Title: Landmark, Inc. v. Stockmen's Bank & Trust Co.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Landmark, Inc. v. Stockmen's Bank & Trust Co.1984 WY 39680 P.2d 471Case Number: 83-154Decided: 04/13/1984LANDMARK, INC., APPELLANT (DEFENDANT AND THIRD-PARTY PLAINTIFF),

v.

STOCKMEN'S BANK & TRUST COMPANY, (THIRD-PARTY DEFENDANT),

v.

ARLIE RUGER AND DEBBIE RUGER, D/B/A RUGER MOBILE HOME PARK, APPELLEES (PLAINTIFFS).

Supreme Court of Wyoming
LANDMARK, INC., APPELLANT 
(DEFENDANT AND THIRD-PARTY PLAINTIFF),

v.

STOCKMEN'S BANK & 
TRUST COMPANY, (THIRD-PARTY DEFENDANT),

v.

ARLIE RUGER AND DEBBIE 
RUGER, D/B/A RUGERMOBILEHOMEPARK, APPELLEES 
(PLAINTIFFS).

Appeal from the 
DistrictCourtofCampbellCounty, Paul T. Liamos, 
Jr., J.

James L. Edwards 
of Sheehan, Stevens & Sansonetti, Gillette, for appellant.

James N. Wolfe 
of Wolfe & Tate, Sheridan, for 
appellees.

Before ROONEY, C.J., and THOMAS, ROSE, BROWN and 
CARDINE, JJ.

ROSE, 
Justice.

[¶1.]     Facts which this court 
is charged with considering in this appeal show that appellees Arlie and Debbie 
Ruger purchased a parcel of land approximately 15 miles from Gillette, Wyoming for the purpose of building a mobile 
home park. The Rugers hired appellant, Landmark, Inc., to install a water and 
sewer system on the property which the appellant did not complete on time and, 
even after the system was represented to be properly installed, it contained 
leaks of up to 200 gallons per hour. The appellees were therefore forced to hire 
labor and materials to repair the water system so that it would function and, at 
the time of trial, the system was still not working satisfactorily. The evidence 
is that appellees suffered loss of income and profit, and it is alleged that the 
appellees' losses are due to the breach of contract by and negligence of the 
appellant.

[¶2.]     The district judge 
denied various of the appellant's preliminary motions including a motion for 
summary judgment on the issue of lost income and profits, and the case therefore 
went to trial, with the jury awarding the appellees damages in the amount of 
$89,500 for repairs and replacement of the water and sewer system and an 
additional $40,500 for lost income.

[¶3.]     We will 
affirm.

ISSUES PRESENTED FOR 
REVIEW

[¶4.]     The issues as defined 
by the appellant are:

"I. Did the District 
Court err in denying Appellant's Motion for Summary Judgment on the issue of 
plaintiffs' claim for lost profits or income?

"II. Did the District 
Court err in denying appellant's Motion for a Directed Verdict or Motion for 
Judgment Notwithstanding the Verdict on the issue of plaintiffs' claim for lost 
profits or income?

"III. Was the evidence 
before the District Court sufficient to establish an award of $89,500.00 for the 
repair and replacement of the water and sewer system?"

[¶5.]     With respect to the 
resolution of all three of these issues, we will be mindful of the oft-repeated 
rule which says that, on appeal, this court assumes the evidence of the 
successful party is true, leaves out of consideration entirely the evidence of 
the unsuccessful party in conflict therewith, and gives to the evidence of the 
successful party every favorable inference which may reasonably be drawn from 
it. Krist v. Aetna Casualty&Surety, Wyo., 667 P.2d 665 
(1983).

Issue No. 
1

The Lost Profits or 
Income Summary-Judgment Issue

[¶6.]     In its motion, the 
appellant-defendant third-party plaintiff moved for summary 
judgment

"* * * [a]gainst 
plaintiff [appellees here] as to plaintiff's claim against defendant for lost 
income."

According to the 
movant:

"This motion is based on 
the pleadings, answers to interrogatories, responses to requests for production 
of documents, depositions, and any and all items of record at this time, as well 
as on the attached affidavit as specifically incorporated herein. Such 
pleadings, filings, affidavits and other materials established that there is no 
genuine issue as to any material fact as outlined in the case authority under 
Rule 56 of Wyoming Rules of Civil Procedure and that therefore the defendant and 
third-party plaintiff Landmark is entitled to judgment as a matter of law as 
stated in its answer and counterclaim."

