2018 UT App 47

THE UTAH COURT OF APPEALS

PATRICIA BECKMAN,

Appellant,

v.

CYBERTARY FRANCHISING LLC, FRANCHISE FOUNDRY LLC,

AND CHRISTIAN FAULCONER,

Appellees.

Opinion

No. 20150295-CA

Filed March 22, 2018

Fourth District Court, Provo Department

The Honorable Darold J. McDade

No. 110402922

Andrew W. Stavros and Austin B. Egan, Attorneys

for Appellant

Daniel K. Brough and James C. Dunkelberger, 

Attorneys for Appellees

JUDGE JILL M. POHLMAN authored this Opinion, in which JUDGES

MICHELE M. CHRISTIANSEN and DAVID N. MORTENSEN concurred.

POHLMAN, Judge:

¶1 Patricia Beckman appeals the trial court’s judgment in her 

lawsuit against Cybertary Franchising LLC, Franchise Foundry 

LLC, and Christian Faulconer (collectively, Defendants). We 

affirm in part, reverse in part, vacate in part, and remand for 

further proceedings.

BACKGROUND

¶2 In 2005 Beckman established Cybertary, a company 

offering virtual administrative services to businesses. At a 

business conference in 2010, Beckman met Faulconer, a principal 
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of Franchise Foundry. Franchise Foundry provided marketing 

services for companies, and Faulconer expressed an interest in 

marketing for and investing in Cybertary.

¶3 Beckman and Faulconer ultimately negotiated three 

agreements. First, Beckman, Franchise Foundry, and another 

entity executed an operating agreement for Cybertary. Second, 

Cybertary and Franchise Foundry entered into a service 

agreement under which Franchise Foundry agreed to perform 

marketing and sales services in exchange for a minority share in 

Cybertary. Third, Cybertary and Beckman executed an 

employment agreement (the Employment Agreement) under 

which Cybertary agreed to employ Beckman as its chief 

executive officer for a three-year term “[s]ubject to earlier 

termination as provided in” that agreement. The Employment 

Agreement set a base salary for Beckman and provided for 

bonuses and a monthly benefits allowance. The Employment 

Agreement allowed Cybertary to terminate Beckman’s 

employment for “cause” and enumerated seven events that 

would constitute “cause.”

¶4 Beckman’s relationship with Cybertary soured, and 

Cybertary failed to pay her according to the terms of the 

Employment Agreement. Concurrently, Beckman filed for 

bankruptcy on May 20, 2011. In Beckman’s view, Faulconer was 

threatening to terminate her employment and was considering 

buying out her shares of Cybertary through the bankruptcy 

proceeding. In October 2011, Beckman’s counsel sent a letter to 

Faulconer and a Cybertary manager threatening litigation and 

demanding that Cybertary pay the amounts it owed Beckman. 

Faulconer responded and arranged a phone call “for settlement 

purposes only.”

¶5 On October 19, 2011, Beckman and Faulconer had a 

ninety-minute phone call, which Beckman recorded (the October 

conversation). At the beginning of the call, Faulconer stated, 

“This whole conversation . . . is really just for settlement 

purposes only . . . .” Beckman acknowledged this preface, 

stating, “Now you said this discussion is for settlement purposes 
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only,” and, “If . . . this entire discussion is aiming towards a 

settlement, what is it that you propose?” She and Faulconer then 

candidly discussed Beckman’s grievances but did not resolve 

them.

¶6 On November 2, 2011, Beckman sued Cybertary. Beckman 

alleged claims for breach of contract and unjust enrichment 

based on Cybertary’s failure to pay her base salary and benefits 

allowance. Because Beckman expected that all amounts owed to 

her before May 2011 would be addressed in the bankruptcy 

proceeding, she sought compensation only for those amounts 

that came due after her bankruptcy filing.

¶7 Two weeks later, on November 14, 2011, Cybertary 

formally notified Beckman that, “effective immediately,” it was 

terminating her employment for cause. The notice cited three 

subsections of the Employment Agreement’s termination 

provision to support its determination of cause: 

subsections 6(b)(ii), (iii), and (vi).1 As evidence of cause, 

Cybertary explained that it had reason to believe that Beckman 

had engaged in certain conduct that discredited Cybertary or 

was detrimental to its reputation or its results of operation or 

 

1. Those provisions are as follows:

(ii) Executive’s willful breach, habitual neglect, 

gross neglect, or dereliction of Executive’s duties 

under this Agreement;

(iii) Executive’s material misconduct with regard to 

the Company, including, but not limited to, 

Executive’s failure to comply with Company’s 

written rules and policies; . . .

(vi) Any conduct, whether dishonest, fraudulent, 

or otherwise, that discredits the Company or is 

detrimental to the reputation of the Company or 

the Company’s results of operations or 

business . . . . 
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business, pursuant to subsection 6(b)(vi). Cybertary further 

explained,

Not only does that [particular] conduct fall 

squarely within Section 6(b)(vi) . . . and its 

prohibition on conduct that harms Cybertary’s 

reputation or operations, but [it] also constitutes 

“gross neglect” or “dereliction” of your duties 

pursuant to Section 6(b)(ii) . . . , as well as “material 

misconduct with regard to” Cybertary pursuant to 

Section 6(b)(iii) . . . .

As further evidence of cause, Cybertary believes 

that you have failed to perform certain crucial 

duties related to your responsibility as Cybertary’s 

chief executive officer. Those failures constitute 

“habitual neglect” or “dereliction” of your duties 

pursuant to Section 6(b)(ii) . . . , as well as “material 

misconduct” pursuant to Section 6(b)(iii).

The notice also stated that the grounds articulated as cause for 

Beckman’s termination were “not intended to be a 

comprehensive list” and that Cybertary “reserve[d] the right to 

articulate additional grounds for terminating [Beckman’s] 

employment for cause.”

¶8 Beckman subsequently amended her complaint, adding 

Franchise Foundry and Faulconer as defendants. Beckman’s 

amended breach of contract claim stated,

In retaliation for filing this lawsuit, Faulconer and 

Franchise Foundry have attempted on behalf of 

Cybertary to terminate Beckman as Chief Executive 

Officer for Cybertary. Faulconer and Franchise 

Foundry have interfered with Beckman’s ability to 

perform her duties as Chief Executive Officer . . . . 

Such retaliation and actions on behalf of Cybertary 
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further constitute a material breach of the 

Employment Agreement.

Beckman also added a claim for declaratory judgment, seeking 

to nullify Cybertary’s termination of the Employment 

Agreement. In her prayer for relief, Beckman indicated that at 

trial she would prove damages believed to be “in excess of 

$300,000, plus interest, attorney’s fees and costs.”

¶9 Cybertary filed counterclaims against Beckman for, 

among other things, breach of contract, breach of the implied 

covenant of good faith and fair dealing, and breach of fiduciary 

duty. Cybertary alleged that Beckman had disparaged it, failed 

to keep its affairs confidential, and failed to perform her duties 

“in an effective and careful manner.” Cybertary also asserted 

that it had “sustained significant damages” and, without 

specifying an amount, sought “general, specific, and 

consequential damages, in an amount to be proven at trial.”

¶10 In March 2013, Beckman sought leave to amend her 

complaint for a second time. Beckman sought to amend her 

factual allegations, expand her claim for unjust enrichment, and 

add four new causes of action: breach of the operating 

agreement; breach of fiduciary duty; fraudulent inducement; 

and civil conspiracy. The trial court denied the motion, finding 

that it “was untimely and the product of unreasonable delay,”

and that Defendants would be prejudiced if the amendment 

were allowed.

¶11 Beckman and Defendants subsequently filed crossmotions for summary judgment. The trial court denied 

Beckman’s motion but granted Defendants’ motion in part. 

Specifically, it granted summary judgment to Franchise Foundry 

and Faulconer on Beckman’s claim for breach of the 

Employment Agreement. The court explained that it was 

undisputed that “neither Franchise Foundry nor Faulconer are 

parties to [the] Employment Agreement” and reasoned that 

Beckman could not “enforce that contract against individuals or 
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entities that are not parties to the contract.” The court otherwise 

denied Defendants’ motion.

¶12 In advance of trial, Defendants filed a motion in limine, 

requesting that the trial court exclude the recording of the 

October conversation. Defendants argued that the recording 

constituted evidence of settlement negotiations and that it 

therefore should be excluded at trial pursuant to rule 408 of the 

Utah Rules of Evidence. The court agreed and granted 

Defendants’ motion, ruling that “the statements captured therein 

constitute[d] compromise negotiations.”

¶13 The case proceeded to trial. Although Cybertary had 

provided a supplemental disclosure quantifying its claimed 

damages as $373,500, the trial court found that the disclosure 

was untimely and refused to submit the question of Cybertary’s 

damages to the jury. The court subsequently granted Beckman’s 

motion for a directed verdict on Cybertary’s counterclaims.

¶14 Before submitting the case to the jury, the parties 

disagreed about the jury instruction defining “cause” as it 

related to Cybertary’s termination of Beckman’s employment 

(Instruction 12). Beckman asserted that Instruction 12 should be 

worded to define “cause” as the seven events enumerated in the 

Employment Agreement, and she argued that Cybertary was 

required to prove at least one event “by a preponderance of the 

evidence.” Defendants, on the other hand, asserted that 

Instruction 12 should explain that the determination of whether 

one of the events constituted “cause” “was a matter for 

Cybertary’s good business judgment.” Defendants further 

proposed that Instruction 12 provide that “[s]o long as Cybertary 

possessed a fair and honest cause or reason, in good faith, that 

met one of these [seven enumerated] definitions, cause existed to 

terminate Beckman, whether or not the facts that Cybertary 

believed to be true really, in fact, were true.” (Citing Uintah Basin 

Med. Center v. Hardy, 2005 UT App 92, ¶ 16, 110 P.3d 168.)

