Title: Kemper Architects, P.C. v. McFall, Konkel & Kimball Consulting Engineers, Inc.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Kemper Architects, P.C. v. McFall, Konkel & Kimball Consulting Engineers, Inc.1992 WY 179843 P.2d 1178Case Number: 91-231Decided: 12/18/1992Supreme Court of Wyoming
KEMPER ARCHITECTS, P.C., 
a Wyoming Corporation, Appellant (Defendant),

 
 
v.

 
 
McFALL, KONKEL & 
KIMBALL CONSULTING ENGINEERS, INC., a Colorado Corporation doing business in 
Wyoming, 
Appellee (Plaintiff).

 
 
Appeal from District 
Court, LaramieCounty, Nicholas G. 
Kalokathis, J.

 
 
Jane A. Villemez and 
Charles E. Graves of Graves, Santini & Villemez, Cheyenne, for 
appellant (defendant).

 
 
William H. Knapp and 
Byrum C. Lee, Jr. of Knapp, Lee and Cardi, P.C., Denver, CO, for appellee 
(plaintiff).

 
 
Before MACY, C.J., 
THOMAS, CARDINE and GOLDEN, JJ., and PRICE, District Judge. 

 
 

PRICE, District 
Judge.

 
 

[¶1.]     In this appeal, we are 
asked to examine the standard of performance to be applied in an action for 
implied contractual indemnity. The issue concerns professional engineering 
services supplied under the terms of an oral contract between the engineer and 
the architect. The architect appeals what it terms the improper application of 
tort standards to a breach-of-contract action. Additionally, the architect 
challenges several evidentiary rulings dealing with the hearsay exception for 
public records, redactions, and expert testimony. Finding the instructions 
adequately advised the jury and finding no abuse of discretion in the 
evidentiary rulings, we affirm.

 
 

[¶2.]     The architect frames 
these issues for this Court's consideration:

 
 
     1. Whether the trial 
court erred in applying tort standards to this suit by the architect against its 
subcontractor for implied contractual indemnity.

 
 
     2. Whether the trial court's improper 
exclusion of evidence prejudiced the architect's ability to prove breach of 
contract by its subcontractor.

 
 
A. Official records of 
the U.S. Army Corps of Engineers were admissible under the public records 
exception to the hearsay rule.

 
 
B. References to the 
subcontractor's wrongful conduct should not have been redacted from admitted 
records.

 
 
C. Testimony of the 
subcontractor's wrongful conduct, offered through a witness with first-hand 
knowledge, was admissible as lay opinion testimony.

 
 

[¶3.]     The engineer 
rephrases:

 
 
     1. The trial court 
applied the appropriate standards by which [the architect] was required to 
establish its claim against [the engineer] for implied contractual 
indemnity.

 
 
     2. The evidentiary 
rulings by the trial court were proper.

 
 
A. The trial court 
properly excluded [the architect's] proposed Exhibits A and L-1 based on their 
lack of trustworthiness.

 
 
B. The redactions of 
portions of Exhibits L(2) and M were an appropriate exercise of the trial 
court's discretion.

 
 
C. The trial court 
properly excluded expert opinion testimony from Laurence Seeba because he failed 
to qualify as an expert under W.R.E. 702.

 
 
I. 
Facts

 
 

[¶4.]     McFall, Konkel & 
Kimball Consulting Engineers, Inc. (the engineer) designed a building's heating, 
ventilation, and air conditioning system (the system), which is the focus of 
this litigation. As a specialist in mechanical systems designs, the engineer 
performed the work under an oral subcontract with Kemper Architects, P.C. (the 
architect). The architect incorporated the variable air volume system into the 
architectural plans for a training and instructional facility built for the 
United States Army Corps of Engineers at F.E. Warren Air Force Base in 
Cheyenne, Wyoming.

 
 

[¶5.]     As constructed, the 
system could not be "balanced" to provide the appropriate volume and air flow; 
consequently, the system failed to meet specifications. The project's prime 
contractor spent approximately $135,000 in converting the system to a constant 
volume design which corrected the deficiencies. The Corps of Engineers notified 
the architect that it would be liable for the additional 
cost.

 
 

[¶6.]     During the subsequent 
federal administrative process of assessing damages, the engineer offered to 
provide legal counsel and expert witnesses for the architect. This offer never 
resulted in a final written agreement for representation or for indemnification. 
However, on February 1, 1990, during the period of indemnification-agreement 
negotiations, the engineer filed an appeal on the architect's behalf with the 
Armed Services Board of Contract Appeals.

 
 

[¶7.]     Concurrently, the 
architect withheld payment of approximately $45,000 in fees it owed to the 
engineer. On May 14, 1990, the engineer reacted by filing this action, seeking 
payment. The architect answered and counterclaimed for indemnification. As a 
result, the engineer withdrew the legal representation it had provided for the 
architect before the Board of Contract Appeals. Eventually, the architect paid 
$37,000 in damages in an agreed settlement of the government's claim, 
terminating the Board of Contract Appeals action.

