Title: Del Rossi v. Doenz

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Del Rossi v. Doenz1996 WY 33912 P.2d 1116Case Number: 95-39Decided: 03/12/1996Supreme Court of Wyoming
 

PAUL DEL ROSSI,  

Petitioner, 

 

v. 

 

BILL DOENZ, a/k/a William J. Doenz,  

Respondent.

 

Original 
Proceeding Petition for Writ of Review.

 

Representing 
Petitioner: 

Micheal K. Shoumaker of Northern Wyoming Law 
Associates, Sheridan.

Representing 
Respondent: 

Hardy H. Tate, Sheridan, W. Perry Dray of Dray, 
Madison & Thomson, P.C., Cheyenne, and Frank C. Richter of Richter and 
Torkelson, Billings.

 

Before GOLDEN, C.J., and 
THOMAS, MACY, TAYLOR and LEHMAN, JJ.

TAYLOR, Justice. 

[¶1]      This case 
involves a real estate transaction gone bad. Pursuing a theory of promissory 
estoppel, the jilted buyer filed suit against the seller. A county court jury 
awarded damages that equaled the buyer's legal fees. The seller appealed to the 
district court, which reversed the award, finding that the statute of frauds 
precluded the claim. We agree with the district court that no legal theory 
justifies the county court jury's award.

 

[¶2]      We affirm. 

 

I. 
ISSUES

 

[¶3]      Petitioner, Paul 
Del Rossi, states the issue:

 

(a) Did the district judge err in his conclusion that 
the Del Rossi claim is precluded by the statute of frauds?

 

[¶4]      Respondent, Bill 
Doenz, phrases the issues less concisely:

 

(1) Whether an action for attorney's fees and travel 
expenses growing out of an alleged failed oral agreement for the sale of real 
property is an issue of fact for a jury to determine or is an issue of law? (a) 
Did the County Court improperly deny Doenz's Motions to Dismiss? (b) Did the 
County Court improperly deny Doenz's Motion for Summary Judgment? (c) Did the 
County Court improperly deny Doenz's Motions in Limine? (d) Assuming there is a 
question of fact, was the jury improperly instructed or failed to be instructed 
on the Statute of Frauds? Simply stated, may the County Court ignore the Statute 
of Frauds and solely consider a theory of Promissory Estoppel for a claim for 
attorney's fees and consequential damages in a failed oral agreement for the 
sale of real property?

 

(2) Does the Del Rossi argument ignore the Statute of 
Frauds, the Condition Precedents that were part of the sale, the lack of 
consideration between the parties, as well as, the issue of reasonable 
reliance?

 

II. 
FACTS

 

[¶5]      Paul Del Rossi 
(Del Rossi), buyer, and Bill Doenz, a/k/a William J. Doenz (Doenz), seller, 
orally agreed to the basic terms of an agreement, but those terms were never 
reduced to a signed document. Doenz eventually jilted Del Rossi and sold the 
property to another party. Lacking a written agreement, and thus faced with the 
formidable task of overcoming the statute of frauds, Del Rossi filed suit under 
a theory of promissory estoppel seeking damages for the costs of non-refundable 
plane tickets and attorney's fees which Del Rossi incurred through his efforts 
to bring the agreement he thought existed to fruition.

 

[¶6]      A county court 
awarded Del Rossi $3,816.07, the precise amount of his attorney's fees. Doenz, 
who had unsuccessfully moved for a directed verdict at the close of Del Rossi's 
case and at the close of all evidence, moved for a judgment notwithstanding the 
verdict after the jury returned a verdict in favor of Del Rossi. The county 
court judge denied the motion. Doenz appealed to the district court, which 
reversed the jury award, ruling that Doenz was entitled to judgment as a matter 
of law. Del Rossi appeals that decision.

 

III. 
DISCUSSION

 

A. 
STANDARD OF REVIEW

 

[¶7]      In Cargill, Inc. v. Mountain Cement Co., 
891 P.2d 57, 61 (Wyo. 1995), we held that the denial of a motion for summary 
judgment cannot be reviewed following a trial on the 
merits:

 

Before granting summary judgment, a court must 
determine whether there are any genuine issues of material fact in dispute and, 
if not, whether the moving party is entitled to judgment as a matter of law. Roemer Oil Co. v. Aztec Gas & Oil 
Corp., 886 P.2d 259, 262 (Wyo. 1994). This two-pronged analysis is 
inapplicable if a motion for summary judgment is denied and the case is heard on 
its merits. The first prong of summary judgment analysis is rendered moot when 
the trier of fact accepts a particular set of facts at 
trial.