¶15 The version of Instruction 12 given to the jury included 

Beckman’s language about Cybertary having to prove at least 
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one of the seven enumerated events by a preponderance of the 

evidence, while also including Defendants’ language providing 

that whether “cause” existed “was a matter for Cybertary’s good 

business judgment.”

¶16 The jury found in favor of Beckman, in part. On the 

special verdict form, the jury indicated that Cybertary breached 

the Employment Agreement by failing to pay Beckman’s 

compensation and benefits, but did not breach the agreement by 

terminating her employment without cause. The jury further 

found that neither Franchise Foundry nor Faulconer acted with 

gross negligence or willful misconduct. Although Beckman 

sought an award of $235,041.05, the jury determined that 

Cybertary owed Beckman $84,913.83 in unpaid salary and 

$18,150 in unpaid benefits, totaling $103,063.83 in damages.

¶17 Beckman then moved for an award of prejudgment 

interest. The trial court denied the motion, concluding that 

Beckman’s damages “are not the type of damages that are 

susceptible to an award of prejudgment interest.”

¶18 Beckman and Cybertary also filed competing motions for 

attorney fees. Both relied on the attorney fees provision 

contained in the Employment Agreement. Under that provision,

the “nonprevailing party” “to any proceeding under [the 

Employment Agreement]” pays its own and the other side’s 

reasonable expenses, including attorney fees. The provision 

defined “nonprevailing party” as “the party that the court of 

competent jurisdiction awards less than one-half (1/2) of all of 

the amounts in dispute.”

¶19 The court construed the attorney fees provision “as 

mandating an assessment of whether each party asserting a 

claim under the Employment Agreement is a ‘nonprevailing 

party’ under that claim.” As to Beckman’s fees request, the court 

determined that “[b]ecause Cybertary was awarded less than 

one-half of the amounts it sought against Beckman, it [was] the 

nonprevailing party with respect to its counterclaims, and it 

[was] therefore required to pay Beckman’s attorney fees and 
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costs incurred in defending against those claims.” Accordingly, 

the court awarded Beckman $75,317.24 against Cybertary. As to 

Cybertary’s request for fees, the court determined that Beckman 

was the nonprevailing party with respect to her claims, “having 

recovered less than one half of the amount she sought against 

Cybertary.” Thus, the court found, Beckman was required to pay 

the attorney fees and costs Cybertary incurred in defending 

against her claims, which amounted to $62,181.90. The court 

then subtracted the amount awarded to Cybertary from the 

amount awarded to Beckman, resulting in a net award of 

attorney fees and costs of $13,135.34 to Beckman.

¶20 Franchise Foundry and Faulconer also requested attorney 

fees. The trial court determined that because Franchise Foundry 

and Faulconer prevailed on summary judgment on Beckman’s 

claim against them under the Employment Agreement, they 

were entitled to $27,153.33 in attorney fees from Beckman. 

Beckman appeals.

ISSUES AND STANDARDS OF REVIEW

¶21 Beckman advances five main claims of error on appeal. 

First, Beckman contends that the trial court abused its discretion 

by denying her motion for leave to amend her complaint. This 

court “will not disturb a trial court’s denial of a motion to amend 

pleadings absent an abuse of discretion.” Reller v. Argenziano, 

2015 UT App 241, ¶ 14, 360 P.3d 768. Under this standard, we 

will reverse the trial court if its decision “exceeds the limits of 

reasonability.” Coroles v. Sabey, 2003 UT App 339, ¶ 16, 79 P.3d 

974 (citation and internal quotation marks omitted).

¶22 Second, Beckman contends that the trial court incorrectly 

applied rule 408 of the Utah Rules of Evidence and exceeded its 

discretion in refusing to admit an audio recording of the October

conversation on the ground that the recording was evidence of 

compromise negotiations. We review the trial court’s resolution 

of the legal questions underlying the admissibility of evidence 

for correctness and the trial court’s decision to admit or exclude 
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evidence for an abuse of discretion. See State v. Griffin, 2016 UT 

33, ¶ 14, 384 P.3d 186.

¶23 Third, Beckman contends that Instruction 12 incorrectly

defined “cause” with regard to the termination of her 

employment under the Employment Agreement. “A trial court’s 

decision regarding jury instructions presents a question of law, 

which is reviewed for correctness.” Vitale v. Belmont Springs, 916 

P.2d 359, 361 (Utah Ct. App. 1996).

¶24 Fourth, Beckman contends that the trial court erroneously 

failed to award her prejudgment interest. “A trial court’s 

decision to grant or deny prejudgment interest presents a 

question of law which we review for correctness.” Cornia v. 

Wilcox, 898 P.2d 1379, 1387 (Utah 1995).

¶25 Fifth, Beckman contends that the trial court erred in its 

awards of attorney fees. “A challenge to an award of attorney 

fees [based on a] contract or statute . . . presents a question of 

law that we review for correctness.” Brodkin v. Tuhaye Golf, LLC, 

2015 UT App 165, ¶ 34, 355 P.3d 224.

ANALYSIS

I. Leave to Amend

¶26 First, Beckman contends that the trial court abused its 

discretion by denying her motion for leave to file a second 

amended complaint to add four new claims. Beckman argues 

that she should have been allowed to amend her complaint 

because her motion was not untimely, her delay was justified by 

her pending bankruptcy action, and Defendants would have had 

adequate time to prepare to defend against the new claims.

¶27 Rule 15 of the Utah Rules of Civil Procedure allows a 

party, before trial, to amend its pleading “once as a matter of 

course” within twenty-one days after serving the pleading, or, 

where a responsive pleading is required, the earlier of twenty-
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one days after service of that pleading or twenty-one days after 

service of a motion under rule 12(b), (e), or (f).2 Utah R. Civ. P. 

15(a)(1). Additional amendments may be filed “only with the 

court’s permission or the opposing party’s written consent.” Id.

R. 15(a)(2). “The court should freely give permission when 

justice requires.” Id.

¶28 Our supreme court has recently explained that this 

standard requires a district court “to decide whether the 

nonmoving party has identified a ground or factor sufficient to 

defeat the presumption in favor of amendment.” Stichting 

Mayflower Mountain Fonds v. United Park City Mines Co., 2017 UT 

42, ¶ 48. Among the factors that may weigh against a decision to 

allow an amendment are untimeliness, undue delay, prejudice to 

the opposing party, bad faith, and failure to cure pleading 

deficiencies with other, earlier amendments; but, “[t]here is no 

rigid test.” Id. ¶¶ 47–48; see also Daniels v. Gamma West 

Brachytherapy, LLC, 2009 UT 66, ¶ 58, 221 P.3d 256. “Even a single 

consideration or factor may be enough to justify denial of a 

motion for leave to amend.” Stichting Mayflower, 2017 UT 42, 

¶ 48.

¶29 In reviewing a district court’s decision to deny a motion 

for leave to amend under rule 15(a), we owe the court deference 

because rule 15(a) “leaves a lot of discretion in the hands of the 

district judge.” Id. ¶ 52. We afford that discretion because we 

recognize that district courts “are in a much better position than 

appellate courts to make such case-specific determinations as 

whether too much time has passed to fairly allow an 

amendment, whether a party’s delay is the result of an unfair 

tactic or dilatory motive, or whether some other unforeseen 

factor militates for or against a particular result in that particular 

case.” Kelly v. Hard Money Funding, Inc., 2004 UT App 44, ¶ 41, 87 

 

2. Rule 15 was amended in 2016. Although the trial court applied 

an earlier version of the rule, we cite the current version because 

recent amendments do not affect our analysis.
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P.3d 734. Thus, “[t]he question presented is not whether we 

would have granted leave to amend. It is whether we find an 

abuse of discretion in the district judge’s decision to deny the 

motion.” Stichting Mayflower, 2017 UT 42, ¶ 49.

¶30 Under this standard, we affirm. The trial court here based 

its denial of Beckman’s motion to amend on findings of 

untimeliness, unreasonable delay, and prejudice to Defendants. 

Beckman challenges all three of those findings but has not 

demonstrated that the trial court exceeded the bounds of its 

discretion in denying her motion on those grounds.

¶31 First, with respect to timeliness, Beckman argues that her 

motion, filed more than sixteen months after she filed her 

original complaint, was not untimely “as a matter of law.” We 

do not disagree. There is, after all, no “bright line rule” against 

which to judge the timeliness of a motion to amend. See Kelly, 

2004 UT App 44, ¶ 28. However, we are not persuaded that it 

was unreasonable for the trial court to conclude that Beckman’s 

motion was untimely under the circumstances.

¶32 Beckman filed her motion months after the discovery 

deadline had passed3 and after her lawsuit had been dormant for 

 

3. During the hearing on her motion for leave to amend, 

Beckman identified August 15, 2012, as the fact discovery 

deadline and conceded that under rule 26 of the Utah Rules of 

Civil Procedure, “fact discovery has long since closed.” In fact, 

rather than argue that the discovery deadline had not passed (or 

had only recently passed), Beckman focused on the reasons the 

case had been delayed, and advocated for a “new scheduling 

order” and “additional time for discovery.” On appeal, 

Beckman’s argument in her opening brief is similar to the one 

she made to the trial court. Although she argues that the “fact 

discovery cutoff date was September 6, 2012,” she does not 

argue that the litigation was not in an advanced procedural 

stage; rather, she argues that “the time period at issue must 

(continued...)
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some time, causing the trial court judge to observe that the case 

had been “dragging on and dragging on and—and nothing 

done.” Where Beckman sought to significantly expand the scope 

of the lawsuit by adding four new claims (including claims for 

fraud and conspiracy) more than sixteen months into litigation 

that had shown little outward progress, and months after 

deadlines established by rule 26 of the Utah Rules of Civil 

Procedure had passed, we cannot conclude that there was no 

reasonable basis for the court’s timeliness finding.

