This opinion is subject to revision before final

p ublication in the Pacific Reporter

20 20 UT 25

IN THE



## S UPREME 

## C OURT OF THE 

## S TATE OF 

## U TAH

G REGORY N. J ONES , Appellant /Cross

- Appellee

,

v.

M ACKEY P RICE T HOMP SON & O STLER , M ACKEY P RICE , LLC,

R ANDALL A. M ACKEY , and G IFFORD W. P RICE ,

Appellees /Cross

- Appellants

.

No. 201 70604 Heard October 4, 2019
Filed May 14, 2020

On Direct Appeal

Third District, Salt Lake County
The Honorable Richard D. McKelvie

No. 060911956

Attorneys:
James D. Gilson, Lyndon R. Bradshaw, Cole P. Crowther

, Salt Lake City, for appellant/cross

- appellee

Gifford W. Price , Salt Lake City, for appellees/cross

- appellants

A SSOCIATE C HIEF J USTICE L EE au thored the opinion of the Court

, in which C HIEF J USTICE D URRANT , J USTICE H IMONAS , J USTICE P ETERSEN , and J UDGE P OHLMAN joined.

Having recused himself, J USTICE P EARCE does not participate herein;

C OURT OF A PPEALS J UDGE J ILL M. P OHLMAN sat.

A SSOCIATE C HIEF J USTICE L EE , opinion of the Court:

¶1 This appeal arises out of a longstanding dispute between attorney Gregory Jones and his former law firm

, Mackey Price Thompson & Ostler, P.C. (MPTO)

, over the distribution of litigation proceeds

. Jones cla ims a right to some of the fees collected by the
firm in personal injury cases arising out of the use of the diet drugJ ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

2 known as Fen

- Phen. Jones has asserted claims for quantum meruit/unjust enrichment, breach of fiduciary duty, and fraudulent
transfer. He also claims a right to an award of punitive damages and seeks to impose a constructive trust on the funds held by MPTO.

¶2 In 2017, after nearly ten years of litigation (including a previous appeal to this court)

, a jury entered a $647,0 9 0 verdict against MPTO on a quantum meruit/unjust enrichment theory

. But

t he district court dismissed Jones’s claims for breach of fiduciary duty, fraudulent transfer, and punitive damages after MPTO filed a

motio n for directed verdict

. It also rejected Jones’s req uest for a

constructive trust.

¶3 After trial, t he district court concluded that the judgment properly extended to a second entity, Mackey Price

, LLC

— an entity
that the district court deemed a successor in interest to MPTO under
rule 25 of the Utah Rules of Civil Procedure. Yet the district court denied Jones’ s request to extend joint and several liability (under an alter ego theory) against Randall Mackey and Gifford Price individually and against a third entity

— Mackey Price Law, a Utah corporation

. And it d eclined Jones’s request to conclude, in post

judgment proceedings

, that Mackey, Price, and Mackey Price Law
had violated Utah ’s LLC and corporation statutes

. ¶4 On this appeal, Jones challenges the dismissal of several of
his claims on directed verdict, the denial of his request for a

const ructive trust

, and the refusal to entertain his alter ego and statutory violation claims in post

- judgment proceedings

. On

cross

- appeal, MPTO challenges the jury verdict on the quantum meruit/unjust enrichment claim on the ground that the expert witness testimony that supported it should h ave been excluded

. M ackey Price

, LLC also cross

- appeals, asserting that the district court lacked jurisdiction to add it to the judgment as a successor in

interest to MPTO

. ¶5 We affirm the directed verd ict on the fiduciary duty claim
but reverse the dismissal of the fraudulent transfer and punitive damages claims and reverse and remand for further proceedings on Jones’s request for imposition of a constructive trust. We also affirm
the denia l of Jones’ s alter ego and statutory claims against Mackey, Price, and Mackey Price Law because such claims cannot be asserted

in post

- judgment proceedings under Brigham Young University v. Tremco Consultants, Inc. , 2007 UT 17, 156 P.3d 782

. And we uphold the jury verdict on the quantum meruit/unjust enrichment claim on the ground that the district court did not abuse its discretion in admitting the testimony of Jones’ s expert witness

.Cite as: 2020 UT 25

Opinion of the Court

3 ¶6 Finally, we clarify and limit the reach of our decision in

Tremco . W e conclude that the district court had the authority to
consider a rule 25 motion for substitution

— to add Mackey Price

, LLC as a successor to MPTO

— in post

- verdict proceedings . But we
nonetheless reverse and remand on the ground that Mackey Price

, LLC was ent itled to contest the merits of the proposed substitution

once the district court rejected its jurisdictional arguments.

I. BACKGROUND
A. The Dispute and Jones’s First Appeal

¶7 In 1992 Randall Mackey and Gifford Price formed a professional corporation to conduct their law practice. Their firm has
had various names over the years but was known as Mackey Price Thompson & Ostler, P.C., during the period relevant to this case. We
refer to i t herein as MPTO

. ¶8 T wo attorneys associated with MPTO

, Jeffrey Thompson
and Russell Skousen

, initiated a Fen

- Phen program with MPTO to litigate claims arising from the fallout surrounding the beleaguered weight

- loss pill. Jones also worked for MPTO and focu sed on Fen

- Phen cases from 2002 to May 2005 . At that time, Jones developed
dissociative amnesia , which severely impaired his memory and prevented him from continuing his work . Th e Fen

- Phen cases eventually generated over $1 millio n in fees f o r MPTO

. After Jones
claimed to be entitled to some of the Fen

- Phen funds, MPTO deposited the fee checks into its trust account and agreed as a

“ professional courtesy” to let Jones know if any of the funds were to
be distributed

. ¶9 Jones sued MPTO over these funds in July 2006

, asserting
various claims for relief . MPTO distributed the Fen

- Phen funds in December of that year , p urportedly to avoid incurring large tax
liabilities . MPTO paid $ 328,261 to Thompson and Skousen, $165,000 to Jones

, $175,484 each to Mackey and Price, and the rest to other
MPTO creditors

. Yet Jones maintained that he was entitled to a larger share of the funds

. In February 2007, he successfully amended his complaint to add claims for breach of fiduciary duty and
fraudulent transfer.

¶10 Jones’ s suit against MPTO, Mackey, Price, T hompson, Skousen, and various Thompson and Skousen limited liability companies reached us in 2015. At that time, we affirmed the district court’s dismissal of Jones’ s contract claim, as well as his quantum
meruit and fra udulent transfer claims against Mackey, Price, Thompson, Skousen, and the LLCs. Jones v. Mackey Price Thompson &J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

4 Ostler ( Jones I

) , 2015 UT 60, ¶ ¶ 4

– 5, 355 P.3d 1000

. But we reversed
the district court ’s denial of Jones’ s request for a jury trial, ruling th at Jones was entitled to a jury on his quantum meruit/unjust enrichment claim against MPTO. Id. ¶ 5

.

B. MPTO’s Trial Objections

¶11 A trial followed

. In the course of the proceedings

, MPTO objected several times to the testimony offered by Jones’s expert witness, John Hansen. In part, MPTO objected that Hansen’s trial drawing s , use of notes, and some aspects of his methodology were not previously disclosed under r ule 26 of the Utah Rules of Civil
Procedure and therefore should be excluded from the jury ’s
consideration

. The district court overruled these objections. MPTO also objected to Hansen testifying as to what considerations typically
went into a fee

- splitting agreement

, asserting that they were
irrelevant in light o f the dismiss al of Jones’s contract claim. The
district court also overruled these objections , citing another portion
of our Jones I decision

.

C. MPTO’s Motion for Directed Verdict

¶12 Before the case was submitted to the jury , MPTO sought
directed verdict on several of Jones’s claims, including his claims
that MPTO’s December 2006 transfers breached a fiduciary duty to Jones and were fraudulent under the Utah Fraudulent Transfer Act.
Th e district court entered directed verdict against Jones on hi s claims
for b reach of fiduciary duty and fraudulent transfer and his request for punitive damages.

¶13 Jones opposed MPTO’s motion

. O n the fiduciary duty claim

, h e argued that rule 1.15 of the Utah Rules of Professional Conduct
and MPTO’s alleged agreement to p lace the fun ds in a “segregated
account” indicated that MPTO owed Jones a fiduciary duty. Jones asserted that MPTO had violated that duty by leaving him out of the process that gave Mackey and Price “ much more than they
deserved” and paid others who “didn’t do anythin g on

. . . Fen

Phen.” T he district court disagreed, ruling that no statute created an independent duty to Jones and that while the Utah Rules of Professional Conduct might be evidence of a fiduciary duty, they

cannot in and of themselves create such a duty.

¶14 In defending his fraudulent transfer claim, Jones focused on
several factors laid out in the Utah Fraudulent Transfer Act. He argued that Mackey and Price had received payments “far in excess”
of the reasonable value of the ir services , that they kne w that the $165,000 paid to Jones was “woefully inadequate

, ” and that MPTOCite as: 2020 UT 25

Opinion of the Court

5 had paid the paltry sum to frustrate Jones’s ability to prosecute his

case. But the district court weighed the various factors laid out in the

statute differently. And it concluded that there was insufficient evidence for a jury to find by clear and convincing evidence that MPTO acted with actual intent to hinder, delay, or defraud Jones. In particular

, the court emphasized its belief that MPTO transferred the funds only to avoid tax liability and that Jones was not actually harmed by the transfer.

¶15 With respect to his request for punitive damages, Jones asserted that MPTO had acted in blatant disregard of his rights and
thus he was entitled to punitive damages on both his fiduciary du ty and fraudulent transfer claims. T he district court again disagreed,
rul ing that there was no evidence of “ malicious intent ” on the part of

MPTO.

