answered the 
counterclaim on August 6, 1986, and received leave of court to amend its 
complaint during the October 29, 1987, pretrial conference and on November 18, 
1987, at the opening of the trial. The case was tried on November 18-19, 1987. 
On December 21, 1987, the court dismissed the counterclaim and entered a $ 
28,756.12 judgment against Anderson.

 
 
DID THE PARTIES 
CONTRACT?

 
 

[¶7.]     Anderson's first issue questions whether the written lease 
agreement evidenced a valid contract between Anderson and Certified. A contract comes into 
being when there is a meeting of the minds concerning the terms of the 
agreement. Jackson Hole Builders v. Piros, 654 P.2d 120, 122 (Wyo. 1982). The existence 
of a contract depends upon the intent of the parties and presents the trial 
court with a question of fact. United 
States ex rel. Farmers Home Administration v. 
Redland, 695 P.2d 1031, 1036 (Wyo. 1985). On appellate review we defer to a 
trial court's findings of fact unless they are shown to be an abuse of trial 
court discretion. Kennedy v. Kennedy, 761 P.2d 995, 998 (Wyo. 1988). See also 
Martin v. State, 720 P.2d 894, 897 (Wyo. 1986) (defining judicial 
discretion).

 
 

[¶8.]     Anderson argues that 
LaVelle's alterations of the original written lease agreement were not an 
acceptance of that offer, but instead created a counter offer that was never 
accepted by Certified in writing. We agree that no contract was formed when 
Lavelle signed the lease agreement after he altered two of its terms. A 
party who will not accept an offer without a material alteration to its terms 
rejects the offer. Panhandle Eastern Pipe Line Company v. Smith, 637 P.2d 1020, 1023 (Wyo. 1981). A material alteration of a 
contractual term is one that cannot be implied in the original offer. Id. If the party 
who modifies the original offer returns it to the original offeror for his 
acceptance, the modified offer becomes a counter offer that must be accepted 
unconditionally by the original offeror to create a contract.1 It is undisputed that Chick sent 
the lease agreement to LaVelle and that LaVelle reviewed it. LaVelle then 
telephoned Chick and they negotiated two changes in its terms. After this 
negotiation LaVelle altered the document to reflect those changes, initialed the 
alterations, signed the lease agreement, and returned it to Chick. Since the two 
alterations could not have been implied in the original offer, they were 
material and modified the original offer. This modified offer became a counter 
offer by Anderson to Certified.

 
 

[¶9.]     Anderson uses this 
conclusion to argue that Certified could accept the counter offer only if 
it did so in writing. Anderson urges that Chick's failure to initial 
both of LaVelle's alterations was a failure to accept in this alleged 
exclusive mode of acceptance and amounted to no acceptance at all. This is where 
we part company with Anderson.

 
 

[¶10.]  In Panhandle, 637 P.2d  at 1022, we 
made the following statement concerning the application of the exclusive mode of 
acceptance rule:

 
 
The offeror is the master of the 
offer, but we think fairness demands that when there is a dispute concerning 
mode of acceptance, the offer itself must clearly and definitely express an 
exclusive mode of acceptance. There must be no question that the offeror would 
accept the prescribed mode and only the prescribed mode. * * * * The requirement 
[that offeree just sign the offer and not add anything] strikes us as 
unreasonable, and strikes out as a prescribed mode of acceptance unless the 
offeror's intention is explicitly set out. We agree that the mode of acceptance 
rule '* * * * has been enforced with a rigor worthy of a better cause. Calamari 
& Perillo, Contracts, § 2-22 (2d ed. 1977). We are not eager to enforce it 
if there is any question about the mode of acceptance or about the clarity with 
which the demand was made.

 
 

[¶11.]  The written agreement in this case did 
not require acceptance exclusively in writing. It already had Chick's signature 
on the only other signature line on the document as a result of the initial 
offer. No evidence exists in the record that LaVelle told Chick he must notify 
Anderson of Certified's return promise to perform, initial the alterations to 
the document, or sign it again. The document does not contain any express terms, 
or additional terms added by LaVelle, which explicitly require Chick to accept 
by return promise in writing. Cf. Wheeler v. Woods, 723 P.2d 1224, 1227 
(Wyo. 1986) 
(express requirement for acceptance in writing). Under our reasoning in 
Panhandle these facts create sufficient uncertainty about the proper mode 
of acceptance to compel us to hold that Certified was not bound to accept 
Anderson's 
counter offer in writing.