¶33 Second, and closely related to her untimeliness argument, 

Beckman contends that she was justified in waiting to file her 

amended complaint because of uncertainties associated by her 

then-pending bankruptcy case. She argues that “moving forward 

with new and plausible claims for relief would have increased 

the likelihood that the trustee would have seized those claims,” 

and thus she was justified in waiting until after the bankruptcy 

case concluded. In evaluating a movant’s justification for delay, 

district courts “focus[] on the reasons offered by the moving 

party for failing to include the new facts or allegations in the 

original complaint.” Carter v. Bourgoin Constr., Inc., 2015 UT App 

198, ¶ 11, 357 P.3d 1 (alteration in original) (citation and internal 

quotation marks omitted). “In doing so, a court should look for a 

dilatory motive, a bad faith effort . . . , or unreasonable neglect.” 

 

(...continued)

factor in the delays precipitated by [Defendants].” It is not until 

her reply brief that Beckman takes the position that fact 

discovery did not expire until May 8, 2013, just weeks before the 

trial court heard argument on her motion. Even if Beckman’s 

change of position between the filing of her opening and reply 

brief was excusable due to what appears to be her reliance on the 

wrong version of rule 26, Beckman has offered no justification 

for her suggestion that we should review the trial court’s 

decision based on facts different from those she argued before 

that court. Thus, we will hold her to the representations she 

made there.
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Id. (omission in original) (citation and internal quotation marks 

omitted).

¶34 In this case, Beckman never demonstrated to the trial 

court why she had to wait to file certain claims despite having 

already filed other of her claims while the bankruptcy case was 

pending. In other words, she never explained why her expressed

concern over what actions the trustee could take did not deter 

her from filing the claims pleaded in her original and first 

amended complaints, but did deter her from filing the additional 

claims she proposed to assert in her motion for leave to amend. 

Given the unanswered questions and inherent inconsistencies in 

Beckman’s argument, we cannot conclude that the trial court 

exceeded its broad discretion in finding that Beckman’s delay 

was unreasonable under the circumstances. See Stichting

Mayflower Mountain Fonds v. United Park City Mines Co., 2017 UT 

42, ¶ 52 (“The judge is charged with deciding whether the 

movant had a good reason for not asserting the new claims at an 

earlier stage of the proceedings . . . [a]nd the judge’s findings are 

entitled to deference on appeal. We are in no position to disturb 

them.”).

¶35 Third, as to prejudice, Beckman argues that had she been 

permitted to amend her complaint, Defendants still would have 

had “ample time to adjudicate the issues raised in [her] second 

amended complaint.”

¶36 In its oral ruling, the trial court determined that 

Beckman’s delay in bringing her new claims caused “problems 

with Rule 26,” and Defendants “would be prejudiced if Beckman 

were permitted to file her proposed Second Amended 

Complaint.” The court observed that while discovery could be 

extended, the purpose behind rule 26 is “to make sure things are 

filed timely” and that that purpose was not served by extending 

the litigation to accommodate Beckman’s proposed amendment.

¶37 While we acknowledge that the court could have 

reopened discovery and extended deadlines to accommodate 

Beckman’s amendment, we are again mindful that the trial court 
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is better positioned than we are to assess the potential prejudice 

of an amended pleading on non-moving parties. See Daniels v. 

Gamma West Brachytherapy, LLC, 2009 UT 66, ¶ 60, 221 P.3d 256; 

see also Stichting Mayflower, 2017 UT 42, ¶ 52 (“Under the 

applicable standard of review, we owe deference to the district 

court’s determination that [the moving party’s] delay and the 

impact on the timely resolution of the case were sufficient to 

defeat the presumption in favor of amendment.”). Given the trial 

court’s “involvement in and experience with the case,” Stichting 

Mayflower, 2017 UT 42, ¶ 53, it was in a better position than this 

court to assess the impact on Defendants of Beckman’s proposed 

amendment by which she sought to add, after the close of 

discovery, four substantive claims to a case that had already 

extended beyond the timelines established under rule 26. Thus, 

there is a basis for the trial court’s finding, and we conclude that 

the trial court did not exceed its broad discretion in denying 

leave to amend.

II. The Exclusion of the October Conversation

¶38 Beckman next contends that the trial court erred in 

excluding, pursuant to rule 408 of the Utah Rules of Evidence,

the audio recording of the October conversation. She argues that 

the recording does not fall within the scope of rule 408 because 

(1) no dispute existed at the time of the call, (2) the call 

constituted a business communication, and (3) Faulconer did not 

offer during the call to settle any disputed claim. Alternatively, 

Beckman argues that the recording should nevertheless be 

admitted because the recording contains statements relevant to

the parties’ claims and defenses and would be “otherwise 

discoverable.”

¶39 Rule 408 provides that evidence of compromise offers and 

negotiations “is not admissible either to prove or disprove 

liability for or the validity or amount of a disputed claim.” Utah

R. Evid. 408(a). Specifically, when offered for that purpose, the 

rule bars evidence of “(1) furnishing, promising, or offering—or 

accepting, promising to accept, or offering to accept—a valuable 
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consideration in order to compromise or attempt to compromise 

the claim; and (2) conduct or a statement made in compromise 

negotiations.” Id. “[F]or the exclusionary rule to attach, the party 

seeking to have evidence of offers to compromise or statements 

made in the course thereof excluded must show that the 

discussions in question were made in compromise negotiations.” 

Davidson v. Prince, 813 P.2d 1225, 1232 (Utah Ct. App. 1991)

(citation and internal quotation marks omitted). The rule is 

“‘premised on the idea that encouraging settlement of civil 

claims justifies excluding otherwise probative evidence from 

civil lawsuits.’” State v. Mead, 2001 UT 58, ¶ 46, 27 P.3d 1115 

(quoting Manko v. United States, 87 F.3d 50, 54 (2d Cir. 1996)).

¶40 Rule 408 has two caveats. First, evidence subject to the 

rule may nevertheless be admitted if offered “for another 

purpose, such as proving a witness’s bias or prejudice, negating 

a contention of undue delay, or proving an effort to obstruct a 

criminal investigation or prosecution.” Utah R. Evid. 408(b)(1). 

Second, “otherwise discoverable” evidence need not be excluded 

“merely because it is presented in the course of compromise 

negotiations.” Id. R. 408(b)(2). In other words, rule 408 “does not 

immunize the information included in fact statements, but, in 

order to encourage free discussion, merely makes inadmissible 

the statements themselves when offered as admissions of a party 

opponent.” Edward L. Kimball & Ronald N. Boyce, Utah 

Evidence Law 4-130 (2d ed. 2004).

¶41 We agree with the trial court that the recording of the 

October conversation is evidence of “conduct [and] statement[s] 

made in compromise negotiations.” See Utah R. Evid. 408(a)(2). 

Both Beckman and Faulconer engaged in the October 

conversation with the understanding that the purpose of the 

colloquy was to discuss a resolution of their dispute. Faulconer 

suggested the parties speak after Beckman had threatened 

litigation, and in his email arranging the phone call, Faulconer 

twice stated that if Beckman agreed to participate, the discussion

would be “for settlement purposes only.” Faulconer further

reiterated the point at the beginning of the call, and he stated 
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that he would be frank to aid in their effort to “reach a 

settlement” and “to make this work.”

¶42 For her part, Beckman demonstrated her assent to 

Faulconer’s condition by proceeding with the conversation, 

stating that her attorney had given them the “green light” to 

have the discussion. She also twice acknowledged that the stated 

purpose of the call was “for settlement . . . only,” and for ninety 

minutes she discussed with Faulconer the grounds of their 

dispute and proposals to resolve it. The record therefore 

supports the trial court’s conclusion that the ensuing “statements 

captured [in the recording] constitute[d] compromise 

negotiations,” and the recording is inadmissible under rule 408 

“either to prove or disprove liability for or the validity or 

amount of” Beckman’s claims. See id.

¶43 Beckman nevertheless argues that because, at the time of 

the call, Faulconer had not disputed that Beckman’s wages were 

owed to her and Cybertary had not terminated her employment, 

there were no disputes to compromise and the conversation was 

simply a “business communication.” The record does not 

support Beckman’s claim. Midway through the phone call, 

Beckman expressly confirmed the parties’ dispute when she 

stated: “We are here to discuss the dispute related to the 

employment agreement.” She also began the conversation by 

saying that she was recording it so that she could share it with 

her attorney. And, although the recording evidences Faulconer’s

agreement that Beckman had earned her wages, it also shows

that the parties sharply disagreed over whether Beckman shared 

responsibility for the wages not being paid; whether Beckman, 

Faulconer, and Franchise Foundry could be held individually 

liable for the wages; and where funds would come from to pay 

the wages. Similarly, with regard to Beckman’s employment, 

although she had not yet been terminated, the parties discussed 

their disagreement over whether Faulconer had cause and 

authority to terminate Beckman, and she sought, as a step 

toward resolution of their dispute, an assurance that Faulconer 

had no such intent. Thus, the recording itself amply 
Beckman v. Cybertary Franchising

20150295-CA 17 2018 UT App 47

demonstrates that the parties had an ongoing dispute and that

the phone call was not a business communication.

¶44 Beckman further argues that the trial court erred in 

excluding the recording under rule 408 because the recording 

does not constitute evidence of “furnishing, promising, or 

offering—or accepting, promising to accept, or offering to 

accept—valuable consideration in order to compromise or 

attempt to compromise the claim” under rule 408(a)(1).

Beckman’s argument is misplaced. The court excluded the 

evidence under rule 408(a)(2), as “conduct or . . . statement[s] 

made in compromise negotiations.” Because the court did not 

rely on subsection (a)(1) of rule 408 to find the recording 

inadmissible, we need not consider whether Faulconer’s offers of 

compromise constitute “valuable consideration” under that 

subsection.