D. The Verdict and Jones’s Request for a Constructive Trust

¶16 On March 7, 2017 a jury awarded Jones a $647,090 verdict against MPTO on his remaining claims

. Jones quickly proposed that the district court impose a constructive trust to assist him in obtaining satisfaction of the judgment. MPTO objected, arguing that Jones I precluded the possibility of a constructive trust ( an equitable remedy ) on Jones’s quantum meruit claim ( a legal claim )

. T he district

court agreed with MPTO and denied Jones’ s request to impose a

constructiv e trust in connection with the judgment.

E . Jone s’s Rule 25 Motion and MPTO’s JNOV Motion

¶17 T he post

- verdict proceedings continued when Jones sought to hold another Mackey and Price entity responsible for the judgment and MPTO asked the district court to reconsider its
decisions on the admissibility of Ha nsen’s expert testimony.

¶18 Prior to and during tri a l, Mackey and Price had maintained a website for the newly named “Mackey Price & Mecham” at the
web address www.mackeyprice.com . The firm listed a phone
number and described itself as a “business law firm” comprised of four attorneys: Mackey, Price, and two others

. But j ust two days after the jury verdict, on March 9, 2017, Mackey and Price formed Mackey

Price

, LLC. The LLC’s Certificate of Organization listed the same
addres s as MPTO ’s

, naming Mackey as the registered agent and Mackey and Price as co

- managers. Mackey and Price also transferred its website to Mackey Price

, LLC

, which listed the same phoneJ ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

6 number as before and again described itself as a “business law firm”

com prised of the same four attorneys. 1

¶19 In June 2017 the district court held argument on Jones’s proposed form of judgment. The court expressed concern that MPTO had reorganized as Mackey Price

, LLC to avoid paying the judgment
and wondered whether MPTO was engaged in a game of “legal
whack

- a

- mole.” At the conclusion of the hearing, the district court gave MPTO the opportunity to submit a brief on wh ether Mackey

Price

, LLC should be joined as a party under r ule 21 of the Utah
Rules of Civil Procedure . MPTO a vailed itself of that opportunity

, asserting that rule 21 did not obviate the requirement for the court to exercise personal jurisdiction via service of a summons and complaint. For its part, Mackey Price

, LLC made a special appearance for the limited purp ose of conte sting the court’s jurisdiction. N either entity addressed the allegation that Mackey

Price

, LLC had been formed to avoid the judgment. The district court
entered a judgment against MPTO, including Mackey Price

, LLC in
the judgment’s definition of MPTO without any findings o f fact or
conclusions of law explaining the basis for that decision

. ¶20 A few weeks later

, Mackey and Price executed security agreements in favor of themselves on behalf of Mackey Price

, LLC

, whereby Mackey and Price acquire d a secured intere st in the LLC’s personal and fixture property, inventory, equipment, instruments,
and other assets in exchange for legal work . Mackey and Price
contend that the se security agreements justify their decision to pay
themselves rather than the judgment

. ¶21 Jones filed a notice of appeal from the i nitial j udgment on July 27, 2017

. Thereafter, the district court heard argument on MPTO’s motion for judgment notwithstanding the verdict (JNOV),
which asserted that Jones’s expert witness testimony should have
been excluded on the ground s that elements of his testimony had not been disclosed prior to trial and that it was contrary to la w and
established facts. MPTO reiterated the objections it made at trial

. It

__________________________________________________________ _ _ _

1 Price later testified that he and Mackey immediately began practicing law and billing their clients through the LLC. I t “was made clear to the clients” which business “was going forward,” and
that services “would be coming from the LLC.” Price also confirmed that Mackey Price

, LLC had been substituted on the lease at Mackey
Price & Mecham’s office and begun operat ing out of the same space.Cite as: 2020 UT 25

Opinion of the Court

7 furthe r alleged that previous rulings regarding MPTO’s agreements with Thompson and Skousen meant that MPTO’s payments to Thompson and Skousen could not properly be considered part of the benefit Jones had conferred on MPTO. On September 22, 2017, t he
district c ourt denied MPTO’s JNOV motion

. But in the same order , it
concluded that its decision to extend the judgment to includ e Mackey Price

, LLC as a judgment debtor was void under Brigham Young University v. Tremco Consultants, Inc. , 2007 UT 17, 156 P.3d 782

. It ordered Jones to prepare an amended judgment and remove Mackey Price, LLC. In so doing

, however, the court invited Jones to
serve and move to join Mackey Price

, LLC under rule 21 or 25 of the
Utah Rules of Civil Procedure

. ¶22 Jones filed a motion to do jus t that and served Mackey Price,

LLC with rule 4 notice. 2 MPTO and Mackey Price

, LLC both filed memoranda in opposition to Jones’s motion

. Once again, Mackey Price, LLC made its case in a special appearance. MPTO and Mackey Price, LLC first argued that the district court lacked subject matter jurisdiction to rule on the motion. They claim ed that once the district

court had denied MPTO’s JNOV motion on September 22, Jones’s July 27 notice of appeal kicked in, shifting jurisdiction to th is court

. They also arg ued that the district court lacked personal jurisdiction

over Mackey Price, LLC.

¶23 On November 22, 2017 , the district court gr anted Jones’s

motion without oral argument and again joined Mackey Price

, LLC as a party to the judgment, this time under civil r ule s 21 and 25

. In so doing

, t he district court ruled that it retained jurisdiction because no amended judgment had been entered; in the absence of a final judgment, any notice of appeal was premature. The court also ruled that it had personal jurisdiction ov er Mackey Price, LLC because Jones had served the LLC in accordance with rule 4. In joining Mackey Price, LLC , the district court noted that it was odd that a party facing a significant judgment ( like MPTO ) would oppose the joinder of another party if the two really were separate entities. It
also stated that if Mackey Price

, LLC had disputed the factual allegations, the court would have held an evidentiary hearing to determine whether Mackey Price, LLC was in fact a successor to

MPTO . But since Mackey Pri ce , LLC focused “entirely on procedural

__________________________________________________________ _ _ _

2 Around this time, MPTO filed a notice of appeal from the district court’s denial of its JNOV motion.J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

8 issues,” the court found that it was entitled to grant Jones’s motion once those procedural arguments were rejected. 3

¶24 O n December 1, 2017 t he district court entered an a mended j udgment that included Mackey Price

, LLC as a judgment debtor

. Thereafter, Mackey Price, LLC filed a petition for extraordinary
relief.

F. Jones’s Effort to Extend Liability to Mackey Price Law

¶25 In January 2018 Mackey and Price formed a third entity

, Mackey Price Law. Mackey and Price are the sol e shareholders, officers, and directors of Mackey Price Law. Once again , Mackey serves as the registered agent. Moreover, Mackey and Price executed additional security agreements

, under which they acquired a secured interest in “All Assets” of Mackey Price Law.

¶26 Jones had initially filed a motion asking the court to rule that MPTO, Mackey, Price , and Mackey Price

, LLC were abusing the state’s corporation and LLC statutes and that the parties were alter

egos of one another

. Upon discovering the creation of Mackey Price Law, Jones filed a supplement al motion asking the court to find that Mackey Price Law was also an alter ego and jointly and severally
liable for the a mended j udgment. Following a hearing , the di strict

court relied on Tremco and refuse d to hear Jones’s new claims for fraudulent transfer, alter ego, and statutory violations in post

judgment proceedings

, or to add Mackey Price Law to the judgment

.

G. The Appeal and Cross

- Appeal

¶27 The parties thereafter filed their appeals and cross

- appeals,
which we consider below. In Part II we consider the arguments raised by Jones on his direct appeal. In Part III we take up the issues

on cross

- appeal. And in Part IV we synthesize the basis for our
decision in order to clarify the questions presented on remand.

__________________________________________________________ _ _ _

3 The district court acknowledged that Mackey had filed a declaration disputing whether certain assets were in fact transferred from MPTO to Mackey Price, LLC, but concluded that “Mackey’s testimony fails to challenge the central allegation in the Motion: t hat Mackey Price, LLC is simply a continuation of Defendant Mackey Price Thompson & Ostler.”Cite as: 2020 UT 25

Opinion of the Court

9 II . JONES’S DIRECT APPEAL

¶28 On direct appeal, Jones challenges the district court’s (A) entry of a partial directed verdict ; (B) denial of a right to seek a constructive trust in support of the judgment ; and (C) refusal to
allow him to assert his fraudulent transfer, alter ego, and statutory
violations claims in post

- judgment proceedings. We affirm in part and reverse in part.

A . Directed Verdict

¶29 Jones first challenges the district court’s decision to take the issues of breach of fiduciary duty, fraudulent transfer, and punitive damages away from the jury. We “review[] trial court rulings on
motions for directed verdict for correctness.” Arnold v. Grigsby , 2018 UT 14, ¶ 10, 417 P.3d 606.

¶30 A directed verdict is in order “ [i]f a party has been fully heard on an issue during a jury trial and the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue.” Id

. (alteration in original) (quoting U TAH R. C IV

. P. 50(a)(1)). We affirm the entry of directed verdict on the fiduciary duty claim but reverse on the fraudulent transfer and punitive damages claims.

1. Fiduciary Duty

¶31 Jones claims that he w as the beneficiary of a trust relationship and that MPTO owed him a fiduciary duty under (i ) general trust principles, (ii ) Utah Rule of Professional Conduct 1.15(e), and (iii ) the “law of the case” doctrine. We disagree and
affirm the district court’s dismissal of this clai m on MPTO’s motion
for directed verdict.