 
 

[¶8.]     Meanwhile, before the 
trial in the state proceeding, the district court granted a partial summary 
judgment in favor of the engineer, ordering the architect to pay a portion of 
the withheld engineering fees. At trial, the jury considered the remaining fee 
disputes and the counterclaim. The jury awarded the engineer its request of 
$8,627.60 for unpaid fees not covered by the partial summary judgment and found 
that the engineer had no duty to indemnify the architect. The architect appeals 
only the denial of indemnification.

 
 
II. 
Discussion

 
 
A. Negligence and the 
Standard of Performance

 
 

[¶9.]     The architect maintains 
that the trial court committed reversible error by instructing the jury to apply 
a negligence standard to the engineer's performance. Two jury instructions are 
at issue:

 
 
INSTRUCTION NO. 
6

 
 
     Under the theory of 
implied indemnity, [the architect] must prove by a preponderance of the evidence 
that [the engineer] produced a design which was due to [its] negligence and 
which caused [the architect] to suffer damages as a result of such 
design.

 
 
INSTRUCTION NO. 
7

 
 
     In regard to the 
implied indemnity theory you are instructed that [in] performing professional 
services for a client, an engineer has the duty to have that degree of learning 
and skill ordinarily possessed by reputable engineers.

 
 
     It is his further duty 
to use reasonable diligence and his best judgment in the exercise of his 
professional skill and in the application of his learning, in an effort to 
accomplish the purpose for which he was employed.

 
 
     A failure to perform 
any such duty is negligence.

 
 
     The degree of care, 
skill and judgment which is usually exercised by an engineer is not a matter 
within the common knowledge of jurors or lay persons. These standards are within 
the special knowledge of experts in the field of engineering and can only be 
established by their testimony. You may not speculate or guess what those 
standards of care, skill and judgment are but must attempt to determine[] this 
from the testimony of legal experts called for that 
purpose.

 
 

[¶10.]  On review, this Court considers whether 
the instructions, taken as a whole, adequately and clearly advise the jury of 
the applicable law. L.U. Sheep Company v. Board of County Commissioners of 
County of Hot Springs, 790 P.2d 663, 672 (Wyo. 1990). Reversible error from an 
improper instruction requires a showing on the record that substantial rights 
were affected. Condict v. Whitehead, Zunker, Gage, Davidson & Shotwell, 
P.C., 743 P.2d 880, 885 (Wyo. 1987). Sufficient prejudice arises from a 
demonstration that the instruction confused or misled the jury with respect to 
the proper principles of law. DeJulio v. Foster, 715 P.2d 182, 186 (Wyo. 1986). A number of 
factors may be considered in measuring the degree of prejudicial error, 
including:

 
 
"(1) the extent to which 
there is conflict in the evidence on critical issues; (2) whether or not the 
respondent's argument to the jury may have contributed to the instruction's 
misleading effect; (3) whether or not the jury requested a re-reading of the 
erroneous instruction or of related evidence; (4) the closeness of the jury's 
verdict; and (5) the effect of other instructions in curing the 
error."

 
 
Condict, 743 P.2d  at 886 
(quoting 1 California Forms of Jury Instruction, Procedures and Instructions § 
1.13[3] (1987) (footnotes omitted)).

 
 

[¶11.]  Initially, the engineer contends that the 
architect's objections to Instruction Nos. 6 and 7 were procedurally inadequate 
since the architect did not supplement its oral objections with proposed 
alternative written instructions. In support of its argument, the engineer 
relies upon Runnion v. Kitts, 531 P.2d 1307 (Wyo. 1975), Texas Gulf Sulphur Company v. Robles, 511 P.2d 963 (Wyo. 1973), and Logan v. Pacific Intermountain Express Company, 400 P.2d 488 (Wyo. 
1965). While this Court has previously stated that waiver occurs when a litigant 
orally objects to the form or language of a jury instruction without submitting 
a proposed alternative written instruction, we have been less than consistent in 
our application of the alleged rule. See, e.g., Davis v. Consolidated Oil & 
Gas, Inc., 802 P.2d 840 (Wyo. 1990); City of Cheyenne v. Simpson, 787 P.2d 580 
(Wyo. 1990); TG v. Department of Public Assistance and Social Services, Sheridan 
(In re CH), 783 P.2d 155 (Wyo. 1989); Hashimoto v. Marathon Pipe Line Co., 767 P.2d 158 (Wyo. 1989); Condict, 743 P.2d 880; Haley v. Dreesen, 532 P.2d 399 
(Wyo. 1975); Runnion, 531 P.2d 1307; Texas Gulf Sulphur Company, 511 P.2d 963; 
and Logan, 400 P.2d 488.