¶45 As for rule 408’s caveats, Beckman does not claim that she 

offered the recording for a purpose other than to “prove or 

disprove liability for or the validity or amount of a disputed 

claim,” see Utah R. Evid. 408(b)(1), but she suggests that 

unidentified statements in the recording are “otherwise 

discoverable” and therefore admissible, see id. R. 408(b)(2). Rule 

408(b)(2) states that courts are “not required to exclude evidence 

otherwise discoverable merely because it is presented in the 

course of compromise negotiations.” Id. We agree with 

Defendants that rule 408(b)(2) does not apply because Beckman 

seeks to admit “a recording of the actual compromise 

negotiations to prove certain alleged admissions by Faulconer.” 

(Emphasis omitted.) For the reasons stated above, the trial court 

did not err in concluding that evidence of those negotiations is 

inadmissible under rule 408(a)(2).

III. The Jury Instruction Regarding “Cause” for Termination

¶46 Beckman next contends that the trial court erred in 

instructing the jury as to the definition of “cause” in connection 

with her claim that Cybertary breached the Employment 

Agreement when it terminated her employment without cause. 
Beckman v. Cybertary Franchising

20150295-CA 18 2018 UT App 47

Under the Employment Agreement, the parties agreed that 

Cybertary would employ Beckman for three years subject to 

earlier termination as provided in the “Termination for Cause” 

provision. It stated that Beckman’s term of employment “may be 

terminated by [Cybertary] immediately for ‘cause,’” and 

enumerated seven “events with respect to [Beckman]” that 

“shall constitute ‘[c]ause’” for immediate termination:

(i) Executive’s commission of a felony of any kind 

or any other crime (whether it is a felony or not) 

involving securities fraud, theft, or moral 

turpitude;

(ii) Executive’s willful breach, habitual neglect, 

gross neglect, or dereliction of Executive’s duties 

under this Agreement;

(iii) Executive’s material misconduct with regard to 

the Company, including, but not limited to, 

Executive’s failure to comply with [the] Company’s 

written rules and policies;

(iv) Executive’s failure to follow in good faith the 

reasonable lawful direction of the Board or any 

committee thereof;

(v) Any act by Executive of sexual harassment (or 

Executive’s creating a hostile work environment) 

or any other activity of Executive prohibited by 

state, local, and/or federal law with respect to 

discrimination based on age, sex, race, religion, or 

national origin;

(vi) Any conduct, whether dishonest, fraudulent, 

or otherwise, that discredits the Company or is 

detrimental to the reputation of the Company or 

the Company’s results of operations or business; 

and/or 
Beckman v. Cybertary Franchising

20150295-CA 19 2018 UT App 47

(vii) Any breach of any of Executive’s obligations 

under the Inventions, Confidentiality, and 

Restrictive Covenant Agreement referred to below.

¶47 Instruction 12 identified these events4 and specified, 

“‘Cause’ has been defined in . . . the Employment Agreement 

and requires Cybertary to prove, by a preponderance of the 

evidence,” one of the events. Beckman’s challenge focuses on 

additional language included in Instruction 12, which applies 

the business judgment rule to the determination of cause:

In determining whether Cybertary breached the 

Employment Agreement by inaccurately 

determining that one or more of these definitions 

of “cause” existed, you must remember that the 

determination of whether one or more of these 

definitions was satisfied was a matter for 

Cybertary’s good business judgment. So long as 

Cybertary possessed a fair and honest cause or 

reason, in good faith, that met one of these 

definitions, cause existed to terminate Beckman, 

whether or not the facts that Cybertary believed to 

be true really, in fact, were true.

Beckman asserts that by instructing the jury regarding 

Cybertary’s good business judgment, the trial court incorrectly 

“looked beyond the plain language of [the] Employment 

Agreement and inserted its own definition of what constitutes 

‘cause’ for termination.” Cybertary responds that the 

Employment Agreement does not define “what the employer 

must prove to establish cause for termination” and that the jury 

was properly instructed as to Utah law in that regard. According 

to Cybertary, “[e]mployers are not required to prove the facts 

 

4. We note for the sake of accuracy that Instruction 12 actually 

included event (vi) twice and omitted event (iv). Neither party 

has complained about that apparent error.
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20150295-CA 20 2018 UT App 47

giving rise to the termination so long as the employer can 

demonstrate a reasonable, good-faith belief that the facts 

existed.” Cybertary’s argument and the trial court’s decision to 

include the challenged language in Instruction 12 rested on their

interpretation of Uintah Basin Medical Center v. Hardy, 2005 UT 

App 92, 110 P.3d 168.

¶48 The dispute in Uintah Basin centered on a two-page 

employment agreement that provided that the agreement could 

be terminated after ninety days’ “written notice for just cause of 

termination by either party.” Id. ¶ 2 (internal quotation marks 

omitted). The agreement did not define “‘just cause’ or otherwise 

clarify what grounds would justify termination.” Id. This court 

concluded, in the absence of evidence that the parties intended a 

meaning of just cause unique to their agreement, that “the 

parties intended the term to have its ordinary meaning.” Id. ¶ 17. 

The court explained that the term “just cause” is “ordinarily 

understood to provide employers with power to terminate an 

employee for legitimate business reasons and in the interest of 

improving client services as long as the justification is not a mere 

pretext for a capricious, bad faith, or illegal termination.” Id.; see 

also id. ¶ 16 (explaining that “termination for just cause is widely 

understood to permit discharge only for ‘a fair and honest cause 

or reason, regulated by good faith . . . as opposed to one that is 

trivial, capricious, unrelated to business needs or goals, or 

pretextual’” (omission in original) (quoting Guz v. Bechtel Nat’l, 

Inc., 8 P.3d 1089, 1100 (Cal. 2000))); id. (“What constitutes good 

cause for dismissal of an employee is generally a matter for an 

employer’s good business judgment . . . .” (omission in original) 

(citation and internal quotation marks omitted)).

¶49 With respect to “what an employer must show to prove it 

terminated an employee for just cause,” the court adopted an 

“objective reasonableness approach,” id. ¶¶ 21, 23, under which

employers may “justify termination with an objective good faith 

reason supported by facts reasonably believed to be true by the 

employer,” id. ¶ 22. Courts applying this approach should 

recognize that “an employer’s [proffered] justification for 
Beckman v. Cybertary Franchising

20150295-CA 21 2018 UT App 47

discharging an employee should not be taken at face value but 

also recognize that a judge or jury should not be called upon to 

second-guess an employer’s business decisions.” Id. Thus, the 

employer in Uintah Basin could establish just cause for 

termination by showing that it “acted in good faith by 

adequately considering the facts it reasonably believed to be true 

at the time it made the decision.”5 Id. ¶ 23.

¶50 Beckman asserts that because the Employment 

Agreement “specifically defines what ‘cause’ for termination 

means,” the objective reasonableness approach adopted in 

Uintah Basin does not apply. She argues that the Employment 

Agreement should be interpreted according to its plain 

language, and that the holding of Uintah Basin with respect to

“just cause” cannot be invoked to modify the terms of her 

contract in which “cause” has been expressly defined. Cybertary 

disagrees, arguing that Uintah Basin “is not so readily restricted 

to its facts” and that the court’s reasoning “is still pertinent.” 

Cybertary contends that “[a]lthough the Employment 

Agreement enumerated general grounds for cause, rather than 

an undefined articulation of ‘just cause,’ the enumerated 

grounds are no more instructive and offer no more practical 

guidance.” Thus, Cybertary argues, “Uintah teaches that such 

definitions, like ‘just cause’ generally, must be interpreted and 

applied, in the first instance, by the employer.”

¶51 We agree with Beckman. “When interpreting a contract, 

our task is to ascertain the parties’ intent.” Mind & Motion Utah 

Invs., LLC v. Celtic Bank Corp., 2016 UT 6, ¶ 24, 367 P.3d 994; see 

also Berube v. Fashion Centre, Ltd., 771 P.2d 1033, 1044 (Utah 1989) 

(“[E]mployment contracts should be construed to give effect to 

 

5. In adopting the objective reasonableness approach, the court 

acknowledged but rejected an approach requiring “the employer 

to prove that the conditions necessitating termination actually 

existed.” Uintah Basin Med. Center v. Hardy, 2005 UT App 92,

¶¶ 21–23, 110 P.3d 168.
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20150295-CA 22 2018 UT App 47

the intent of the parties.”). “And the best indication of the 

parties’ intent is the ordinary meaning of the contract’s terms.” 

Mind & Motion, 2016 UT 6, ¶ 24. “If the language within the four 

corners of the contract is unambiguous, the parties’ intentions 

are determined from the plain meaning of the contractual 

language, and the contract may be interpreted as a matter of 

law.” WebBank v. American Gen. Annuity Service Corp., 2002 UT 

88, ¶ 19, 54 P.3d 1139 (citation and internal quotation marks 

omitted). 

¶52 In Uintah Basin, the parties had agreed to an employment 

arrangement that could be terminated for “just cause.” Uintah 

Basin Med. Center v. Hardy, 2005 UT App 92, ¶¶ 2, 10, 110 P.3d 

168. Because the parties did not define the term, this court 

concluded that the parties intended it to have its ordinary 

meaning—a meaning that included a measure of discretion. Id.

¶¶ 2, 16–17. And having determined that the term “just cause” is 

“widely understood to permit discharge only for a fair and 

honest cause or reason, regulated by good faith,” id. ¶ 16 

(citation and internal quotation marks omitted), the court 

concluded that the fact-finder should determine whether the 

employer had an “objective good faith reason” for termination 

rather than second-guess the employer’s business decision, see id.

¶¶ 22–23.

¶53 We cannot, however, reach the same conclusion in this 

case. Cybertary and Beckman negotiated an employment

contract with seven enumerated events that constituted cause for 

early termination. Thus, unlike the parties in Uintah Basin, 

Cybertary and Beckman clearly evidenced their intent that 

something other than the ordinary meaning of just cause would 

govern Beckman’s termination. For example, while “just cause” 

as defined in Uintah Basin permits termination on the basis of any 

“good faith business reason[],” id. ¶ 19, the Employment 

Agreement narrowed the scope of permissible bases for 

termination to those specifically identified. Because the parties 

did not create a contract in which termination would be 

permitted on the basis of any just cause, we do not incorporate 
Beckman v. Cybertary Franchising

20150295-CA 23 2018 UT App 47

that term, or its accordant “objective reasonableness” standard, 

into the parties’ contract.