[¶7.]     The record fails to 
disclose any depositions, interrogatories or answers to interrogatories. Nor 
does it contain a demand for the production of documents and there are no 
documents on file which appear to be responsive to such a demand. There are no 
exhibits, materials or filings of record which speak to lost income or profits 
which appear to have been of record when the motion for summary judgment was 
filed and denied.

[¶8.]     The record does contain 
two affidavits of Stephen F. Hughes, President of Landmark, Inc., 
appellant-defendant, third-party plaintiff, in support of Landmark, Inc.'s 
motion for summary judgment. These affidavits address other subjects and do not 
even mention lost profits. The appellees-plaintiffs filed responsive affidavits 
which also do not mention lost income or profits. The record contains no other 
evidence or testimony - deposition-affidavit - response to interrogatory or 
other form of factual representation - pertaining to lost profits or income 
which predates the testimony of witnesses elicited at the 
trial.

[¶9.]     Given this state of 
affairs, we are therefore forced to consider the appellant's contention of error 
as though the motion for summary judgment is based only on the pleadings. In this regard, 
the appellees' complaint alleges:

"That by virtue of 
Defendant's breach of contract in its failure to complete the project on time 
and to conform to the plans and specifications as agreed, the Plaintiffs have 
suffered damages by reason of the additional expenses, interest and costs for 
the project, and for lost income in a sum in excess of One Hundred Fifty 
Thousand Dollars ($150,000.00),"

in response to 
which the appellant Landmark, Inc. makes a general denial. No other mention of 
lost profits or income is contained in the pleadings.

[¶10.]  The relevant aspects of Rule 56, W.R.C.P. 
provide:

"Summary 
judgment.

* * * * * 
*

"(b) For defending party. - A party against 
whom a claim, counterclaim, or cross-claim is asserted or a declaratory judgment 
is sought may, at any time, move with or without supporting affidavits for a 
summary judgment in his favor as to all or any part 
thereof.

"(c) Motion and proceedings thereon. - * * * 
The adverse party prior to the day of hearing may serve opposing affidavits. The judgment sought shall be rendered 
forthwith if the pleadings, 
depositions, answers to interrogatories, and admissions on file, together with 
the affidavits, if any, show that there 
is no genuine issue as to any material fact and that the moving party is 
entitled to a judgment as a matter of law." (Emphasis 
added.)

[¶11.]  The ultimate question for our decision on 
this issue is this:

Can we say, given the 
nature of the case, that an allegation of loss of profits countered by a 
pleading denial is sufficient substructure to support a summary judgment for the 
party entering the denial?

[¶12.]  A Rule 56 summary judgment has been 
described as an appropriate procedural device for the disposition of cases where 
there exists no question of material fact and only questions of law are 
involved. Carter v. Davison, Wyo., 
359 P.2d 990, 994 (1961), quoting from Pen-Ken Gas & Oil Corporation v. 
Warfield Natural Gas Co., 137 F.2d 871, 877 (6 Cir. 1943), cert. denied 320 U.S. 800, 64 S. Ct. 431, 88 L. Ed. 483.

[¶13.]  In Carter v. Davison, supra, a 
malicious-prosecution action, it was shown that the defendant in the underlying 
criminal case had waived his preliminary hearing and was ultimately found not 
guilty. The defendant in the malicious-prosecution case, who had been the 
complaining witness in the criminal prosecution, moved for summary judgment on 
the pleadings on the grounds that he had made out a prima facie case of probable 
cause in the criminal case according to the law pertaining to such matters. It 
was the movant's contention that, if he were right in this as a matter of law, 
it would then be impossible to elicit such facts as would structure a question 
of material fact and, therefore, summary judgment was appropriate. In this case 
we held that a motion for summary judgment "may be made wholly on the 
pleadings," 359 P.2d  at 994, citing Reynolds v. Needle, 77 U.S.App.D.C. 53, 
132 F.2d 161 (1942), and 6 Moore's Federal Practice, 2d ed., p. 
2063.

[¶14.]  In Reynolds, supra, it was apparent upon 
the face of the pleading that the statute of limitations had run and it was held 
that summary judgment was therefore appropriate without presentation of 
supporting evidence.