 
 

[¶12.]  W.R.C.P. 511 provided in pertinent part: "No 
party may assign as error the giving or the failure to give an instruction 
unless he objects thereto before the jury retires to consider its verdict, 
stating distinctly the matter to which he objects and the grounds of his 
objection." The purpose of W.R.C.P. 51 is to require litigants to timely inform 
the trial judge of contended errors in the jury instructions so that corrections 
or modifications may be made, if necessary. Davis, 802 P.2d  at 843; Story v. State, 721 P.2d 1020, 1045 
(Wyo.), cert. 
denied, 479 U.S. 962, 107 S. Ct. 459, 93 L. Ed. 2d 405 (1986). Consistent with the 
plain language and purpose of W.R.C.P. 51, we now clarify that "[a]n objection 
stating distinctly the objectionable matter and the grounds for objection is 
sufficient" to preserve a jury instruction issue for appeal. 9 CHARLES ALAN 
WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 2553 at 643 
(1971). We acknowledge, however, that supplementation of an oral objection with 
proposed alternative jury instructions is the "better practice," and we strongly 
encourage such procedure. Id. at 635. Upon a review of the record, we 
are satisfied that the architect lodged sufficient objections to Instruction 
Nos. 6 and 7 for this Court to consider its arguments.

 
 

[¶13.]  The core of the controversy between the 
parties required the determination of whether it was the architect or the 
engineer who assumed the ultimate responsibility for the system's failure. The 
"first instance" responsibility to the original claimant, the Corps of 
Engineers, was resolved by the architect's settlement agreement and payment. 
JUSTIN SWEET, LEGAL ASPECTS OF ARCHITECTURE, ENGINEERING, AND THE CONSTRUCTION 
PROCESS § 36.01 (3d ed. 1985). Indemnity derives from an express or implied 
contract and enforces one party's duty to respond for all the damages. Wyoming 
Bank and Trust Company v. Waugh, 606 P.2d 725, 730 (Wyo. 1980). Because no 
express indemnity agreement existed between the parties, the doctrine of implied 
contractual indemnity must supply the means to determine the ultimate 
responsibility. Richardson Associates v. 
Lincoln-DeVore, Inc., 806 P.2d 790, 811 (Wyo. 1991). A cause of action for implied 
contractual indemnity arises "when there is a relationship between the party 
seeking indemnity and the party against whom indemnity is sought, such that the 
latter owes an independent duty to the former." Vickery v. Reliable Electric 
Company, 703 F.2d 488, 491 (10th Cir. 1983) (citing Pan American Petroleum 
Corporation v. Maddux Well Service, 586 P.2d 1220, 1224 (Wyo. 
1978)).

 
 

[¶14.]  The instruction dispute requires a 
determination of whether the trial court properly utilized a negligence standard 
to determine the engineer's underlying responsibility. A case which remains 
instructive is Miller v. New York Oil Company, 34 Wyo. 272, 243 P. 118 
(1926). Miller owned an apartment house in Casper, Wyoming. The personal representative of a 
tenant who was asphyxiated from carbon dioxide poisoning in one of the 
apartment's bathrooms successfully sued Miller for negligence. The suit claimed 
Miller knew that a gas water heater had been improperly installed and 
negligently failed to warn or correct the condition. While an appeal was 
pending, Miller agreed to a settlement. Afterward, Miller filed an action for 
indemnity against the company with which he had contracted to install the water 
heater, New York Oil Company. This Court defined New York Oil Company's duty to 
Miller as requiring the exercise of ordinary or due care, and Miller was 
required to prove that duty had not been performed. 34 Wyo. at 279, 243 P. 118. 
The Court ruled, under a sufficiency-of-the-evidence standard, that Miller 
established New York Oil Company's failure to exercise due care. 34 Wyo. at 282, 243 P. 118. 
New York Oil Company protested that indemnity should not be allowed since Miller 
"was adjudged guilty of negligence" in the suit by the deceased tenant's 
personal administrator. 34 Wyo. at 284, 243 P. 118. The Court held that 
Miller's liability in the first action "grew out of a non-delegable duty he owed 
the deceased." Id. Because Miller's negligence was 
constructive or secondary, he could still recover indemnity from New York Oil 
Company, the primarily negligent party, since its wrongful acts exposed Miller 
to liability. 34 Wyo. at 283-84, 243 P. 118.

 
 

[¶15.]  In Miller, the court cited an equitable 
implied indemnity rule that between parties indemnity was 
available,

 
 
"where one does the act 
or creates the nuisance, and the other does not join therein, but is merely 
exposed to liability and suffers damage. He may recover from the party whose 
wrongful act has thus exposed him. In such case the parties are not in pari 
delicto as to each other, though as to third persons either may be held 
liable."

 
 
34 Wyo. at 283, 243 P. 118 (quoting Gray v. Boston Gas Light 
Co., 19 Am.Rep. 324 (Mass. 1873)).

 
 

[¶16.]  The modern statement of indemnity is 
contained in the RESTATEMENT OF RESTITUTION:

 
 
     A person who, in whole 
or in part, has discharged a duty which is owed by him but which as between 
himself and another should have been discharged by the other, is entitled to 
indemnity from the other, unless the payor is barred by the wrongful nature of 
his conduct.