¶54 A contrary interpretation—that Beckman could be 

terminated for the mistaken, but honest belief, that one of the 

seven enumerated events identified in the Employment 

Agreement had occurred—is unwarranted. The contract 

language “established a standard that is sufficiently definite to 

allow a fact-finder to determine whether [Cybertary] had [cause] 

to support the termination of [Beckman’s] employment.”6 See

Kern v. Palmer College of Chiropractic, 757 N.W.2d 651, 660 (Iowa 

2008) (rejecting the objective reasonableness approach where the 

parties expressly defined the meaning of cause in their 

employment contract). Having contracted for that standard, we 

see no justification for Cybertary’s assertion that the fact-finder 

should not be allowed to “second guess” Cybertary’s own 

determination of whether cause existed to terminate Beckman’s 

employment. See id.; Janoff v. Gentle Dental, PC, 986 P.2d 1278, 

1280–81 (Or. Ct. App. 1999) (seeing “no reason to treat [an 

employment] contract differently from every other contract, 

including [a] plaintiff’s right to a judicial determination of all 

factual issues related to whether” the enumerated grounds for 

termination were satisfied).

¶55 Given our conclusion that the Employment Agreement 

does not incorporate an objective reasonableness standard into 

the termination provision, it was erroneous for the trial court to 

instruct the jury that “the determination of whether one or more 

of these definitions [of cause] was satisfied was a matter for 

Cybertary’s good business judgment.” It was also erroneous to 

instruct the jury that “[s]o long as Cybertary possessed a fair and 

 

6. In reaching this conclusion, we reject Cybertary’s argument 

that the seven enumerated events identified in the Employment 

Agreement as cause for termination are so ill-defined that they 

“must be interpreted and applied, in the first instance, by the 

employer.”
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20150295-CA 24 2018 UT App 47

honest cause or reason, in good faith, that met one of these 

definitions, cause existed to terminate Beckman.”

¶56 “An erroneous jury instruction is prejudicial if, taken in 

context with the jury instructions as a whole, it misadvised or 

misled the jury on the law.” Harris v. ShopKo Stores, Inc., 2013 UT 

34, ¶ 39, 308 P.3d 449 (citations and internal quotation marks 

omitted). This court will reverse for a new trial when it is 

reasonably likely that the error affected the outcome and “our 

confidence in the jury’s verdict is undermined.” Id. ¶ 40 (citation 

and internal quotation marks omitted).

¶57 Here, we conclude that the error in Instruction 12 was 

prejudicial. As explained above, Instruction 12 misadvised the 

jury on the applicable law with respect to Beckman’s claim that 

Cybertary breached the Employment Agreement by terminating 

her employment without cause. Based on this incorrect legal 

standard, the jury may well have determined that Cybertary 

legally terminated Beckman’s employment based only on a good 

faith belief that cause existed even if there was no actual cause 

for termination. Thus, there is a reasonable likelihood that the 

jury may have reached a different result had it been given jury 

instructions that articulated the correct legal standard. We 

therefore reverse and remand for a new trial on this claim.

IV. Prejudgment Interest

¶58 Beckman contends that the trial court erred in declining to 

award her prejudgment interest. She asserts that she is entitled 

to prejudgment interest because her unpaid wages and benefits 

can be measured and quantified by the amounts specified in the 

Employment Agreement and because her damages were fixed 

and complete as of the date of her termination on November 14, 

2011. Cybertary responds that Beckman’s loss was not fixed as of 

a particular time, because the jury had to “exercise its judgment 

and discretion to award damages” in limiting the damages 

award to the wages and benefits that had accrued prior to 

Beckman’s termination, in determining whether that award was 

subject to an offset, and in determining whether Beckman had 
Beckman v. Cybertary Franchising

20150295-CA 25 2018 UT App 47

waived or deferred her right to payment. Cybertary also argues 

that because any interest would accrue from the date of each 

missed payment, and because Beckman was sometimes 

overpaid, Beckman did not provide sufficient evidence to 

support an award of prejudgment interest. Cybertary further 

argues that prejudgment interest is unavailable because the 

Employment Agreement was not a contract for the loan or 

forbearance of money, goods, or chose in action.

¶59 “[T]he purpose of awarding prejudgment interest is to 

compensate a party for the depreciating value of the amount 

owed over time and, as a corollary, to deter parties from 

intentionally withholding an amount that is liquidated and 

owing.” Encon Utah, LLC v. Fluor Ames Kraemer, LLC, 2009 UT 7, 

¶ 67, 210 P.3d 263 (citation and internal quotation marks

omitted). Under Utah law, “[p]rejudgment interest may be 

recovered where the damage is complete, the amount of the loss 

is fixed as of a particular time, and the loss is measurable by facts 

and figures.” Id. ¶ 51 (citation and internal quotation marks 

omitted). “[L]osses that cannot be calculated with mathematical 

accuracy are those in which damage amounts are to be 

determined by the broad discretion of the trier of fact, requiring 

the fact-finder to be guided by [its] best judgment in assessing 

the amount to be allowed for past as well as for future injury.” 

USA Power, LLC v. PacifiCorp, 2016 UT 20, ¶ 100, 372 P.3d 629 

(first alteration in original) (citations and internal quotation 

marks omitted). “Such losses include those stemming from 

personal injury, wrongful death, defamation, false 

imprisonment, malicious prosecution, and assault and battery.” 

Id. In those situations, prejudgment interest is inappropriate 

because “the trier of fact is left to assess damages based on a 

mere description of the wrongs done or injuries inflicted.” Encon 

Utah, 2009 UT 7, ¶ 53 (citation and internal quotation marks 

omitted).

¶60 Here, we agree with Beckman that her damages could be 

calculated with mathematical accuracy. For Beckman’s only 

successful claim, she alleged that Cybertary had not paid wages 
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20150295-CA 26 2018 UT App 47

and benefits she was due under the terms of the Employment 

Agreement. The Employment Agreement established the 

payment schedule and the amounts due to Beckman, and at trial 

Beckman provided an exhibit breaking down the funds that 

Cybertary paid. And even Cybertary conceded in the trial court 

that the jury calculated its damages award by subtracting the 

amount Cybertary paid Beckman over the course of her 

employment from the total amount she was due.7 Unlike “cases 

where the trier of fact is left to assess damages based on a mere 

description of the wrongs done or injuries inflicted,” see id.

(citation and internal quotation marks omitted), the amount 

owed under the Employment Agreement was “ascertainable by 

calculation,” see id. ¶ 54 (citation and internal quotation marks 

omitted). Accordingly, we conclude that Beckman was entitled 

to prejudgment interest. See id. ¶ 65 (stating that the trial court 

based its decision on measurable facts and figures because it 

reviewed the terms of the fixed price contract, the percentage of 

work completed, and noted that the parties agreed to a 10% 

profit on that work); Campbell, Maack & Sessions v. Debry, 2001 

UT App 397, ¶ 23, 38 P.3d 984 (affirming an award of 

prejudgment interest where a debt existed under an agreement,

the debtor delayed in tendering the amount due, and the court 

had “sufficient information to calculate the loss with 

mathematical accuracy and to fix the loss as of a particular time” 

(brackets, citation, and internal quotation marks omitted)).

 

7. In opposition to Beckman’s motion for prejudgment interest, 

Cybertary observed that the jury’s verdict “plainly tracked” 

Beckman’s Trial Exhibit 34, which totaled the payroll payments 

Cybertary made to Beckman throughout her employment, in the 

amount of $45,961.17. Section 3(a) of the Employment 

Agreement identified, by month, the salary due to Beckman 

from June 2010 through her termination, which totaled $130,875. 

Subtracting the amount Cybertary paid Beckman from the 

amount it owed totaled $84,913.83—the amount the jury 

awarded for unpaid salary.
Beckman v. Cybertary Franchising

20150295-CA 27 2018 UT App 47

¶61 Cybertary counters that because the jury had to determine 

Beckman’s damages and because it ultimately awarded a lesser 

amount than she claimed, her loss was not fixed as of a 

particular time. The fact that Beckman’s damages were 

ascertained at trial, however, does not mean that her damages 

were “not already complete, fixed, and measurable.” See

Highlands at Jordanelle, LLC v. Wasatch County, 2015 UT App 173, 

¶ 28, 355 P.3d 1047; see also AE, Inc. v. Goodyear Tire & Rubber Co., 

576 F.3d 1050, 1058 (10th Cir. 2009) (concluding that, under Utah 

law, it “is clear that prejudgment interest may be appropriate 

even if the amount of damages [is] ascertained at trial”). 

Beckman asserted two breach of contract theories against 

Cybertary: one based on Cybertary’s failure to pay wages and 

benefits Beckman earned for the time period before her 

termination, and another based on Cybertary’s premature 

termination of the Employment Agreement. As damages for that 

second theory, Beckman sought the wages and benefits she 

would have earned had Cybertary not prematurely terminated 

her employment. Ultimately, the jury awarded Beckman only 

those wages and benefits she earned pre-termination because it 

rejected her theory that Cybertary unlawfully terminated her 

employment without cause. But the fact that the jury rejected 

Beckman’s second theory, and its attendant claim for posttermination wages and benefits, does not negate the fact that 

Beckman’s damages for unpaid wages for the period prior to her 

termination were fixed and measurable based on the amount she

was owed under the Employment Agreement. See Encon Utah, 

2009 UT 7, ¶ 54 (noting that prejudgment interest is appropriate 

in cases where the amount due under the contract is 

“ascertainable by calculation” (citation and internal quotation 

marks omitted)).

