F I L E D

United States Court of Appeals

Tenth Circuit

February 16, 2006

Elisabeth A. Shumaker

Clerk of Court

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

MURPHY OIL USA, INC.,

Plaintiff-Appellee/Cross

Appellant,

v.

LAWRENCE WOOD; TRIVENTAL,

INC.,

Defendants-Appellants/CrossAppellees,

and

RANDALL RAMEY,

Defendant - Appellee.

Nos. 04-6183 and 04-6239

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

(D.C. No. 03-CV-42-C)

Robert W. Dace (and Sheryl N. Young, with him on the brief), McAfee & Taft, A

Professional Corporation, Oklahoma City, Oklahoma, for Plaintiff-Appellee/Cross

Appellant.

Robert N. Sheets (Heather L. Hintz, on the briefs, and Lyndon W. Whitmire, with

him on the briefs), Phillips, McFall, McCaffrey, McVay & Murrah, P.C.,

Oklahoma City, Oklahoma, for Defendants-Appellants/Cross-Appellees.
1Defendant Wood’s appeal focuses on the district court’s rejection of his

standing to pursue his individual tort claims. This is addressed below.

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Before SEYMOUR, EBEL, and KELLY, Circuit Judges.

KELLY, Circuit Judge.

Defendant-Appellant/Cross-Appellee Trivental, Inc.1 (“Trivental”) appeals

from a judgment as a matter of law (“JMOL”) in favor of PlaintiffAppellee/Cross-Appellant Murphy Oil U.S.A., Inc. (“Murphy”) on (1) Murphy’s

breach of contract claim; (2) two of Trivental’s breach of contract counterclaims;

and (3) Murphy’s breach of fiduciary duty claim. Lawrence Wood, an officer of

Trivental, also appeals the district court judgment that he lacked standing to

pursue his individual counterclaims. Finally, Trivental appeals the court’s award

of attorney’s fees and pre-judgment interest in favor of Murphy. 

Murphy cross-appeals from a judgment on a jury verdict in favor of

Trivental with regard to a third breach of contract counterclaim. Murphy also

cross-appeals the district court judgment denying punitive damages. Finally,

Murphy cross-appeals the determination that Murphy was not entitled to

attorney’s fees with regard to Trivental’s counterclaims. Our jurisdiction arises

under 28 U.S.C. § 1291, and we affirm in part, and reverse in part.
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Background

Murphy owns and operates gasoline service stations, including those in

Wal-Mart locations, throughout portions of the country. Murphy and Trivental

entered into a contract (“General Contract”), effective January 1, 2000, whereby

Trivental was to perform work as the general contractor for the building of

gasoline stations, four of which were relevant to the litigation in this case. 

Before the construction of any individual gas station, Trivental and Murphy

would enter into a particularized contract (“Specific Contract”) that would outline

the scope of work, contract price, payment terms, completion date, and other

matters not addressed in the General Contract relevant to that particular station. 

Trivental and Murphy entered into Specific Contracts to build four gas stations, in

these locations: New Iberia, Louisiana; Hugo, Tulsa, and Oklahoma City,

Oklahoma. 

Murphy sued Trivental claiming that Trivental breached its contract by

failing to pay its subcontractors for work done on the Oklahoma City gas station. 

See Aplt. App. at 82. Murphy further argued that Trivental had misappropriated

trust funds paid by Murphy, intended for the benefit of the subcontractors, in

violation of Okla. Stat. Ann. tit. 42, §§ 152, 153. Trivental counterclaimed,

arguing that Murphy had failed to fully compensate Trivental for “extra work”

performed and materials supplied at the New Iberia, Hugo, and Tulsa stations. 
2The district court ruled that Louisiana law governed the New Iberia station

counterclaim, and waiver did not apply there. Aplt. App. at 478, n.*. 

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See Aplt. App. at 88. 

