Case Title: JOHNSON v. SIKORSKI

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 2004-11-10T00:00:00Z

Document:
JOHNSON v. SIKORSKI2004 WY 137100 P.3d 420Case Number: 04-27, 04-28Decided: 11/10/2004
OCTOBER 
TERM, A.D. 2004

 

                                                                                                            

 

 

CRAIG 
A. JOHNSON,

 

Appellant(Plaintiff/Counterclaim 
Defendant),

 

v.

 

JACK 
SIKORSKI,

 

Appellee(Defendant/Counterclaim 
Plaintiff).

 

 

PAUL 
BEFUMO,

 

Appellant(Defendant),

 

v.

 

CRAIG 
A. JOHNSON,

 

Appellee(Plaintiff).

 

 

 

Appeal 
from the District Court of Laramie County

The 
Honorable Nicholas G. Kalokathis, Judge

 

Representing 
Appellant/Appellee Johnson:

            
Mitchell E. Osborn, Cheyenne, Wyoming. 

 

Representing 
Appellee Sikorski:

            
Peter K. Michael of Peter K. Michael, P.C., Cheyenne, 
Wyoming.

 

Representing 
Appellant Befumo:

            
Paul 
Befumo, pro se.

 

 

Before 
HILL, C.J., and GOLDEN, KITE, and VOIGT, JJ., and YOUNG, 
DJ.

 

 

KITE, 
Justice.

 

[¶1]      Craig Johnson was 
a beneficiary under a trust created by his father.  First Estate Management Corp. (FEMCO) 
was the trustee.  FEMCO hired Jack 
Sikorski to operate the trust businesses.  
Mr. Johnson and Mr. Sikorski had difficulties, resulting in an 
altercation for which Mr. Johnson was convicted of breach of the peace.  Thereafter, FEMCO's vice-president, Paul 
Befumo, created a new trust (RW & NW Trust), named himself as the trustee, 
and transferred the trust property to the new trust. 

 

[¶2]      Mr. Johnson, 
along with his sister and co-beneficiary, filed suit against FEMCO, Mr. Befumo 
and Mr. Sikorski, alleging breach of fiduciary duty.  Mr. Sikorski filed a counter-claim 
against Mr. Johnson for harassment and assault.  The district court bifurcated the case, 
setting separate trials on the claims for breach of fiduciary duty and 
assault.

 

[¶3]      During the trial 
on Mr. Johnson's claims, the district court dismissed Mr. Sikorski after the 
plaintiffs' case and, at the close of trial, found against Mr. Befumo, and 
removed FEMCO and Mr. Befumo as trustees.  
Prior to trial on the assault counter-claim, the district court entered 
an order precluding Mr. Johnson from calling any witnesses because he failed to 
properly designate them.  At the 
close of the trial, the district court found for Mr. Sikorski and awarded 
$25,000 in damages.  Mr. Johnson 
appeals from the judgment entered against him on Mr. Sikorski's counter-claim, 
asserting error in the district court's order precluding him from calling 
witnesses.  Mr. Befumo, appearing 
pro se, appeals from the judgment entered against him on Mr. Johnson's 
claims, asserting error in the district court's order allowing an amendment to 
the pleadings and its application of Rock Springs Land and Timber, Inc. v. 
Lore, 2003 WY 100, 75 P.3d 614 (Wyo. 2003).  We affirm.  

    

 

ISSUES

 

[¶4]      In case No. 
04-27, Mr. Johnson raises the following issue:

 

Did 
the trial court abuse its discretion by granting the motion in limine of 
appellee/counterclaim plaintiff which prevented appellant/counterclaim defendant 
from making an opening statement, testifying, or presenting any evidence or 
otherwise defending against the counterclaim because he did not redesignate 
himself as a witness in the bifurcated trial upon the counterclaim?         

 

Mr. 
Sikorski states the issues as follows:

 

1.      
Whether 
the district court abused its discretion by prohibiting a counter-claim 
defendant from calling witnesses whose testimony was not designated as required 
by the court's pretrial order.

