Title: KM Upstream, LLC v. Elkhorn Constr., Inc.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

KM UPSTREAM, LLC, a Delaware limited liability company v. ELKHORN CONSTRUCTION, INC.,  a Wyoming corporation v. KM UPSTREAM, LLC, a Delaware limited liability company,2012 WY 79Case Number: S-11-0185, S-11-0207; S-11-018Decided: 06/06/2012This opinion is subject to formal revision before publication in Pacific Reporter Third.  Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.  
APRIL 
TERM, A.D. 2012
 
KM 
UPSTREAM, LLC, a Delaware limited liability 
company,Appellant(Defendant),v.ELKHORN CONSTRUCTION, 
INC., a Wyoming corporation,Appellee(Plaintiff).ELKHORN 
CONSTRUCTION, INC., a Wyoming 
corporation,Appellant(Plaintiff),v.KM UPSTREAM, LLC, 
a Delaware limited liability 
company,Appellee(Defendant).
 
Appeals 
from the District Court of Fremont County
The 
Honorable Norman E. Young, Judge 
 
Representing 
KM Upstream, LLC:
Drake 
D. Hill, Rebecca H. Noecker, and Michael L. Beatty of Beatty, Wozniak & 
Reese, PC.  Argument by Ms. 
Noecker.
 
Representing 
Elkhorn Construction, Inc.:
Mark 
W. Harris of Harris Law Firm, PC; Scott D. Cessar and Audrey K. Kwak of Eckert 
Seamans Cherin & Mellott, LLC.  
Argument by Mr. Cessar.
 
Before 
KITE, C.J., and GOLDEN, HILL, VOIGT, and BURKE, JJ.
 
VOIGT, 
Justice.
 
[¶1]      The district 
court granted summary judgment to Elkhorn Construction, Inc. (Elkhorn), a 
subcontractor, on its mechanic’s lien claim against KM Upstream, LLC (KM), the 
owner of an amine plant, the construction of which plant underlies all the 
issues of this case.1  KM appealed, arguing that summary 
judgment was improper because of the existence of genuine issues of material 
fact, and because the district court did not have jurisdiction to proceed with 
the case, given the automatic stay arising in the bankruptcy proceedings of 
Newpoint Gas, LP (Newpoint, LP).2  KM also asserts that the district court 
could not proceed in the absence of Newpoint because Newpoint, the contractor, 
is an indispensable party.  Elkhorn 
cross-appealed, contending that the district court should have adjudicated its 
claimed oil and gas lien, in addition to the mechanic’s lien, thereby making 
attorney’s fees and costs available.
 
[¶2]      Because of a 
W.R.C.P. 54(b) certification issue, the appeal and the cross-appeal were each 
filed twice.  The resulting four 
docketed cases, as referenced in the heading of this opinion, have been joined 
for briefing, argument, and opinion.  
We affirm in part, reverse in part, and remand to the district court for 
further proceedings consistent herewith.
 
ISSUES
 
[¶3]      1.   Did the automatic stay in Newpoint, 
LP’s bankruptcy deprive the district court of jurisdiction to enter summary 
judgment in this case?
 
            
2.   Did the district 
court err in granting summary judgment in the absence from this case of 
Newpoint, an indispensable party?
 
            
3.   Did the district 
court err in granting summary judgment in the absence from this case of HFG 
Engineering US, Inc. (HFG), an alleged joint venturer with Newpoint, and 
therefore an indispensable party?
 
            
4.   Did the district 
court err in finding no genuine issues of material fact?
 
            
5.   Did the district 
court err in awarding summary judgment in an amount exceeding the contract price 
where Wyo. Stat. Ann. § 29-2-101(b) (LexisNexis 2007) requires that the work or 
materials establishing a mechanic’s lien be furnished under a 
contract?
 
            
6.   Did Elkhorn’s Lien 
Statement set forth both a mechanic’s lien claim and an oil and gas lien 
claim?
 
            
7.   Did the district 
court err in concluding that Elkhorn’s damages were liquidated and awarding 
pre-judgment interest?
 
            
8    Did the 
district court err in finding that Elkhorn conceded that $181,369 of its claim 
was not valid, and by subtracting that amount from Elkhorn’s 
judgment?
 
            
9.   Did the district 
court err in holding that the allowed foreclosure of the mechanic’s lien 
“mooted” the necessity for the district court to address Elkhorn’s separate 
motion for summary judgment on the oil and gas lien claim?
 
FACTS
 
[¶4]      On July 6, 2007, 
KM and Newpoint, Inc. entered into a contract whereby the latter would construct 
for the former “an amine plant at West Frenchie Draw, Fremont County, 
Wyoming[.]”  KM agreed to pay 
Newpoint, Inc. $15,664,490 as a fixed cost, as might be amended by written 
change order.  Eventually, two 
written change orders increased the price to $15,695,855.30.  KM paid Newpoint, Inc. $15,524,659.21, 
and it paid $219,256.72 to other contractors to finish the 
job.
 
[¶5]      Newpoint, Inc. 
subcontracted with Elkhorn to build the foundation and to interconnect certain 
“skids.”  The Time and Material 
Contract between Newpoint, Inc. and Elkhorn contained a “target price” of 
$5,700,000, which target price was not to be increased but by Newport, Inc., in 
writing.  Despite the fact that this 
target price was never formally increased in writing, and despite the fact that 
no additional change orders were presented, Newpoint, Inc. approved Elkhorn’s 
invoices in the total amount of $9,910,086.96.
 
[¶6]      On March 6, 2009, 
Elkhorn filed a Lien Statement with the Fremont County Clerk, reading in 
pertinent part as follows:
 
            
NOTICE 
is 
hereby given that pursuant to and in accordance with Section 29-1-301 et. seq. 
and Section 29-3-101 et. seq., Wyoming Statutes, 2007, Elkhorn Construction, 
Inc., whose mailing address is P.O. Box 809, Evanston, Wyoming 82931, has and 
claims a lien against the leasehold 
interest and improvements hereinafter 
described and all 
production of oil, gas, ore and minerals in solid form, or proceeds therefrom 
in 
the amount of $4,880,588.83, plus interest, late charges, attorney’s fees and 
costs from January 16, 2009, for materials furnished and delivered and labor 
supplied for the improvement of said property by Elkhorn Construction, 
Inc.
 
            
An 
itemized list setting forth and describing the materials delivered and labor 
supplied by Elkhorn Construction, Inc., is attached hereto as Appendix “A” and 
by this reference hereby made a part hereof.
 
            
That the materials and labor were delivered and performed for and to 
Newpoint Gas, LP at its special instance and request and upon its promise to pay 
Elkhorn Construction, Inc. the reasonable value therefore.  A copy of the contract is attached as 
Appendix “B.”
 
            
Elkhorn Construction, Inc. furnished and delivered such labor and 
materials aforesaid during the period of March 18, 2008 to January 16, 
2009.
 
            
The aforesaid materials and labor were furnished to Newpoint Gas, LP for 
the improvement of the West Frenchie Draw Amine Gas Treating Plant, on real 
property situate in Fremont County, Wyoming, and being more particularly 
described as follows:
 
. 
. . .
 
            
The foregoing described real property is owned by the State of Wyoming, 
whose address is indicated above.
 
(Emphasis 
in original.)  Attached to the Lien 
Statement were 1,260 pages of invoices and labor charges for amounts claimed by 
Elkhorn.
 
[¶7]      On March 23, 
2009, Elkhorn filed a complaint against KM, alleging three causes of action: 
foreclosure of the lien as a mechanic’s lien under Wyo. Stat. Ann. § 29-2-101 
(LexisNexis 2007), foreclosure of the lien as an oil and gas lien under Wyo. 
Stat. Ann. § 29-3-103 (LexisNexis 2007), and unjust enrichment/quantum 
meruit.3  KM responded with a motion to add 
Newpoint, Inc. as “a party needed for just adjudication of this dispute under 
W.R.C.P. 19.”  That motion was 
followed by a similar motion to join Newpoint, Inc. under W.R.C.P. 12(b)(7) and 
W.R.C.P. 19(a).  Eventually, KM and 
Elkhorn stipulated that Newpoint, Inc. be joined as a party defendant, and an 
order to that effect was entered on November 24, 2009.  Thereafter, Elkhorn filed its Second 
Amended Complaint, alleging the same three causes of action, but naming 
“Newpoint Gas, LP a/k/a Newpoint Gas Services, Inc.” as a defendant.  The Second Amended Complaint was 
re-filed with a corrected caption, naming Newpoint Gas Services, Inc. as the 
additional defendant.
 