¶32 Jones first asserts that there was evidence that a trust was created when MPTO placed the Fen

- Phen funds in its trust account.
He claims that he was a beneficiary of that trust because MPTO
knew he claimed an intere st in the Fen

- Phen proceeds and allegedly agreed to segregate the funds “on that basis.” Jones claims support for this view in the fact that MPTO ultimately paid him a portion o f
the Fen

- Phen funds. Thus, in Jones ’s view , MPTO , as trustee,
breached a fiduciary duty to him when it decided “ what portion Jones was entitled ” to “ rather than awaiting the jury’s verdict .” The alleged breach is in MPTO “ selfishly ” paying Mackey and Price “ and [ its ] creditors the disputed remaining portion” prior to the resol ution of Jones’s claims.J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

10 ¶33 We affirm because w e find no evidence of a

trustee

- beneficiary relationship between Jones and MPTO. Trusts and corresponding fiduciary relationships are generally created by

contract

, statute

, judicial decree

, or some manifestation of an intent

to create a trust

. 4 Jones ’s situation matches none of these scenarios,
and he has not identified a basis for an exception to the general rule.

¶34 Granted, MPTO notified Jones that it had placed the disputed funds in its trust accou nt and would inform him of any decision to distribute funds “reasonably in advance of any distribution actually being made.” But Jones cites no record basis for
the conclusion that MPTO intended to make or did ma k e a binding agreement of any kind, let alon e a binding agreement to hold the
funds until after the resolution of the case

, or to give notice before making distributions. Jones can likewise point to no statute or judicial decree that create d a trust ee

- beneficiary relationship

. ¶35 W e find no authority for the proposition that a party can unilaterally create a trust and make himself a beneficiary of that trust by the simpl e expedient of claiming an interest in a pot of money and having another agree to keep him apprised of any distribu tions

. Such a rule would press h olders of disputed funds into fiduciary service without their knowledge or consent

. That is not the law. And
for these reasons we find no basis in general trust principles for a

trustee

- beneficiary relationship between Jones and MPTO

. ¶36 Second, Jones argues that Utah Rule of Professional Conduct 1.15(e) “ supports ” a findin g of a fiduciary duty. Rule 1.15(e) states that “[w] hen in the course of representation a lawyer is in possession of property in which two or more persons (one of whom may be the lawyer) claim interests, the property shall be kept separate by the lawyer until the dispute is resolved. ” According to Jones, this means
that a factfinder could determine that a fiduciary relationship arose

__________________________________________________________ _ _ _

4 See U TAH C ODE § 75

- 7

- 401(1)(b) (“A trust may be created by .

. . declaration by the owner of property that the owner holds identifiable property as trustee .

. . .”); id. § 75

- 7

- 402(1)(b) (“A trust is created only if .

. . the settlor indicates an intention to create the trust

or a stat ute, judgment, or decree authorizes the creation of a trust

. . . .”); 24 A M

. J UR

. P L

. & P R

. F ORMS Trusts § 2 (20 20 ) (“Although technical words, such as ‘trust’ or ‘trustee,’ are not required in order to create the trust, the intention to create a trust mu st nevertheless be apparent.”).Cite as: 2020 UT 25

Opinion of the Court

11 once MPTO knew the owner ship of the funds w as disputed an d agreed to hold them in a trust account

. ¶37 But as Jones himself acknowledges

, r ule 1.15(e) can only support a finding of fiduciary duty

— it can’t create one

. The “Utah Rules of Professional Conduct are not designed to create a basis for civil liability.” Archuleta v. Hughes

, 969 P.2d 409, 414 (Utah 1998). Nor do the rules create a legal presumption that a duty has been
breached. Id. Without a basis in general trust principles, r ule 1.15(e)
alone cannot support Jones’ s breach of fiduciary duty claim.

¶38 Finally, Jones argues that the “ law of the case ” doctrine mandates a finding of fiduciary duty

. This doctrine states that “ a decision made on an issue during one stage of a case ” is sometimes

“ binding in successive stages of the same litigation.” IHC Health Servs., Inc. v. D. & K. Mgmt., Inc. , 2008 UT 73, ¶ 26, 196 P.3d 588 (citation omitted)

. Jones contends that the district court had already
determined at the summary judgment stage that Mackey and Price
owed him a fiduciary duty

. A nd he asserts that that determination
should have bound the district court moving forward

. ¶39 But the district court made no such finding

. Instead, t he court simply concluded, in response to a motion for summary judgment

, that “a fact finder could determine that fiduciary dut ies were voluntarily assumed” and “ could determine t hat Rule 1.15(e) would apply

. ” ( E mphas e s added

. ) These were not determinations that a fiduciary duty in fact exist ed

. In any event, the district court statements were subject to reconsideration by a successor judge. As

we recently clarified, the law of the case leaves a successor judge
broad discretion to revisit any “nonfinal decision entered previously

. ” Build, Inc. v. Utah Dep ’ t of Transp

. , 2018 UT 34

, ¶ 2 7 , 428
P.3d 995

. ¶40 B ecause neither general trust principles, r ule 1.15(e), nor the
law

- of

- the

- case doctrine support s a finding that MPTO owed Jones a fiduciary duty

, we affirm the district court’s entry of partial directed verdict on Jones’s claim for breach of fiduciary duty.

2. Fraudulent T ransfer

¶41 Jones next challenges the dismissal of his fraudulent transfer
claim , arguing that there was sufficient evidence for the jury to find that MPTO had acted with actual intent to hinder, delay, or defraud Jones when it distributed the Fen

- Phen funds . In dismissing this claim, the district court went through the list of factors that t he
Fraudulent Transfer Act sets forth for determining a defendant’s
“actual intent

. ” These includ e whether the transfer was to an insider,J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

12 whether the debtor retained possession or control of the property after the transfer, and whether the transfer was concealed or made
after the threat of a lawsu it. U TAH C ODE § 25

- 6

- 5(2) ( 20 1 6). 5 Based on these factors, the district court concluded that “no reasonable jury
could make a determination [by clear and convincing evidence] that
there was a violation of the Fraudulent Transfer Act or that these transfers took place [with] an intent to hinder, delay, or defraud

anyone

. ”

¶42 Th e district court f irst acknowledged that some of the
transfer in question was to insiders Mackey and Price, who thus retained possession or control of some of the funds. But the court
also found that the transfer was disclosed (not concealed) , that the
transfer didn’t consi st of substantially all of MPTO’s assets, and that MPTO didn’t abscond, conceal assets, become insolvent, make the transfer before or after a substantial debt was incurred, or transfer
essential assets

— all of which weighed in favor of the defendants.

Becau se the suit “was filed well in advance of the transfer,” the
district court said that it did n o t matter that the defendants had been sued before they made the transfer. In addition, t he district court stated that it didn’t think it “weigh[ed] in favor of e ither party”
whether Mackey and Price had received the ir portion of the funds as
reasonable consideration ( even if that fact was in dispute ) since the defendants “certainly believe[d]” that it was a reasonable
distribution. L astly , the district court relie d heavily on the notion that “the only credible evidence in the record with respect to this
transfer [wa] s that the defendants became aware of a poten tial tax liability.” T he district court concluded that there was “ no evidence to contravene the position of the defendants that they transferred this money solely in order to avoid paying the taxes on it

, ” and thus no way for a jury to conclude that MPTO’s transfers were fraudulent.

¶43 We disagree and reverse. Before reaching the merits

, we address two threshold questions raised in the briefing on this appeal.

__________________________________________________________ _ _ _

5 We cite the 2016 version of the fraudulent transfer statute throughout, though it is unclear which version of the statute the district court applied in its March 2017 analysis. Because the statute
remained the same from th e time Jones added the fraudulent transfer claim to his complaint (February 2007) to the time the court entered directed verdict (March 2017), it does not matter which version we cite so long as we do not use the amended version that
went into effect in Ma y 2017. See infra ¶¶ 46

– 50

.Cite as: 2020 UT 25

Opinion of the Court

13 We first conclude that a “mixed motive” is sufficient to establish an “actual intent” to hinder, delay, or defraud under the Fraudulent
Transfer Act

. W e then hold that Jones was required to establish such

a ctual intent by clear and convincing evidence. With these premises in mind, we conclude that there was sufficient evidence in the trial record for a jury to find by clear and convincing evidence that there
was a fraudulent transfer in this case.

a. Mixed motive

¶44 We begin by clarify ing the governing legal standard on a question that has been decided in other states but never in Utah. The question is whether “actual intent” to hinder, delay, or defraud requires proof that such intent was the sole or primary p urpose of the defendant, or whether proof of a “mixed motive” is sufficient. We conclude that there is no requirement that the intent to hinder, delay, or defraud be the sole or even primary motive of the
defendant . This follows from the text of the statut e, which requires proof only that a defendant act “with actual intent” to hinder, delay,
or defraud. U TAH C ODE § 25

- 6

- 5(1) (a) ( 20 1 6). It would add an unstated qualifier to require that a defendant acting “with actual
intent” act solely or primarily with th at actual intent. And such an addition is foreclosed by our canons of interpretation. 6

¶45 Utah cases have not addressed this “mixed motive” question directly . But they have spoken of an actual intent to hinder, delay, or defraud when interpreting the Fraudulent Transfer Act or

its variants. 7 And courts in other jurisdictions have interpreted

__________________________________________________________ _ _ _

6 See Nevares v. M.L.S. , 2015 UT 34, ¶ 34, 345 P.3d 719 (rejecting an interpretation of a statute on the ground that it ran afoul of the canon against “read[ing] into the statute a limitation not expressly stated on its face”); Olsen v. Eagle Mountain City , 2011 UT 10, ¶ 18, 248 P.3d 465 (declining to “add conditions .

. . that are not set forth expressly by legislation”).

7 See, e.g. , Butler v. Wilkinson , 740 P.2d 1244, 1261 (Utah 1987) (interpreting the Utah Fraudulent Conveyance Act to mean that “the
defendant must have an actual fraudulent intent” (emphasis added)) ; Selvage v. J.J. Johnson & Assocs. , 910 P.2d 1252, 1261

– 62 (Utah Ct. App. 1996) (stating repeatedly that there was enough evidence to infer “ an actual intent to hinder, delay or defraud” in part because one witness testified that, “ part of the decision regarding the date for placing Johnson into bankruptcy was to allow the one

- year statute of (continued .