 
 
RESTATEMENT OF 
RESTITUTION § 76 at 331 (1937). The rule applies to contractual or 
quasi-contractual duties as well as a duty to pay created by a tort. Id. at cmt. b. An 
essential principle of implied contractual indemnity states that the party 
seeking indemnity must be without active fault on his part. Wyoming Johnson, 
Inc. v. Stag Industries, Inc., 662 P.2d 96, 102 (Wyo. 1983) (quoting Eazor 
Express, Inc. v. Barkley, 441 Pa. 429, 272 A.2d 893 (1971)); Chirco Construction 
Company, Inc. v. Stewart Title and Trust of Tucson, 129 Ariz. 187, 189, 629 P.2d 1023, 1025 (Ct.App. 1981); 42 C.J.S. Indemnity § 32 
(1991).

 
 

[¶17.]  Owings v. Rose, 262 Or. 247, 497 P.2d 1183 (1972), illustrates an implied contractual-indemnity cause of action 
brought by a group of architects against a structural engineering firm under the 
RESTATEMENT OF RESTITUTION. The architects contracted with the engineers to 
design a "superior floor" for a manufacturing plant but, following the 
completion of construction, the concrete floor cracked and eroded. Owings, 497 P.2d  at 1185. After settling a lawsuit brought by the plant's owner, the 
architects sued the engineers for indemnity. The court required proof that (1) 
the party seeking indemnity had discharged a legal obligation or duty owed to a 
third party; (2) the party against whom indemnification was sought was also 
liable to the third party; and (3) as between the two parties, the obligation 
should be discharged by the party against whom indemnification was sought. 
Id. Applying 
these standards, the Oregon Supreme Court affirmed the jury's verdict that the 
engineers' negligence in their flooring design required them to indemnify the 
architects. Id. at 1186-88.

 
 

[¶18.]  The architect in this case misreads its 
own authority in arguing that it was "severely prejudiced" by the challenged 
instructions. The architect says that the factually similar case of Hill v. 
George Engine Company, 190 F. Supp. 417 (E.D.La. 1961), should govern. However, 
a careful reading of Hill reveals that the implied contractual duty owed was 
breached by the negligent installation of an engine component. Hill owned a 
tugboat, the M.V. Waw Hoss, which towed barges through a series of Louisiana locks. During 
one trip, the tugboat's drive system failed to reverse, and a barge it was 
towing struck and damaged a lock gate. The drive system failed because a small 
bolt and nut had vibrated loose. Hill settled a damage claim with the Corps of 
Engineers and sued the George Engine Company, the company which installed the 
drive system, for indemnification. While no express indemnification agreement 
existed between the parties, the court found that the George Engine Company's 
implied-contractual-indemnity duty was to properly perform the work and services 
and "hold Hill harmless from any foreseeable damages resulting from improper 
performance." Hill, 190 F. Supp.  at 420. The court ruled that the George Engine 
Company negligently installed the drive system and failed to perform its 
agreement properly, competently, and safely. Id. Instruction No. 6 was fully in 
accord with this precedent.

 
 

[¶19.]  While the language of Instruction No. 6 
represented an inelegantly phrased statement of the law, the instruction 
correctly required the architect to prove that the engineer was negligent in 
discharging its contractual duty to design the system. In its answer and 
counterclaim, the architect understood that, despite the contractual origin of 
the indemnity action, the engineer's underlying negligence was at issue. The 
architect averred that the engineer's "negligence is the direct and proximate 
cause" of the Corps of Engineers' claim and that the engineer was "entirely 
responsible" for the financial settlement the architect paid. The architect's 
action retained its character as being one for a breach of contract despite the 
fact that recovery turned upon the engineer's standard of performance. 
Weyerhaeuser Steamship Co. v. Nacirema Operating Co., 355 U.S. 563, 569, 78 S. Ct. 438, 442, 2 L. Ed. 2d 491 (1958); Ryan Stevedoring Co. v. Pan-Atlantic 
Steamship Corporation, 350 U.S. 124, 134, 76 S. Ct. 232, 100 L. Ed. 133 
(1956).

 
 

[¶20.]  Instruction No. 7 stated a standard of 
performance for an engineer performing a professional service. The architect 
challenges the standard-of-performance instruction, arguing that its burden was 
to prove that the engineer breached its contractual duty, not that a standard of 
care for professional engineers was violated. The architect's argument misstates 
the applicable law.

 
 

[¶21.]  The distinction between a contract action 
and a tort action is that the breach of contract is the failure to perform a 
duty expressly stated or implied by the terms of the agreement, whereas a tort 
is the violation of a duty which is imposed by law. Tamarac Development Company, 
Inc. v. Delamater, Freund & Associates, P.A., 234 Kan. 618, 675 P.2d 361, 
363 (1984). The applicable standard of performance for the engineer was that 
which arose or was implied by the contract with the architect. Resolving the 
question of whether Instruction No. 7 stated an appropriate standard of 
performance requires an analysis of the duty imposed by the oral agreement 
between the architect and the engineer to design the 
system.