[¶15.]  In Moore's Federal Practice, supra, the author 
observes that, while a motion for summary judgment may be based solely upon the 
pleadings, it is then

"* * * functionally 
equivalent to a motion to dismiss for failure to state a claim under Rule 
12(b)(6) or a motion for judgment under Rule 12(c)."1

 

[¶16.]  We have followed this concept in Wyoming, 
when we recently said in Lafferty v. 
Nickel, Wyo., 663 P.2d 168, 169 (1983):

"In this case appellees 
based their motion for summary judgment on the pleadings without providing any 
other competent evidence to support the motion. In this posture appellees' 
motion for summary judgment is equivalent to either a motion to dismiss for 
failure to state a claim upon which relief can be granted made pursuant to Rule 
12(b)(6), W.R.C.P., or a motion for a judgment on the pleadings made pursuant to 
Rule 12(c), W.R.C.P. Schwartz v. 
Compagnie General Transatlantique, 405 F.2d 270, 273 (2nd Cir. 1968); United States v. Mills, 372 F.2d 693, 
696 (10th Cir. 1966); Parker v. De Kalb 
Chrysler Plymouth, 459 F. Supp. 184, 187 (D.C.Ga. 1978), aff'd 673 F.2d 1178 
(11th Cir. 1982); 6 Moore's Federal Practice, ¶¶ 56.02[3], pp. 56-29, 56.11[3], 
p. 56-229. Therefore, for the purpose of this appeal the facts alleged in the 
complaint are deemed admitted and the allegations contained therein are viewed 
in a light most favorable to the appellant. Moxley v. Laramie Builders, Inc., Wyo., 
600 P.2d 733, 734 (1979); State Highway 
Commission v. Bourne, Wyo., 425 P.2d 59, 63 (1967)."

[¶17.]  Applying this rule to the case at bar, 
the appellees having alleged that they have

"* * * suffered damages 
by reason of * * * lost income in a sum in excess of One Hundred and Fifty 
Thousand Dollars ($150,000.00),"

and the 
appellant movant having simply denied the allegation, and it being our 
obligation, for summary-judgment purposes, to treat the facts alleged in the 
complaint as though they are admitted, we conclude that the appellant has failed 
to establish that a genuine issue of material fact does not exist2 - and thus denial of summary 
judgment must be affirmed insofar as the first issue raised by the appellant is 
concerned.

Issue No. 
2

Lost Profits and/or 
Income

[¶18.]  The appellant argues that the trial court 
erred in failing to direct a verdict on the issue of lost profits. This asks us 
to decide whether the record contains sufficient evidence to sustain a verdict 
and judgment on lost income and profits.

[¶19.]  The work commenced at the end of 
November, 1981 and the evidence favorable to the appellees is that the first 
phase containing 22 spaces would be completed in 90 days and the second phase, 
which contemplated an additional 20 spaces, would be completed in the spring of 
1982. Landmark, Inc. never did complete the job and appellees were forced to 
hire others to do it.

[¶20.]  The appellees claim loss of income and 
profit from the date Landmark, Inc. agreed to complete the project, to the time 
when it actually was completed by others. The exhibits and testimony of the 
appellees' witnesses undertake to substantiate lost income for Phase I in the 
sum of $35,190 and for Phase II in the amount of $26,400 for a total of $61,590. 
The lost-income figure found by the jury is $40,500.

[¶21.]  We find the evidence sufficient to 
support this verdict.

[¶22.]  At the outset, the rule of Champion Ventures, Inc. v. Dunn, Wyo., 
593 P.2d 832, 835 (1979), comes to mind, where we said:

"Where there cannot be a 
fixed amount of damages, triers-of-fact must of necessity be given broad 
discretion in deciding what award is fair and just. Chittim v. Armco Steel Corporation, 
Wyo., 407 P.2d 1015, 1018 (1965)."

[¶23.]  Since damages such as those with which we 
are here concerned cannot be calculated with certainty, they should nevertheless 
be ascertained 

"* * * if there is 
evidence from which a reasonable estimate of money damages may be made that is 
sufficient, the primary objective being to determine the amount of loss, 
applying whatever rule is best suited for that purpose." Douglas Reservoirs Water Users Association 
v. Cross, Wyo., 569 P.2d 1280, 1284 (1977).