. .)J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

14 parallel language of the Uniform Fraudulent Transfer Act in the

same way

— holding that actual intent to hinder, delay, or defraud may be established on the ground that at least one of the defendant’s motives was an impermissible one. 8 We agree with these holdings and disagree with the contrary view endorsed in other jurisdictions

. 9 We conclude that a plaintiff may carry her burden of showing that a
defendant had act ual intent to hinder, delay, or defraud without

__________________________________________________________ _ _ _ limitation to expire,” and thus the defendant’s actions “indicated an intentional attempt to hinder, delay or defraud rather than merely a bona fide purpose to reduce Johnson’s debt to [defendant]” (emphases added)).

8 See, e.g. , In re Blatstein , 192 F.3d 88, 97 (3d Cir. 1999) (“Our inquiry under [the Pennsylvania UFTA] is whether [the ] [ debtor] intended to hinder or delay a creditor. If he did, he had the intent penalized by the statute notwithstanding any other motivation he may have had for the transfer .” ( third alteration in original) (citation omitted)); In re Tronox Inc. , 503 B.R. 239, 279 (Bankr . S.D.N.Y. 2013) (holding that Oklahoma’s fraudulent transfer law does not require the plaintiff to show that the “main or only purpose of the transfer was defendant’s actual intent to damage a creditor” (citation and internal quotation marks omitted)); In re Stanley , 384 B.R. 788, 799 (Bankr. S.D. Ohio 2008) (ruling that under Ohio’s UFTA, “‘[a]ctual intent’ may be present whether the transfer was motivated entirely or merely in part by a desire to hinder, delay or defraud creditors”);

Bertram v. WFI Stadi um, Inc. , 41 A.3d 1239, 1247 (D.C. 2012) (“[E]ven
if a debtor has at least one non

- fraudulent motive for a transaction, the additional motive of effecting the transaction to hinder a creditor ‘is a sufficient ground for an unassailable conclusion [of] .

. . fraudulent intent.’” (second and third alterations in original) (citation omitted).

9 See, e.g. , Tindall v. H & S Homes, LLC , 757 F. Supp. 2d 1339, 1364 (M.D. Ga. 2011) (“The facts here suggest that .

. . Defendants’
dominant intent appears to have been to hinder, delay or defraud
Plaintiff .

. . . ‘[Actual] intent will be found if the circumstances
indicate that the main or only purpose of the transfer was to prevent a lawful creditor from collecting a debt.’” (emphases added) (citations omitted) ) ; In re Schneider , 417 B.R. 907, 915 (Bankr. N.D. Ill. 2009) (“If
the primary motivation for the transfer is based on fraudulent intent, other motivations may be urged, but they are irrelevant.” (emphasis added)).Cite as: 2020 UT 25

Opinion of the Court

15 showing that it was the defendant’s sole or primary motivation.
Thus

, the question is whether there existed a legally sufficient evidentiary basis for a reasonable jury to conclude that MPTO made the payments from its trust account with an actual intent to hinder, delay, or defraud Jones.

b. Standard of proof

¶46 We next consider what standard of proof Jones was required

to meet on his fraudulent transfer claim. The standard is clearly set forth in the statute as it stands today. See U TAH C ODE § 25

- 6

- 202.
Under the current version of the statute (effective May 2017)

, a transfer made with “actual intent to hinder, delay, or defraud” is not “fraudulent” but merely “voidable.” Id

. § 25

- 6

- 202(1). And a claim under this provision requires proof only by a “preponderance of the
evidence.” Id. § 25

- 6

- 202(3).

¶47 But this altered the operative burden of proof under Utah law. The pre

- 2017 statute treated all transfers made with “actual

intent to hinder, delay, or defraud ” as “fraudulent

. ” See U TAH C ODE § 25

- 6

- 5(1) (20 1 6). Under the old statute, any “ transfer made or obligation incurred by a debtor is fraudulent as to a creditor[] .

. . if the debtor made the transfer or incurred the obligation []

. . . with actual intent to hinder, delay, or defraud any creditor of the debtor.”
Id. (emphasis added). And u nder Utah law

, a claim of fraud must be proven by clear and convincing evidence. 10

¶48 This highlights an important distinction between the 2017 statute and the one it amended. Under the pre

- 2017 law

, the plaintiff bore the burden of proving all claims asserting intent to hinder,

__________________________________________________________ _ _ _

10 See Daines v. Vincent , 2008 UT 51, ¶ 38, 190 P.3d 1269 (“To prevail on a claim of fraudulent inducement, [the plaintiff] must present clear and convincing evidence .

. . .”) ; Armed Forces Ins. Exch

.

v. Harrison , 2003 UT 14, ¶ 27, 70 P.3d 35 (“ [F]raud is a wrong of such nature that it must be shown by clear and convincing proof and will not lie in mere suspicion or innuendo.” (alteration in original) (citation and internal quotation marks omitted) ) ; Lundstrom v. Radio Corp. of Am

. , 405 P.2d 339, 341 (Utah 1965) (same); Ferrell v. Wiswell

, 143 P. 582, 5 83

– 84 (Utah 1914) (“We have no right to overlook the wholesome rule that where deeds or contracts are sought to be
vacated .

. . upon the ground of fraud and deceit, the burden of proving the alleged fraud is upon him who asserts it; moreover, that
the fra ud must be established by clear and convincing evidence.”).J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

16 delay, or defraud by clear and convincing evidence. But under the statute that went into effect in May 2017

, the plainti ff bears the burden of proving such claims only by a preponderance of evidence.

¶49 This triggers the question of which version of the statute applies. And that implicates standards set forth in our decision i n State v. Clark , 2011 UT 23

, 251 P.3d 829

. U n der Clark “w e apply the law as it exists at the time of the event regulated by the law in question. ” Id

. ¶ 13. “On matters of substance the parties’ primary rights and duties are dictated by the law in effect at the time of their underlying primary conduct (e. g., the conduct giving rise to a criminal charge or civil claim).” Id

. ¶ 14. “Thus, if a law regulates a breach of contract or a tort, we apply the law as it exists

. . . at the time of the event giving rise to [ the ] cause of action.” Id. ¶ 13. “When

it co mes to the parties’ procedural rights and responsibilities, however, the relevant underlying conduct is different: the relevant occurrence for such purposes is the underlying procedural act (e.g., filing a motion or seeking an appeal).” Id

. ¶ 14. “The law governing th[e] [relevant] procedural occurrence is thus the law in effect at the time of the procedural act

. . . . ” Id

. ¶50 We have not decided whether a statute altering the standard of proof in a civil proceeding is substantive or procedural . N or have
we decided whether a statute effecting such change can or should be applied retroactively. 11 And we need not do so here. The statute lowering the standard of proof to a preponderance of evidence was not in effect until May 2017. By then, all the relev ant events even arguably regulated by the statute

— whether the substantive “primary conduct” giving rise to the alleged fraudulent transfer ( December 2006 ), or the procedural filing of the relevant pleadings (February 2007) and presentation of proof at tria l (March 2017)

— had already taken place. For that reason there is no basis for application
of the new statute to this case. And Jones was thus required to prove his claim for fraudulent transfer by clear and convincing evidence.

__________________________________________________________ _ _ _

11 In criminal proceedings, we have held that “ statutes which

‘ alter the degree, or lessen the amount or measure, of the proof which was made necessary to conviction when the crime was
committed ’ ” may not be applied retroactively. See State v. Schreuder

, 726 P.2d 1215, 1218 (Utah 1986) (citation omitted). But that decision
was based on the Ex Post Facto Clauses of the federal and state
constitutions, id. , not the framework laid out in State v. Clark , 2011 UT 23, 251 P.3d 829.Cite as: 2020 UT 25

Opinion of the Court

17 c. Application of the law to the facts in the record

¶51 We may reverse the district court ’s decision dismissing Jones’s fraudulent transfer claim if we find that the jury had a “legally sufficient evidentiary basis” to find for Jones on t his claim

. U TAH R. C IV

. P. 50(a)(1). Under the st andards set forth above, we
must decide whether there was a sufficient basis for a reasonable jury to find by clear and convincing evidence that MPTO had an actual intent to hinder or delay Jones in seeking his share of the
funds. We reverse because we con clude that there was sufficient evidence in the record for a reasonable jury to so conclude.

¶52 The district court leaned heavily on its finding that “the only credible evidence in the record with respect to this transfer is that the
defendants became aware o f a poten tial tax liability.” Conversely,
the court stated that there was “ no evidence to contravene the position of the defendants that they transferred this money solely in order to avoid paying the taxes on it.” We see the record differently.
The court may have been correct to suggest that the only direct
evidence of MPTO’s motives went to tax avoidance. But
circumstantial evidence may also be considered. And we think there was ample circumstantial evidence in the record to support a jury
determination (by clear and convincing evidence) that at least one of MPTO’s motives was to hinder or delay Jones.

¶53 T he district court also cited the fact that Jones had filed his
lawsuit several months before MPTO made the transfer. But this
would not have prevent ed the jury from drawing a negative
inference from the fact that, “before the transfer was made or obligation was incurred, the debtor had been sued or threatened
with suit.” U TAH C ODE § 25

- 6

- 5(2)(d) (20 1 6) . The fact that Jones filed
his lawsuit several months before the transfer doesn’t categorically
exonerate the defendants’ motivations . A reasonable jury could have found that the fact the defendants were being sued cut in favor of Jones. And given that the jury verdict awarded Jones virtually all the

Fen

- Phen litigation funds, a reasonable jury could have decided that the large transfers to Mackey and Price did not constitute “the value

of the consideration .

. . reasonably equivalent to the value of the
asset transferred.” Id. § 25

- 6

- 5(2)(h). That too would h ave weighed in favor of Jones.