 
 

[¶22.]  The traditional formulation of a 
professional's standard of performance directs: "An engineer's duty is to 
exercise such care, skill, and diligence as people engaged in the engineering 
profession ordinarily exercise under like circumstances." JAMES ACRET, 
ARCHITECTS & ENGINEERS § 1.08 at 12 (2d ed. 1984). This standard of 
performance is imposed by law in tort actions for negligence. Weston v. New 
Bethel Missionary Baptist Church, 23 Wn. App. 747, 598 P.2d 411, 414 (1978) 
(stating the rule that an engineer is guilty of negligence if he fails to apply 
the skill and learning which is required of similarly situated engineers). We 
recognize that the contracting parties may agree to a standard of performance 
which is greater than the typical "skill usually exercised by others of its 
profession" standard. See, e.g., Town of Winnsboro v. Barnard & Burk, Inc., 294 So. 2d 867, 877-78 (La. Ct. App. 1974) (en banc). In this action, however, no 
express contract terms existed which varied the standard of performance. 
Richardson 
Associates, 806 P.2d  at 811.

 
 

[¶23.]  The oral agreement between the architect 
and the engineer called for a system design. Our task is to consider what 
standard of performance is implied by such an agreement. The architect argues 
that the engineer impliedly "agreed to provide a workable system useful to the 
Corps and to hold [the architect] harmless for damages incurred when the 
designed system would not work." We believe this statement overreaches by 
implying a warranty of fitness for a particular purpose is applicable to 
professional services. The implied warranty of fitness for a particular purpose 
is applicable to contracts for the sale of goods, not for professional services. 
See Wyo. Stat. 
§ 34.1-2-315 (1991).

 
 
An engineer, or any other 
so-called professional, does not "warrant" his service or the tangible evidence 
of his skill to be "merchantable" or "fit for an intended use." These are terms 
uniquely applicable to goods. Rather, in the preparation of design and 
specifications as the basis of construction, the engineer or architect 
"warrants" that he will or has exercised his skill according to a certain 
standard of care, that he acted reasonably and without neglect. Breach of this 
"warranty" occurs if he was negligent. Accordingly, the elements of an action 
for negligence and for breach of the "implied warranty" are the 
same.

 
 
Audlane Lumber & 
Builders Supply, Inc. v. D.E. Britt Associates, Inc., 168 So. 2d 333, 335 
(Fla.Ct.App. 1964), cert. denied, 173 So. 2d 146 (Fla. 1965). The sound policy reason to avoid 
an outcome-oriented standard, such as the one the architect suggests, is that 
the "likely understanding between the client and the professional designer is 
not that a successful outcome will be achieved when professional services are 
purchased but that the professional will perform as would other professionals." 
SWEET, LEGAL ASPECTS OF ARCHITECTURE, ENGINEERING, AND THE CONSTRUCTION PROCESS, 
supra, § 17.07 at 355 (emphasis in original).

 
 

[¶24.]  We find nothing in the agreement between 
the architect and the engineer which would require a variance from the standard 
of performance applicable to professionals. Instead, we believe sound policy 
reasons support the continued vitality of the majority rule limiting liability 
to situations in which the professional is negligent.

 
 
Architects, doctors, 
engineers, attorneys, and others deal in somewhat inexact sciences and are 
continually called upon to exercise their skilled judgment in order to 
anticipate and provide for random factors which are incapable of precise 
measurement. The indeterminate nature of these factors makes it impossible for 
professional service people to gauge them with complete accuracy in every 
instance. Thus, doctors cannot promise that every operation will be successful; 
a lawyer can never be certain that a contract he drafts is without latent 
ambiguity; and an architect cannot be certain that a structural design will 
interact with natural forces as anticipated. Because of the inescapable 
possibility of error which inheres in these services, the law has traditionally 
required, not perfect results, but rather the exercise of that skill and 
judgment which can be reasonably expected from similarly situated 
professionals.

 
 
City of Mounds View v. Walijarvi, 263 N.W.2d 420, 424 (Minn. 
1978).

 
 

[¶25.]  The use of expert witnesses to establish 
the professional standard of performance is consistent with Wyoming law. For example, 
a physician's performance can only be evaluated after expert opinion about the 
standard of care is offered unless the care is so obviously wanting in 
reasonable skill that laymen would discern it. Roybal v. Bell, 778 P.2d 108, 112 (Wyo. 1989); Govin v. Hunter, 374 P.2d 421, 424 (Wyo. 1962). Similarly, 
expert opinion was required to determine if the engineering design submitted by 
the engineer was below the requisite level of professional skill and competence. 
Govin, 374 P.2d  at 422-23. 