 

2. 
Whether [Mr. Johnson's] claim of error based on the exclusion of evidence is 
barred by his failure to make an offer of proof in the district court. 

 

[¶5]      In case No. 
04-28, Mr. Befumo presents the following issues:

 

1.      
Did 
the trial court err in allowing [Mr. Johnson] to change [his] theory of relief 
at the beginning of trial, and to present evidence on facts and issues not pled 
in the complaint?

 

2.      
Did 
the trial court abuse its discretion in allowing an amendment of the pleadings 
at the close of [Mr. Johnson's] case where there was no excuse for the delay, 
and where the [defense] was prejudiced by the amendment?

 

3.      
Was 
the district court's reliance on Rock Springs Land and Timber Inc. v. Lore 
[2003 WY 100, 75 P.3d 614 (Wyo. 2003)] misplaced?

 

 

FACTS

 

[¶6]      In 1997, Nona and 
Robert Wilkoske created the Nona N. Wilkoske and Robert C. Wilkoske Revocable 
Trusts (the trusts).  Mr. Wilkoske 
named his two children, Mr. Johnson and Beverly Tourville, as beneficiaries of 
his trust.  The trust property 
consisted primarily of a business known as A-1 Auto Salvage, an abandoned 
missile site and various items of personal property.  Mrs. Wilkoske named her daughter, Vicki 
Rhodes, beneficiary of her trust.  
When the original trustee resigned in 1999, the trust beneficiaries named 
FEMCO successor trustee.  Mr. 
Befumo, FEMCO's vice-president, employed Mr. Sikorski to re-open and run the 
salvage business.  

 

[¶7]      Shortly after 
FEMCO took over as trustee, Mr. Johnson and Ms. Tourville became concerned that 
Mr. Befumo and Mr. Sikorski were mismanaging the trust property.  They filed a complaint against FEMCO, 
Mr. Befumo and Mr. Sikorski, alleging they breached their fiduciary obligations 
by operating and selling trust assets without the consent of and against the 
wishes of the beneficiaries, failing to properly inventory and account for trust 
assets and income and utilizing trust assets for their own personal gain.  Mr. Johnson and Ms. Tourville sought an 
accounting of trust assets and income.

 

[¶8]      Mr. Sikorski 
denied the claims and filed a counter-claim against Mr. Johnson, alleging that 
Mr. Johnson attacked and threatened to kill him.  Specifically, he alleged Mr. Johnson 
placed a large sharpened steel hook around his neck and attempted to drag him 
out of the open window of the truck he was driving.  He further alleged Mr. Johnson made 
repeated threats upon his life, broke into his residence and generally created 
an atmosphere of fear and violence.  
Mr. Sikorski brought claims for intentional infliction of emotional 
distress, defamation, trespass, and intentional interference with a contractual 
relationship.  He sought damages in 
excess of $1,000,000.    

 

[¶9]      The district 
court bifurcated the claims, setting Mr. Johnson's claim for breach of fiduciary 
duty for trial first, followed by trial on the counter-claim.  Both cases were scheduled for trial to 
the court. 

 

[¶10]   At the close of Mr. Johnson's case 
during the first phase of the trial, the district court granted judgment as a 
matter of law for Mr. Sikorski on the breach of fiduciary duty claim.  The claims against FEMCO and Mr. Befumo 
proceeded to trial.  Following the 
trial, the district court entered an order declaring that the conveyances from 
the original trust to the new trust were null and void and FEMCO acted ultra 
vires in making the conveyances.  
The district court ordered that FEMCO and Mr. Befumo be relieved from 
duties concerning the Robert Wilkoske trust and a new trustee be appointed.1

 

[¶11]   Prior to the second phase of the 
trial on the counter-claim, Mr. Sikorski moved to preclude Mr. Johnson from 
calling any witnesses, contending that he failed to designate any witnesses as 
required by the district court's case management order.  The district court granted the motion, 
thus precluding Mr. Johnson from presenting an opening statement, testifying or 
calling other witnesses.  At the 
close of the trial, the district court entered judgment for Mr. Sikorski and 
awarded $12,500.00 in compensatory damages and an additional $12,500.00 in 
punitive damages.      

