Title: Wyoming Sawmills, Inc. v. Morris

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Wyoming Sawmills, Inc. v. Morris1988 WY 82756 P.2d 774Case Number: 88-3Decided: 06/10/1988Supreme Court of Wyoming
WYOMING 
SAWMILLS, INC., a Wyoming corporation, Appellant (Plaintiff/Third-Party 
Defendant)

 
 
v.

 
 
Robert B. 
MORRIS; Raymond McCoy, Gerald McCoy; and Gary McCoy, d/b/a J & D Wood 
Products; Sheridan National Bank, and Edith I. Morris, Appellees 
(Defendants/Third-Party Defendants/Third-Party 
Plaintiffs)

 
 
Darlene L. Reiter of Burgess & 
Davis, Sheridan, for Appellant.

 
 
Dan B. Riggs and Haultain E. Corbett 
of Lonabaugh & Riggs, Sheridan for Appellees Robert B. Morris, Edith I. 
Morris, Raymond McCoy, Gerald McCoy, and Gary McCoy d/b/a J & D Wood 
Products, and Sheridan National Bank.

 
 
Robert W. Koester, Sheridan, for 
Appellee Sheridan National Bank.

 
 
Michael K. Davis, Sheridan, for 
Appellees Raymond McCoy, Gerald McCoy, and Gary McCoy d/b/a J & D Wood 
Products.

 
 
Stuart S. Healy of Healy & 
Kinnaird, Sheridan, for Appellees Robert B. Morris and Edith I. Morris. 

 
 
Before Thomas, Cardine, Urbigkit, 
and Macy, JJ., and Rooney, Ret. J. 

 
 
Rooney, Retired 
Justice.

[¶1.]     This appeal is from a 
judgment enforcing an oral settlement agreement.

[¶2.]     We 
affirm.

[¶3.]     Appellant words the 
issues on appeal:

 
 
"I. Was there an unconditional 
acceptance of the essential terms of the settlement offer sufficient to form a 
contract?

"II. Was there a meeting of the 
minds sufficient to form a contract?

"III. Did the settlement 
negotiations form a contract?

"IV. Does the order of the Court, 
which incorporates the terms of the settlement document, violate W.R.C.P., Rules 
11 and 41?"

 
 
Appellees word 
them:

 
 
"I. Did the Trial Court have 
authority to enforce the terms of the Settlement Agreement between the 
parties?

"II. Was there sufficient evidence 
to support the Trial Court's finding that an agreement to settle the litigation 
existed between the parties?"

 
 

[¶4.]     Appellant agreed to 
purchase from appellee Robert B. Morris approximately 230,000 board feet of 
green saw logs which were decked at a location known as U.S. Forest Service 
Little Willow Timber Sale. Thereafter, appellees McCoys claimed ownership of the 
logs and appellee Sheridan National Bank claimed a security interest in them. 
This litigation resulted from the several claims by the 
parties.

[¶5.]     Since the first three 
issues presented by the appellant and the second issue presented by appellees 
are issues of fact, we must, as to these issues, examine the record to determine 
if there is evidence to support the findings of the trial court, and we do so in 
accordance with the following law.

[¶6.]     We have often said 
that, on appeal, the Supreme Court assumes that evidence in favor of the 
successful party is true, leaves out of consideration entirely the conflicting 
evidence presented by the unsuccessful party, and gives the evidence of the 
successful party every favorable inference that may reasonably and fairly be 
drawn from it. Furthermore, a reviewing court cannot substitute its judgment of 
the facts for that of the trial court unless the trial court's judgment is 
clearly erroneous or contrary to the great weight of the evidence. See e.g. 
Hance v. Straatsma, Wyo., 721 P.2d 575, 578 (1986); Dehnert v. Arrow 
Sprinklers, Inc., Wyo., 705 P.2d 846, 851 (1985); Scherling v. 
Kilgore, Wyo., 599 P.2d 1352, 1359 (1979); Madrid v. Norton, Wyo., 
596 P.2d 1108, 1117 (1979), and cases there cited with reference to this 
proposition.