 
 

[¶26.]  Instruction No. 7 accurately stated the 
professional standard of performance present in the contract between the 
architect and the engineer. Instruction No. 6 correctly defined a violation of 
that standard as occurring if the engineer was negligent. The question of 
whether indemnity should be allowed or denied on the basis of the engineer's 
breach of that standard or the architect's independent negligence then became a 
question of fact for the jury's determination. Pearson Ford Company v. Ford 
Motor Company, 273 Cal. App. 2d 269, 78 Cal. Rptr. 279, 283 
(1969).

 
 
B. Evidentiary 
Disputes

 
 

[¶27.]  The architect contends that its trial 
presentation suffered substantial prejudice on the basis of a series of 
challenged evidentiary rulings. The standard for appellate review of the trial 
court's evidentiary decisions states:

 
 
[T]he rule is that the 
admissibility of evidence rests within the exercise of discretion by the trial 
court. The rulings of trial courts on these matters are given considerable 
deference and will not be reversed as long as some legitimate basis for the 
ruling is found. The burden is assigned to [the party who originally offered the 
evidence] on appeal to demonstrate an abuse of discretion with respect to the 
refusal to admit evidence that it offered.

 
 
     For these purposes, we 
apply our definition of an abuse of discretion as "an error of law committed by 
the court under the circumstances." We also invoke our definition of an abuse of 
discretion as a situation in which "a court acts in a manner which exceeds the 
bounds of reason under the circumstances."

 
 
Stauffer Chemical Company 
v. Curry, 778 P.2d 1083, 1101 (Wyo. 1989) (citations 
omitted).

 
 

[¶28.]  The architect challenges the trial 
court's refusal to admit two exhibits into evidence. Exhibit A was a letter 
directed to the architect by a Corps of Engineers contracting officer. Exhibit 
L(1) was a compilation of documents, including Exhibit A, which was prepared in 
conjunction with the architect's appeal to the Board of Contract Appeals. The 
architect argues that both documents were admissible as public 
records.

 
 
The following are not 
excluded by the hearsay rule, even though the declarant is available as a 
witness:

 
 
. . . 
.

 
 
     (8) Public records 
and reports. - Records, reports, statements, or data compilations, in any 
form, of public offices or agencies, setting forth . . . (C) in civil actions 
and proceedings and against the state in criminal cases, factual findings 
resulting from an investigation made pursuant to authority granted by law, 
unless the sources of information or other circumstances indicate lack of 
trustworthiness[.]

 
 
W.R.E. 
803(8)(C).

 
 

[¶29.]  The trial court, upon the engineer's 
objection, determined that both exhibits were untrustworthy since they contained 
hearsay statements alleging a design defect in the system. The architect argued 
that the evidence was needed to establish that the Corps of Engineers asserted a 
claim against the architect. However, the court noted that ample evidence was 
present in the record of the claim and that the existence of the claim was 
undisputed by the engineer.

 
 

[¶30.]  The trustworthiness evaluation may be 
conducted by considering a nonexclusive list of four factors: (1) the timeliness 
of the investigation; (2) the investigator's skill or experience; (3) whether a 
hearing was held; and (4) possible bias when reports are prepared with a view to 
possible litigation. Beech Aircraft Corporation v. Rainey, 488 U.S. 153, 109 S. Ct. 439, 102 L. Ed. 2d 445 (1988), on remand, 868 F.2d 1531 (11th Cir. 1989). While the documents 
appear to be timely, we shall consider each one 
individually.

 
 

[¶31.]  Exhibit A was prepared by a deputy chief 
of the Contracting Division of the Department of the Army. It was a letter, 
addressed to the architect, purporting to restate "Findings of Fact" of the 
preparer's investigation of the system. The exhibit contained numerous 
statements attributed to nongovernmental officials. Many statements were 
attributed to various contractors and engineers and quoted from the "Contractor 
Daily Reports." In addition, the exhibit concluded with a statement that the 
architect, as the "AE" on the project, "was negligent in preparing the design 
for the HVAC System and it is liable."

 
 

[¶32.]  The architect placed no evidence before 
the court supporting the trustworthiness of the exhibit by demonstrating the 
investigator's skill or experience or that any hearings were held. Exhibit A 
contained numerous hearsay-within-hearsay statements which each required 
individual exceptions for admission. Seaton v. State of Wyoming 
Highway Commission, District No. 1, 784 P.2d 197, 200 
(Wyo. 1989). 
See also John McShain, Inc. v. Cessna Aircraft Company, 563 F.2d 632, 635-36 (3d 
Cir. 1977). Under W.R.E. 803(8)(C), it remains improper to introduce 
out-of-court statements not made by the investigating government official when 
the purpose is to establish the truth of the matter asserted in the statement. 4 
DAVID W. LOUISELL & CHRISTOPHER B. MUELLER, 
FEDERAL EVIDENCE § 455 (1980 & Supp. 1992).