 

            

STANDARD 
OF REVIEW

 

[¶12]   The decision to allow amendment to 
pleadings is vested within the sound discretion of the district court and is, 
therefore, subject to reversal only for an abuse of discretion. Ekberg v. 
Sharp, 2003 WY 123, ¶9, 76 P.3d 1250, ¶9 (Wyo. 2003).  A decision involving whether to require 
adherence to pretrial orders is also a matter left to the district court's 
discretion.  Casteel v. 
News-Record, Inc., 875 P.2d 21, 23 (Wyo. 1994).  Thus, we have said a trial court has 
discretion to waive the requirements contained in its pretrial order and we will 
not overturn such a ruling absent an abuse of discretion.  Contreras v. Carbon County School 
District #1, 843 P.2d 589, 592 (Wyo. 1992).  However, we have also recognized that 
adherence to scheduling orders is critical in maintaining the integrity of 
judicial proceedings and so the trial court has extensive authority to enforce 
such pretrial orders.  Carroll v. 
Bergen, 2002 WY 166, ¶20, 57 P.3d 1209, ¶20 (Wyo. 
2002).

 

 

DISCUSSION

 

 

1.                  
Amendment 
to the Pleadings

 

[¶13]   Mr. Befumo asserts the district 
court permitted a "trial by ambush" because it allowed Mr. Johnson to change his 
theory at the beginning of trial, present evidence on an issue not pled in the 
complaint and then amend his pleadings at the close of his case.  Until the day of trial, he argues, Mr. 
Johnson's theory was that Mr. Befumo, FEMCO and Mr. Sikorski breached their 
fiduciary duty to the trust beneficiaries by failing to distribute assets, 
engaging in self-dealing and failing to provide accountings.  Then, on the morning of trial, Mr. 
Johnson suggested for the first time that Mr. Befumo acted beyond his authority 
in transferring trust assets from the Wilkoske trusts to a new trust (the RW 
& NW trust) and that all subsequent acts as RW & NW trust were ultra 
vires.  Citing Ayne v. 
Hixon, 53 Or. 19, 98 P. 515 (1908), Mr. Befumo contends he was entitled 
to adequate notice of and an opportunity to defend against what he characterizes 
as a substantive change in the plaintiffs' theory.

 

[¶14]   Mr. Johnson asserts there was no 
error because W.R.C.P. 15 allows a party to move to amend pleadings to conform 
to the evidence at any time and gives the trial court broad discretion to allow 
such amendments when the merits of the action will be promoted thereby and the 
objecting party fails to show prejudice will result.  Mr. Johnson contends Mr. Befumo failed 
to show prejudice, and impliedly consented to the amendment by failing to 
request a continuance.

 

[¶15]   Wyoming Rule of Civil Procedure 
15(b) provides in pertinent part as follows:

 

(b)  Amendments to conform to the 
evidence.  When issues not raised by the pleadings are tried by express or 
implied consent of the parties, they shall be treated in all respects as if they 
had been raised in the pleadings. Such amendment of the pleadings as may be 
necessary to cause them to conform to the evidence and to raise these issues may 
be made upon motion of any party at any time, even after judgment; but failure 
so to amend does not affect the result of the trial of these issues. If evidence 
is objected to at the trial on the ground that it is not within the issues made 
by the pleadings, the court may allow the pleadings to be amended and shall do 
so freely when the presentation of the merits of the action will be subserved 
thereby and the objecting party fails to satisfy the court that the admission of 
such evidence would prejudice the party in maintaining the party's action or 
defense upon the merits. The court may grant a continuance to enable the 
objecting party to meet such evidence. 