[¶7.]     The existence of a 
contract requires a meeting of the minds of the parties to it. Jackson Hole 
Builders v. Piros, Wyo., 654 P.2d 120 (1982); Crockett v. Lowther, Wyo., 
549 P.2d 303 (1976). An unconditional, timely acceptance of an offer, properly 
communicated to the offeror, constitutes a meeting of the minds of the parties 
and establishes a contract. Wheeler v. Woods, Wyo., 723 P.2d 1224 
(1986); Schacht v. First Wyoming Bank, N.A.-Rawlins, Wyo., 
620 P.2d 561 (1980); Madison v. 
Marlatt, Wyo., 619 P.2d 708 (1980); Crockett v. Lowther, 
supra; Trautwein v. Leavey, Wyo., 472 P.2d 776 (1970); Central Coast 
Construction v. Lincoln-Way Corporation, 404 F.2d 1039 (10th Cir. 
1968).

[¶8.]     Whether a contract has 
been entered into depends on the intent of the parties and is a question of 
fact, United States Through Farmers Home Administration v. Redland, Wyo., 
695 P.2d 1031 (1985), and this is so with reference to oral 
contracts.

 
 
"Whether an oral contract exists, 
its terms and conditions and the intent of the parties are questions of fact. 
Jim's Water Service, Inc. v. Alinen, Wyo., 
608 P.2d 667 (1980)." Richardson v. 
Green, Wyo., 644 P.2d 778, 779 
(1982).

 
 
Finally,

 
 
"An agreement to make a written 
contract where the terms are mutually understood and agreed on in all respects 
is as binding as the written contract would be if it had been executed." 
Robert W. Anderson House Wrecking and Excavating, Inc. v. Board of Trustees, 
School District No. 25, Fremont County, Wyoming, Wyo., 681 P.2d 1326, 1331 
(1984).

 
 
"In general, the principle is well 
settled that where the parties to a contract intend that it shall be closed and 
consummated prior to the formal signing of a written draft, the terms having 
been mutually understood and agreed upon, the parties will be bound by the 
contract actually made, although it be not reduced to writing; but, on the other 
hand, if the parties do not intend to close the contract until it shall be fully 
expressed in a written instrument properly attested, then there will be no 
complete contract until the agreement shall be put into writing and signed." 
Summers v. Mutual Life Ins. Co., 12 Wyo. 369, 75 P. 937, 943 
(1904).

 
 

[¶9.]     The record reflects 
that, during the pleading and discovery stages of the case, all four parties 
engaged in settlement negotiations. Counsel for the parties met on September 10, 
1987 to further discuss settlement. An understanding was reached on all items 
except one which involved a payment by appellant to appellees McCoys. Counsel 
for appellant stated that she had authority to pay $10,000 and counsel for 
appellees McCoys stated that he had authority to accept $12,000. Counsel for 
appellant suggested that each party contribute $500 from their respective 
positions in compromise of the difference. It was agreed that counsel would 
contact their clients and recommend acceptance of the 
suggestion.

[¶10.]  Later, in a four-way telephone 
conversation, all counsel reported acceptance by their clients of the 
suggestion,1 and it was agreed that they would 
meet the following day at 3:00 p.m. to execute the documents and close the 
transaction.

 
 

[¶11.]  At 3:00 p.m. the next day, all parties 
and their counsel met as agreed except appellant and its counsel. Shortly after 
3:00 p.m., appellant's counsel arrived and announced that her client would not 
be there and that "we don't have a deal."

[¶12.]  Appellant's contention is that payment 
and execution of the settlement document "were conditions precedent to the 
settlement." Appellees contend that a binding oral agreement settling the 
litigation was entered into by all of the parties during the four-way telephone 
conference on September 10, 1987, and that payment thereunder and execution of 
the settlement document were no more than performance of the terms of the oral 
settlement agreement. The evidence of the prevailing parties presented at the 
hearing was sufficient to support the finding of the trial court that appellees' 
contention was correct.