 
 

[¶12.]  An offer which does not specify a mode of 
acceptance invites acceptance in any manner reasonable under the circumstances. 
United Concrete Pipe Corporation v. Spin-Line Company, 430 S.W.2d 360, 
363-364 (Tex. 1968) cited in Thomas v. Reliance Insurance Co., 617 F.2d 122, 128 (5th Cir. 1980); Restatement (Second) of Contracts § 32 at 89 (1981). 
Cf. Spatz v. Mile-Hi Realty, 589 P.2d 849, 852 (Wyo. 1979). The 
acceptance may be a return promise to perform or an actual performance; an 
acceptance by actual performance operates as a promise to render complete 
performance under the stated terms and forms a contract. Pangarova v. 
Nichols, 419 P.2d 688, 697 (Wyo. 1966); United Concrete, 430 S.W.2d 
at 363-364; Restatement (Second) of Contracts § 62 at 149 
(1981).

 
 

[¶13.]  In this case, pursuant to a general 
telephone conversation the original written offer containing Chick's signature 
was delivered to LaVelle in Laramie on April 18, 1985. That offer was 
delivered to LaVelle by Chick's crane operator who had come to Laramie to deliver the crane and begin demolition work on 
Anderson's 
project. After reading Chick's written offer, LaVelle telephoned Chick during 
the evening of April 18, 1985, suggesting changes to the writing. The two men 
discussed the contract and LaVelle made two minor changes to the writing, signed 
and initialed the writing, and returned it to Chick as a counteroffer. Chick 
read the altered agreement, initialed one of the changes and apparently filed 
it. The crane began working when it arrived on April 18, 1985, and both parties 
performed under the terms of the written contract as evidenced by the altered 
writing LaVelle returned to Chick until the crane was damaged on April 22, 1985. 
Nothing in the record shows a rejection by Certified or a withdrawal of the 
counter offer by Anderson. Giving deference to the trial court's 
findings, we hold that Certified accepted the counter offer by performing under 
the terms of the lease agreement from April 18 through April 22, 1985. A 
contract was formed between the parties under these facts and its terms are 
evidenced by the written lease agreement, as altered, initialed, and signed by 
LaVelle. See Farr v. Link, 746 P.2d 431, 433 (Wyo. 
1987).

 
 
OPERATOR 
NEGLIGENCE

 
 
Allocation of 
Risk of Loss

 
 

[¶14.]  Anderson's next issue attempts to focus our 
attention on the alleged negligence of the crane operator. It argues that this 
operator was, in substance, an employee of Certified when the crane was damaged 
and his alleged negligence in causing the damage is attributable to Certified. 
Anderson cites 
as support for this theory several cases involving leases of cranes and other 
equipment, in which the lessor supplied the equipment operator and that 
operator's conduct was found to be the proximate cause of damage to the 
equipment or injury to another person. See Rocky Mountain Bridge Company v. 
Martin K. Eby Construction Company, 543 P.2d 1288 (Colo.App. 1975); Great 
Western Sugar Company v. Erbes, 148 Colo. 
566, 367 P.2d 329 (1961); Chartier v. Winslow Crane Service Company, 142 
Colo. 294, 350 P.2d 1044 (1960); Foy-Proctor 
Co. v. Marshall & Thorn, 169 Ky. 377, 183 S.W. 940 
(1916).

 
 

[¶15.]  Anderson's argument ignores the written lease 
agreement, and the cases it cites are similarly distinguishable on their facts. 
Anderson fails 
to recognize that the parties to this type of contract are free to allocate the 
risk of loss among themselves as they choose. Allstar Video, Inc. v. 
Baeder, 730 P.2d 796, 798-799 (Wyo. 1986). Anderson cites no cases that involve written 
lease agreements containing an express allocation of risk of loss 
provision.

 
 

[¶16.]  The written lease agreement between 
Anderson and 
Certified is a lease of personal property for a definite period of time for the 
mutual advantage of the parties, sometimes referred to as a bailment lease. 
Fuchs v. Goe, 62 Wyo. 134, 163 P.2d 783, 789, 166 A.L.R. 1329 
(1945). See also 9 S. Williston, Williston on Contracts § 1041A at 927-928 
(1967). In this type of lease, the bailee is generally held to a standard of 
ordinary care regarding the condition of the personal property involved. 
Mazzola v. Sawyer, 702 P.2d 167, 169 (Wyo. 1985); Fuchs, 163 P.2d  at 789. 
However, the parties to a bailment lease may specially contract to place the 
risk of loss or damage to bailed personal property on the bailee, essentially 
making bailee an insurer of the personalty. Allstar Video, 730 P.2d  at 
799; Fuchs, 163 P.2d  at 789-790. "A special contract between the parties 
may either enlarge or limit the obligation of the bailee [to exercise ordinary 
care] as it ordinarily would be under the general law." Fuchs, 163 P.2d  
at 789. Such changes in a bailee's obligations to care for personal property 
under a bailment contract are enforceable only if they are expressed in "clear 
and explicit language." Fuchs, 163 P.2d  at 790-791. See also Allstar 
Video, 730 P.2d  at 798-799. The bailee's contractual duty to insure the 
personal property must arise from the plain meaning of the words used to limit 
the obligation. Fuchs, 163 P.2d  at 791.