[¶8]      KM filed an 
answer in response to the Second Amended Complaint, denying that Elkhorn was 
entitled to recover any amounts under any of its causes of action, and 
presenting numerous affirmative defenses.  
Newpoint, Inc. filed an answer, in pertinent part denying that Elkhorn 
had provided any material or performed any labor for which it had not been 
paid.  Newpoint, Inc. also 
counterclaimed against Elkhorn, claiming that Elkhorn had breached its contract 
with Newpoint, Inc. by seeking compensation beyond the contract’s target price, 
without prior notice as required by the contract.  Newpoint, Inc. also sought a declaration 
that nothing further was owed to Elkhorn under the contract.  Newpoint, Inc. later filed an amendment 
to its answer and counterclaim, limiting the counterclaim to a request for a 
declaratory judgment as to what amounts Elkhorn might be owed, and adding a 
cross-claim against KM, with seven claims for relief: misrepresentation, 
estoppel/waiver, breach of the implied covenant to provide timely and adequate 
plans, breach of contract, indemnity, breach of the covenant of good faith and 
fair dealing, and unjust enrichment.
 
[¶9]      KM answered 
Newpoint, Inc.’s cross-claim, and filed a responsive cross-claim against 
Newpoint, Inc., in which it alleged breach of contract as follows: creation of 
the Elkhorn lien, failure to manage contract expenses, failure to pay or 
discharge lien, failure to provide notice of liens, failure to acquire 
subcontractor’s waiver of lien rights, failure to assure consistent subcontract, 
failure to indemnify, and breach of the duty of good faith and fair 
dealing.  Finally, KM sought a 
declaration as to Newpoint, Inc.’s obligations to defend against and hold KM 
harmless from the Elkhorn claims, or other claims arising by virtue of contract 
or common law.
 
[¶10]   After replying to Newpoint, Inc.’s 
amended counterclaim, Elkhorn filed an amendment to its Second Amended Complaint 
in which it added a breach of contract claim against Newpoint, Inc., seeking 
$4,880,588.83 for amounts that it had not been paid under the project.  Subsequently, Newpoint, Inc. answered 
the amendment to Elkhorn’s Second Amended Complaint, and amended its cross-claim 
against KM by adding allegations of negligent retention of contractor, and 
indemnity under a specific section of the contract.  KM then answered Newpoint, Inc.’s 
cross-claim, and amended its cross-claim against Newpoint, Inc. by alleging the 
following causes of action: breach of contract--joint venture obligations, 
promissory estoppel, equitable estoppel, breach of contract, breach of 
contract--creation of the Elkhorn lien, breach of contract--demand in excess of 
contract price, breach of contract--failure to pay or discharge liens, breach of 
contract--failure to provide notice of liens, breach of contract--failure to 
acquire subcontractor’s waiver of lien rights, breach of contract--failure to 
assure consistent subcontract, breach of contract--obligation to defend and 
indemnify, breach of statutory duty to defend and pay, breach of the duty of 
good faith and fair dealing, and a declaratory judgment.
 
[¶11]   The next series of filings in the 
district court began with KM’s motion to join HFG as a party defendant.  In its motion, KM asserted that all 
claims arising out of the same transaction should be adjudicated in one 
litigation, that Wyoming’s lien statutes allow the owner to require the joinder 
of the project contractor because of the contractor’s statutory duty to defend 
against the lien, that HFG and Newpoint were joint venturers, making HFG liable 
for project obligations, and that complete relief was not available absent 
joinder of HFG.  Elkhorn opposed 
KM’s motion on a number of grounds.  
First, Elkhorn pointed out that the case was nearly two years old and was 
set for trial.  Second, Elkhorn 
complained that, despite KM’s knowledge from the outset of HFG’s role in the 
matter, no discovery had been conducted in that regard.  Third, Elkhorn contended that, with its 
belated motion, KM was advancing an entirely new legal theory--that is, that 
Newpoint and HFG were joint venturers.  
And finally, Elkhorn pointed out that the arbitration clause in the 
contract between KM and HFG would compel arbitration of any issues between 
them.4
 
[¶12]   On March 28, 2011, Elkhorn filed a 
motion for summary judgment.  A 
similar motion from KH followed on April 4, 2011.  Both motions were supported by hundreds 
of pages of affidavits, deposition transcripts, and other exhibits.  On May 3, 2011, KM filed a motion 
seeking partial summary judgment against Newpoint, Inc., on four of the causes 
of action in its cross-claim.  
Before any of these motions could be heard, KM notified the district 
court that Newpoint, LP had filed in Oklahoma a voluntary petition seeking 
bankruptcy protection, and seeking the district court’s guidance on application 
of the bankruptcy court’s automatic stay.  
Two days later, KM filed an amended notice of the bankruptcy, this time 
advising the court that “Newpoint Gas, LP, allegedly a/k/a Newpoint Gas 
Services, Inc.” had taken bankruptcy.  
Elkhorn opposed recognition or application of the automatic stay arising 
in the Oklahoma bankruptcy in this case, arguing that its contract was with 
Newpoint, Inc., which company was not in bankruptcy, rather than with Newpoint, 
LP, the company in bankruptcy.  
Elkhorn argued further that, not only does a bankruptcy stay not stay 
proceedings against solvent companies affiliated with the company taking 
bankruptcy, neither does it stay proceedings against co-defendants of the 
company taking bankruptcy.
 
[¶13]   The district court heard the 
pending motions in regard to the bankruptcy stay, as well as the summary 
judgment motions, on June 17, 2011.  
Ruling from the bench, the district court granted Elkhorn’s motion for 
summary judgment to allow foreclosure on the mechanic’s lien, but indicated that 
it would stay the balance of the proceedings as such related to Newpoint, Inc. 
and Newpoint, LP.  On July 1, 2011, 
an Order Staying Case and an Order Granting Plaintiff’s Motion for Summary 
Judgment on Foreclosure of Mechanic’s Lien were entered.  The details of those orders will be 
discussed as pertinent below.
 
DISCUSSION
 
Did 
the automatic stay in Newpoint, LP’s bankruptcy deprive the district court of 
jurisdiction to entersummary judgment in this 
case?
 
[¶14]   With little fanfare, we will 
dispose of KM’s contention that the federal bankruptcy code’s automatic stay, 
found at 11 U.S.C. § 362(a) (2006 & Supp. IV 2010), effective in Newpoint, 
LP’s Oklahoma bankruptcy, should have stayed the entire case facing the district 
court in Wyoming.  Whether we review 
the district court’s decision de 
novo, as argued by KM, or for an abuse of discretion, as argued by Elkhorn, 
we come to the same conclusion.5  The automatic stay does not stay 
proceedings against solvent co-defendants, such as KM, of an insolvent debtor, 
such as Newpoint, LP.  See, e.g., Fortier v. Dona Anna Plaza Partners, 747 F.2d 1324, 1329-30 (10th Cir. 1984); Diamond Hill Inv. Co. v. Shelden, 767 P.2d 1005, 1010 (Wyo. 1989); Hamel v. Am. 
Continental Corp., 713 P.2d 1152, 1154 (Wyo. 1986); 2 Howard J. Steinberg, Bankruptcy Litigation § 12:13 (2d ed. 
2008); 9B Am. Jur. 2d Bankruptcy § 
1747 (2006).
 
[¶15]   It must be remembered that, in the 
instant case, the district court did stay the proceedings in regard to any 
claims, cross-claims, or counterclaims that could have resulted in a judgment 
against Newpoint, allowing only the summary judgment on Elkhorn’s in rem mechanic’s lien foreclosure to 
proceed.  See True v. Hi-Plains Elevator Mach., 
Inc., 577 P.2d 991, 1004 
(Wyo. 1978) and Mawson-Peterson Lumber 
Co. v. Sprinkle, 59 Wyo. 334, 140 P.2d 588, 591-92 (Wyo. 
1943).  Because the property subject 
to the lien foreclosure was the property of KM, rather than the property of 
Newpoint, the entity in bankruptcy, the in rem proceeding to foreclose the lien 
was not subject to the automatic stay.  
Fortier, 747 F.2d  at 
1330.
 