[¶13.]  In addition to the testimony set forth in 
note 1, supra, counsel for appellees Morrises testified in 
part:

 
 
"Q. Do you recall any discussion of 
the 10th, of the time effectuating the settlement?

"A. During the telephone and 
conversations previously, I distinctly remember Mike Davis2 putting that on as a condition, as 
of the close of business of Friday, the 11th of September. He indicated to all 
of us that he would not instruct his clients to come down off of the mountain 
until he was certain that we had a firm deal.

"Q. Was Ms. Reiter3 present when those statements were 
made by Mr. Davis?

"A. Yes, she 
was.

"Q. And what, if anything, was said 
during the telephone conversation, to which all of the parties were party, 
concerning the timing of the accord which had been 
reached?

"A. The same thing. That we would 
meet at 3:00 o'clock, as we had discussed earlier that morning. We would meet at 
3:00 o'clock on the following afternoon to sign the documents and exchange 
the checks.

* * * 
*

"Q. Mr. Healy, is there any doubt in 
your mind that the parties had reached an agreement on all terms of this 
agreement by the afternoon of September 10th?

"A. None whatsoever." (Emphasis 
added.)

 
 

[¶14.]  Robert Koester, counsel for appellee 
Sheridan National Bank, testified in part:

 
 
"Q. * * * * Mr. Koester, I think we 
were still on the telephone call that you had, among all four counsel; 
correct?

"A. Yes.

* * * 
*

"Q. Were there any -- Well, in fact, 
during that conversation, did Ms. Reiter say anything respecting the question of 
whether or not all parties had an agreement?

"A. I don't 
recall.

"Q. Was there any other discussion 
among anybody else that would lead you to believe you had an 
agreement?

"A. I believe everybody agreed there 
was an agreement at that time."

 
 

[¶15.]  Mike Davis testified in 
part:

 
 
"Q. So as I understand it, at that 
point and time, counsel for all four parties participated in the conference 
call?

"A. That's 
correct.

"Q. Did you develop any 
understanding whether at that time the parties had reached an agreement with 
respect to the litigation?

"A. My understanding was that we had 
reached an agreement to settle on the terms we have 
indicated."

 
 

[¶16.]  Even Darlene Rieter testified in 
part:

 
 
"Q. Ms. Rieter, you testified there 
was a meeting in your office on the morning of September 10th; do you recall 
that?

"A. Yes.

"Q. At that time it was the case 
that Sawmills had extended authority to you to settle with Mr. Morris for twelve 
thousand dollars?

"A. No, that is not correct. Oh, I 
am sorry, Mr. Morris?

"Q. Yes.

"A. Yes.

"Q. And you expressed that, did you 
not?

"A. I am not sure that that was 
expressed at that meeting. Right at this moment I think perhaps that had been 
agreed at an earlier time.

"Q. There was no question about that 
particular sum or your authority from the Sawmills, was 
there?

"A. I don't believe 
so.

"Q. And basically you found that the 
parties wound up two thousand dollars apart, is that 
correct?

"A. That's 
correct.

"Q. And you did get the concession 
of an additional five hundred dollars from your client later that date from Mr. 
Newman, isn't that correct?

"A. That's 
correct."

 
 

[¶17.]  The settlement document intended to be 
executed at the 3:00 p.m. meeting on September 11, 1987 was introduced into 
evidence as Exhibit "A" at the hearing. The testimony in favor of appellees was 
sufficient to support the trial court's determination that the minds of the 
parties met with reference to the terms of the oral settlement agreement; that 
these terms were contained in the proposed settlement document; that appellant 
had accepted the essential terms thereof; and that it formed an enforceable 
contract.

[¶18.]  In arguing its fourth issue, appellant 
contends that the court erred in admitting the settlement document intended to 
be executed at the 3:00 p.m. meeting on September 11, 1987 as Exhibit "A" on the 
ground that doing so violated that portion of Rule 11, W.R.C.P., which reads in 
part:

 
 
"If a pleading, motion, or other 
paper is not signed, it shall be stricken unless it is signed promptly after the 
omission is called to the attention of the pleader or 
movant."