 

When the "issue of material fact" prong of summary 
judgment analysis is removed, the only question that remains is whether the 
moving party is entitled to judgment as a matter of law. The proper procedural 
mechanism for challenging an adverse judgment, following a trial on the merits, 
is a motion for judgment as a matter of law. We hold that it is improper to 
review the denial of a motion for summary judgment following a trial on the 
merits. Bigney v. Blanchard, 430 A.2d 839, 842-43 (Me. 1981).

 

[¶8]      Generally, a 
motion for directed verdict is reviewed by determining whether the jury reached 
the one conclusion reasonable jurors could have reached under the circumstances. 
Cargill, Inc., 891 P.2d  at 62. 
However, W.R.C.P. 50(a)(1) allows a court to grant a motion for directed verdict 
if the evidence presented at trial is legally insufficient. Thus, when the case 
is allowed to go to the jury and the jury renders a verdict which is not 
supported by legally sufficient evidence, the trial court has an obligation to 
direct the entry of judgment as a matter of law. W.R.C.P. 50(b). This obligation 
must be fulfilled despite the fact that judgment as a matter of law should be 
granted cautiously and sparingly. Rhoades 
v. K-Mart Corp., 863 P.2d 626, 629 (Wyo. 1993). The decision to grant or 
deny a motion for judgment as a matter of law is reviewed de novo. Cargill, Inc., 891 P.2d  at 
62.

 

[¶9]      The district 
court ruled that Doenz's oral promise was unenforceable because it violated the 
statute of frauds. Since Del Rossi did not sue to enforce the real estate 
contract, reliance upon the statute of frauds is misplaced. Our decision focuses 
instead on promissory estoppel and the general rule that litigants must pay 
their own way. This shift in analysis is entirely appropriate as we may affirm a 
district court's decision on any proper legal grounds supported by the record. 
Gaub v. Simpson, 866 P.2d 765, 767 
(Wyo. 1993).

 

B. 
PROMISSORY ESTOPPEL

 

[¶10]   The legal issue presented in this 
appeal is whether attorney's fees incurred as a result of an oral real estate 
transaction are recoverable under a theory of promissory estoppel. Here, the 
evidence presented at trial was legally insufficient to establish a claim for 
promissory estoppel. Judgment as a matter of law should have been entered in 
favor of Doenz following his motion for a directed 
verdict.

 

[¶11]   To recover damages under a theory 
of promissory estoppel, Del Rossi must establish that (1) he and Doenz had a 
clear and definite agreement; (2) that he acted to his detriment in reasonable 
reliance on that agreement; and (3) that the equities of the situation support 
the enforcement of the agreement. Davis 
v. Davis, 855 P.2d 342, 348 (Wyo. 1993) (quoting Michie v. Board of Trustees of 
Carbon County School Dist. No. 1, 847 P.2d 1006, 1009 (Wyo. 1993)). Further, 
Del Rossi bears the burden of establishing all of the elements of promissory 
estoppel. Provence v. Hilltop Nat. 
Bank, 780 P.2d 990, 993 (Wyo. 1989).

 

[¶12]   The first two elements of a 
promissory estoppel claim are questions of fact which must be resolved by a 
jury. Michie, 847 P.2d  at 1009. The 
third element, however, is a question of law which must be addressed by a court. 
Id. The question of whether the 
equities support the enforcement of the agreement necessarily involves questions 
of policy. Davis, 855 P.2d  at 348-49. 
Thus, the question of law which we must resolve is whether, under a theory of 
promissory estoppel, Del Rossi can recover attorney's fees incurred as the 
result of an oral agreement to enter into a real estate transaction. We begin by 
noting that in Wyoming, litigants are generally expected to pay their own 
attorney's fees unless there is a contractual agreement or some statutory 
authorization to the contrary. Sheridan 
Commercial Park, Inc. v. Briggs, 848 P.2d 811, 817 (Wyo. 1993). There has 
been no argument in this case that either exception 
applies.

 

[¶13]   Therefore, we turn our attention to 
the proposition that Doenz must pay Del Rossi's attorney's fees since the two 
orally agreed to enter into a real estate contract. In Davis, we said, "[t]he party seeking to 
have the oral contract enforced must demonstrate a change of position 
`substantially for the worse' and the incurrence of `unjust and unconscionable 
injury and loss' before the invocation of estoppel can be successful." Davis, 855 P.2d  at 349 (quoting Crosby v. Estate of Strahan, 78 
Wyo. 302, 324 P.2d 492, 497 (1958)). There is nothing unjust or unconscionable 
about requiring a sophisticated businessman to pay the attorney's fees he 
incurred in a real estate transaction gone sour.