            
It should be self-evident from the clear language of 11 U.S.C. § 362 
(1983) that the automatic stay granted petitioners in bankruptcy is directed at 
only claims against the “debtor,” the “property of the debtor,” and the “estate” 
and not acts against others.  This 
is confirmed by courts working regularly in bankruptcy matters and knowledgeable 
in the field.
 
            
The automatic stay provisions apply to proceedings or acts against the 
debtor, the debtor’s property, and the property of the estate, but do not apply 
to acts against property which is neither the debtor’s nor the estate’s.  The automatic stay does not operate to 
prohibit action against a co-debtor nor affect the liability of a co-debtor not 
in bankruptcy.  Something more than 
filing a bankruptcy petition must be shown in order that proceedings be stayed 
against nonbankrupt parties.  Where 
a pending action is not interfering with a bankruptcy, an automatic stay of such 
action would in no way foster the Bankruptcy Code’s policy of preserving the 
debtor’s insolvent estate for the benefit of creditors.
 
Hamel, 
713 P.2d  at 1154 (internal citations omitted).  The bankruptcy stay in Oklahoma did not 
deprive the district court of  jurisdiction to enter summary judgment in 
the instant case.
 
Did 
the district court err in granting summary judgmentin the absence from this 
case of Newpoint,an indispensable party?
 
[¶16]   District court rulings on the 
joinder of parties, including allegedly indispensable parties, are reviewed for 
an abuse of discretion.  Grove v. Pfister, 2005 WY 51, ¶ 4, 110 P.3d 275, 277 
(Wyo. 2005); Albrecht v. Zwaanshoek 
Holding En Financiering, B.V., 762 P.2d 1174, 1178 (Wyo. 
1988).  The court rule governing 
joinder is found at W.R.C.P. 19:
 
            
(a)   Persons to be joined if feasible. – A 
person who is subject to service of process and whose joinder will not deprive 
the court of jurisdiction over the subject matter of the action shall be joined 
as a party in the action if: (1) in the person’s absence complete relief cannot 
be accorded among those already parties; or (2) the person claims an interest 
relating to the subject of the action and is so situated that the disposition of 
the action in the person’s absence may: (i) as a practical matter impair or 
impede the person’s ability to protect that interest; or (ii) leave any of the 
persons already parties subject to a substantial risk of incurring double, 
multiple, or otherwise inconsistent obligations by reason of the claimed 
interest.  If the person has not 
been so joined, the court shall order that the person be made a party.  If the person should join as a plaintiff 
but refuses to do so, the person may be made a defendant, or, in a proper case, 
an involuntary plaintiff.  If the 
joined party objects to venue and joinder of that party would render the venue 
of the action improper, that party shall be dismissed from the 
action.
 
            
(b)   Determination by court whenever joinder not 
feasible. – If a person as described in subdivisions (a)(1) and (a)(2) 
hereof cannot be made a party, the court shall determine whether in equity and 
good conscience the action should proceed among the parties before it, or should 
be dismissed, the absent person being thus regarded as indispensable.  The factors to be considered by the 
court include:
 
(1)    To what extent a judgment 
rendered in the person’s absence might be prejudicial to the person or those 
already parties;
 
(2)    The extent to which, by 
protective provisions in the judgment, by the shaping of relief, or other 
measures, the prejudice can be lessened or avoided;
 
(3)    Whether a judgment rendered 
in the person’s absence will be adequate;
 
(4)    Whether the plaintiff will 
have an adequate remedy if the action is dismissed for 
nonjoinder.
 
. 
. . .
 
[¶17]   In addition to this provision in 
the court rules, the lien statutes provide a mechanism for making a contractor 
such as Newpoint a party in a lien foreclosure action brought by a subcontractor 
such as Elkhorn against an owner such as KM:
 
            
The contractor shall defend any action brought by his employee, 
subcontractors hired by the contractor, their employees or by any suppliers of 
materials provided under contract in accordance with this chapter at his own 
expense.  During the pendency of the 
action the owner or his agent may withhold from the contractor the amount of 
money for which a lien is filed.  If 
judgment is rendered against the owner or his property on the lien foreclosure, 
he may deduct from any amount due to the contractor the amount of the judgment 
and costs.  If the owner has paid 
the contractor in full he may recover from the contractor any amount paid by the 
owner for which the contractor was originally liable.
 
Wyo. 
Stat. Ann. § 29-2-108 (LexisNexis 2007).
 
[¶18]   Before we discuss this law, and the 
issue of indispensable parties, we must make a point.  This is not a question of the effect of 
the district court’s denial of a motion to join Newpoint as an indispensable 
party.  As noted above, after KM 
filed two motions to add Newpoint, Inc., as a party defendant, KM and Elkhorn 
stipulated to such joinder, and an order was entered to that effect.  See supra ¶ 7.  Elkhorn’s complaint was amended, 
Newpoint, Inc. answered, and filed a counterclaim against Elkhorn and a 
cross-claim against KM.  See supra ¶¶ 7, 8.  Both Elkhorn and KM responded to 
Newpoint, Inc.’s claims.  
Subsequently, the district court was notified that Newpoint, Inc. had 
filed for bankruptcy protection in Oklahoma, and the question of the 
applicability of the bankruptcy stay, discussed above, arose.  See supra ¶ 12.  Consequently, the limited issue now 
before us is whether the district court abused its discretion in failing to stay 
or dismiss the entire case because of Newpoint, Inc.’s non-participation, a 
question not much different from the one just answered. 
 
[¶19]   We believe that the district 
court’s concurrent entry of its two orders--one granting summary judgment to 
Elkhorn against KM on the limited issue of the lien foreclosure, and one staying 
all proceedings that in any way affected Newpoint’s rights and obligations--was 
precisely what was intended by the automatic bankruptcy stay, by the lien 
statutes, and by the court rule governing indispensable parties.  We begin by noting the purpose of the 
lien statutes, which is “to create a means of securing the claims of a 
particular class of creditors and to prevent unjust enrichment arising out of 
the enhancement of value of property from labor and materials which would 
otherwise go without payment.”  Engle v. First Nat’l Bank of Chugwater, 
590 P.2d 826, 830 (Wyo. 
1979).  Allowing the insolvency or 
bankruptcy of the contractor to defeat the lien claim of a subcontractor would, 
of course, thwart that purpose.  
That reasoning is reflected in W.R.C.P. 19(a), (b)(4), which directs the 
district court, in determining “whether in equity and good conscience the action 
should proceed among the parties before it” when an “indispensable” party cannot 
be joined, to consider “[w]hether the plaintiff will have an adequate remedy if 
the action is dismissed for nonjoinder.”  
In addition, W.R.C.P. 19(a) makes it clear that a person should not be 
joined as a party under the rule if “joinder will [] deprive the court of 
jurisdiction over the subject matter of the action . . . .”  Clearly, the intent of the rule is that 
it not be used to prevent adjudication of claims between parties where that 
adjudication can be accomplished, as here, in the absence of the allegedly 
indispensable party.  Newpoint, the 
contractor, does not need to be present in this lawsuit for Elkhorn, the 
subcontractor, to foreclose its lien against KM, the owner.  Hamel, 713 P.2d  at 
1154.
 