¶54 We also think the district court placed too much weight on
MPTO’s supposed tax motivations. A reasonable jury could have wondered why there was no written or paid advice regarding the alleged tax problem

— a potential weakness that Jones probed at trial.

A reasonable jury also could have found Mackey and Price to beJ ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

18 lacking credibility in general. At trial, Jones’s attorney tried to uncover exactly how Mackey and Price arrived at the $165,000 figure for Jones, as they did not i nvolve Jones in their calculations. Price testified that in calculating how m any of the Fen

- Phen funds to send Jones, he and Mackey took into account damages that Jones caused the firm in his handling of two specific cases. But Mackey tes tified to just the opposite. Mackey said they did not t ake into account the fact that Jones ’s work had been “deficient” in certain cases. A reasonable jury could have discounted Mackey ’s and Price’s testimon y in light
of th is contradiction. At a minimum, a reasonable jury could have concluded that Mackey and Price were being less than forthcoming

on the issue

, as they failed to offer any kind of concrete formula for
MPTO’s payment to Jones and repeatedly insisted that they were simply trying to “be fair to Mr. Jones” b y looking at “various
factors.”

¶55 A ny jury may be less inclined to find for a party whose credibility is called into question. But Mackey ’s and Price’s credibility on this point was especially important . While MPTO’s tax fears might adequately explain why MP TO distributed the funds
when it did, they do nothing to explain why MPTO paid out the sums it did or why it chose to pay the entities it did

. The decision to pay Mackey, Price, and other creditors decreased the amount of Fen

Phen funds in MPTO’s possessio n , and thus how much and how quickly Jones could reasonably expect to recover in the event of a
favorable outcome at trial. If the jury believed that MPTO paid Jones based on a reasonable, good

- faith determination of what it believed Jones was owed, the ju ry likely would have found that MPTO simply made the transfers with the intent to avoid taxes and pay off creditors. But if the jury believed that MPTO was trying to lowball Jones and divest itself of the rest of the funds, the jury very well

c ould have in ferred that MPTO was also trying to put itself in a position where it no longer had what Jones claimed (and MPTO believed) he was owed

. ¶56 MPTO’s failure to explain its calculation of Jones’s payment, as well as its possible offset for Jones’s alleged mishandling of cases

, make it more likely that MPTO also ac ted to hinder or delay Jones in
his efforts to recover his share of the Fen

- Phen fees. W e hold that there was sufficient evidence for a reasonable jury to conclude by clear and convincing evidence that MPTO acted with actual intent to hinder or delay Jones. And we accordingly reverse the directed
verdict on this claim

.Cite as: 2020 UT 25

Opinion of the Court

19 3 . Punitive D amages
¶57 Jones next challenges the district court ’s dismissal of his claim for punitive damages. By statute, punitive dam ages are generally available “ only if compensatory or general damages are awarded and it is established by clear and convincing evidence that
the acts or omissions of the tortfeasor are the result of willful and malicious or intentionally fraudulent conduc t, or conduct that manifests a knowing and reckless indifference toward, and a disregard of, the rights of others.” U TAH C ODE § 78B

- 8

- 201(1)(a) ; id. § 78

- 18

- 1(1)(a) (2006)

. In rejecting Jones’s request for punitive damages

, the district court relied on the notion that there was “no
evidence of malice” on MPTO’s part. We reverse in light of our
decision to reinstat e the fraudulent transfer claim. With the
fraudulent transfer claim in place

, Jones is entitled to pursue his claim for punitive damages.

B . Const ructive Trust

¶58 Jones also challenges the district court’s ruling denying hi s request for the imposition of a constructive trust. In the proceedings
below

, Jones asserted that he had established all the prerequisites for the imposition of a constructive trus t. The district court declined to reach that question, however, because it concluded that our ruling in Jones I “specifically rejected the availability of a constructive trust as

a potential remedy” in this case.

¶59 We concede that there was a degree of imprecision in our
discussion in Jones I on this point . But we clarify that our analysis in Jones I did not foreclose the possibility of a constructive trust in this
case and remand to allow the district court to decide i n the first instance whether Jones has established the preconditions for the imposition of a constructive trust.

¶60 In Jones I we held that Jones had a right to a jury trial
because he sought “ on ly money damages” and requested a “ legal remedy, not an equitabl e one.” 2015 UT 60, ¶ 51 , 355 P.3d 1000

. With this in mind, the district court thought that Jones was seeking to move the goalposts on remand

. It thought it unfair to allow Jones to

“ seek [] to obtain an equitable remedy (a constructive trust)” a fter convincing this court that “ his claim seeks a legal remedy (monetary relief)

. ”

¶61 We can see how the district court could read our Jones I opinion in this way. But our analysis in Jones I , though not as precise as it might have been, was not an indication tha t Jones could not seek the imposition of a constructive trust. In Jones I we held onlyJ ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

20 that the quantum meruit/unjust enrichment claim itself was legal in nature. In the briefing in Jones I , Jones never proffered an intent to forgo an equitable remedy in the aid of the collection on his legal
claim. Indeed, we noted that Jones was not just asserting a claim for quantum meruit/unjust enrichment but also “ask [ing] the court to
hold the fees re ceived by Mackey Price in constructive trust .” Id. ¶ 51

n.58. And o ur analysis did not foreclose the availability of such relief; the question was simply not presented to us.

¶62 We thus conclude that Jones I does not categorically
foreclose Jones from seeking the imposition of a constructive trust. Our case law supports the availability of equitable remedies in support of the collection of damages on a legal claim. See Ong Int ’l (U.S.A.) Inc. v. 11th Ave. Corp. , 850 P.2d 447, 457 (Utah 1993) ; see also

R ESTATEMENT (T HIRD ) OF R ESTITUTION & U NJUST E NRICHMENT § 4

cmt

. d ( A M

. L AW I NST

. 2011 )

. Constructive trusts, moreover, have properly been imposed to aid in collecti ng on a legal claim. 12 And that is all that Jones has asked for here.

¶63 We reverse on that basi s. In so doing we are not endorsing the propriety of a constructive trust in the circumstances of this case.

See Wilcox v. Anchor Wate, Co. , 2007 UT 39, ¶ 34, 164 P.3d 353 (identifying factors for consideration in the imposition of a constructive trust). We leave the resolution of that question for the
district court on remand.

C

. New Claims in Post

- Judgment Proceedings

¶64 Jones ’s last contention is his challenge to the district court’s
de termination that he could not prosecute his claims for fraudulent

trans fer, alter ego, and statutory violations in post

- judgment proceedings. The district court held that such claims were foreclosed
under our decision in Brigham Young University v. Tremco Consultants

, Inc.

, 2007 UT 17, 156 P.3d 782

. We agree and affirm.

__________________________________________________________ _ _ _

12 See Butler , 740 P.2d at 1253, 1262 (ruling that plaintiffs were entitled to a constructive trust on their fraudulent conveyance claim to prevent defendants from unjustly enriching themselves from proceeds not yet received from a land sale); R ESTATEMENT (T HIRD ) OF
R ESTITUTION & U NJUST E NRICHMENT § 4 cmt. e, illus. 9

– 10 ( A M

. L AW
I NST

. 2011) (endorsing the availability of a constructive trust in connection with a claim for collection of embezzled funds).Cite as: 2020 UT 25

Opinion of the Court

21 ¶65 Tremco involved a plaintiff who sought to execute a judgment on the assets of persons not named as parties to the
lawsuit or judgment. Id. ¶¶ 12

– 13, 36. In that case , the court held that claims founded on “alter ego” and “fraudulent transfer” are “civil

ac tion[s] that must be prosecuted in the manner prescribed in the Utah Rules of Civil Procedure, commencing with the filing of a summons and complaint and not the abbreviated post

- judgment collection procedures of rule 69.” Id. ¶ 39. “ I n light of the status conferred through the development of the common law and legislative action upon alter ego and fraudulent transfer ” claims

, a plaintiff may not seek to advance these claims in post

- judgment proceedings in an attempt to extend liability for a judgment to new parties. Id. ; see also id. ¶ 45. Instead

, such claims must be initiated and litigated in the ordinary course under our rules of civil procedure, with rights of discovery, motion practice, trial, etc. Id

. ¶ 40.

¶66 Jones seeks to distinguish this case on the ground that he is invoking rule s 21 and 25 of the Utah Rules of Civil Procedure in an attempt to “substitute” Mackey, Price, and Mackey Price Law as
“successors” to MPTO. In support of this view, Jones notes that the
district court has already allowed Mack ey Price

, LLC to be substituted as a successor entity under rules 21 and 25. Jones claims that his bid to add Mackey, Price, and Mackey Price Law is no
different.

¶67 We disagree. The proceedings seeking to add Mackey Price

, LLC as a party to the judgment are distinct from the proceedings at
issue here. See infra ¶ ¶ 91

– 9 3

. When Jones sought to extend the judgment to Mackey Price

, LLC he was asserting only that Mackey

Price

, LLC was a successor to MPTO that should be substituted in as

a named party to the judgment. But the proceedings seeking to add Mackey, Price, and Mackey Price Law were different. There, Jones
asserted new, substantive common

- law and statutory claims

— fraudulent transfer, alter ego, and other statutory violations

— against

an u nnamed, unjoined party . These are precisely the kinds of claims
that cannot be asserted in post

- judgment proceedings under Tremco

. ¶68 We affirm on this basis. 13 Jones’s claims against Mackey, Price, and Mackey Price Law ar e separate civil action s with

__________________________________________________________ _ _ _

13 For reasons explained be low, see infra ¶¶ 89

– 90, the district court may have also lacked jurisdiction to allow Jones to assert new claims for liability against Mackey, Price, and Mackey Price Law. Jones’s July 27, 2017 notice of appeal became effective, and generally (continued .