 
 
The following occurred during the 
testimony of Mike Davis:

 
 
"Q. And does Exhibit A reflect the 
agreement that you testified was reached on September 10th, 1987, 
sir?

"A. It does, except it does not -- I 
believe it does not reflect that the payment of funds was to take place on 
September 11th, before close of business.

"MR. RIGGS: Move to admit Exhibit A 
into evidence, Your Honor.

"THE COURT: It will be 
received."

 
 

[¶19.]  Not only was the document offered and 
received as evidence at trial rather than being filed or presented in the course 
of forming issues for trial,4 but there was no objection to its 
admission presented at the hearing.

 
 
"Except for appeals which involve 
issues of jurisdiction or fundamental rights, we will not ordinarily consider 
contentions of error unless the trial court has first been apprised thereof and 
given an opportunity to rule upon the alleged error. Matter of Parental 
Rights of PP, Wyo., 648 P.2d 512 (1982). The trial court is 
usually apprised of the error by means of objection together with reasons in 
support of the objection. Matter of Parental Rights of PP, supra." Dennis v. 
Dennis, Wyo., 
675 P.2d 265, 266 (1984).

 
 
See Goggins v. Harwood, Wyo., 
704 P.2d 1282 (1985).

 
 

[¶20.]  In Goggins v. Harwood, 704 P.2d  at 
1291, we said:

 
 
"Rule 7.05, W.R.A.P. states the 
plain error doctrine:

 
 
"'Plain errors or defects affecting 
substantial rights may be noticed although they were not brought to the 
attention of the court.'

 
 
"In order to invoke the plain-error 
rule, it is necessary to show

 
 
"'* * * * (1) that the record 
reflects clear and unequivocally the fact complained of; (2) that the facts 
prove a transgression of a clear rule of law; (3) that the error affects a 
substantial right of the accused; and (4) that the defendant has been materially 
prejudiced by that violation.' Westmark v. State, Wyo., 693 P.2d 220, 224 
(1984)."

 
 

[¶21.]  As noted supra, the facts of this case do 
not prove a transgression of a clear rule of law. The document was not submitted 
as a pleading or part of a pleading to formulate issues. It was submitted as 
evidence of the testimony already offered and received. It contained details of 
that which, according to the testimony, had previously been agreed to by counsel 
for all of the parties, including counsel for appellant. A preliminary draft had 
previously been circulated to such counsel. Exhibit "A" changed the preliminary 
draft only to more clearly set forth the description of the obligations being 
released and to include the compromise suggested by appellant's counsel. The 
document was in the process of being executed when appellant's counsel announced 
that "we don't have a deal." Considerable testimony was received concerning the 
exhibit. Its admission was proper to give meaning to, and to support, such 
testimony.

[¶22.]  Additionally, appellant was not 
materially prejudiced by the admission of Exhibit "A" into evidence. The 
information contained therein was already before the court by virtue of 
testimony of the witnesses. It was a convenient means for compilation of the 
terms for settlement agreed upon between the parties. Many of such terms 
concerned settlement of issues that existed among appellees, separate and apart 
from issues involving appellant. It is equally difficult to understand 
appellant's contention that the trial court's order constituted an involuntary 
dismissal of its action. It is true that there were no grounds for such 
dismissal under Rule 41(b), W.R.C.P., which reads in pertinent 
part:

 
 
"(2) By the Court. -- Upon its own 
motion the court may dismiss without prejudice any action not prosecuted or 
brought to trial with due diligence."