[¶24.]  In Wyoming Bancorporation v. Bonham, Wyo., 
563 P.2d 1382, 1385, reh. denied 566 P.2d 219 (1979), we held that lost profits 
will not be denied merely because a business is new, providing sufficient data 
is available and in evidence and which evidence furnishes a basis for 
computation of "probable loss of profits." Therefore, we have adopted a 
"reasonable certainty" test where new business lost-profit proof is in issue. 
See: S. Jon Kreedman & Co. v. Meyers 
Bros. Parking - Western Corporation, 58 Cal. App. 3d 173, 130 Cal. Rptr. 41 
(1976); Vickers v. Wichita State 
University, Wichita, 213 Kan. 614, 518 P.2d 512 (1974); and Smith Development Corporation v. Bilow 
Enterprises, Inc., 112 R.I. 203, 308 A.2d 477 (1973). We reaffirmed the 
rules of Wyoming Bancorporation in Albin Elevator Company v. Pavlica, Wyo., 
649 P.2d 187 (1982), when we said:

"* * * However, the rule 
allowing recovery for lost profits requires that the plaintiff prove such loss 
with a reasonable degree of certainty through use of the best evidence 
available." 649 P.2d  at 191, citing Wyoming Bancorporation v. Bonham, supra; 
R.E.B., Inc. v. Ralston Purina 
Company, 525 F.2d 749 (10th Cir. 1975); and Lundgren v. Whitney's, Inc., 94 Wn.2d 91, 614 P.2d 1272 (1980).

[¶25.]  We went on to hold, in Bancorporation v. Bonham, supra, that 
the establishment of lost profits "with reasonable certainty" depends upon the 
facts of each case. See Notes: The Requirement of Certainty in the Proof of Lost 
Profits, 64 Harvard L.Rev. 317, 319 (1950). The best proof available should be 
furnished, Vickers v. Wichita State 
University, Wichita, supra; McCormick Law of Damages, § 29 (1935), but 
absolute certainty with respect to proving loss of future profits is not 
required. Smith Development Corporation 
v. Bilow Enterprises, Inc., supra; 22 Am.Jur.2d, Damages § 
172.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

[¶26.]  In this case, what was designated as 
plaintiffs' Exhibit 62 reads as follows:

"Rutger Mobile Home Park 
I

 
 


 
 
 
 
Lot

#

 
 
 
 
Gross

Rental

 
 
Average

Mo. 
      Cost

When 
      Rented

 
 
 
 
Net

Rental

4/1/82-

5/1/83

Months

Unoccupied

 
 
Lost

Income

thru 
      5/1/83

1

350.00

75.00

275.00

12

3300.00

2

450.00

100.00

350.00

13

4550.00

3

450.00

100.00

350.00

11

3850.00

4

450.00

100.00

350.00

3

1050.00

5

450.00

100.00

350.00

0

-0-

6

150.00

30.00

120.00

6

720.00

7

150.00

30.00

120.00

13

1560.00

8

150.00

30.00

120.00

13

1560.00

9

150.00

30.00

120.00

13

1560.00

10

150.00

30.00

120.00

13

1560.00

11

150.00

30.00

120.00

13

1560.00

12

150.00

30.00

120.00

9

1560.00

13

150.00

30.00

120.00

13

1560.00

14

150.00

30.00

120.00

13

1560.00

15

150.00

30.00

120.00

13 
      

1560.00

16

150.00

30.00

120.00

13

1560.00

17

150.00

30.00

120.00

6

720.00

18

150.00

30.00

120.00

10

1200.00

19

150.00

30.00

120.00

9

1080.00

20

150.00

30.00

120.00

13

1560.00

21

150.00

30.00

120.00

13

1560.00

22

150.00

30.00

120.00

4

480.00

 
 
 
 
 
 
 
 
 
 
35.190.00

 
 
"Phase 
II

 
 
"20 lots net rental 
$120.00 per lot 

July 12, 1982 thru May, 
1983, 11 months to date 

$120 X 11 = $1320 loss 
per lot to date 

$1320 X 20 = $26,400 lost 
income to date 20 spaces"

[¶27.]  Plaintiffs' Exhibit 62 portrays net 
income figures for all of the lots in Phase I. It shows the gross rental and 
average monthly cost of each lot's utilities with a resulting net figure. In 
addition, the exhibit shows the months during which each lot was unoccupied with 
a consequent lost-income figure for each lot, and, finally, a total lost-income 
figure for all lots in Phases I and II.

[¶28.]  In support of this exhibit, various 
witnesses testified to the proposed rental figures based on experience in the 
area under the same or reasonably similar circumstances. There was testimony of 
a probable expectancy that the spaces would have been rented during the time 
frame in question, had the spaces in fact been available. The cost factors were 
based upon the experience of the appellee Mrs. Ruger, who testified to seven 
years in the business in the area.