These counterclaims were submitted to the jury. The claims relating to the

Tulsa and Hugo stations were decided under Oklahoma law, while the claim

relating to the New Iberia station was decided under Louisiana law. Following

deliberation, the jury awarded Trivental damages in the following amounts: (1)

$37,500 for the Tulsa station, (2) $40,000 for the Hugo station, and (3) $137,500

for the New Iberia station. See Aplee. Br. 5-6. 

Over a month later, the district court partially set aside the jury verdict in

favor of Trivental, and granted JMOL for Murphy on the counterclaims relating to

the two Oklahoma stations, ruling that Trivental had accepted negotiated amounts

of money and therefore waived any right to pursue the remainder allegedly due on

the contract. Aplt. App. at 478-9.2

 The district court had not instructed the jury

on waiver. See id. at 1634 (“There is no instruction on waiver on breach of

contract claims.”). As such, Trivental was awarded $137,500 in damages.

Next, the court entered JMOL on Murphy’s breach of contract claim,

awarding Murphy $80,702.06 for actual damages, and an additional $9,074.76 in

prejudgment interest. The district court also entered JMOL on Murphy’s breach

of fiduciary duty claim, ruling that the managing officers of Trivental, Defendants
- 5 -

Wood and Ramey, could be held personally liable for breach of trust. The district

court also granted Murphy attorney’s fees in the amount of $77,040.75. 

On appeal, Trivental argues that the district court erred in (1) setting aside

the jury’s verdict and entering JMOL in favor of Murphy on the Oklahoma

stations, (2) reserving the defense of waiver, (3) granting JMOL in favor of

Murphy on its breach of fiduciary duty claim, (4) improperly shifting the burden

of proof on damages to Trivental, (5) failing to instruct the jury on Trivental’s

“first breach” theory, (6) failing to instruct on Trivental’s fraud and constructive

fraud claims, and failing to grant it a new trial, (7) holding that Wood lacked

standing to proceed on fraud and tortious interference claims, (8) awarding

attorney’s fees to Murphy, and (9) awarding prejudgment interest to Murphy. In

its cross-appeal, Murphy argues that the district court erred in (1) not granting

Murphy JMOL or a new trial or remittitur on Trivental’s contract claim on the

New Iberia station, (2) failing to submit Murphy’s laches defense to the jury, (3)

not granting Murphy JMOL and awarding it punitive damages on its breach of

fiduciary duty claim, and (4) not awarding Murphy attorney’s fees in connection

with Trivental’s counterclaims.

Discussion

A. Trivental’s Appeal (04-6183)
3Trivental also argues that the district court’s setting aside the verdict

resulted in misleading jury instructions and denied it the right to trial by jury. In

view of our reversal on other grounds, we need not address this issue.

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1. Waiver

Trivental argues that sufficient evidence of Murphy’s breach of contract

existed, and therefore the district court erred in setting aside the jury verdict on

its counterclaims. Trivental further asserts that the district court erred in granting

JMOL on waiver grounds, contending that waiver presents a question of fact for

the jury.3 Murphy argues that the court’s ruling was proper because Trivental

voluntarily and intentionally accepted partial payment pursuant to a negotiated

contract modification and thereby waived its right to claim the remainder. 

When a district court sits in diversity, it is required to apply the most recent

statement of applicable substantive state law as pronounced by the particular

state’s highest court. See Phillips v. New Hampshire Ins. Co., 263 F.3d 1215,

1218 (10th Cir. 2001). On appeal, we use the “normal federal standards of

appellate review to examine the district court’s decision process.” Id. (internal

citations and quotations omitted). Thus, we review a district court’s decision on a

motion for judgment as a matter of law de novo, applying Oklahoma law. 

Tanberg v. Sholtis, 401 F.3d 1151, 1156 (10th Cir. 2005). This court applies the

same standard as that applied by the district court. See Cummings v. Gen.