 

[¶14]   Attorneys are frequently retained 
in advance by parties who are planning to execute real estate contracts. Those 
attorneys often generate substantial legal fees. Few would argue with the 
proposition that it would be foolish to execute such a contract without proper 
legal advice. In light of these facts, we are not prepared to say that the party 
who reneges on an oral agreement to agree must pay the other party's legal fees 
under a theory of promissory estoppel. Such a conclusion is simply bad public 
policy.

 

[¶15]   In essence, Del Rossi argues that 
any legal fees generated in reliance on an oral agreement to agree are to be 
hung above the closing table. Suspending the Sword of Damocles above the closing 
table would certainly have a chilling effect on the sale of real property, and 
would encourage parties to attempt complex real estate transactions without 
proper legal advice. The negative impact of such a rule far outweighs any injury 
suffered by Del Rossi. Del Rossi has failed to establish that requiring him to 
pay his own legal fees is unjust and unconscionable, or that the equities of 
this case have overcome the rule that litigants must pay their own 
way.

 

IV. 
CONCLUSION

 

[¶16]   The district court correctly 
concluded that Doenz was entitled to judgment as a matter of 
law.

 

[¶17]   Affirmed.

 

THOMAS, Justice, concurring specially. 

[¶18]   I am in complete accord with the 
decision found in the majority opinion that the district court, which reversed 
the judgment in the county court, should be affirmed. I have identified, at 
least for myself, an additional ground for the decision. It can be stated 
briefly.

 

[¶19]   We have said, in a number of 
different instances and contexts, that we do not endeavor to enforce "agreements 
to agree." Lavoie v. Safecare Health 
Serv., Inc., 840 P.2d 239 (Wyo. 1992); Inter-Mountain Threading, Inc. v. Baker 
Hughes Tubular Services, Inc., 812 P.2d 555 (Wyo. 1991); Doud v. First Interstate Bank of 
Gillette, 769 P.2d 927 (Wyo. 1989); Rialto Theatre, Inc. v. Commonwealth 
Theatres, Inc., 714 P.2d 328 (Wyo. 1986); Roth v. First Sec. Bank of Rock Springs, 
Wyoming, 684 P.2d 93 (Wyo. 1984); Czapla v. Grieves, 549 P.2d 650 (Wyo. 
1976). Our statute of frauds provides, in pertinent part:

 

(a) In the following cases every agreement shall be 
void unless such agreement, or some note or memorandum thereof be in writing, 
and subscribed by the party to be charged therewith:

 

* * * * * *

 

(v) Every agreement or contract for the sale of real 
estate, or the lease thereof, for more than one (1) year; 

* * *.

 

WYO. STAT. § 1-23-105 
(1988).

 

Ineluctable logic persuades 
me that, in the instance of an agreement that is void unless it is "in writing, 
and subscribed by the party to be charged therewith," any preliminary 
negotiations can constitute nothing more than an "agreement to agree." 
Consequently, the claimed oral arrangement Del Rossi seeks to enforce under the 
guise of promissory estoppel is in direct conflict with our rule that we do not 
endeavor to enforce "agreements to agree."

 

[¶20]   While the case arose in the context 
of an agreement to use a particular pipe-threading process, perhaps language in 
Inter-Mountain Threading, Inc., 812 P.2d  at 560, is prophetic for this case:

 

It is clear from the evidence that Baker Hughes' 
business relationships under either form of agreement would not have been simple 
arrangements free of details. Either contemplated relationship would have bound 
the parties for a substantial period of time and would have involved substantial 
sums of money. Considering what is at stake in terms of product, technology, 
trade secrets, money, and reputation, it 
is important that the relationship and commitment of the parties, each to the 
other, be carefully expressed in a formally executed written document. For 
the above and foregoing reasons, we also conclude that Baker Hughes could not 
have expected or foreseen IMT's alleged reliance on Douglas' remarks at the 
breakfast meeting. (Emphasis added.)

 

[¶21]   I also would affirm the district 
court, but I would hold there was no clear and definite agreement upon which Del 
Rossi could rely. As a matter of law, because the sale of land had to be 
accomplished by an agreement in writing, the prior negotiations could not be 
anything more than an unenforceable "agreement to 
agree."