[¶29.]  Given this evidence, we find that the 
Wyoming Bancorporation and Albin Elevator Company rules for proof of loss of 
profits in a new business have been complied with. The verdict was well within 
the range of the proof and that is all that is required. Panhandle Eastern Pipe Line Company v. 
Smith, Wyo., 637 P.2d 1020, 1027 (1981).

Issue No. 
3

Damages for the Repair 
and Replacement of the Water and Sewer System

[¶30.]  The question raised by Issue No. 3 is 
whether or not the record contains sufficient evidence to sustain the jury's 
verdict and court's judgment of $89,500 for necessary repairs and replacement of 
the water and sewer system. Preliminarily, it should be noted that the appellant 
does not question whether or not there was a breach of the contract by the 
appellant or that the appellees were damaged thereby.

[¶31.]  In Zitterkopf v. Roussalis, Wyo., 546 P.2d 436, 438 (1976) we held that the general measure of damages for breach of 
contract is that amount which will compensate the damaged party for the loss 
which the full performance of the contract would have prevented or the breach of 
it has entailed, citing Woodburn Brothers 
v. Erickson, 97 U.S.App.D.C. 227, 230 F.2d 240 (10 Cir. 1956); McBain v. Pratt, Alas., 514 P.2d 823, 65 
A.L.R.3d 621 (1973); Taylor v. Colorado 
State Bank of Denver, 165 Colo. 576, 440 P.2d 772 (1968); Steel v. Eagle, 207 Kan. 146, 483 P.2d 1063 (1971); Prier v. Refrigeration 
Engineering Company, 74 Wn.2d 25, 442 P.2d 621 (1968); 25 C.J.S. Damages § 
74, p. 843; 22 Am.Jur.2d, Damages § 47, p. 74. To the same effect, see Reynolds v. Tice, Wyo., 595 P.2d 1318 
(1979).

[¶32.]  In the case at bar, we conclude that the 
evidence is sufficient for the jury to find that the water and sewer system 
installed by the appellant-defendant had to be repaired and replaced. The 
appellees-plaintiffs introduced repair billings which totaled $20,775.76. There 
was testimony of one of the appellees to the effect that additional work would 
have to be done on a gas line, which repair would total $1,800, and that pumps 
in the water system would have to be repaired or replaced, the cost of which 
would be $3,000. There was testimony stating the cost of repairing and redoing 
the septic system would be $63,900. Testimony was also elicited to the effect 
that the water system as installed was not of the same quality as that designed 
and to correct this everything from the curb stop should be replaced. The bid 
sheet [plaintiffs' Exhibit 61] establishes the cost of the materials necessary 
to make the repairs from the corporation stop to the curb stop to be: copper 
pipe, $150; corporation stops, $190; curb stops, $276, exclusive of the cost of 
PVC pipe between the corporation and curb stops. There was no testimony as to 
the labor costs involved. The total of these sums is 
$90,091.76.

[¶33.]  We therefore find that there is 
sufficient evidence to support the jury's verdict and the court's judgment 
entered thereon.

[¶34.]  Affirmed.

FOOTNOTES

1 Rule 12(b)(6), W.R.C.P. 
provides that the responsive pleading shall contain all defenses to a claim for 
relief except that certain defenses may be made by motion, including a motion 
that the pleading fails "to state a claim upon which relief can be granted." 
Rule 12(c), W.R.C.P. provides:

"Motion for judgment on the pleadings. - 
After the pleadings are closed but within such time as not to delay the trial, 
any party may move for judgment on the pleadings. If, on a motion for judgment 
on the pleadings, matters outside the pleadings are presented to and not 
excluded by the court, the motion shall be treated as one for summary judgment 
and disposed of as provided in Rule 56, and all parties shall be given 
reasonable opportunity to present all material made pertinent to such a motion 
by Rule 56."

2 Under Rule 56, W.R.C.P., 
the burden of showing the absence of a genuine issue of material fact is upon 
the movant. Gill v. Schaap, Wyo., 601 P.2d 545 (1979); Miller v. Reiman-Wuerth 
Company, Wyo., 598 P.2d 20 (1979); Cantonwine v. Fehling, Wyo., 582 P.2d 592 (1978); Timmons v. Reed, 
Wyo., 569 P.2d 112 (1977); Seay v. Vialpando, Wyo., 
567 P.2d 285 (1977).