¶62 Relatedly, Cybertary argues that Beckman should be 

denied prejudgment interest because the “claimed prejudgment 

interest is not ‘calculable with mathematical certainty.’” 

Beckman calculated interest from the date Cybertary terminated 

her employment (November 14, 2011) rather than from the 

earlier dates of each alleged breach. Cybertary argues that 
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20150295-CA 28 2018 UT App 47

because Beckman did not calculate the prejudgment interest 

from the date of each missed payment, the court did not have 

sufficient evidence before it to correctly calculate the interest.

Cybertary’s argument misses the mark. “The mathematical 

accuracy standard does not apply to the calculation of 

prejudgment interest itself, but instead applies to the amount of 

damages found by the trier of fact.” Iron Head Constr., Inc. v.

Gurney, 2009 UT 25, ¶ 18, 207 P.3d 1231.

¶63 Moreover, Cybertary does not contend that Beckman’s

requested prejudgment interest is not readily calculable. Rather, 

Cybertary complains that Beckman failed to provide sufficient 

evidence for the court to award prejudgment interest accruing 

incrementally from the date of each missed payment. But 

Beckman did not seek to recover that added interest. Beckman 

sought only to recover interest that accrued as of the date of her 

termination. Any argument that Beckman may have lacked 

sufficient evidence to recover prejudgment interest that accrued 

before her termination does not render her evidence insufficient 

as to the post-termination interest she actually sought.

¶64 Cybertary, citing Utah Code section 15-1-1, further argues 

that prejudgment interest is unavailable to Beckman because the 

Employment Agreement was not a contract for “the loan or 

forbearance of any money, goods, or chose in action.” Section 15-

1-1 states, “Unless parties to a lawful contract specify a different 

rate of interest, the legal rate of interest for the loan or 

forbearance of any money, goods, or chose in action shall be 10% 

per annum.” Utah Code Ann. § 15-1-1(2) (LexisNexis 2013). 

Contrary to Cybertary’s argument, this provision does not

dictate whether a party is entitled to prejudgment interest. That 

determination is made based on whether a party’s damages can 

be calculated with mathematical accuracy. See supra ¶ 59.

Instead, section 15-1-1 identifies the particular interest rate that 

applies to those categories of contracts identified in the statute. 

See USA Power, LLC v. PacifiCorp, 2016 UT 20, ¶ 109, 372 P.3d 629.

Hence, Cybertary cannot rely on section 15-1-1 to defeat 

Beckman’s claim to prejudgment interest.
Beckman v. Cybertary Franchising

20150295-CA 29 2018 UT App 47

¶65 We reverse the trial court’s order denying Beckman 

prejudgment interest and remand for the trial court to calculate 

the amount of prejudgment interest to which Beckman is 

entitled.

V. Attorney Fees

¶66 Beckman challenges the trial court’s awards of attorney 

fees in two respects. First, she contends that the trial court erred 

by awarding attorney fees to Cybertary. Second, she contends 

that the trial court erred by awarding attorney fees to Franchise 

Foundry and Faulconer. Finally, all of the parties request 

attorney fees on appeal. We address each category of attorney 

fees in turn.

A. The Attorney Fees Awarded to Cybertary8

¶67 “In Utah, attorney fees are awardable only if authorized 

by statute or by contract.” Dixie State Bank v. Bracken, 764 P.2d 

985, 988 (Utah 1988). If provided for by contract, the award of 

attorney fees is allowed “only in accordance with the explicit 

terms of the contract and only to the extent permitted by the 

contract.” Maynard v. Wharton, 912 P.2d 446, 451 (Utah Ct. App. 

1996).

¶68 The trial court awarded attorney fees based on its 

interpretation of the attorney fees provision in the Employment 

Agreement. That provision states,

 

8. Although we are remanding this matter for a new trial on 

Beckman’s termination claim against Cybertary, we address this 

issue because it has been fully briefed and is likely to arise again 

on remand. See State v. James, 819 P.2d 781, 795 (Utah 1991); see 

also Utah R. App. P. 30(a) (“If a new trial is granted, the court 

may pass upon and determine all questions of law involved in 

the case presented upon the appeal and necessary to the final 

determination of the case.”).
Beckman v. Cybertary Franchising

20150295-CA 30 2018 UT App 47

The nonprevailing party in any proceeding 

hereunder shall be the party that the court of 

competent jurisdiction awards less than one-half 

(1/2) of all of the amounts in dispute 

(“Nonprevailing Party”). The Nonprevailing Party 

to any proceeding under this Agreement shall pay 

its own expenses, the court fees, and any 

administrative fees arising in connection therewith, 

and the expenses, including without limitation, 

attorneys’ fees, costs, and costs of investigation, 

reasonably incurred by the other party to the 

proceeding.

Under this provision, the “nonprevailing party” is responsible 

for paying its own and the other party’s reasonable attorney fees 

and other expenses. The “nonprevailing party” is defined as the 

party who was “award[ed] less than one-half (1/2) of all of the 

amounts in dispute.”

¶69 The Employment Agreement does not explain how to 

calculate “all of the amounts in dispute.” The parties disagreed 

over the relevant figures before the trial court, but for purposes 

of this appeal, Beckman and Cybertary apparently agree on the 

following pertinent facts and figures: Beckman sought an award 

of $235,041.05 at trial for breach of the Employment Agreement,

and the jury awarded her $103,063.83; Cybertary disclosed 

damages in the amount of $373,500 for its counterclaims, but the 

trial court excluded Cybertary’s damages from trial for failure to 

timely disclose them; and the court granted a directed verdict on 

the counterclaims to Beckman.

¶70 The trial court construed the attorney fees provision’s 

language “as mandating an assessment of whether each party 

asserting a claim under the Employment Agreement is a 

‘nonprevailing party’ under that claim.” Consequently, the court 

in effect bifurcated its analysis. The court first assessed whether 

Cybertary recovered less than half of the amounts it sought 

against Beckman on its counterclaims and, second, the court
Beckman v. Cybertary Franchising

20150295-CA 31 2018 UT App 47

assessed whether Beckman recovered less than half of the 

amounts she sought against Cybertary on all of her claims. 

Taking this approach, the court determined that Cybertary was 

the nonprevailing party under its counterclaims and that 

Beckman was the nonprevailing party under her claims against 

Cybertary. Because both sides were “nonprevailing parties” 

under this analysis, the trial court concluded that each side owed 

the other for the attorney fees incurred in defending against the 

respective claims. And because Beckman’s attorney fees award 

exceeded that of Cybertary, the court offset those amounts and 

awarded Beckman a total of $13,135.34.

¶71 On appeal, Beckman challenges the trial court’s decision 

to apply the attorney fees provision by evaluating whether each 

party asserting a claim under the Employment Agreement was a 

“nonprevailing party” with respect to that claim. She asserts that 

this approach contradicts the plain language of the Employment 

Agreement. By her reading, the attorney fees provision allows 

for “only one prevailing party” because the “term ‘nonprevailing 

party’ is singular,” and “‘all of the amounts’” is a plural phrase 

that refers to “those amounts sought in the ‘dispute,’” a singular 

term. Beckman argues that the attorney fees provision “groups 

‘all amounts in dispute’ together and then assigns liability to the 

one party who is awarded less than one-half of those amounts.” 

(Emphasis omitted.)

¶72 According to Beckman, she sought an award of 

$235,041.05 at trial, and Cybertary, despite having its 

supplemental disclosure of damages struck at trial, sought 

damages of $373,500 on its counterclaims. By Beckman’s math, to 

determine “all of the amounts in dispute,” the trial court “should 

have subtracted what Beckman sought ($235,041.05) from what 

Cybertary sought ($373,500) to arrive at $138,458.95.” (Emphasis 

added.) Because Cybertary was awarded nothing at trial, 

Beckman argues, Cybertary recovered less than half of the 

amounts in dispute and therefore was the “nonprevailing party” 

as defined by the attorney fees provision.
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20150295-CA 32 2018 UT App 47

¶73 Cybertary offers a different interpretation of the provision 

and a different calculation of “all of the amounts in dispute.” 

Cybertary asserts that the “only way to read [the attorney fees 

provision] with any fidelity to its language, and with any 

common sense, is to recognize that it assesses attorney fees for 

each party asserting a claim.” This reading separates each 

party’s total claimed damages and compares those amounts with 

each party’s ultimate recovery. According to Cybertary, when 

Beckman recovered $103,063.83 at trial, she recovered “less than 

half of the total $235,041.05 she sought in damages.” On her 

claims, Cybertary states that Beckman “is therefore the 

nonprevailing party and required to pay Cybertary’s attorney 

fees and costs associated with” those claims. Likewise, because 

Cybertary “recovered less than half of its $373,500.00 claim,” 

Cybertary admits it “is the nonprevailing party on its claims and 

must therefore pay Beckman’s attorney fees associated with that 

claim.”

¶74 To illustrate why its interpretation of the attorney fees 

provision makes sense, Cybertary posits an alternative scenario 

in which “all of the amounts in dispute” are determined by 

adding the parties’ claimed damages together. Cybertary asserts 

that this scenario would adhere to a strict reading of the 

provision and result in $608,541.45 as the total of Beckman’s and 

Cybertary’s claims. But even if Beckman recovered her entire 

amount claimed in damages, she would be deemed the 

nonprevailing party who is liable for Cybertary’s attorney fees. 

