Case Title: Mosell Equities, LLC v. Berryhill & Co., Inc

Citation: 

Docket Number: 41338

State: idaho

Court: Idaho Supreme Court (civil)

Date: 2015-01-26T00:00:00Z

Document:
IN THE SUPREME COURT OF THE STATE OF IDAHO 
 
Docket No. 41338-2013 
 
MOSELL EQUITIES, LLC, an Idaho limited 
liability company, 
 
Plaintiff-Respondent, 
 
v. 
 
BERRYHILL & COMPANY, INC., an Idaho 
corporation; JOHN E. BERRYHILL, III; and 
AMY BERRYHILL, individually, and as 
husband and wife, 
 
Defendants-Appellants. 
 
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Boise, December 2014 Term 
 
2015 Opinion No. 9  
 
Filed: January 26, 2015 
 
Stephen W. Kenyon, Clerk 
 
 
 
Appeal from the District Court of the Fourth Judicial District of the State of 
Idaho, in and for Ada County.  Hon. Dennis E. Goff, Senior District Judge. 
 
The order of the district court is reversed. 
 
Daniel E. Williams, Thomas Williams & Park, LLP, Boise, argued for appellants. 
 
Paul R. Mangiantini, Clark & Associates, Eagle, argued for respondent. 
 
 
 
EISMANN, Justice. 
 
This is an appeal out of Ada County from an order granting respondent a new trial.  We 
reverse the order of the district court and remand this case for entry of a judgment that is 
consistent with the jury verdict. 
 
I. 
Factual Background. 
 
 
On June 28, 2007, Mosell Equities issued a check to Berryhill & Co. in the sum of 
$50,000.  The word “loan” was written on the memo line of the check.  John Berryhill, the owner 
and president of Berryhill & Company, Inc., photocopied the check and wrote below the image 
of the check the following: 
 
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This is a loan from Mosell Equities to cover some misc. downtown expenses 
during our bookkeeper transition.  It will go into the general check register + be 
used for any billing of payables needed for downtown or Berryhill & Co. 
 
It will be transitioned into part of Glenn’s “buy in” of MoBerry Venture Corp. 
Inc. 
 
Mr. Berryhill signed the document as did Glenn Mosell, the owner and managing 
member of Mosell Equities, LLC.  Over the next ten months, Mosell Equities issued nine 
additional checks to Berryhill & Company, all but two of which had “loan” written on the memo 
line.  The ten checks totaled $405,000. 
On May 28, 2009, Mosell Equities filed this action against Berryhill & Company and Mr. 
and Mrs. Berryhill (collectively herein referred to as “Berryhill”).  The complaint alleged that 
Mosell Equities had loaned money to Berryhill and that it had failed to repay the loans.  The case 
was tried to a jury in September 2009.  During the trial, Messrs. Mosell and Berryhill provided 
widely divergent testimony regarding their relationship, whether the checks were actually loans, 
and what had transpired.  The essence of their divergent views is set forth in greater detail in the 
prior appeal in this case, Mosell Equities, LLC v. Berryhill & Co., Inc., 154 Idaho 269, 297 P.3d 
232 (2013). 
The jury returned a verdict in favor of Berryhill on the claims regarding the alleged loans.  
Mosell Equities filed a motion for a judgment notwithstanding the verdict or, in the alternative, 
for a new trial.  The district court granted a judgment notwithstanding the verdict as to part of a 
claim for relief, and this Court reversed that order on appeal.  Id. at 280, 297 P.3d at 243.  On 
remand, the district court granted Mosell Equities a new trial, and Berryhill appealed. 
 
II. 
Did the District Court Err in Granting Mosell Equities a New Trial? 
 
 
The district court granted Mosell Equities a new trial on the ground of the insufficiency 
of the evidence to justify the verdict.  The standard for granting a new trial on that ground is as 
follows: 
A trial judge may grant a new trial on that ground if, after making his or her own 
assessment of the credibility of the witnesses and weighing the evidence, the 
judge determines that the verdict is not in accord with the clear weight of the 
evidence.  The judge is not required to view the evidence in the light most 
favorable to the jury’s determination, but may grant a new trial even if there is 
 
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substantial evidence supporting the verdict.  The judge must also conclude that a 
different result would follow a retrial. 
 
Hudelson v. Delta Intern. Machinery Corp., 142 Idaho 244, 248, 127 P.3d 147, 151 (2005) 
(citations omitted). 
 