 

Pursuant 
to the language of the rule, in order for this Court to address the issue raised 
by Mr. Befumo, we must consider whether a new issue was tried by express or 
implied consent of the parties, whether a motion was made to conform the 
evidence to the pleadings and, if so, by whom, whether an objection was made at 
the trial and if any showing of prejudice was made, and whether Mr. Befumo moved 
for or the district court offered to grant a continuance to enable him to meet 
the evidence.  From the record 
before us, we are unable to determine the answers to any of these questions 
because Mr. Befumo did not designate the transcript upon which he relies as part 
of the record on appeal. 

 

[¶16]   Pursuant to W.R.A.P. 3.05(b), Mr. 
Befumo was required to file a designation "of all parts of the record . . . to 
which appellant intends to direct the particular attention of the appellate 
court in its brief".2  Although Mr. Befumo quotes portions of 
the trial transcript in his appellate brief, he did not designate the transcript 
as part of the record on appeal.  As 
the appellant, Mr. Befumo had the burden of providing this Court with a complete 
record on which to base a decision.  
Orcutt v. Shober Inv., Inc., 2003 WY 60, ¶9, 69 P.3d 386, ¶9 (Wyo. 
2003).  Having no other means to 
review the district court's decision, we must assume the decision was in accord 
with the law.  Id. 

 

 

2.         
Pretrial order

 

[¶17]   Mr. Johnson contends the district 
court denied him the opportunity to present a defense to Mr. Sikorski's 
counterclaim by its order preventing him from calling any witnesses.  Mr. Sikorski argues in response that the 
district court's decision was discretionary, Mr. Johnson failed to comply with 
the scheduling order and, pursuant to W.R.C.P. 37(b)(2)(B), the district court 
was warranted in ruling as it did.  
Under the particular facts of this case, we agree with Mr. 
Sikorski.

 

[¶18]   In the course of these proceedings, 
the district court entered an order setting witness designation dates, stating 
as follows:

 

The 
plaintiffs shall designate all witnesses to be called at trial by no later than 
July 10, 2003. The defendants shall designate their witnesses by no later 
than August 15, 2003.

 

The 
designation shall indicate a detailed summary of the testimony. . . 
.

 

The 
failure to conform to these requirements may result in an order precluding the 
witness from testifying.

 

That 
same day, the district court also entered an order bifurcating the 
counter-claim, which similarly stated:

 

As 
to the counter-claim, Mr. Sikorski will designate his witnesses by no later than 
July 10, 2003, and those defending the counter-claim shall designate by 
no later than August 15, 2003.

 

Pursuant 
to the second order bifurcating the counter-claim, Mr. Sikorski timely filed 
designations of witnesses containing detailed summaries of their expected 
testimony.  Mr. Johnson likewise 
filed a designation listing the witnesses he planned to call in the first phase 
of the trial and summarizing their testimony.3  None of the witnesses Mr. Johnson 
listed, including Mr. Johnson himself, were designated to testify concerning the 
allegations made in Mr. Sikorski's counter-claim. 

 

[¶19]   On August 13 and 15, 2003, Mr. 
Befumo filed designations of witness testimony as required by the first 
order.  Mr. Sikorski also filed a 
designation of witness testimony in compliance with the order.  When Mr. Johnson did not file a 
designation of witness testimony by August 15, 2003, in compliance with the 
second order bifurcating the counter-claim, Mr. Sikorski filed his motion 
seeking to prohibit Mr. Johnson from calling any witnesses in the trial on the 
counter-claim.  The district court 
heard argument on the motion prior to trial.  As he did before this Court, Mr. 
Sikorski argued to the district court that Mr. Johnson should be precluded from 
calling any witnesses to testify in the second phase of the trial because he did 
not designate any witnesses to testify concerning the allegations in the 
counter-claim.  Counsel for Mr. 
Johnson responded by reading his designation of his testimony, which did not 
reference even indirectly the counter-claim. Counsel for Mr. Johnson made no 
effort whatsoever to apprise the district court as to what Mr. Johnson's 
testimony would be concerning the assault.  
The district court summarily granted the motion in limine, stating:  "You will not be allowed to call any 
witnesses, nor to give an opening statement, since you don't have any 
witnesses." 