 
 

[¶33.]  While the architect argues that Exhibit A 
stated "findings" admissible under W.R.E. 803(8)(C), we find reason to disagree. 
A finding states investigative conclusions or opinions; however, the statement 
of legal conclusions, assessing negligence and liability for damages, exceeds 
the limits of a public record admissible under W.R.E. 803(8)(C). Hines v. 
Brandon Steel Decks, Inc., 886 F.2d 299, 302 (11th Cir. 1989), on remand, 754 F. Supp. 199 (M.D.Ga.), aff'd, 948 F.2d 1297 (11th Cir. 1991), cert. denied, ___ 
U.S. ___, 112 S. Ct. 1587, 118 L. Ed. 2d 305 (1992); Beech Aircraft Corporation, 488 U.S.  at 169-70, 
109 S. Ct.  at 450.

 
 

[¶34.]  Exhibit L(1) was a compilation of 
documents, including the letter separately presented as Exhibit A. Other 
documents included portions of various contracts, air conditioning 
specifications, the "Contractor Daily Reports" previously mentioned, and various 
letters from the architect, the engineer, and the Corps of Engineers. Exhibit 
L(1) stated no additional factual findings of the Corps of 
Engineers.

 
 

[¶35.]  Certainly, Exhibit L(1)'s trustworthiness 
was questionable since it was prepared with a view toward possible litigation, 
initially in the form of an administrative appeal. The previously noted 
deficiencies of Exhibit A apply since that exhibit was contained within Exhibit 
L(1). The other documents contained in the compilation included numerous 
hearsay-within-hearsay statements and statements by nongovernmental officials, 
many advancing their own views regarding the system 
problems.

 
 

[¶36.]  The trial court properly excluded Exhibit 
L(1). The exhibit, taken as a whole, failed to state any "factual findings 
resulting from an investigation" by the agency. Under W.R.E. 803(8)(C)'s 
provisions, only findings formally approved and adopted by the agency are 
admissible. 4 LOUISELL & MUELLER, FEDERAL EVIDENCE, supra. The inclusion of 
Exhibit A, the contract officer's letter, did not meet this standard since no 
evidence was offered that the letter represented a finding formally approved and 
adopted by the agency. In substance, Exhibit L(1) represented a compilation of 
staff reports, including Exhibit A, and other preliminary materials. The 
materials, as a compilation, may be considered as being prejudicial, irrelevant, 
cumulative, or of no probative value and, therefore, be excluded. O'Dell v. 
Hercules Incorporated, 904 F.2d 1194 (8th Cir. 1990).

 
 

[¶37.]  The architect failed to meet its burden 
to support the trustworthiness of Exhibit A and Exhibit L(1). We hold that the 
trial court did not abuse its discretion in refusing to admit the 
exhibits.

 
 

[¶38.]  Next, the architect challenges the trial 
court's decision to redact legal conclusions contained in two exhibits offered 
as public records under W.R.E. 803(8)(C). Exhibit L(2), offered by the 
architect, was the stipulated settlement for $37,000 between the architect and 
the Corps of Engineers. The trial court admitted the exhibit but ordered that a 
reference to "deficient design work performed by the mechanical engineering 
firm, McFall, Konkel & Kimball, through Kemper its principal" be redacted. 
The architect's Exhibit M, styled a "Satisfaction of Judgment," stated that the 
architect paid the settlement amount and that the Corps of Engineers released 
any claims against the engineer, "the mechanical subcontractor, arising from its 
negligence in causing the design defect which resulted in the claim against 
Kemper Architects, the architect." The quoted language was 
redacted.

 
 

[¶39.]  We find no abuse of discretion in the 
trial court's action. As previously noted, legal conclusions contained in public 
records are not admissible under W.R.E. 803(8)(C). Additionally, the 
trustworthiness of these two statements may be questioned. Without evidence to 
the contrary, it is quite conceivable, for example, that both documents were 
drafted by one of the parties to the administrative action with an interest in 
including a gratuitous legal conclusion for possible future 
litigation.

 
 

[¶40.]  The architect contends, however, that 
these statements were opinions on ultimate issues which are admissible under 
W.R.E. 704. The record contains no indication that the architect presented this 
argument during trial, and the Supreme Court does not consider issues raised for 
the first time on appeal. Squaw Mountain Cattle Company v. Bowen, 804 P.2d 1292, 
1296 (Wyo. 1991); McCue v. McCue, 776 P.2d 742, 
745 (Wyo. 
1989).

 
 

[¶41.]  Finally, the architect argues that the 
trial court erred in refusing to qualify an expert witness and, subsequently, in 
refusing to admit the witness' lay opinion testimony. Laurence E. Seeba, Jr. was 
a mechanical engineer with the Corps of Engineers at the time of the trial. He 
conducted reviews of construction projects to determine if, using normal 
construction procedures, a project was feasible. When problems developed with 
the system, Seeba reviewed the project's plans and visited the construction 
site. He testified extensively regarding his firsthand factual 
knowledge.

 
 

[¶42.]  The engineer objected, however, when 
Seeba offered his opinion that "the system is not designed as required." The 
trial court ruled that, if he were qualified as an expert, Seeba could offer his 
opinion. During questioning, the engineer's counsel and the architect's counsel 
asked Seeba about his experience with similar system 
designs:

 
 
     Q. [BY THE ENGINEER'S 
COUNSEL] Have you ever designed a system that is comparable to the system that 
was designed by McFall, Konkel, Kimball for the training and instructional 
facility at F.E. Warren Air Force Base?