 
 

[¶17.]  The express language of the written lease 
agreement in this case clearly and explicitly obligated Anderson to maintain 
insurance against risk of loss or damage to the crane, regardless of the cause. 
The second term of the written lease agreement evidencing the contract between 
Anderson and 
Certified provided:

 
 
SECOND: Lessee [Anderson] agrees 
to keep the equipment fully insured at all times against all risks of loss or 
damage from every cause whatsoever and Lessee shall carry public liability and 
property damage insurance covering the equipment in an amount sufficient to 
indemnify Lessor against any loss. All such insurance shall be in the name of 
both Lessor and Lessee, specifically naming Lessor as a co-insured. The 
Proceeds of such insurance shall, at Lessor's option, be applied to repair, 
restore, or replace the equipment or toward Lessee's obligations hereunder. 
Lessee shall provide Lessor with certificates of insurance. (Emphasis 
added.)

 
 
This language obligates Anderson to insure the 
crane and to co-insure Certified against any loss from damage to the crane. This 
allocation of the risk of loss exists no matter who Anderson attempts to blame 
for damaging the crane.

 
 

Anderson's Operator

 
 

[¶18.]  Anderson's 
negligence allegation is further weakened when we review the propriety of the 
trial court's finding that the crane operator was Anderson's employee under the written contract and that he 
was under Anderson's control at the time the crane was 
damaged. While Anderson asserts that Mills was under 
Certified's control when the crane was damaged, it admits in its brief that it 
agreed to accept Certified's crane operator under the contract. The trial court 
accepted Chick's testimony concerning LaVelle's telephone call to Chick shortly 
after work began, asking if a different person could operate the crane. LaVelle 
did not complain about Mill's competence to operate the crane. When Chick 
expressed a preference for having Mills operate the crane, LaVelle agreed and 
the conversation ended amicably. LaVelle also did not complain about Mills in 
writing. Based on this evidence the trial court found that Mills was controlled 
by Anderson when 
the crane was damaged.

 
 

[¶19.]  By arguing questions of control, 
Anderson is 
trying to relitigate a factual issue that was properly decided at trial. 
Anderson has not 
shown an abuse of trial court discretion underlying this finding, and we defer 
to the trial court in that circumstance.

 
 
ALLEGED 
TERMINATION AND DAMAGES

 
 

[¶20.]  Anderson's 
final issue is essentially a facial challenge to the trial court's findings and 
conclusions that Anderson breached the lease agreement thereby 
entitling Certified to damages for repair of the crane and the payments due 
under the lease. The evidence at trial was overwhelming that Anderson breached the 
clear terms of the written contract in a number of ways. Based on properly 
supported findings of fact, the trial court concluded Anderson breached the 
contract by failing to: (1) insure the crane; (2) co-insure Certified against 
damage to the crane; (3) provide Certified with certificates of insurance; (4) 
replace the damaged crane or pay for the repairs; and, (5) pay the two monthly 
rental payments of $ 6,500. The trial court had more than enough evidence before 
it to find a breach by Anderson and award damages based on that 
breach. Anderson 
cannot relitigate proper findings of fact on appeal. We are also unpersuaded by 
Anderson's 
argument that Certified failed to mitigate its damages. Anderson's argument 
amounts to a request that this court infer a failure to mitigate in the absence 
of proof in the record. As the breaching party, Anderson is charged with the burden to prove 
its mitigation claim. See Sturgeon v. Phifer, 390 P.2d 727, 731 
(Wyo. 1964). 
It has failed to carry that burden.

 
 

[¶21.]  Affirmed.

 
 
FOOTNOTES

 
 

1"An acceptance is still effective if the 
addition only asks for something that would be implied from the offer and is 
therefore immaterial." Panhandle Eastern Pipe Line Company v. Smith, 637 P.2d 1020, 1023 (Wyo. 1981).