 

[¶20]   W.R.C.P. 16(b) allows the district 
court to enter a scheduling order addressing "any . . . matters appropriate in 
the circumstances of the case."  
W.R.C.P. 16(f) provides in relevant part:

 

If 
a party or a party's attorney fails to obey a scheduling . . . order, . . . the 
judge, upon motion or the judge's own initiative, may make such orders with 
regard thereto as are just, and among others any of the orders provided in Rule 
37(b)(2)(B), (C) and (D).

 

W.R.C.P. 
37 provides in relevant part:

 

[I]f 
a party fails to obey an order entered under Rule 26(f), the court in which the 
action is pending may make such orders in regard to the failure as are just, and 
among others the following:

            
. . .

 

(B) 
An order refusing to allow the disobedient party to support or oppose designated 
claims or defense, or prohibiting the disobedient party from introducing 
designated matters in evidence.

 

We 
have said, "where the authority to perform a proposed action rests within the 
discretion of the court we must allow considerable latitude in which [it] may 
exercise its discretion." Winterholler v. Zolessi, 989 P.2d 621, 627 
(Wyo. 1999).  This does not mean, 
however, that courts have "unrestrained power to act in an arbitrary 
manner."  
Id.

 

Fundamental 
to the concept of the rule of law is the principle that reason and justice shall 
prevail over the arbitrary and uncontrolled will of any one person. . . .  The meaning of the term discretion' 
itself imports that the action should be taken within reason and good conscience 
in the interest of protecting the rights of both parties and serving the ends of 
justice. It has always been the policy of our law to resolve doubts in 
favor of permitting parties to have their day in court on the merits of a 
controversy.

 

Id. 
at 628.  In Winterholler, we 
applied the following factors to determine whether late supplementation of 
expert disclosures was fair under the circumstances:

 

(1)      
whether 
allowing the evidence would incurably surprise or prejudice the opposing 
party;

(2)      
whether 
excluding the evidence would incurably prejudice the party seeking to introduce 
it;

(3)      
whether 
the party seeking to introduce the testimony failed to comply with the 
evidentiary rules inadvertently or willfully;

(4) 
the impact of allowing the proposed testimony on the orderliness and efficiency 
of the trial; and

(5)   the 
impact of excluding the proposed testimony on the completeness of the 
information before the court or jury.  

 

Id.  On the basis of the particular 
circumstances presented in Winterholler, we held that the court abused 
its discretion in excluding expert testimony designated after the deadline.  We said,

 

[W]e 
are unable to find support in the record for the conclusion that the admission 
of [the disputed] testimony would incurably surprise or prejudice 
the defense. It is not difficult, however, to see that the exclusion of the 
[testimony] . . . prejudiced [the plaintiff's] ability to present the merits of 
her . . . claim.  

 

Id.

 

[¶21]   Applying what we said in 
Winterholler to the facts before us, we might conclude the district court 
abused its discretion in precluding Mr. Johnson from testifying.  As in Winterholler, it is 
difficult to see how the admission of his testimony would incurably surprise or 
prejudice Mr. Sikorski.  It seems 
likely he could have anticipated the possible explanations Mr. Johnson would 
give for the assault and threats.  
However, it is not difficult to see that the exclusion of his testimony 
prejudiced the defense -- Mr. Johnson was not allowed to present his. 

 

[¶22]   An important distinction, however, 
between this case and Winterholler, is that in the latter case the party 
moving for preclusion became aware of the testimony that was not timely 
designated six weeks before trial.  
In contrast, Mr. Johnson not only missed the deadline for listing 
witnesses; he never complied.  He 
made no showing either before the district court or this court as to why his 
failure should be excused.  He also 
made no effort to inform the district court what the expected testimony would 
be.  Under similar circumstances, at 
least one other court has concluded no abuse of discretion occurred in 
precluding the testimony.  Hitt 
v. J.B. Coghill, Inc., 641 P.2d 211 (Alaska 1982).