“When reviewing a trial judge’s grant of a new trial on appeal, this Court applies the 
abuse of discretion standard.”  Id.  In making a determination of whether a trial court abused its 
discretion, this Court considers:  (1) whether the trial court correctly perceived the issue as one 
of discretion; (2) whether the trial court acted within the boundaries of this discretion and 
consistent with the legal standards applicable to the specific choices available to it; and (3) 
whether the trial court reached its decision by an exercise of reason.  Rockeller v. Grabow, 139 
Idaho 538, 545, 82 P.3d 450, 457 (2003). 
 
In this case, Berryhill argues that the district court erred in granting a new trial because it 
granted a new trial on a theory of recovery that was not tried to the jury.  We agree. 
 
Mosell Equities brought this action contending that it had made loans to Berryhill that it 
failed to repay.  It contended that the loans were made while the parties were considering 
entering into a business relationship, but they never did so.  The amended complaint alleged,  
“Mosell Equities loaned these funds to John Berryhill and Berryhill & Company, Inc. while 
Glenn Mosell and John Berryhill were considering establishing a business relationship, initially 
in a company called MOBERRY, and subsequently, by Mosell Equities acquiring a 50% 
ownership in Berryhill & Company, John Berryhill’s corporation.”  The amended complaint 
reiterated that these sums were loans, and it alleged that Berryhill breached the contract “[b]y 
refusing to repay the loan”; that it breached an implied-in-fact contract because it “ha[s] and 
continue[s] to refuse to repay the loan”; and that Mosell Equities provided a benefit to Berryhill 
“by loaning them $405,000” and that it was “inequitable and unjust” for Berryhill “to retain the 
benefit of the $405,000.00 loan without compensating Mosell Equities for the principle [sic] 
amount of the loan plus accumulating statutory interest.” 
 
Mr. Mosell testified that Mosell Equities loaned the money in contemplation of 
purchasing a one-half interest in a new company to be formed called MoBerry, Inc., which 
would own Berryhill & Company, and then in contemplation of purchasing a one-half interest in 
Berryhill & Company.  He admitted that Berryhill & Company was not worth $800,000.  
 
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However, he testified, “I agreed to take the 387,000 that was agreed upon earlier to an even 
$400,000 for 50 percent of the Berryhill & Company stock.” 
Documents were prepared to consummate that transaction, but Mr. Mosell did not sign 
them.  He testified that he told Mr. Berryhill that the economic downturn was bigger than they 
thought and that “$400,000 was too much for me to keep in the restaurant.  That instead of 
converting $400,000 to 50 percent of the restaurant, for 200 shares, that I would like to look at 
owning fewer shares and getting some cash back.” 
Mr. Mosell testified that he gave Mr. Berryhill the option of Mosell Equities having a 
25% ownership interest in Berryhill & Company and receiving back $200,000 (either from 
Berryhill or by Mr. Berryhill finding another investor to pay the $200,000) or by Berryhill 
paying back $400,000 or working out a repayment plan.   
Thus, Mr. Mosell’s version of the transaction was that Mosell Equities loaned Berryhill 
$400,000, and it was not obligated to purchase any stock in Berryhill & Company.  It could 
purchase 50% of the stock for $400,000; or 25% for $200,000 and receive back $200,000; or not 
purchase any at all and receive back $400,000.  He testified that he had the right to demand 
repayment because “[i]t was a short-term loan.” 
 
In its motion for a new trial, Mosell Equities argued that the parties had agreed that it 
would purchase 50% of Berryhill & Company for $400,000 and that “Berryhill refused to tender 
stock or any equity in Berryhill & Co., Inc., and then refused to return Mosell Equities’ money.”  
In granting the new trial, the district court agreed. 
It held that the writing on the copy of the check mentioned above was a signed contract, 
which “indicated that this loan ‘will be transitioned into part of Glenn’s “buy in” of Moberry 
Venture Corp. Inc.’ ”  It then held that Berryhill breached that contract by failing to deliver stock 
representing a 50% interest in either Moberry Venture Corp., Inc., or Berryhill & Company.  The 
court wrote as follows: 
It is undisputed that Mosell Equities paid Berryhill & Company 
$405,000.00.  It is undisputed that the proposed buy-in never happened—
Berryhill & Company never gave Mosell Equities shares in the proposed 
MoBerry Corporation or the established Berryhill & Company.  . . .  It has been 
nearly six years to the day of this initial signed writing without the provided funds 
being transitioned into a “buy-in.”  Based on the Court’s review of all the 
evidence, more than six years to transition the funds into a “buy-in” is an 
unreasonable time for performance.  Thus, although Mosell Equities performed its 
obligations to Berryhill & Company under the contract by providing the requisite 
 
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funds, Berryhill & Company did not completely perform its obligations within a 
reasonable time by failing to transition the funds into a “buy-in.”  Therefore, the 
clear weight of the evidence establishes that Berryhill & Company breached the 
express contract. 
 