 
 
     A. No, 
sir.

 
 
     . . . 
.

 
 
     Q. [BY THE ARCHITECT'S 
COUNSEL] Without regard to whether you have designed a system of this 
complexity, have you seen, in your experience with the Corps, the design of that 
complexity on a regular basis?

 
 
     A. No, 
sir.

 
 
 
 

     Q. And is this a 
unique design in that regard?

     A. Yes, 
sir.

 
 
     Q. Is it a design that 
is difficult, more difficult and more complex than any design that you have 
seen?

 
 
     A. Yes, 
sir.

 
 
     Q. And under those 
circumstances, would anybody be considered to be an expert on this particular 
design?

 
 
     A. I could not answer 
that, I don't know. There may be some people qualified.

 
 

[¶43.]  Expert testimony is 
permitted:

 
 
     If scientific, 
technical, or other specialized knowledge will assist the trier of fact to 
understand the evidence or to determine a fact in issue, a witness qualified as 
an expert by knowledge, skill, experience, training, or education, may testify 
thereto in the form of an opinion or otherwise.

 
 
W.R.E. 702. The trial 
court's determination of whether a testifying witness is qualified as an expert 
is a matter of discretion which will not be disturbed on appeal unless it is 
"`clearly and prejudicially erroneous, and then only in extreme cases.'" 
Caterpillar Tractor Company v. Donahue, 674 P.2d 1276, 1286 (Wyo. 1983) (quoting Reed v. Hunter, 663 P.2d 513, 517 
(Wyo. 1983)). 
For a witness to qualify as an expert, a determination must be made that the 
witness has "adequate knowledge, whether acquired by formal education or 
otherwise, and the appropriate experience in any area in which he proposes to 
state an opinion." Stauffer Chemical Company, 778 P.2d  at 1099. See also W.R.E. 
702.

 
 

[¶44.]  We hold that the trial court did not 
abuse its discretion in refusing to permit Seeba to testify as an expert 
witness. Seeba's admitted lack of experience with similar systems limited his 
testimony to information he acquired by personal knowledge. W.R.E. 
602.

 
 

[¶45.]  After Seeba failed to qualify as an 
expert, the architect contended that the trial court improperly denied it the 
opportunity to offer Seeba's testimony as opinion testimony by a lay witness. 
Opinion testimony by lay witnesses is allowed under Wyoming 
law.

 
 
     If the witness is not 
testifying as an expert, his testimony in the form of opinions or inferences is 
limited to those opinions or inferences which are (a) rationally based on the 
perception of the witness and (b) helpful to a clear understanding of his 
testimony or the determination of a fact in issue.

 
 
W.R.E. 701. This Court 
has cautioned that conclusory testimony on hotly contested trial issues may be 
excluded as not being helpful to a determination of the facts in issue. McCabe 
v. R.A. Manning Construction Co., Inc., 674 P.2d 699, 705 (Wyo. 
1983).

 
 

[¶46.]  W.R.E. 701 cannot be read to allow a 
witness who fails to qualify as an expert to offer opinion testimony "where the 
subject in question lies outside the realm of common experience and requires 
special skill or knowledge." 3 DAVID W. 
LOUISELL & CHRISTOPHER B. MUELLER, FEDERAL EVIDENCE § 376 at 419 
(Supp. 1992). Topics demanding special experience, such as the appropriate 
mechanical design for an atypical heating and air conditioning system, require 
that only the testimony of a person possessing that special experience be 
received. Randolph v. Collectramatic, Inc., 590 F.2d 844, 
848 (10th Cir. 1979).

 
 

[¶47.]  Seeba's testimony indicated that the 
complex designs utilized by the engineer were beyond his individual competence 
and knowledge. Any opinions Seeba may have offered regarding possible defects in 
such designs would have been inappropriate under even the most liberal view of 
lay-opinion testimony. United 
States v. Paiva, 892 F.2d 148, 157 (1st Cir. 
1989). We would defeat the helpful purpose of expert witnesses, W.R.E. 702, if 
we were to permit those who fail to qualify to simply restate their opinions as 
lay witnesses, W.R.E. 701. We agree with the trial court that permitting Seeba 
to testify about design deficiencies would not have been 
proper.

 
 
III. 
Conclusion

 
 

[¶48.]  The trial court properly applied a 
negligence standard to the determination of whether the engineer breached its 
standard of care in an action for implied-contractual indemnity. Identifying the 
applicable standard of care required testimony from expert witnesses who were 
familiar with mechanical engineering practices. Additionally, the trial court 
did not abuse its discretion in its evidentiary rulings.

 
 

[¶49.]  Affirmed.

 
 
FOOTNOTES

 
 

1 
Revised effective March 24, 1992.