As Cybertary explains, this reading would lead to “a harsh, 

absurd result” because “a defendant could resist a legitimate 

claim by asserting a bogus counterclaim in an astronomical 

amount, and then claim that the prevailing plaintiff is not 

entitled to attorney fees, even though the plaintiff recovered 

100% of its claim.” In other words, Cybertary claims that adding 

each side’s claimed damages together to determine “all of the 

amounts in dispute” would give a defendant a perverse 

incentive to plead meritless counterclaims in high amounts.
Beckman v. Cybertary Franchising

20150295-CA 33 2018 UT App 47

¶75 To resolve this issue, we must look to the four corners of 

the Employment Agreement to determine its meaning and the 

parties’ intentions. Nolin v. S & S Constr., Inc., 2013 UT App 94, 

¶ 12, 301 P.3d 1026. If the language within the four corners of the 

contract is unambiguous, we may determine the parties’ 

intentions from the plain meaning of the contractual language as 

a matter of law. Bakowski v. Mountain States Steel, Inc., 2002 UT 

62, ¶ 16, 52 P.3d 1179. A “court considers extrinsic evidence of 

the parties’ intent only if the language of the contract is 

ambiguous.” Glenn v. Reese, 2009 UT 80, ¶ 10, 225 P.3d 185. A 

contractual provision may be ambiguous if it is “unclear, it omits 

terms, or the terms used to express the intention of the parties 

may be understood to have two or more plausible meanings.” 

Saleh v. Farmers Ins. Exch., 2006 UT 20, ¶ 15, 133 P.3d 428 (citation 

and internal quotation marks omitted).

¶76 Both parties contend that the Employment Agreement is 

unambiguous and must be read in support of their respective 

positions. Applying the above principles, we examine this rather 

unusual attorney fees clause. The Employment Agreement 

requires that the “nonprevailing party” pay its own expenses 

and court fees along with the fees and costs reasonably incurred 

by the other party “in any proceeding” thereunder. The 

agreement specifically defines the nonprevailing party as “the 

party that the court of competent jurisdiction awards less than 

one-half (1/2) of all of the amounts in dispute.” By defining the 

nonprevailing party this way, this attorney fees provision differs 

considerably from the more standard, boilerplate provisions that 

entitle the prevailing party to an award of attorney fees.9

 

9. Beckman cites common law principles, including the net 

judgment rule and comparative victory rule, to support her 

interpretation of the attorney fees provision. These common law 

rules might have some relevance if the contractual provision at 

issue stated that the prevailing party is liable for attorney fees. 

See Olsen v. Lund, 2010 UT App 353, ¶¶ 4, 7–8, 246 P.3d 521. But 

(continued...)
Beckman v. Cybertary Franchising

20150295-CA 34 2018 UT App 47

¶77 Contrary to Cybertary’s argument and the conclusion 

of the trial court, we see no indication in the Employment 

Agreement that the parties intended to apply the attorney fees 

provision in a bifurcated fashion. The provision not only refers 

to the “nonprevailing party” in the singular, but it refers to that 

singular nonprevailing party “in any proceeding hereunder.” 

The term “proceeding” is commonly understood to mean a

“legal action,” Merriam-Webster.com, http://www.merriamwebster.com/dictionary/proceeding (last visited Mar. 21, 2018), 

suggesting that in a singular legal action under the Employment 

Agreement there will be only one nonprevailing party. And that 

nonprevailing party is to pay all of its own fees and costs and 

those of the other party “arising in connection therewith.”

¶78 In other words, the potential obligation to pay attorney 

fees and costs is expressly tied to fees incurred in connection 

with the proceeding; it is neither completely untethered nor tied 

to fees and costs incurred relative to a particular claim. By 

expressly tethering the definition of “nonprevailing party” to a 

proceeding, we cannot fairly read the term as tethered to a 

party’s claims.

¶79 The agreement defines the nonprevailing party as the 

party in the proceeding to whom the court “awards less than 

one-half (1/2) of all of the amounts in dispute.” Beckman and 

Cybertary suggest two alternative ways to determine “all of the 

 

(...continued)

because the award of attorney fees under the Employment 

Agreement depends on which party is deemed the 

“nonprevailing party,” our analysis does not utilize these 

common law principles. See Foote v. Clark, 962 P.2d 52, 54–55

(Utah 1998) (concluding that cases evaluating the parties’ 

respective successes to determine which was the prevailing 

party were irrelevant where the only criterion for an award of 

attorney fees under the contract was to demonstrate that the 

other party was in default).
Beckman v. Cybertary Franchising

20150295-CA 35 2018 UT App 47

amounts in dispute” when counterclaims are involved: by 

subtracting, or offsetting, the parties’ damages (the subtraction 

approach); or by adding both parties’ damages together (the 

addition approach).

¶80 Under the subtraction approach, “all of the amounts in 

dispute” would be calculated by offsetting the plaintiff’s and the 

defendant’s claimed damages. In other words, the actual amount 

in dispute would be determined by subtracting one party’s 

claimed damages from the other party’s. The actual amount of 

money in dispute would thus turn on the relative damages each 

party claimed. If one party claimed a large amount of damages 

and another claimed a smaller amount, it is possible that the 

party claiming the smaller amount could recover all of the 

damages it seeks and still be deemed a “nonprevailing party” if 

its recovery was less than one-half of the difference.10

¶81 Under the addition approach, “all of the amounts in 

dispute” would be determined by adding the parties’ damages 

together. Like the subtraction approach, the addition approach 

would make the total amount in dispute hinge on how much 

each party claimed in damages. And hypothetically, even if one 

party recovered entirely on its claim, that party could be deemed 

the nonprevailing party if the other party asserted a greater 

amount of damages.11

 

10. For example, if the plaintiff asserted a claim for $100,000 and 

the defendant counterclaimed for $600,000, “all of the amounts 

in dispute” under Beckman’s subtraction approach would be 

$500,000. The plaintiff could recover the entirety of its damages 

and still be deemed a “nonprevailing party” for recovering less 

than half of the “all of the amounts in dispute.”

11. For example, if the plaintiff asserted a claim for $100,000 and 

the defendant counterclaimed for $600,000, “all of the amounts 

in dispute” under the addition approach would be $700,000. 

(continued...)
Beckman v. Cybertary Franchising

20150295-CA 36 2018 UT App 47

¶82 Although both approaches make the risk of paying 

attorney fees dependent upon the amount of damages claimed 

by the other party, and both have the potential to lead to 

arbitrary results, Beckman advocates for the subtraction 

approach presumably because it works in her favor in this case. 

Had the trial court subtracted Beckman’s claimed damages from 

Cybertary’s claimed damages, it would have determined that 

$138,458.95 constituted “all of the amounts in dispute.” And 

because Cybertary recovered nothing and Beckman recovered 

$103,063.83, more than half of the total amount, Beckman 

contends that Cybertary should be deemed the singular 

nonprevailing party. Cybertary, on the other hand, contends that 

neither approach should apply, reasoning that the subtraction 

approach is not supported by the provision’s plain language 

while the addition approach leads to harsh results.

¶83 We conclude that the meaning of the phrase “all of the 

amounts in dispute” is ambiguous in this context. The parties 

advocate different ways to calculate “all of the amounts in 

dispute,” but the plain language does not obviously support 

either alternative. The phrase generally suggests that “all of the 

amounts in dispute” should be combined, but it does not include 

terms necessary to determine whether the parties intended that 

those amounts be subtracted, added, or otherwise calculated. We 

therefore must remand this issue to the trial court to consider 

extrinsic evidence to determine its meaning.

¶84 Having reached this conclusion, we return to Cybertary’s 

argument that the provision must be interpreted to apply 

separately to each party’s respective claims because any other 

reading leads to harsh or arbitrary results. We acknowledge that 

regardless of whether “all of the amounts in dispute” is 

 

(...continued)

Again, the plaintiff could recover the entirety of its damages and 

still be deemed a nonprevailing party under the Employment 

Agreement.
Beckman v. Cybertary Franchising

20150295-CA 37 2018 UT App 47

determined through subtraction or addition, a party could be 

deemed a “nonprevailing party” under the provision despite 

having been awarded the entirety of its damages claim. We also 

note that regardless of whether the subtraction or addition 

approach is used, there are scenarios under which the party 

deemed nonprevailing under the provision is the party all would 

concede is the nonprevailing party under a traditional prevailing 

party clause.12 But having discerned no support for the trial 

court’s bifurcated approach in the plain language of the 

Employment Agreement, we cannot “make a better contract for 

the parties than they have made for themselves.” Bakowski v. 

Mountain States Steel, Inc., 2002 UT 62, ¶ 19, 52 P.3d 1179. “Nor 

will we avoid the contract’s plain language to achieve an 

‘equitable’ result.” Id. While the trial court interpreted the 

Employment Agreement to achieve what is arguably a 

reasonable result, its interpretation was not supported by the 

provision’s plain language. We therefore vacate the trial court’s 

award of fees to Cybertary, and, as noted above, remand the 

issue for the trial court to decide whether Cybertary is entitled to 

a fees award after the court determines the parties’ intent 

regarding this ambiguous clause through the consideration of 

extrinsic evidence.

B. The Attorney Fees Awarded to Franchise Foundry and 

Faulconer

¶85 Beckman contends that the trial court erred in employing 

the reciprocal attorney fees statute, Utah Code section 78B-5-826,

to award attorney fees to Franchise Foundry and Faulconer. In 

particular, Beckman argues that she did not assert claims against 

Franchise Foundry and Faulconer for breach of the Employment 

 

12. For example, if the plaintiff asserted a claim for $100,000 and 

the defendant counterclaimed for $600,000, and the plaintiff was 

awarded nothing and the defendant was awarded $600,000, it is 

unlikely that anyone would challenge a determination that the 

plaintiff was a nonprevailing party.
Beckman v. Cybertary Franchising

20150295-CA 38 2018 UT App 47

Agreement, and thus they could not invoke the reciprocal 

attorney fees statute to recover attorney fees under the 

Employment Agreement. Franchise Foundry and Faulconer, in 

contrast, assert that they are entitled to recover fees pursuant to 

the Employment Agreement and the reciprocal attorney fees 

statute because Beckman “asserted a claim for breach of the 

Employment Agreement against [them].” In their view, “the 

Employment Agreement formed the premise of Beckman’s 

claim,” it would have allowed “Beckman to recover fees had she 

prevailed,” and the reciprocal attorney fees statute therefore 

“allows Franchise Foundry and Faulconer to recover attorney 

fees.”