[¶20]   Without doubt, Wyo. Stat. Ann. § 
29-2-101 was “incorporated in the lien laws for the owner’s protection, and the 
owner has a clear right to insist that the contractor be made a party.”  Hamel, 713 P.2d  at 1154.  
We have previously noted, however, that this right is only the right 
to have the contractor made a party if such “is possible.”  True, 577 P.2d  at 1005.  This is consonant with the introductory 
language to W.R.C.P. 19(a), which indicates that persons are to be joined under 
the rule “if feasible,” and to the body of the rule, which contains several 
exceptions to joinder where such could defeat the underlying action: person not 
subject to service of process, subject matter jurisdiction would be destroyed, 
or venue would be rendered improper.  
See Hoiness-LaBar Ins. v. Julien 
Constr. Co., 743 P.2d 1262, 
1269 (Wyo. 1987) (not indispensable party if not subject to service of 
process).  It is also consonant with 
the fact, noted above, that inclusion of an indispensable party is a 
discretionary decision, not one made as a matter of law.  See American Beryllium & Oil Corp. v. 
Chase, 425 P.2d 66, 68 (Wyo. 
1967) (no fixed rule determines whether person with interest is an indispensable 
party; rather, peculiar facts of case are determinative).  The general rule has been described as 
follows:
 
            
Parties are indispensable only when their interest in the controversy is 
such that a final decree cannot be made without either affecting that interest 
or leaving the controversy in such condition that its final disposition may be 
inconsistent with equity and good conscience.  An “indispensable party” is one whose 
interest is such that a final decree cannot be entered without affecting that 
interest or in whose absence the controversy cannot be terminated. A person is 
an indispensable party only when the judgment to be rendered necessarily must 
affect his or her rights.  A party 
becomes an indispensable party if the party has an interest relating to the 
subject of the action and is so situated that the disposition of the action in 
the party’s absence may as a practical matter impair or impede the party’s 
ability to protect that interest.  
An indispensable party is one whose interest in the controversy makes it 
impossible to completely adjudicate the matter without affecting either that 
party’s interest or the interests of another party in the action.  A party is indispensable when his or her 
rights are so connected with the claims of the litigants that no degree can be 
made without impairing those rights.  
The absence of an indispensable party prevents a court from granting 
relief.  However, the doctrine of 
indispensability is not jurisdictional.
 
            
A person who has no interest in the controversy between the parties to 
the action is not an indispensable party.  
Persons who might conceivably have an interest in the outcome of 
litigation are not to be considered indispensable parties.  Every person who has any interest in a 
controversy or subject matter of a suit that is separable from the interest of 
the other parties before the court, so that it will not necessarily be directly 
or injuriously affected by a decree that does complete justice between them, is 
a proper party to the suit but is not an indispensable 
party.
 
59 
Am. Jur. 2d Parties § 10 (2d ed. 
2012).
 
[¶21]   A mechanic’s lien foreclosure, in 
the context of the case sub judice, 
is a statutory procedure that allows a subcontractor to obtain from the property 
the reasonable value of the labor and materials put into that property.  It has the joint equitable goals of 
preventing unjust enrichment and providing restitution.  Horseshoe Estates v. 2M Co., 713 P.2d 776, 779 (Wyo. 1986); Engle, 590 P.2d  at 830.  Perhaps it could be said that the usual 
necessity for a subcontractor establishing a lien and seeking to foreclose it is 
that the contractor did not pay for the subcontractor’s services.  Allowing the owner to hide behind the 
contractor’s bankruptcy would render the statutory lien process nugatory.  The legislative policy behind the lien 
statutes is clear--the parties providing the labor and materials are to be paid 
where possible.6
 
[¶22]   In its final argument in regard to 
this issue, KM cites A.H. Robins Co. v. 
Piccinin, 788 F.2d 994, 999-1001 (4th Cir. 1986) for the proposition that 
Newpoint is an indispensable party because KM is entitled to “absolute 
indemnity” from Newpoint.  In 
response, Elkhorn distinguished  A.H. Robins from the instant case by 
pointing out that in the latter the question of indemnity is not at all clear, 
and that that matter remains to be resolved between KM and Newpoint in the 
bankruptcy.  We agree with 
Elkhorn.  The contingent nature of 
any indemnification claims simply renders them too remote to justify staying 
these state lien foreclosure proceedings and transferring the entire matter to 
the bankruptcy court.  Ni Fuel Co. v. Jackson, 257 B.R. 600, 
616 (N.D. Okla. 2000).  In turn, 
allowing these proceedings to continue will not affect the indemnity claims 
involving the bankrupt entity and the bankruptcy estate:
 
[If] 
the state court action [is] permitted to proceed, that state court action will 
not determine whether or not a right to indemnification exists.  The state court action would only 
determine liability and damages on the claims before the state court.  Whether or not a claim for indemnity can 
be brought against the bankrupt debtors is a decision left for the bankruptcy 
court.
 
Id.  This is precisely what has happened in 
the instant case.  The district 
court maintained jurisdiction over the statutory lien foreclosure, and then 
stayed the balance of the proceedings for resolution in the bankruptcy 
court.  That was the correct course 
of action.
 
Did 
the district court err in granting summary judgment in the absence from this 
case of HFG Engineering US, Inc. (HFG), an alleged joint venturer with Newpoint, 
and therefore an indispensable party?
 
[¶23]   About two years into this lawsuit, 
KM filed a motion to join HFG as an additional defendant, arguing that HFG was a 
joint venturer with Newpoint, and therefore was an indispensable party.  KM’s theory was that, as a joint 
venturer with Newpoint, HFG was liable for Newpoint’s contractual obligations, 
including indemnity.  Elkhorn 
opposed the joinder motion, principally on three grounds: that the motion was 
untimely, that as a matter of law Newpoint and HFG were not joint venturers, and 
that a mandatory arbitration clause in the contract between KM and HFG would 
compel arbitration of any claims between them.
 
[¶24]   Our resolution of the joinder issue 
as it applies to Newpoint allows us to determine this issue without further 
discussion.  Resolution of Elkhorn’s 
statutory lien claim does not require resolution of the question of whether 
Newpoint and HFG were joint venturers, and does not require resolution of any 
potential indemnification issues among KM, HFG, and Newpoint.  All of those questions are more properly 
questions for the bankruptcy court, and the stay entered in this case by the 
district court accomplishes that goal.  
The district court did not err in granting summary judgment in the 
absence of HFG.
 
Did 
the district court err in finding nogenuine issues of material 
fact?
 
[¶25]   We have repeatedly stated our 
standard for reviewing summary judgments.  
The following is an apt rendition of that standard given the issues 
presented in this case:
 
            
We evaluate the propriety of a summary judgment by employing the same 
standards and using the same materials as the district court.  Cook v. Shoshone First Bank, 2006 WY 13, ¶ 11, 126 P.3d 886, 889 (Wyo. 2006).  Thus, our review is plenary.  Birt v. Wells Fargo Home Mortg., Inc., 
2003 WY 102, ¶ 7, 75 P.3d 640, 647 (Wyo. 
2003).
 
Wyo. 
R. Civ. P. 56 governs summary judgments.  
A summary judgment is appropriate when there are no genuine issues of 
material fact and the moving party is entitled to judgment as a matter of 
law.  W.R.C.P. 56(c).  When reviewing a summary judgment, we 
consider the record in the perspective most favorable to the party opposing the 
motion and give that party the benefit of all favorable inferences which may be 
fairly drawn from the record.  We 
review questions of law de novo 
without giving any deference to the district court’s 
determinations.
 
Cathcart 
v. State Farm Mut. Auto. Ins. Co., 
2005 WY 154, ¶ 11, 123 P.3d 579, 587 (Wyo. 2005), 
quoting Baker v. Ayres and Baker Pole and 
Post, Inc., 2005 WY 97, ¶ 
14, 117 P.3d 1234, 1239 (Wyo. 
2005).
 
            
“A 
genuine issue of material fact exists when a disputed fact, if it were proven, 
would establish or refute an essential element of a cause of action or a defense 
that the parties have asserted.”  Christensen v. Carbon County, 2004 WY 135, ¶ 8, 100 P.3d 411, 413 (Wyo. 2004) 
(quoting Metz Beverage Co. v. Wyoming 
Beverages, Inc., 2002 WY 21, 
¶ 9, 39 P.3d 1051, 1055 (Wyo. 
2002)).  The party requesting a 
summary judgment bears the initial burden of establishing a prima facie case for summary 
judgment.  If he carries his burden, 
“the party who is opposing the motion for summary judgment must present specific 
facts to demonstrate that a genuine issue of material fact exists.”  Id.  We have explained the duties of the 
party opposing a motion for summary judgment as follows:
 
            
“After a movant has adequately supported the motion for summary judgment, 
the opposing party must come forward with competent evidence admissible at trial 
showing there are genuine issues of material fact.  The opposing party must affirmatively 
set forth material, specific facts in opposition to a motion for summary 
judgment, and cannot rely only upon allegations and pleadings . . ., and 
conclusory statements or mere opinions are insufficient to satisfy the opposing 
party’s burden.”
 