The court also concluded that the jury on a retrial “will find contrary to the first jury by finding 
an express contract that Berryhill & Company breached by failing to perform within a reasonable 
period of time.” 
 
There is a significant difference between the theory upon which this case was tried by 
Mosell Equities and the theory upon which the district court granted a new trial.  Mosell Equities 
tried this case upon the theory that it agreed to make a short-term loan to Berryhill while the 
parties contemplated whether they could reach an agreement regarding whether Mosell Equities 
would decide to acquire up to a 50% interest in either a corporation to be formed or Berryhill & 
Company.  It later decided it wanted either a 25% interest in Berryhill & Company and $200,000 
of the short-term loan repaid or it wanted the entire $400,000 loan repaid. 
The district court granted a new trial on the theory that the parties had entered into a 
binding contract under which Mosell Equities paid $400,000 for a 50% interest in either the 
corporation to be formed or Berryhill & Company and Berryhill breached that express contract 
by failing to transfer a 50% interest in either of those corporations. 
Under the theory upon which this case was tried, Mosell Equities was not obligated to 
acquire any portion of the two corporations.  Under the theory upon which the district court 
granted a new trial, Mosell Equities was contractually obligated to acquire a 50% interest in one 
of the two corporations.  There may certainly be a reason why Mosell Equities brought this 
action on the theory that there was a loan rather than the theory that there was a contract to 
acquire a 50% interest in one of the two corporations. 
The demand letter sent on February 20, 2009, to Mr. and Mrs. Berryhill did not demand a 
50% interest in Berryhill & Company, nor did it demand that they form a new corporation and 
issue 50% of the stock to Mosell Equities.  The demand letter stated that “it is clear that the legal 
relationship between Mr. Mosell and Berryhill & Company is that of lender to borrower, 
respectively.”  It also stated, “While it may have been contemplated at one point in time that Mr. 
Mosell was to become a shareholder in your company, the fact remains that no such transaction 
was ever completed.”  Because a 50% interest in Berryhill & Company was not worth $400,000,   
Mosell Equities may have chosen to frame this lawsuit as merely a loan in contemplation of 
 
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entering into a later agreement rather than the breach of an agreement to purchase a 50% interest 
in Berryhill & Company. 
“Where a plaintiff has chosen to submit his case upon certain issues or theories, they are 
bound by those choices, and it is error for the trial court to afterward grant one party a new trial 
on the basis that the plaintiff might have prevailed had it raised a different issue.”  Heitz v. 
Carroll, 117 Idaho 373, 378, 788 P.2d 188, 193 (1990).  By granting the motion for a new trial in 
order to enable Mosell Equities to try the case on a theory it did not raise in the first trial, the 
district court abused its discretion by failing to act consistently with the applicable legal 
standards.  Therefore, we reverse the order granting a new trial. 
 
III. 
Is Either Party Entitled to an Award of Attorney Fees on Appeal? 
 
 
Both parties request an award of attorney fees on appeal pursuant to Idaho Code section 
12-120(3) on the ground that this was an action to recover in a commercial transaction.  “That 
statute provides that in any civil action to recover in a commercial transaction, the prevailing 
party shall be allowed a reasonable attorney fee.”  Advanced Med. Diagnostics, LLC v. Imaging 
Ctr. of Idaho, LLC, 154 Idaho 812, 816, 303 P.3d 171, 175 (2013).  Because Berryhill & 
Company is the prevailing party on appeal, it is entitled to an award of attorney fees and Mosell 
Equities is not. 
 
IV. 
Conclusion. 
 
 
We reverse the order granting a new trial and direct the district court to enter a judgment 
consistent with the jury verdict.  We award appellants costs and attorney fees on appeal. 
 
 
Chief Justice BURDICK, Justices J. JONES, HORTON, and Justice Pro Tem WALTERS 
CONCUR.