¶86 Utah’s reciprocal attorney fees statute permits courts to 

“award attorney fees to the prevailing party of a contract dispute 

so long as the contract provide[s] for the award of attorney fees 

to at least one of the parties.” Wing v. Code, 2016 UT App 230, 

¶ 12, 387 P.3d 601. The statute states:

A court may award costs and attorney fees to 

either party that prevails in a civil action based 

upon any promissory note, written contract, or 

other writing executed after April 28, 1986, when 

the provisions of the promissory note, written 

contract, or other writing allow at least one party to 

recover attorney fees.

Utah Code Ann. § 78B-5-826 (LexisNexis 2012). The text of the 

statute “provides that a court may award costs and attorney fees 

to a prevailing party in a civil action if two main conditions are 

met.” Bilanzich v. Lonetti, 2007 UT 26, ¶ 14, 160 P.3d 1041. First, 

“the underlying litigation must be based upon a contract in the 

sense that a party to the litigation must assert the writing’s 

enforceability as basis for recovery.” Hooban v. Unicity Int’l, Inc., 

2012 UT 40, ¶¶ 14–15, 285 P.3d 766 (internal quotation marks 

omitted). And second, the provisions of the contract “must allow 

at least one party to recover fees if that party had prevailed.” Id.

(internal quotation marks omitted).
Beckman v. Cybertary Franchising

20150295-CA 39 2018 UT App 47

¶87 Here, the trial court agreed with Franchise Foundry and 

Faulconer that the reciprocal attorney fees statute was triggered. 

The trial court reasoned that because Franchise Foundry and 

Faulconer “prevailed on Beckman’s claim against them under 

the Employment Agreement” when the court granted them 

summary judgment on Beckman’s first claim for relief, the 

reciprocal attorney fees statute applied to entitle Franchise 

Foundry and Faulconer to attorney fees. We disagree. Although 

Beckman asserted in her amended complaint that Franchise 

Foundry and Faulconer should be held liable for damages 

arising out of Cybertary’s breach of the Employment Agreement, 

Beckman did not seek to enforce the Employment Agreement 

against Franchise Foundry and Faulconer. Thus, the first 

condition of the reciprocal attorney fees statute was not satisfied. 

See id.

¶88 This conclusion is driven by the nature of Beckman’s 

claim. Beckman labeled her first claim for relief as one for 

“Breach of Employment Agreement,” an agreement she 

identified in her amended complaint as between Beckman and 

Cybertary. Beckman claimed that Cybertary breached the 

Employment Agreement by failing to pay her salary and 

benefits, and that Franchise Foundry and Faulconer took actions 

“on behalf of Cybertary” in further breach of the agreement. 

Beckman also sought a declaration that because Faulconer and 

Franchise Foundry “have not acted in good faith,” they would

be “liable for any damages suffered by Beckman as a result of 

their actions.” And in her prayer for relief, Beckman sought a 

monetary judgment against Cybertary, Franchise Foundry, and 

Faulconer.

¶89 While Beckman did not clearly articulate the theory under 

which she sought to recover damages from Franchise Foundry 

and Faulconer, she did not assert a claim against them for breach 
Beckman v. Cybertary Franchising

20150295-CA 40 2018 UT App 47

of contract.13 Beckman never alleged that Franchise Foundry and 

Faulconer were parties or assignees to the Employment

Agreement, and she never alleged that they breached it. Instead, 

she asserted a claim for declaratory judgment in which she 

sought a declaration that “Faulconer and Franchise Foundry 

have not acted in good faith and are therefore liable for any 

damages suffered by Beckman as a result of their actions.” In 

other words, Beckman sought to recover damages from 

Franchise Foundry and Faulconer for allegedly failing to act in 

good faith, but she did not seek to enforce the Employment 

Agreement against them.

 

13. It appears that Beckman was seeking to hold Franchise 

Foundry and Faulconer individually liable for Cybertary’s 

breach of the Employment Agreement based on section 48-2c807(1) of the since-repealed Utah Revised Limited Liability 

Company Act. It stated, in relevant part, 

(1) A member or manager shall not be liable or 

accountable in damages or otherwise to the 

company or the members for any action taken or 

failure to act on behalf of the company unless the 

act or omission constitutes: (a) gross negligence; (b) 

willful misconduct; or (c) a breach of a higher 

standard of conduct that would result in greater 

exposure to liability for the member or manager 

that is established in the company’s articles of 

organization or operating agreement. 

Utah Code Ann. § 48-2c-807(1) (LexisNexis 2010) (repealed 2016). 

In this regard, the jury was instructed at trial that Beckman 

sought a declaratory judgment that Franchise Foundry and 

Faulconer “did not act in good faith in either causing Cybertary 

to not pay her compensation and/or in causing Cybertary to 

terminate Beckman.” The court further instructed that to succeed 

on her claim, Beckman must demonstrate that Franchise 

Foundry and Faulconer “acted with ‘gross negligence’ or ‘willful 

misconduct.’”
Beckman v. Cybertary Franchising

20150295-CA 41 2018 UT App 47

¶90 Contrary to what Franchise Foundry and Faulconer now 

argue on appeal, they previously and unequivocally shared this 

view. When Defendants moved for summary judgment, they 

agreed that Beckman’s “sole claim regarding the Employment 

Agreement is that Cybertary—and not anyone else—breached 

it,”14 and they even asserted that Beckman “does not, and has 

never, asserted that [breach of contract] claim against any other 

Defendant.” (Emphasis added.) In response, Beckman did not 

oppose Defendants’ motion insofar as it related to Franchise 

Foundry and Faulconer and the Employment Agreement,

because she “openly admit[ted] that Franchise Foundry and 

Faulconer are not parties [to] the Employment Agreement, and 

[had] never claimed otherwise.”

¶91 On this record, we cannot agree with the trial court’s 

conclusion that Franchise Foundry and Faulconer prevailed on a 

claim based on the Employment Agreement. We therefore 

reverse the trial court’s award of attorney fees to Franchise 

Foundry and Faulconer.

C. Attorney Fees on Appeal

¶92 Last, all of the parties request their attorney fees incurred 

on appeal. “A party seeking attorney fees for work performed on 

appeal must state the request explicitly and set forth the legal 

basis for such an award.” Utah R. App. P. 24(a)(9). 

¶93 Typically, “when a party who received attorney fees 

below prevails on appeal, the party is also entitled to fees 

 

14. Franchise Foundry and Faulconer’s assertion was based on 

Beckman’s response to their interrogatory asking her to identify 

every agreement that she claimed Defendants breached and 

which Defendants breached those agreements. Beckman 

responded: “The parties to the Employment Agreement are 

Plaintiff and Cybertary. Cybertary breached the Employment 

Agreement.”
Beckman v. Cybertary Franchising

20150295-CA 42 2018 UT App 47

reasonably incurred on appeal.” Favero Farms, LC v. Baugh, 2015 

UT App 182, ¶ 25, 356 P.3d 188 (citation and internal quotation 

marks omitted). Also, generally speaking, the standard 

contractual provision for the payment of attorney fees to the 

prevailing party includes attorney fees “incurred by the 

prevailing party on appeal as well as at trial.” Id. (citation and 

internal quotation marks omitted). But the attorney fees 

provision in the Employment Agreement is unlike the standard 

contract clause.

¶94 Given the unique nature of the attorney fees provision in 

the Employment Agreement and the fact that the provision does 

not expressly speak to attorney fees on appeal, it is unclear how 

the attorney fees provision might operate with respect to 

attorney fees incurred during appellate proceedings. And apart 

from cursory statements that they are entitled to attorney fees 

under the Employment Agreement, both Beckman and

Cybertary have failed to provide analysis explaining why they 

should receive attorney fees on appeal. See Utah R. App. P. 

24(a)(9). Accordingly, we deny Beckman’s and Cybertary’s 

requests.

15

¶95 We also deny Franchise Foundry’s and Faulconer’s 

requests. Because Franchise Foundry and Faulconer have not 

prevailed on appeal, they are not entitled to attorney fees on 

appeal. See Favero Farms, 2015 UT App 182, ¶ 25.

CONCLUSION

¶96 We conclude that Beckman has not shown that the trial 

court exceeded its discretion in denying her motion for leave to 

amend her complaint. Nor has she shown that the trial court 

erred in excluding an audio recording of compromise 

negotiations under rule 408 of the Utah Rules of Evidence. 

 

15. Beckman also requests costs on appeal under rule 34 of the 

Utah Rules of Appellate Procedure. We decline to award them.
Beckman v. Cybertary Franchising

20150295-CA 43 2018 UT App 47

¶97 Beckman has shown harmful error, however, in the trial 

court’s decision to instruct the jury on the parties’ relative 

burdens of proof in connection with her claim that Cybertary 

wrongfully terminated her employment. Because the parties did 

not incorporate a good business judgment standard into the 

Employment Agreement, the trial court erred in instructing 

otherwise, and we reverse and remand for a new trial on her 

wrongful termination claim.

¶98 We further conclude that the trial court erroneously 

denied Beckman’s request for prejudgment interest. 

Accordingly, we reverse the court’s order and instruct the court 

to calculate the appropriate amount of prejudgment interest on 

remand.

¶99 With regard to the attorney fees awarded to Cybertary, 

we vacate that award. We conclude that the Employment 

Agreement’s attorney fees provision is ambiguous and that the 

trial court should reassess the issue, if necessary, after 

determining the parties’ intent regarding the provision through 

the consideration of extrinsic evidence and after retrial of 

Beckman’s wrongful termination claim. Finally, because the 

court misapplied the reciprocal attorney fees statute, we reverse 

its award of attorney fees to Franchise Foundry and Faulconer. 

¶100 In sum, we affirm in part, reverse in part, vacate in part, 

and remand for further proceedings.