. .)J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

22 comm on

- law or statutory status trigger ing the need to initiate new proceedings in accordance with the Utah Rules of Civil Procedure. Jones has no right to bypass the protections of our rules by tacking

on a brand

- new claim in the abbreviated mechanism of a
post

- j udgment proceeding. This was our holding in Tremco and we stand by it here. Jones has identified no persuasive basis for distinguishing our precedent or for departing from it, and we thus
reinforce Tremco and affirm on that basis.

III . CROSS

- APPEAL S

¶69 Both M PTO and Mackey Price, LLC raise claims o n

cross

- appeal : (A) MPTO challenges the district court’s decision to allow Jones’s expert witness to testify in support of his quantum meruit/unjust enrichment claim ; a nd (B) Mackey Price

, LLC asserts that the district court erred in add ing it as a party to the judgment
under rules 21 and 25 of the Utah Rules of Civil Procedure. We affirm in part and reverse in part.

A. MPTO ’s Cross

- Appeal

¶70 MPTO challenges the district court’s decision allow ing the jury to c onsider expert testimony from John Hansen

, the expert

witness called by Jones in support of his claim for quantum meruit/unjust enrichment. In pretrial proceedings

, Jones had produced an expert witness report for Hansen under the
then

- applicable version of rule 26 of the Utah Rules of Civil

__________________________________________________________ _ _ _ deprived the court of jurisdiction over most matters, when the district court entered its amended final judgment on December 1, 2017, see infra ¶¶ 89

– 90

— before the district court denied Jones’s request to assert new claims of liability against these parties. Despite t he notice of appeal, however, the district court retained jurisdiction over certain post

- judgment proceedings. See Garver v. Rosenberg , 2014 UT 42, ¶ 10 n.12, 347 P.3d 380 . So the court retained the power to decide whether it was appropriate to allow Jones to assert new claims for liability against Mackey, Price, and Mackey Price Law. It had jurisdiction to determine its own jurisdiction. In rejecting Jones’s attempt to assert new claims for liability, the district court was effectively concluding that such claims could not properly be asserted within a post

- judgment proceeding. That would hold both as a matter of jurisdiction and under Tremco

.Cite as: 2020 UT 25

Opinion of the Court

23 Procedure. 14 MPTO had also had the opportunity to depose Hansen.
But at trial in 2017

, MPTO made objections (some clearer than others) that suggested it believed that Hansen’s testimony was going beyond the scope of the t estimony forecast in th e report and deposition and should be foreclosed on that basis

. Specifically, MPTO objected to Hansen’s drawing during his testimony, use of handwritten notes, and alleged reliance on information and methodology not cited in his init ial report and deposition

. The
district court overruled all of MPTO’s objections regarding inadequate disclosure , although at one point the district judge appeared to indicate that he had n o t read Hansen’s report. MPTO
also argued that since Jones no longe r had a contract claim, Hansen could not testify as to what types of considerations typically go into
a fee

- splitting arrangement. The district court overruled this latter point by citing our decision in Jones I

. ¶71 After trial in its JNOV motion

, MPTO also objected to the admissibility of Hansen’s testimony on th e ground that it was foreclosed by prior summary judgment rulings that suggested that the funds MPTO paid to Thompson and Skousen never properly belonged to MPTO. MPTO argued that these funds therefo re could not be considered part of the benefit Jones conferred on MPTO

. Again, the district court rejected MPTO’s arguments.

¶72 MPTO contends that the quantum meruit/unjust enrichment jury verdict cannot stand without Hansen’s testimony.
And it seeks to overt urn the verdict on the above grounds. We

r eview the district court’s determinations on the admissibility of expert testimony for abuse of di scretion

, Northgate Vill

. Dev., LC v. City of Orem , 2019 UT 59 , ¶ 14, 450 P.3d 1117

, and affirm.

1

. Adequacy of Jones ’s P retrial D isclosures

¶73 The 2 006 version of rule 26 (a)(3)(B) of the Utah Rules of Civil Procedure stated that an expert report should contain “the subject matter on which the expert is expected to testify; the substance of the facts and opinions to which the expert is expected to testify; [and] a summary of the gro unds for each opinion

. ” As the

__________________________________________________________ _ _ _

14 Here, the adequacy of Jones’s pretrial disclosures is judged by the standard applicable at the time he was required to make them.

See supra ¶ 49.J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

24 language suggests , t his was not a demanding standard. 15 Nonetheless, MPTO argues that Hansen’s testimony was inadequately disclosed because his trial testimony strayed too far from his expert report and deposition. We disagree.

¶74 At trial, MPTO was not always clear about the precise nature of its objections

— or even about the fact that it was making a rule 26 objection

. And the imprecisions in MPTO’s objections had an
effect on the district court’s stated grounds for i ts rulings. Yet MPTO
did object at least twice that Hansen was straying from his report. And in the context in which the objections were raised, we affirm the district court’s rulings.

¶75 MPTO’s first objection

— to Hansen making an illustration to help convey what he was saying

— clearly lacked merit

. Hansen was simply mapping out what he was explaining , not introducing a new
exhibit or document

. It was in this context that the district court
indicated that it “ha [ d ] n’t seen the report and ha [ d ] n’t seen the
exhib it” that Hansen was in the process of drawing. 16 The district
court’s statement made sense in this context. This was not an admission by the court that it had no basis for assessing the viability of any of MPTO’s objections. It was an acknowledgement that t he expert was entitled to make an illustration expanding on the testimony in his report, and on that point we agree.

__________________________________________________________ _ _ _

15 The Advisory Committee Notes to the new rule 26 illustrate how the old rule operated in practice: “[B] ecaus e experts often were allowed to deviate from the opinions disclosed, attorneys typically
would tak e the expert’ s deposition to ens ure the expert would not offer ‘surprise’ testimony at trial, thereby increasing rather than decreasing the overall cost. The amendments seek to remedy this and other costs associated with expert discovery by, among other things, allowing the opponent to choose either a deposition of the expert or a written report, but not both; in the case of written reports, requiring more comp rehensive disclosures, signed by the expert, and making clear that experts will not be allowed to testify beyond what is fairly disclosed in a report

. . . .”

16 MPTO did specifically raise the objection that “[t]here’s nothing in [his report] about the fee split with any clients[,]” but this was also in the context of the objection to Hansen’s illustration. And again we affirm the decision to overrule that objection.Cite as: 2020 UT 25

Opinion of the Court

25 ¶76 MPTO’s next objection was to Hansen ’s discussi on of Thompson’s and Skousen’s affiliation with “national class counsel.”

But after the district court struck Hansen’s initial answer , MPTO dropped the matter

. To be sure, MPTO also challenged Hansen’s alleged reliance on documents not disclosed in his report, including
Hansen’s use of some last

- minute notes on the stand. But the se notes didn ’t stray from the substance of Hansen’s prior disclosures, and
the judge marked Hansen’s notes as an exhibit for MPTO’s counsel

to use. As for Hansen’s other supposed reliance on information “ not
in the report,” Hansen’s testimony was based on what he had heard others testify at trial. The district court was well within its rights to
overrule MPTO’s vague objections on these points. 17

¶77 MPTO claims that the district court never conducted a proper rule 26 analysis because it incorrectly relied on Jones I to excuse Hansen’s “new,” inadequately disclosed testimony

. But the record belies this. At trial, MPTO ’s main

— and continuing

— objection apparently went to Hansen’s discussion of fee

- splitting arrangements in general. MPTO ’s counsel argued that Hansen’s

testimo ny on this point was inappropriate since there was “no agreement” between Jones and MPTO and the trial was focused on Jones’s quantum meruit/unjust enrichment claim. It was in this context that the district court finally quoted from Jones I and
reasoned th at “[t]o the extent that the [Utah] Supreme Court has given me some leeway or some discretion in allowing an expert witness or evidence regarding the other appropriate factors, that’s what Mr. Hansen is doing.

. . . I believe that this not only is appropri ate but, basically, is what the Supreme Court has ordered
me to allow.” We affirm that ruling. T he district court was simply making the point that even though there was no contract between Jones and MPTO, it was appropriate for Hansen to testify about
what factors usually went into fee

- splitting agreement s because those factors were relevant for determining the reasonable value of Jones’s services. It was not ruling that Jones I allowed Jones to skirt

__________________________________________________________ _ _ _

17 MPTO also cross

- examined Hansen extensively about specific figures that were not in his r eport, repeatedly invoking the Utah Rules of Civil Procedure. But haranguing a witness on

cross

- examination about the plaintiff’s obligations under the rules is not the same as making a specific rule 26 objection for the district
court to rule on.J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

26 rule 26 pretrial disclosure requirements regarding Hanse n’s testimony

. ¶78 The district court’s ruling on MPTO’s JNOV motion
confirms that the court relied on Hansen’s testimony at trial and not

on Jones I in overruling MPTO’s rule 26 objections . In that ruling the
court said that it was “not persuaded that Mr. Hansen strayed from the substance of his expert report at trial ,” but rather found that “ Mr. Hansen testified consistent with his pretrial disclosures.”

¶79 We agree. Hansen’s report state d that it was based on his
“evalua tion and prof essional opinion ” and his experience as a law firm shareholder, practicing attorney in the Salt Lake area for twenty

- five years, former managing partner of a law firm, and
former president of the Utah Chapter of the Federal Bar Association.