 
 
But the matter was not dismissed. As 
stated in the judgment:

 
 
"The above-entitled matter having 
come on before the Court upon the Motion to Compel Judgment of Movants Robert B. 
Morris, Edith I. Morris, Raymond McCoy, Gerald McCoy and Gary McCoy, d/b/a J 
& D Wood Products, and Sheridan National Bank, seeking to enforce by 
Judgment a Settlement Agreement which the Movants contend was made in the 
above-entitled matter, the same having been regularly scheduled by the Court for 
November 5, 1987. The Movants appeared by their counsel, Lonabaugh & Riggs, 
and the resisting party, Wyoming Sawmills, Inc., appeared by its counsel, 
Burgess & Davis. The Court having heard arguments of counsel, considered all 
Briefs filed by the parties, and having considered all evidence presented in the 
above-entitled matter, does find that the Movants and Wyoming Sawmills, Inc. 
entered into and agreed upon a settlement of the captioned litigation on 
September 10, 1987, in the form of a Settlement Agreement as is marked 
Exhibit 'A' and received in evidence. The Court does further specifically find 
that Richard C. Newman, General Manager of Wyoming Sawmills, Inc. and Stanley W. 
Stephens, President of Wyoming Sawmills, Inc., authorized counsel for Wyoming 
Sawmills, Inc. to settle the captioned litigation on the terms and conditions 
agreed to by all parties and their counsel on September 10, 1987, and as 
incorporated in the Settlement Agreement which is dated September 11, 1987, 
marked Exhibit 'A' and entered in evidence in this matter. The Court does 
further find that, a settlement having been agreed upon in the above-entitled 
matter, in the form marked Exhibit 'A' entered in evidence in this 
matter, that the same should now be enforced as the Judgment of the Court." 
(Emphasis added.)

 
 

[¶23.]  The judgment is not a dismissal. It is an 
enforcement of a valid settlement agreement reached by the parties in this case. 
It is similar to a judgment for specific performance of any contract. It is "'in 
the nature of a judgment by consent,'" as was said in Kukla v. National 
Distillers Products Company, 483 F.2d 619, 621 (6th Cir. 1973). The court 
there went on to say that such is

 
 
"authorized under what has been 
consistently recognized as the trial court's 'inherent power to summarily 
enforce settlement agreements entered into by parties litigant in a pending 
case.'

"The power of a trial court to enter 
a judgment enforcing a settlement agreement has its basis in the policy favoring 
the settlement of disputes and the avoidance of costly and time-consuming 
litigation. To effectuate this policy, the power of a trial court to enforce a 
settlement agreement has been upheld even where the agreement has not been 
arrived at in the presence of the court nor reduced to writing." (Citations 
omitted.) Id.

 
 

[¶24.]  The judgment of the trial court is 
affirmed.

 
 
FOOTNOTES

 
 

1Stuart 
Healy, counsel for appellees Morrises, testified in 
part:

 
 
"Q. Mr. 
Healy, were you present as a party to a four-way telephone conversation among 
all counsel in this case on Friday, or on the 10th of 
September?

"A. I was 
part of that conversation. I was brought in on the latter 
part.

"Q. You 
were, in fact, the last one of the counsel who was brought in on that 
conversation, is that the case, sir?

"A. That's 
correct.

"Q. And did 
the other attorneys ask you if you had obtained the authority for the five 
hundred dollar reduction for your client?

"A. They 
asked.

"Q. And did 
you indicate to the other counsel that the five hundred dollar reduction would 
be acceptable with the Morrises?

"A. I did. I 
did not have a verbal commitment from my clients on that, but I felt I could get 
it, and I advised counsel that it was not a factor because if I could not get 
it, I had spent more time on settlement discussions than I had on the merits of 
the case, and I would make up the difference if it came to 
that.

"Q. And 
ultimately the Morrises approved the five hundred dollar 
reduction?

"A. Yes, 
they did. I talked to Bob Morris that evening and he approved 
it."

 
 

2Mike Davis 
was counsel for appellees McCoys.

 
 

3Darlene 
Reiter was counsel for appellant.

 
 

4Section III, 
captioned "Pleadings and Motions," is one of the eleven sections of the Wyoming 
Rules of Civil Procedure. Rules 7 through 16 are contained therein. Section III 
sets forth the procedure for the formation of issues for 
trial.