            
The evidence opposing a prima facie case on a motion for summary judgment 
“must be competent and admissible, lest the rule permitting summary judgments be 
entirely eviscerated by plaintiffs proceeding to trial on the basis of mere 
conjecture or wishful speculation.”  Speculation, conjecture, the suggestion 
of a possibility, guesses, or even probability, are insufficient to establish an 
issue of material fact.
 
Cook, 
¶ 12, 126 P.3d  at 890, quoting Jones v. 
Schabron, 2005 WY 65, ¶¶ 
9-11, 113 P.3d 34, 37 (Wyo. 
2005).
 
Hatton 
v. Energy Elec. Co., 
2006 WY 151, ¶¶ 8-9, 148 P.3d 8, 12-13 (Wyo. 
2006).
 
[¶26]   As mentioned earlier herein, the 
target price in the Newpoint-Elkhorn contract was $5,700,000.  Nevertheless, Newpoint approved Elkhorn 
invoices totaling $9,910,086.96.  
Newpoint paid Elkhorn $4,829,498.13.  Eventually, Elkhorn filed the Lien 
Statement that is the subject of this controversy, to which were attached copies 
of unpaid but Newpoint-approved invoices totaling $4,880,588.83.  At the hearing upon the parties’ summary 
judgment motions, Elkhorn conceded that there were genuine issues of material 
fact concerning certain invoices totaling $181,369.00, leaving a balance of 
$4,699,219.83.  That was the amount 
awarded to Elkhorn in its foreclosure claim.
 
[¶27]   Elkhorn supported its summary 
judgment motion with nine attachments.  
Exhibit A consisted of excerpts from the deposition testimony of Zane 
Rhodes, president of Newpoint, Inc.  
The following colloquy occurred during the deposition after Rhodes 
described the process whereby Newpoint, Inc. authorized Elkhorn’s 
invoices:
 
            
Q.    And the 
approval connoted acceptance that it was agreeable to be paid, 
right?
 
            
A.    
Correct.
 
            
Q.    And as far -- 
it was Newpoint’s position that this format or form of billing provided enough 
information to comply with Elkhorn’s requirements under the contract, 
right?
 
            
A.    
Correct.
 
            
Q.    This is fairly 
standard time and material billing, right?
 
            
A.    
Correct.
 
After 
further testifying that some invoices were approved in the field, and some were 
approved in Newpoint’s offices, Rhodes testified that the amounts were due and 
owing, and that the Elkhorn invoices were “used by Elkhorn to improve Kinder 
Morgan’s property.”
 
[¶28]   Attached to Elkhorn’s summary 
judgment motion as Exhibit D are excerpts from the deposition of Cole Deister, 
Elkhorn’s project representative, who described in detail the construction 
problems that resulted in Elkhorn’s extra work on the project.  Exhibit F contains copies of numerous 
deposition exhibits, including the Time and Material Contract between Newpoint 
and Elkhorn, Elkhorn’s bid documents, rate sheets, e-mails about construction 
problems, invoices, discovery responses, the KM/HFG contract, and the 
KM/Newpoint contract.  Exhibit H 
consisted of an affidavit and a chart comparing the number of laborers Elkhorn 
had expected to work on the project with the larger number of laborers actually 
required.  In further support of its 
summary judgment motion, Elkhorn submitted to the district court a brief 
summarizing these exhibits and laying the blame for the construction problems 
and additional costs squarely upon the failures of HFG, particularly in the 
untimely delivery of engineering drawings.
 
[¶29]   KM filed its own summary judgment 
motion, a memorandum of law in support of that motion, and a response to 
Elkhorn’s motion.  KM raised three 
contentions as to the existence of genuine issues of material fact: (1) whether 
Elkhorn is entitled to the amount it claims, (2) who was responsible for the 
cost overruns, and (3) whether the amount of Elkhorn’s lien claim is 
reasonable.  In regard to those 
specific contentions, we note the following information contained in KM’s 
materials.  First, the head of KM’s 
project management group states in an affidavit that, to the best of his 
knowledge, the target price established in the Newpoint/Elkhorn contract was 
never increased in writing.  Next, 
KM notes that it approved only two change orders for the project, one increasing 
its contract price with Newpoint by $15,090.30, and the second increasing its 
contract price with Newpoint by $16,275.00.  In addition, portions of the transcript 
of the deposition of Elkhorn’s project representative reveal that Elkhorn 
obtained no written change orders from Newpoint.  In short, KM first argues that Elkhorn 
never obtained an increase in its contract price in the manner required by the 
contract, and, therefore, is not entitled to any amount beyond the contract 
price.
 
[¶30]   Elkhorn cites three Wyoming cases 
in rejecting this contention.  
Repeating its argument that HFG’s failure timely to produce engineering 
drawings made it impossible for Newpoint and Elkhorn to determine a new target 
price under their contract, Elkhorn quotes Mortenson v. Scheer, 957 P.2d 1302, 1306 (Wyo. 1998) as 
follows:
 
Where, 
after a contract is made, a party’s performance is made impracticable without 
his fault by the occurrence of an event the non-occurrence of which was a basic 
assumption on which the contract was made, his duty to render that performance 
is discharged, unless the language or the circumstances indicate the 
contrary.
 
(Quoting 
Restatement (Second) of Contracts § 261 (1979)).  Next, noting that Newpoint and Elkhorn 
responded to the impossibility of identifying a new target price by modifying 
the contract price via Newpoint’s approval of Elkhorn’s invoices, Elkhorn points 
out the following language from Schuler 
v. Community First Nat’l Bank, 999 P.2d 1303, 1305 n.1 (Wyo. 
2000):
 
            
As a general rule, if the parties mutually adopt a mode of performing 
their contract differing from its strict terms or if they mutually relax the 
contract’s terms by adopting a loose mode of executing them, neither party can 
go back upon the past and insist upon a breach because the contract was not 
fulfilled according to its letter.  
Quin Blair Enterprises, Inc. v. 
Julien Constr. Co., 597 P.2d 945, 951 n.6 (Wyo. 1979).
 
See 
also Huang Int’l, Inc. v. Foose Constr. Co., 
734 P.2d 975, 978 (Wyo. 1987) 
(habitual disregard of provision requiring written change orders can amount to 
waiver of the requirement).
 
[¶31]   We agree with Elkhorn and the 
district court that the altered method of contract pricing, that being 
Newpoint’s periodic approval of Elkhorn’s invoices, rather than a one-time 
amendment to the target price, does not take those charges outside the parties’ 
contract, or negate Elkhorn’s entitlement to payment.  There is no genuine issue of material 
fact as to that proposition.
 
[¶32]   KM next asserts that a genuine 
issue of material fact remains as to who was responsible for the cost 
overruns.  The suggestion, of 
course, is that Elkhorn should not be allowed to benefit from extra expenses 
that it was at fault for causing.  
In maintaining that it has proven that Elkhorn was not responsible for 
the additional costs, Elkhorn relied upon the attachments to its Lien Statement 
and the exhibits mentioned above that were attached to its summary judgment 
motion.  In response, KM points to 
two Newpoint e-mails that call Elkhorn’s performance into question.  On December 22, 2008, Newpoint’s CEO, 
Wiley Rhodes, informed Elkhorn that despite the good 
intentions of Elkhorn, HFG, and Newpoint, “we all fell short of our 
original goal.”  In an 
internal e-mail dated about three months later, Newpoint, LP’s Project 
Manager, Cathy Torregano, identified what she believed to be contract breaches 
by Elkhorn: failure adequately to schedule and manage project activities, 
failure to submit written notices of discrepancies, failure to document actual 
installation, failure to “redline” civil, mechanical and electrical drawings, 
failure to generate accurate lists to procure required materials, failure to use 
expedited materials within 30 days, and failure to know what was needed to 
finish the job despite continuous reorders.  Finally, KM attached to its response to 
Elkhorn’s summary judgment motion an affidavit and lengthy expert report 
entitled “Analysis of Claimed Damages related to West Frenchie Draw Treating 
Plant Fremont County, Wyoming.”
 