It explain ed th at he has specific knowledge and experience with personal injury claims, contingency fees

, and fee allocations between multiple attorneys. It also name d factors that Hansen took into

account in concluding that Jones was entitled to 80 percent of the

Fen

- Ph en fees

. These factors include d Jones’ s unique employment standing, personal expenses, commitment

, leadership, time, and origination. In his deposition, Hansen likewise highlighted his professional experience with contingency fee cases and fee

- splitting between attorneys, including how fee s plits often depend on the

circumstances surrounding the representation. He said that he
arrived at the 80 percent figure “based on [his] experie nce in dealing with contingency fees and fair resolution” and factors such as
risk

- taking

, leadership, commitment, out

- of

- pocket expenses, and
work distribution

. ¶80 MPTO asserts that Hansen’s trial testimony “deviated materially” from these pretrial disclosur es because he used terms like “standard practices in the community” and “community standards” and gave more specific percentage breakdowns and dollar figures. But Hansen’s testimony included numerous references to his experience with contingency fee and fe e

- splitting

cases, based on his personal practice and observations during the
course of his professional career. The bulk of his testimony
concerned the factors listed in his report. All Hansen did at trial was lump these factors into discrete categories ( risk s , re sources, and responsibilities)

. The same factors still le d to the same 80 percent
determination.

¶81 Hansen’s experience, methodology, and opinions were all highlighted in his report and deposition . MPTO was thus on notice
about the substance of Hansen’s trial testimony. There is no undueCite as: 2020 UT 25

Opinion of the Court

27 surprise when experts summarize factors listed in thei r report into

succinct groupings or use slightly different terminology

. We hold
that Hansen’s testimony was properly admitted and that Jones ’s
disclosure of H ansen’s expert testimony was adequate under the
the n

- applicable rule 26 of the Utah Rules of Civil Procedure.

2

. Hansen’s I nclusion of the Thompson & Skousen P ayment

¶82 In post

- trial proceedings, MPTO also contend ed that Hansen’s testimony should have been excluded because it was contrary to established facts. Specifically, MPTO argue d that Hansen’s testimony was deficient because it included MPTO’s payment to Thompson & Skousen as part of the reasonable value of Jone s’s services

. According to MPTO , past rulings had “created a ‘ceiling’ on Plaintiff’s damages

. . . that Mr. Hansen failed to account
for .”

¶83 The district court was not bound by past district court judges’ summary judgme nt rulings. See Build

, Inc. v. Utah Dep ’ t of Transp

. , 2018 UT 34

, ¶¶ 30

– 31

, 428 P.3d 995

. In any case, t he past rulings concerned whether Jones could pursue a claim against Thompson & Skousen for the payment it received from MPTO

. But whether Jones has a claim against Thompson & Skousen has nothing
to do with how much benefit Jones conferred on MPTO. MPTO

asserts that not accounting for the Thompson & Skousen payment means that MPTO ultimately lost $59,000 processing the Fen

- Phen suits. This, MPTO, argues, contradicts Jones’s theory that MPTO was unjustly enriched

. But whether MPTO made a good deal when all is
said and done does not affect the value of the benefit that MPTO
received from Jones

. Like the district court, this court “does not view
as unreasonable Mr. Hansen’s decision to use the total amount received by Defendants as the starting point for Pla intiff’s quantum
meruit claim.”

¶84 We have even less trouble affirming on this point because MPTO could have presented evidence of the Thompson & Skousen payment to the jury and argued that Jones’s damages should be
reduced accordingly

. But it chose not to. In fact, it affirmatively prevented the jury from hearing evidence of the Thompson & Skousen payment

. Having kept evidence of the payment from the jury

, MPTO cannot now complain that the jury didn’t account for it

in its calculations.

¶85 Hansen’s testimony was adequately disclosed. It was not

contr ary to law or established facts . Because Hansen’s testimony was properly admitted, the jury’s verdict was based on sufficient
evidence and not contrary to law. We affirm the district court’sJ ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

28 admission of Hansen’s testimony and its denial of MPTO’s JNOV

motion.

B. Mackey Price, LLC ’s Cross

- Appeal

¶86 Mackey Price, LLC challenges the district court ’s authority to add it to the judgment as a successor i n interest to MPTO. A lower court’s interpretation of the rules of civil procedure is a question of
law we review for correctness. Belnap v. Howard , 2019 UT 9, ¶ 7, 437
P.3d 355

. We reverse in part and remand. We conclude that the
district court retained jurisdiction at the time it considered Jones’s
substitution motion and had the authority to use post

- verdict proceedings to determine whether Mackey Price, LLC should be
added as a successor in interest under rule s 21 and 25 of the Utah
Rules of Civil Proc edure. But we reverse on the ground that the
district court was required, after it rejected Mackey Price, LLC ’s jurisdictional challenges, to afford Mackey Price, LLC an opportunity to challenge the assertion that it was in fact a successor to MPTO.

1. J urisdiction over Post

- Verdict Proceeding s
¶87 Mackey Price, LLC argues that the district court lost “ subject matter jurisdiction ” once it denied the JNOV motion on September

22 , 2017

. 18 On that date, Mackey Price, LLC claims that Jones’s July 27 notice of appea l became effective and stripped the district court of jurisdiction over the case. And for that reason Mackey Price, LLC
claims that the district co ur t had no authority to add it to the judgment on November 16 , 2017

. ¶88 The district court ruled that it retaine d jurisdiction over the
case because an amended judgment

— which the district court had
also ordered in its September 22 ruling

— had yet to be entered

. For
that reason

, t he district court concluded that there was still no final judgment to effectively appeal

. ¶89 We agree with the district court. Granted, the general rule is that “jurisdiction transfers from the district court to the appellate
court” for most matters “[o]nce a notice of appeal is filed.” Garver v. Rosenberg , 2014 UT 42, ¶ 10, 347 P.3d 380. But thi s general rule is

__________________________________________________________ _ _ _

18 Mackey Price, LLC acknowledges that the district court retained jurisdiction to rule on its rule 50(b) JNOV motion, filed July 27, 2017. See U TAH R. A PP

. P. 4(b)(1)(A) (listing a rule 50(b) motion as one that tolls the time for parties to appeal a judgment).Cite as: 2020 UT 25

Opinion of the Court

29 subject to important exception s 19

— including the principle that “ a premature notice of appeal does not effectuate a transfer of jurisdiction to review the merits of a case. ” Id. ¶ 15. A nd a notice of appeal is premature (and thus ineffective) if it is filed before the entry of final judgment. See id. ¶ 12 (“[J] urisdiction transfers from the district court to the appellate court only where : (1) the district court
has .

. . announced its decision, and a subsequent final judgment is

e ntered in conformity with the announcement ; and (2) the appealing party files a timely notice of appeal. ” (emphas e s added) )

. ¶90 In its September 22 ruling , the district court rejected MPTO’s JNOV motion and explicitly directed Jones to prepare an amended judgment (at that time, to remove Mackey Price, LLC). At that point, Jones’s July 27 notice of appeal was premature, a nd the district court retained jurisdiction

. See i d. ¶ 10 (“[A]n untimely notice may ‘ trigger stern consequences, ’ precluding the appellate court from exercising jurisdiction .” (citation omitted) )

. When the district court granted Jones’s motion to re

- add Mackey Price, LLC to the judgment on November 16, there still had been no appealable “ final judgment

. . . entered in conformity with the announcement” the district court had made in its September 22 ruling

. I t was not until December 1 that the
district court entered a final, amended judgment. So it was not until
that date that Jones’s July 27 notice of appeal became effective and deprive d the district court of jurisdiction over most matters

. See

U TAH R. A PP

. P. 4( c ) (“ A notice of appeal filed after the announcement of a decision, judgment, or order but before entry of the judgment or order shall be treated as filed after such entry and on the day thereof. ”). O n that basis we conclude that the district court retained jurisdiction to decide Jones’s rule 21/25 motion on November 16

.

__________________________________________________________ _ _ _

19 O ur cases also recognize another exception that could potentially apply here

— district courts retain jurisdiction over some post

- judgment proceedings, including “ orders relating to enforcement of a judgment when a judgment is not stayed pending appeal .” Garv er v. Rosenberg , 2014 UT 42, ¶ 10 n.12, 347 P.3d 380 . A proper motion for substitution of a successor entity could conceivably fall within a district court’s jurisdiction over certain
post

- judgment proceedings. See supra ¶ 68 n.13. We need not decide
the m atter here, however, because we conclude that the notice of appeal did not become effective until after the challenged decision.J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

30 2

. Substitution U nder R ule s 21 and 25

¶91 “ I n case of any transfer of interest, ” rule 25 provides that an

“ action may be continued by or against the original party, unless the court upon motion directs the person to whom the interest is transferred to be substituted in the action or joined with the original party.” U TAH R. C IV

. P. 25( c ). Under the terms of t he rule

, the party seeking to add a successor entity need only “serve the motion and any notice of hearing .

. . upon persons not parties in the manner provided in Rule 4 for the service of a summons.” Id

. 25(a)(1) , (c )

. So substitution is available under rule 25 after service of a motion, notice of a hearing, and appropriate proceedings on the question of whether the new party is an entity “to whom the [original party’s]
interest is transferred.” Id. 25 (c). Such a motion, moreover, may be
filed after a jury verdict

. See id

. 21 (“Parties may be dropped or added by order of the court on motion of any party or of its own

initiative at any stage of the action and on such terms as are just.” (emphasis added) )

. 20 Th ese rules thus provide authority for a court

__________________________________________________________ _ _ _

20 Rule 21 ostensibly deals with the “ [ m ] isjoinder and [ n ] on

- joinder of [ p ] arties,” while rule 25 handles the more specific process of “ [ s ] ubstitution.” But the rules clearly overlap. See U TAH R.