 

[¶23]   We have cited with approval other 
courts' statements that the rules of civil procedure were designed to make 
pretrial and discovery uniform across the country and to prevent "trial by 
ambush."  Smith v. Ford Motor 
Co., 626 F.2d 784 (10th Cir. 1980). 
"Mutual knowledge of all the relevant facts gathered by both parties is 
essential to proper litigation."  
Id.  Against these 
important principles, we must weigh the importance of allowing litigants to have 
their day in court.  Denying Mr. 
Johnson the opportunity to present any defense other than the limited one 
he was able to present through cross-examination of Mr. Sikorski and his 
witnesses does not comport with this policy.  Mr. Johnson was the defendant, that is, 
a party to the dispute, not merely a witness.  He was not precluded merely from 
offering particular evidence, he was prevented from presenting his case.  Under these circumstances, we are unable 
to conclude that the district court's order was reasonable, protected the rights 
of both parties or served the ends of justice. That is not the end of the 
inquiry, however.  

 

[¶24]   W.R..E. 103(a)(2) 
provides:

 

(a) 
Effect of erroneous ruling.  Error may not be predicated upon a ruling 
which admits or excludes evidence unless a substantial right of a 
party is affected, and

 

. 
. .

 

    (2) Offer of Proof.  In 
case the ruling is one excluding evidence, the substance of the evidence 
was made known to the court by offer or was apparent from the context 
within which questions were asked. 

 

(emphasis 
added).  In the context of 
evidentiary rulings at trial, this Court has long adhered to the doctrine that a 
sufficient offer of proof is necessary so that we are adequately apprised of the 
nature of the excluded testimony.  
Skinner v. State, 2001 WY 102, ¶39, 33 P.3d 758, ¶39 (Wyo. 
2001).  The only exception occurs 
when the record otherwise clearly discloses the nature of the expected 
testimony.  Sidwell v. State, 
964 P.2d 416, 420 (Wyo. 1998).  The 
requirement of an offer of proof enables the trial court to be fully advised in 
the exercise of its discretion regarding the admission of evidence and allows 
the reviewing court to determine if prejudicial error resulted from the 
exclusion of the proffered testimony.  
Assertions and speculation in an appellate brief in no way take the place 
of an explicit offer of proof.  
Id.

 

[¶25]   Pursuant to these standards and the 
rule, in order to successfully claim that error occurred in the preclusion of 
his testimony, Mr. Johnson was required to make the substance of his testimony 
known to the district court through an offer of proof.  Because he did not make an offer of 
proof and the record otherwise fails to disclose the nature of the expected 
testimony, we hold that Mr. Johnson failed to adequately preserve his second 
issue for appellate consideration.

 

[¶26]   Affirmed.

 

 

FOOTNOTES

1A 
portion of the trial transcript attached to Mr. Johnson's brief reflects that 
the district court orally awarded judgment against Mr. Befumo in the amount of 
$17,500.  However, the written 
judgment entered by the district court does not reflect that award.  By letter dated after the trial and 
before the written judgment, the district court informed the parties it was 
reconsidering the decision awarding damages against Mr. Befumo and that portion 
of the order would be held in abeyance.  

 

  23.05. 
Designation, transmission and retention of record.

            
. . .

 

(b) 
Appellant shall, contemporaneously with the filing of its brief in the appellate 
court and service of that brief upon appellee, serve on appellee, file with the 
clerk of the trial court a designation for transmission to the appellate court 
of all parts of the record, without unnecessary duplication, to which appellant 
intends to direct the particular attention of the appellate court in its 
brief.

3Mr. 
Johnson's designation was actually file-stamped one day late, on July 11, 2003.