[¶33]   Before we further analyze KM’s 
assertion that a genuine issue of material fact exists in regard to who caused 
the project’s cost overruns, we think it prudent first to discuss KM’s third 
allegation--that is, that genuine issues of material fact exist in regard to 
whether the amount of Elkhorn’s claimed lien is reasonable.  We begin with the proposition that the 
correct measure of compensation under a mechanic’s lien, rather than being the 
enhanced value of the owner’s property, is the value of the materials and 
services supplied by the mechanic or materialman.  Horseshoe Estates, 713 P.2d at 778-79; 
Engle, 590 P.2d  at 830.  Of particular note because of the 
parties’ relations in the instant case is our stated principle that, where there 
is no contract between the owner and a subcontractor, the correct measure of 
compensation under a lien filed by that subcontractor against the owner is the 
reasonable value of the labor and materials furnished.  United Pacific Ins. Co. v. Martin & 
Luther Gen. Contractors, Inc., 455 P.2d 664, 669 (Wyo. 1969).  Furthermore, both the cost of the goods 
and services supplied, and the contract price, are “admissible on the issue of 
reasonable value and constitutes prima facie proof of the issue.”  Id. (quoting Lenslite Co. v. Zocher, 388 P.2d 421, 
424 (Ariz. 1964)).
 
[¶34]   In the end, we conclude that 
Elkhorn presented a prima facie case 
in support of its motion for summary judgment, and that KM did not in response 
present specific facts showing the existence of genuine issues of material 
fact.  Through affidavits, 
deposition testimony, contracts, bid documents and rate sheets, and, above all, 
proof that Newpoint had approved all of the subject invoices, Elkhorn met its 
burden of making a prima facie 
showing that it provided the labor and materials underlying the lien statement, 
and that the total amount was reasonable.
 
[¶35]   KM misapprehends its obligation in 
resisting Elkhorn’s summary judgment motion.  It is not sufficient, for instance, to 
suggest that Elkhorn may have been responsible for some of the cost 
overruns.  Speculation is not 
evidence.  Furthermore, KM’s 
reliance upon the contention that Elkhorn and Newpoint did not, in writing, 
increase the “target price” in their contract is without merit.  As noted elsewhere herein, Elkhorn and 
Newpoint mutually agreed upon a different process to determine the contract 
price--that process being Newpoint’s review and approval of invoices submitted 
by Elkhorn as the work progressed.  
In short, Elkhorn documented the work done on KM’s property under the 
Newpoint contract, provided the testimony of its construction representative as 
to the construction problems that caused additional work, and showed that the 
contractor had approved the work done by and the amounts owed to Elkhorn.  It was not error for the district court 
to conclude that there were no genuine issues of material fact in regard to 
these matters.
 
Did 
the district court err in awarding summary judgmentin an amount exceeding 
the contract price whereWyo. Stat. Ann. § 29-2-101(b) (LexisNexis 
2007)requires that the work or materials establishing a mechanic’s lien be 
furnished under a contract?
 
[¶36]   Wyo. Stat. Ann. § 29-2-101(b) 
(LexisNexis 2007), which is part of the “Contractors or Materialmen” lien 
statutes, provides that “[t]o have a lien the work or materials shall be 
furnished under a contract.”  KM 
interprets this language to mean that, not only must there be a contract 
supporting the lien claim, but the lien claim may not exceed the stated contract 
price.  KM then reasons that, 
because Elkhorn’s Lien Statement itemized amounts beyond the original “target 
price” in the Elkhorn-Newpoint contract, Elkhorn’s lien is 
invalid.
 
[¶37]   We will reject KM’s contention with 
little comment.  We note that, 
although KM cites to numerous cases recognizing the statutory contract 
requirement, KM does not cite a single case holding that the statutory language 
“caps” the lien amount at the original contract price.7  It could just as well be that the 
contract requirement exists not to limit the lien amount, but to insure that the 
owner has notice of the potential for a lien filing.  We need not consider that question here, 
however, because the evidence presented to the district court clearly showed, as 
discussed above, that the claimed lien amount had been approved under the 
Newpoint-Elkhorn contract by the conduct of the parties.  The judgment granted did not exceed the 
contract price.
 
Did 
Elkhorn’s Lien Statement set forth both a mechanic’s lien claim and an oil and 
gas lien claim?
 
[¶38]   Title 29 of the Wyoming Statutes is 
entitled “Liens.”8  Title 29 is divided into eight chapters, 
the first three of which are pertinent to this discussion.  Chapter 1 is entitled “General 
Provisions.”  Chapter 2 is entitled 
“Contractors or Materialmen.”  
Chapter 3 is entitled “Mines, Quarries, Oil, Gas or Other Wells.”  At the risk of stating the obvious, we 
will note that Chapter 1 applies to all liens governed by Title 29, “mechanic’s” 
liens are governed by Chapter 2, and oil and gas liens are governed by Chapter 
3.9
 
[¶39]   Elkhorn filed only one Lien 
Statement, which reads in pertinent part as follows:
 
            
NOTICE 
is hereby given that pursuant to and in accordance with Section 29-1-301 et. 
seq. and Section 29-3-101 et. seq., Wyoming Statutes, 2007, Elkhorn 
Construction, Inc., whose mailing address is . . ., has and claims a lien 
against the leasehold 
interest and improvements 
hereinafter described and all 
production of oil, gas, ore and minerals in solid form, or proceeds 
therefrom 
in the amount of $4,880,588.83, plus interest, late charges, attorney’s fees and 
costs from January 16, 2009, for materials furnished and delivered and labor 
supplied for the improvement of said property by Elkhorn Construction, 
Inc.
 
(Emphasis 
in original.)
 
[¶40]   KM argues that, by referencing only 
§ 29-1-301, which governs all lien statements as part of the general provisions 
of Chapter 1, and § 29-3-101, which governs oil and gas liens under Chapter 3, 
Elkhorn did not make a mechanic’s lien claim under § 29-2-101, which is part of 
Chapter 2.  Elkhorn contends, to the 
contrary, that use of the conjunctive “and” between the phrases describing 
leasehold interests and improvements, on the one hand, and oil and gas 
production, on the other, shows the intent of the Lien Statement to set forth 
both a mechanic’s lien claim and an oil and gas lien claim.  Further, Elkhorn argues that § 
29-1-301(b), which lists the information that must be contained in all lien 
statements, does not require a reference to the particular statutory section 
under which the lien is being claimed.  
Finally, Elkhorn notes that it sent KM a notice of its intent to file a 
lien, as required by the mechanic’s lien statutes, but not the oil and gas lien 
statutes, and that in its pleadings throughout the case, KM expressly recognized 
that Elkhorn had filed both a mechanic’s lien and an oil and gas 
lien.
 
[¶41]   We have said many times that 
statutory liens are in derogation of common law, that the lien statutes must be 
strictly construed, and that, to establish a valid lien, there must be full 
compliance with the statutes.  Foster Lumber Co. v. Hume, 645 P.2d 1176,  1180 (Wyo. 1982); Tottenhoff v. Rocky Mountain Constr. 
Co., 609 P.2d 464, 466 (Wyo. 
1980); American Bldgs. Co. v. Wheelers 
Stores, 585 P.2d 845, 847 
(Wyo. 1978).  At the same time, 
however, in recognition of the equitable principles underlying the lien 
statutes, we have also repeatedly found a lien to be valid even though it 
contained inadvertent inaccuracies or omissions that were not prejudicial.  See, e.g., Kirby Bldg. Sys. v. Independence 
P’ship No. One, 634 P.2d 342, 346 (Wyo. 1981);  Engle, 590 P.2d at 830-32; United Pacific, 455 P.2d at 673-76; Phelan v. Cheyenne Brick Co., 26 Wyo. 
493, 188 P. 354, 358 
(1920).
 