C IV

. P. 25(c) (allowing a successor interest to be “substituted in the

action or joined with the original party” (emphasis added)); id. 21 (allowing parties to be generally “dropped or added”). Importantly, moreover, rule 25(a)(1) places a ninety

- day time limit only on the substitution of successors for deceased parties. And that implies that
there is no similar time limit on substitutions of successors in

interest. See A NTONIN S CALIA & B RYAN A. G ARNER , R EADING L AW 107 (2012) (“The expression of one thing implies the exclusion of others.”). Federal authorities applying a parallel federal rule agree. Because federal rule 25(c) is “wholly permissive,” a leading federal treatise
holds that “there is no time limit on moving to substitute under its provisions”

— so long as the district court otherwise retains jurisdiction. See 7C C HARLES A LAN W RIGHT & A RTHUR R. M ILLER , F EDERAL P RACTICE & P ROCEDURE § 1958 (3d ed. 2018) ; id. (noting that
the “ most significant feature ” of the nearly identical federal rule 25(c) is that it “ does not require that anything be done after an
interest has been transferred ,” because “[t] he action may be continued by or against the original party, and the judgment will be binding on the successor in interest even though the successor is not (continued .

. .)Cite as: 2020 UT 25

Opinion of the Court

31 to add a party to a judgment as a successor in interest to a party to the original proceedings

— even after the jury has returned a verdict

. ¶92 Where mere substitution of a successor entity is sought, there is no requirement that the plaintiff initiat e a new proceeding by service of a summons and complaint. Brigham Young University v. Tremco Consultants

, Inc.

, 2007 UT 17, ¶ 39, 156 P.3d 782, is
di stinguishable. Tremco , as noted above, see supra ¶ ¶ 6 4

– 6 8

, requires an entirely new proceeding where the plaintiff is asserting a new

common

- law or statutory claim

— like alter ego or fraudulent
transfer

— that seeks to establish freestanding, independent liability
for a new party. 2017 UT 17, ¶ 39 (“ In light of the status conferred through the development of the common law and legislative action

u pon alter ego and fraudulent transfer, it is apparent that a claim founded on either theory is a civil action that must be prosecuted in the manner prescribed in the Utah Rules of Civil Procedure, commencing with the filing of a summons and complaint and n ot the abbreviated post

-

judgment collection procedures of rule 69

. ”). The domain of rule 25 substitution is different. Here we are dealing not with a new cause of action with its own separate elements but the extension of liability on an entity properly jo ined to the suit as a

successor to the existing defendant. As noted, r ule 25 specifically allows for a more truncated process under the umbrella of the initial proceeding , requiring only that a party seeking to add an alleged
successor “serve the motion an d any notice of hearing” under r ule 4.

U TAH R. C IV

. P. 25(a)(1) , (c)

. ¶93 We reject Mackey Price, LLC’s jurisdictional arguments on
this basis. 21 Because Jones was seeking to add Mackey Price, LLC as

__________________________________________________________ _ _ _ named ”). The federal counterpart to our rule 25(c) has thus been deemed to allow for substitution not just post

- verdict, but post

- judgment (usually where necessary to facilitate enforcem ent of a judgment). See, e.g. , Negrón

- Almeda v. Santiago , 579 F.3d 45, 52 (1st Cir. 2009); Luxliner P.L. Exp., Co. v. RDI/Luxliner, Inc. , 13 F.3d 69, 70 (3d Cir. 1993); Panther Pumps & Equip. Co., Inc. v. Hydrocraft, Inc. , 566 F.2d 8, 23 (7th Cir. 1977); T FG

– Indiana, L.P. v. Hanco, Inc. , No. 2:12

–

cv

– 00146 DN, 2014 WL 6473108, at *1 (D. Utah Nov. 18, 2014).

21 We also reject Mackey Price, LLC’s suggestion that adding a successor entity to a judgment under rules 21 and 25 runs afoul of “due process.” Our opini on in Brigham Young University v. Tremco Consultants, Inc. , does suggest that the unnamed parties in that case were “denied their requisite measure of due process of law when the (continued .

. .)J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

32 a successor entity to MPTO, we hold that Jones was not required to initiate a new proceeding against Mackey Price, LLC by service of a summons and complaint. Jones was entitled to seek substitution of Mackey Price, LLC for MPTO under rules 21 and 25

.

3

. Default of Mackey Price, LLC

¶94 Our conclusion that rule 25 substitution is available in post

- verdict proceedings does not exhaust all of Mackey Price, LLC’s challenges to the proceedings below. Mackey Price, LLC also claims
tha t it was entitled to be heard on the merits

— on whether it was in

__________________________________________________________ _ _ _ district court extended liability to them .” 2007 UT 17, ¶ 27, 156 P.3d

782. But Tremco nowhere held that the substitution of a successor entity is a violation of the Due Process Clause of the Utah Constitution. Quite the contrary. Our holding in Tremco was rooted in the language and structure of ou r rules of civil procedure. See i d. ¶ 29 (holding that a party “who pursue[s] civil actions in conformity with the rules of civil procedure” is presumptively entitled “to invoke the coercive power of the state to seize property or to command a party to con form its conduct to the court’s decrees”). The problem in Tremco was the plaintiff’s failure to pursue civil litigation in conformance with our rules. While we made general reference to the principle of “due process,” we never established any freestanding constitutional right. Instead we held that “[o]ur rules of civil procedure lend operational expression” to the “abstract” promise of “due process” and are “‘designed to provide a pattern of regularity of procedure which the parties and the courts [can] fol low and rely upon.’” Id. (second alteration in original) (citation omitted). We reiterate those principles here. Mackey Price, LLC’s rights to due process are given “operational expression” in our rules of civil procedure. Those rights are adequately protected by the fair and proper application of rules 21 and 25. And Mackey Price, LLC has provided no basis for the establishment of a “due process” right that provides greater protections than those established in our civil rules.

See Neese v. Utah Bd. of Pardons & Parole , 2017 UT 89, ¶ 100, 416 P.3d 663 (explaining that the content o f “general, abstract” constitutional principles like the Due Process Clause must be based on how the founding generation would have understood those principles); In re Discipline of Steffensen , 2016 UT 18, ¶ 7, 373 P.3d 186 (“[T] he Due
Process Clause is not a free

- wheeling constitutional license for courts
to assure fairness on a case

- by

- case basis. ”).Cite as: 2020 UT 25

Opinion of the Court

33 fact a successor entity to MPTO. O n this point we agree, and reverse
and remand.

¶95 Because Mackey Price, LLC was not a party to the original proceedings, the district court required Jones to serve the motion on
the LLC pursuant to rule 4. Jones did so. That was all the notice to

w hich Mackey Price, LLC was entitled. But the district court ne v er required that Jones demonstrate that Mackey Price, LLC was in fact a

successor in interest to MPTO. Instead, t he district court considered a memorandum submitted by Mackey Price, LLC and defaulted the

LLC on the ground that it s memo challenged only “procedural issues” that the district court found unavailing : To the extent Mackey Price, LLC had disputed the factual allegations for joinder, the Court was prepared to schedule an evidentiary hearing to resolve the disputes

. But Mackey Price, LLC does not dispute the
factual allegations and, instead , focuses its opposition entirely on procedural issues. The Court has now resolved the procedural arguments against Mackey Price, LLC. And because M ackey Price, LLC raised no argument or opposition to the merits of the Motion, there remains nothing to litigate. Accordingly, the
Court determines that Plaintiff is entitled to all relief requested in the Motion.

¶96 This was error. Mackey Price, LLC was enti tled to appear specially and challenge the district court’s jurisdiction and then argue the merits of the rule 25 motion if and when the di strict court rejected its procedural challenge. Mackey Price, LLC was not required to immediately address the merits of the rule 25 motion, as the district court suggested, or to affirmatively request an evidentiary hearing for disposition on the merits, as Jones suggests on appeal. As a threshold matter of procedure, Mackey Price, LLC had every right to make a special a ppearance and to challenge the court’s jurisdiction. Once the district court rejected that challenge, it

s hould have given Mackey Price, LLC an opportunity to be heard on
the merits. 22

__________________________________________________________ _ _ _

22 In fairness to the district court, this procedure is not clearly set forth in our rules or case law. We reverse nonetheless, however, because the prescri bed procedure reflects the threshold nature of the (continued .

. .)J ONES v. M ACKEY P RICE T HOMPSON & O STLER
Opinion of the Court

34 ¶97 The procedure for challeng ing the attach ment of a non

- party

as a success or in interest under rule 25 may thus find a parallel in
that for filing a rule 12(b) motion . When a party contests a court’s jurisdiction under rule 12(b) , it is not required to affirmatively preserve the right to argue the merits of the underlying claim. I t may simply make its 12(b) argument , receive an adverse ruling from the district court, and then contest the merits. This is the notion of a special app earance that is baked into rule 12

. See U TAH R. C IV

. P. 12(a)(1) (“If the court denies the [Rule 12] motion .

. . the responsive pleading shall be served within 14 days after notice of the court’s
action.” (emphasis added) ) ; see also id. 12(d) (“ The defens es specifically enumerated (1)

- (7) in subdivision (b) of this rule, whether made in a pleading or by motion

. . . shall be heard and
determined before trial on application of any party, unless the court orders that the hearings and determination ther eof be deferred until
the trial.” (emphasis added) )

. And we believe that such a process is appropriate in the context of a rule 25 substitution motion as well

— a point that our advisory committee may wish to take up in a proposed amendment to this rule

. ¶98 This principle should have governed here. Once the district court determined that it had jurisdiction over Mackey Price, LLC, it should have required Jones to show that Mackey Price, LLC was in
fact a successor in interest to MPTO. The district court shoul d not
have take n Mackey Price, LLC’s silence during a special appearance as a concession or endorsement of Jones’s position. We reverse and remand for a resolution of Mackey Price, LLC’s status on the

merits

— under procedures deemed appropriate by the distr ict court
on remand

.
IV . CONCLUSION

¶99 We reverse the dismissal of Jones’s fraudulent transfer and punitive damages claims, the decision that a constructive trust wa s categorically unavailable , and the default dete rmination that Mackey Price, LLC w as a succes sor in interest to MPTO. But we affirm the district court in all other respects and remand for further proceedings consistent with this opinion.

__________________________________________________________ _ _ _ jurisdictional inquiry and parallels how our civil rules handle analogous procedural matters.