[¶42]   In the instant case, KM does not 
claim to be prejudiced by Elkhorn’s omission from its Lien Statement of a 
specific reference to Wyo. Stat. Ann. § 29-2-101.  Rather, KM simply argues that, because 
of that omission, Elkhorn did not file a mechanic’s lien.  That position is inconsistent with the 
position that KM took during the proceedings in district court.  For instance, in a reply filed on July 
16, 2009, in support of its motion to dismiss Elkhorn’s oil and gas lien 
foreclosure claim, KM made the following statement:
 
Elkhorn’s 
purpose of filing both § 29-3-103 and § 29-2-101 liens is therefore revealed -- 
because a § 29-2-101 contractor’s lien appears most applicable under the facts 
presented, Elkhorn has chosen to not only file a lien under that section, but to 
also attempt to impermissibly acquire a lien against the hydrocarbon production 
being treated by the Amine Plant under § 29-3-101.
 
[¶43]   We find that the Lien Statement is 
sufficiently clear in its intent to state both a mechanic’s lien and an oil and 
gas lien.  It certainly cannot be 
said that, as a matter of law, the language is statutorily inadequate, and it is 
clear from the record that KM was not mislead and suffered no prejudice.  While the lien statutes, themselves, are 
to be strictly construed, and while compliance with their mandates is required, 
it would defeat the equitable purposes behind the statutes--to create a means of 
payment for labor and materials that might otherwise go unpaid--were we to find 
invalid every lien that contained any discrepancy or omitted any information, 
whether or not material. 
 
Did 
the district court err in concluding thatElkhorn’s damages were liquidated 
and awardingpre-judgment interest?
 
[¶44]   In its summary judgment order, the 
district court awarded Elkhorn prejudgment interest at the statutory rate of 
seven percent per annum.  In 
considering the rectitude of prejudgment interest in this case, the parties have 
not suggested what our standard of review should be, other than treating the 
matter as part of the summary judgment.  
We have previously stated that the question of whether a judge is 
entitled to 
award prejudgment interest in a particular case is a question of law that we 
review de novo, while the question of 
whether prejudgment interest should 
be 
awarded is reviewed for an abuse of discretion.  Stewart Title Guar. Co. v. Tilden, 2008 
WY 46, ¶ 21, 181 P.3d 94, 102 
(Wyo. 2008); Millheiser v. Wallace, 
2001 WY 40, ¶ 13, 21 P.3d 752, 756 (Wyo. 2001); Bueno v. CF & I Steel Corp., 773 P.2d 937, 940 (Wyo. 1989).10  As will be seen in the ensuing 
discussion, the issue at hand is of the former type, and therefore the review is 
de novo.  Generally stated, the disputed question 
is whether the claims supporting the Lien Statement meet this Court’s criteria 
for consideration of an award of prejudgment interest.
 
[¶45]   Prejudgment interest is awarded in 
the appropriate case under the doctrine of unjust enrichment, as damages for the 
lost use of money.  Pennant Serv. Co. v. True Oil Co., 2011 
WY 40, ¶ 36, 249 P.3d 698, 711 
(Wyo. 2011); State v. BHP Petroleum 
Co., 804 P.2d 671, 673 (Wyo. 
1991).  This doctrine is applicable 
where a lien is being foreclosed, because the loss of use of money is part of 
the claimant’s damages, and an award of interest may be necessary “to avoid an 
injustice.”  Horseshoe Estates, 713 P.2d  at 782.  Prejudgment interest is available if a 
two-part test is met: (1) the claim must be liquidated, as opposed to 
unliquidated, meaning it is readily computable via simple mathematics; and (2) 
the debtor must receive notice of the amount due before interest begins to 
accumulate.  Bowles v. Sunrise Home Ctr., Inc., 847 P.2d 1002, 1005-06 (Wyo. 1993); BHP 
Petroleum, 804 P.2d  at 673; Holst v. 
Guynn, 696 P.2d 632, 635 
(Wyo. 1985).  Finally, this Court 
has repeatedly held that, in the absence of a contractual agreement to a 
different percentage, the appropriate measure of prejudgment interest is the 
seven percent per annum stated in Wyo. Stat. Ann. § 40-14-106(e) (LexisNexis 
2007).  See, e.g., O’s Gold Seed Co. v. United Agri-Products 
Fin. Servs., 761 P.2d 673, 
677 (Wyo. 1988); Holst, 696 P.2d  at 
635; and John Burk, P.C. v. Burzynski, 672 P.2d 419, 424 (Wyo. 
1983).
 
[¶46]   KM contends that Elkhorn’s claim 
was not liquidated, and that, therefore, prejudgment interest was not available 
to be awarded to Elkhorn.  The 
district court disagreed, finding the claim “readily computable by simple 
mathematical computation[.]”  
Further, the district court found that KM had received notice of the 
claimed amount on March 5, 2009, which was the date the Lien Statement was 
filed.  We will affirm, in good part 
for the same reasons that we affirmed the district court’s finding that there 
are no genuine issues of material fact and that summary judgment is 
appropriate.  Attached to the Lien 
Statement were 1,260 pages of labor and materials invoices, detailing the labor 
and materials supplied toward KM’s project, detailing the amounts owed to 
Elkhorn under those invoices, and reflecting Newpoint’s assurance that the 
amounts were due and payable.  “[A] 
mere difference of opinion as to the amount due or as to liability does not 
preclude prejudgment interest if the amount sought to be recovered is a sum 
certain and the party from whom payment is sought receives notice of the amount 
sought.”  Wells Fargo Bank v. Hodder, 2006 WY 128, ¶ 61, 144 P.3d 401, 421 (Wyo. 
2006).
 
Did 
the district court err in finding that Elkhorn conceded that $181,369 of its 
claim was not valid, and by subtracting that amount from Elkhorn’s 
judgment?
 
[¶47]   This issue was raised by Elkhorn in 
its cross-appeal.  The matter can 
quickly be resolved by reference to the record.  During the summary judgment motion 
hearing, Elkhorn’s counsel made the following comments:
 
            
Your Honor, the only area where we feel they raised a material issue of 
fact is their expert went through our liens and our claims and apparently all 
the discovery and everything -- he’s got a report about this thick.  May I approach?
 
            
. . . .
 
            
This was the only thing, Your Honor, within that, and it was a citation 
in this page in Mr. Bright, their expert’s report.  And arguably, this is what you expect to 
see to raise material issues of fact.  
They claim that there was no authorization for completion bonuses in the 
purchase order.  The rate 
differential, they disagreed with that because the contract provisions don’t 
allow for it.
 
            
You know, these are five or six items that they have raised a material 
issue of fact on.  These are 
concrete items that we can look at, we can examine, we can try this in two 
hours.  I can tell you that they’re 
wrong on all of them.  I mean the 
completion bonuses are documented by e-mail.  The rate differentials, when we were 
required to put on night shift, you’ve got to pay the guys an extra 50 
cents.  There’s a building [sic] 
here for Working Horse Log Homes.  
They said the records don’t indicate what was built.  Well, if we get to trial, Mr. Deister 
here will testify that was to pay the Working Horse Log Homes Company to come 
over and spray sealant on concrete foundation.
 
            
Your Honor, in sum, we believe they’ve only met their burden of proof in 
creating a factual issue on our claim that’s put inside all their technical lien 
arguments, Your Honor, for the sum total of this, of these items, which is 
$181,369.  And we would request that 
the Court enter partial summary judgment in Elkhorn’s favor in the amount of its 
lien claim of $4,880,588 and deduct from it the $181,369 depicted on that, and 
those are the issues of fact to be tried, Your Honor.  Those invoices will come in.  We’ll put on those, and we’ll prove I 
believe that we’re owed that money, also.  
So we’re requesting partial summary judgment in favor of Elkhorn and 
against Kinder Morgan in the amount of $4,699,219 . . . .
 
[¶48]   Based upon this limited concession, 
the district court stated in the summary judgment order that “[Elkhorn] agreed 
to deduct $181,369 from its original lien amount of $4,880,588.83 based on what 
it conceded to be legitimate issues raised by [KM], leaving the amount to be 
foreclosed at $4,699,219.83.”  The 
intent of this language is unclear.  
While stating that “the amount to be foreclosed [is] $4,699,219.83,” the 
district court did not directly declare that the $181,369 was not owed.  Rather, the court identified that sum as 
being subject to “legitimate issues.”  
That suggests that, instead of eliminating Elkhorn’s ability to recover 
the $181,369, the district court meant for that amount to be the subject of a 
bench trial.  We will remand this 
matter to the district court for such proceedings.
 
Did 
the district court err in holding that the allowed foreclosure of the mechanic’s 
lien “mooted” the necessity for the district court to address Elkhorn’s separate 
motion for summary judgment on the oil and gas lien 
claim?
 
[¶49]   The district court concluded its 
summary judgment order with the following language: “based on the resolution of 
[Elkhorn’s] mechanic’s lien, the Court need not address [Elkhorn’s] remaining 
claims.”  In its cross-appeal, 
Elkhorn takes the position that, by using this language, the district court 
“mooted” the issue of its oil and gas lien.11  A reading of the entire order convinces 
us, however, that the district court did not necessarily intend to declare the 
issue of the oil and gas lien claim moot as a matter of law.  Earlier in the order, for instance, 
after staying those issues related to the contractor, Newpoint, the district 
court declared that “I think that makes the rest of the agenda not moot, but we 
probably should wait until we get that sorted out as well.”  While it is not entirely clear from the 
context what the district court meant by “the rest of the agenda,” the quoted 
passage follows soon after the district court commented to counsel about “how 
quickly you really do want to get back here on this field of battle . . . 
.”  It appears that the district 
court intended to bring the parties back to court to determine matters that had 
not been stayed by Newpoint’s bankruptcy.
 
[¶50]   An oil and gas lien claim is, of 
course, a creature quite unlike a mechanic’s lien.  First off, it applies to production and 
the proceeds of production, statutorily delineated means of production, and 
lands and leaseholds under particularized circumstances.  Wyo. Stat. Ann. § 29-3-105 (LexisNexis 
2007).  Because of those 
distinctions, it would not appear that a decision as to a mechanic’s lien would 
necessarily make the issue of an oil and gas lien claim moot.  In addition, under Wyo. Stat. Ann. § 
29-3-103(a)(vi), a successful oil and gas lien claimant may recover attorney’s 
fees and other costs of collection.  

 
[¶51]   Because of these distinctions, and 
other statutory distinctions between a mechanic’s lien and an oil and gas lien, 
we do not believe that resolution of a claim as to the former makes moot a claim 
to the latter.  This case must be 
remanded to the district court to determine the validity and amount of Elkhorn’s 
oil and gas lien claim.  The 
district court will have to determine in the first instance whether the record 
is sufficient for it to make such a determination as part of the determination 
of the motions for summary judgment, or whether a bench trial on the issue is 
necessary.
 
CONCLUSION
 
[¶52]   The automatic stay in the 
bankruptcy of the contractor, Newpoint, did not deprive the district court of 
jurisdiction to enter summary judgment in favor of the subcontractor, Elkhorn, 
in an in rem lien foreclosure action 
against the owner.  Furthermore, 
because the lien foreclosure was an in 
rem proceeding not requiring the presence in the case of either Newpoint or 
HFG, the district court did not err in proceeding in their absence.  Elkhorn presented a prima facie case in support of its 
motion for summary judgment, and KM’s argumentative and speculative response did 
not prove the existence of genuine issues of material fact, making summary 
judgment appropriate.  The labor and 
materials supporting the mechanic’s lien claim were furnished under a contract 
and did not exceed the time and materials contract price, as determined by the 
conduct of the parties.  Elkhorn’s 
Lien Statement set forth both a mechanic’s lien claim and an oil and gas lien 
claim.  Prejudgment interest was an 
appropriate part of the damage award in the summary judgment order because 
Elkhorn’s claim was a liquidated claim in the sense that it was readily 
determinable by simple mathematical computations.  The district court did not determine 
that $181,369 of Elkhorn’s lien claim was not valid; rather the district court 
determined that $181,369 of Elkhorn’s lien claim was disputed, meaning that such 
requires remand and resolution in the district court.  Resolution of the mechanic’s lien claim 
in favor of Elkhorn did not make moot the issues of the validity and amount of 
Elkhorn’s oil and gas lien claim.
 
[¶53]   Affirmed in part and reversed in 
part and remanded to the district court for further proceedings consistent 
herewith.
 
 
 
 
 
 
 
 
 
 
 
 
 
FOOTNOTES
1An 
amine plant treats or “sweetens” natural gas by removing certain noxious 
compounds.
2A 
seemingly collateral issue that became a central issue arose out of the fact 
that Newpoint Gas Services, Inc. and Newpoint Gas, LP are affiliated companies, 
or the latter may be the successor of the former, leaving at least an alleged 
uncertainty as to which, if either, is the appropriate party in this case.  We will refer to these entities as 
Newpoint, Inc. and Newpoint, LP, or sometimes, simply as 
Newpoint.
3The 
lien statutes have been amended since these proceedings began, so we will refer 
to the version found in the 2007 statutes.
4We 
have detailed all these claims, cross-claims, and counterclaims to place the 
eventual stay order and order granting summary judgment in 
context.
5We 
need not resolve at this time which standard of review is 
appropriate.
6This 
policy does not create a necessarily unfair relationship.  An owner has the right to require a 
contractor to provide lien waivers from subcontractors before paying the 
contractor, and the right to require payment and performance bonds from the 
contractor.  See, e.g., Miller v. State, 732 P.2d 1054, 1058 (Wyo. 1987) and 
Wyo. Mach. Co. v. United States Fidelity 
& Guar. Co., 614 P.2d 716, 724 (Wyo. 1980).  See also 17 Am. Jur. 2d Contractors’ Bonds §§ 1, 2 (2004); and 
51 Am. Jur. 2d Liens § 59 
(2011).
7KM 
cites Opportunity Knocks Enterprises, LLC 
v. Shannon Electric, Inc., 2010 
WY 99, ¶ 8, 236 P.3d 255, 
258 (Wyo. 2010) (contract price may include profit, overhead, and markups); Engle v. First. National Bank of 
Chugwater, 590 P.2d 826, 830 
(Wyo. 1979) (implied contract is sufficient); Sargent v. Delgado, 492 P.2d 193, 195 (Wyo. 1972) 
(equitable owner may not create lien affecting legal owner’s interest); and United Pacific Insurance Co. v. Martin & 
Luther General Contractors, Inc., 455 P.2d 664, 669 (Wyo. 1969) 
(amount of the lien is reasonable value of labor and materials furnished, rather 
than value of improvement to the premises).
8Once 
again, we will be referring to the statutes as they existed in 
2007.
9The 
term “mechanic’s lien” encompasses the statutory lien rights of contractors, 
subcontractors, materialmen, and laborers.  
The common element is the provision of labor or materials for the 
improvement of real property.  See 53 Am. Jur. 2d Mechanic’s Liens §§ 1, 2 
(2006).
10See 
also Amoco Prod. Co. v. EM Nominee P’ship Co., 
2 P.3d 534, 543 (Wyo. 2000) and 
ANR Prod. Co. v. Kerr-McGee Corp., 893 P.2d 698, 704 (Wyo. 1995), 
where the award of prejudgment interest in a conversion case was reviewed for an 
abuse of discretion, even though the prejudgment interest was not considered to 
be “interest” per se.  But see also contra. Goodwin v. Upper Crust of Wyo., Inc., 624 P.2d 1192, 1198 (Wyo. 1981), 
where we reversed a denial of prejudgment interest on the ground that the 
appellees “were entitled” to prejudgment interest, and prejudgment interest 
“should have been awarded,” without indicating whether the reversal was due to 
an error of law or abuse of discretion.  
And more emphatically, in Rissler 
& McMurry Co. v. Atlantic Richfield Co., 559 P.2d 25, 34 (Wyo. 1977), we 
held that the appellant was “entitled as a matter of law” to prejudgment 
interest.
11“A 
case is moot when the determination of an issue is sought which, if provided, 
will have no practical effect on the existing controversy.”  Bard Ranch Co. v. Frederick, 950 P.2d 564, 566 (Wyo. 
1997).