Motors, Corp., 365 F.3d 944, 949 (10th Cir. 2004). 
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The Federal Rules of Civil Procedure allow for JMOL, “[i]f during a trial

by jury a party has been fully heard on an issue and there is no legally sufficient

evidentiary basis for a reasonable jury to find for that party on that issue.” Fed.

R. Civ. P. 50(a)(1). As such, JMOL is appropriate only if “the evidence points

but one way and is susceptible to no reasonable inferences which may support the

opposing party’s position.” See Cummings, 365 F.3d at 949.

Here, Murphy raised the defense of waiver in its answer to Trivental’s

counterclaim, and it was an issue identified in the pretrial order. Aplt. App. at 68,

83. Murphy sought JMOL on its waiver theory. Aplt. App. at 1576-77. The

district court reserved ruling on it. Id. at 1577. Apparently later, at a jury

instruction conference, the court indicated it was inclined to accept Murphy’s

waiver theory as a bar to Trivental’s breach of contract counterclaim regarding

the Oklahoma stations. Id. at 716, 813. However, it wanted a written response

from Trivental. Ultimately, the court submitted those breach of contract

counterclaims without any instruction on waiver to the jury. Id. at 716. 

Thereafter, before entering judgment on the jury’s verdict, the district court

granted JMOL in favor of Murphy on the waiver defense and set aside the jury’s

verdict on those claims. In post-judgment motions, Trivental argued that Murphy

had never preserved waiver for jury consideration because Murphy failed to

request an instruction. Aplt. App. at 619. In response to Trivental’s post-
- 8 -

judgment motions, Murphy stood on its entitlement to JMOL, and argued that it

was entitled to JMOL before the case was submitted to the jury. Aplt. App. at

687-88. This argument, however, ignores the plain language of Fed. R. Civ. P

50(b), which provides: “If, for any reason, the court does not grant a motion for

judgment as a matter of law . . . the court is considered to have submitted the

action to the jury subject to the court’s later deciding the legal questions raised by

the motion.” Fed. R. Civ. P. 50(b).

In Oklahoma, waiver is the voluntary and intentional relinquishment of a

known right. Barringer v. Baptist Healthcare of Okla., 22 P.3d 695, 700 (Okla.

2001). As such, the doctrine of waiver focuses on the intention of the party

against whom the waiver is asserted; that is, the party must have the intent to

waive its right. Id.; Bay Petroleum Co. v. May, 264 P.2d 734, 736 (Okla. 1953). 

In cases of contractual waiver, the agreement must be founded upon valuable

consideration. See Smith v. Minneapolis Threshing Mach. Co., 214 P. 178, 180

(Okla. 1923).

Waiver can occur both expressly and implicitly. Barringer, 22 P.3d at 701.

When the evidence concerning waiver is conflicting, or when more than one

reasonable inference may be drawn from the evidence, the existence or nonexistence of waiver is a question of fact for the jury. See id.; see also Kincaid

and Assoc. v. Black Angus Motel, Inc., 983 P.2d 1016, 1021 (Okla. 1999); Bay
- 9 -

Petroleum, 264 P.2d at 736; Skelly Oil Co. v. Funk, 174 P.2d 241, 242 (Okla.

1946); Smith, 214 P. at 181. It is only where there is an express, knowing, and

willing waiver that the issue becomes a question of law for the court. Barringer,

22 P.3d at 701; Smith, 214 P. at 181. 

In this case, Murphy argues that the district court’s waiver holding was

appropriate because Trivental “voluntarily and intentionally accepted money paid

pursuant to negotiated change orders,” but never informed Murphy of its intent to

sue for additional money. This argument proves too much. In order to show an

express waiver, there must be actual evidence that Trivental waived its right to

full payment. Smith, 214 P. at 180-81. Murphy is unable to make this showing. 

Upon thorough review of the record generally, and the General Contract, Specific

Contracts, and change orders particularly, there is simply no evidence that

Trivental expressly waived its rights to the remainder of the contracted for price. 

See e.g., Aplt. App. at 3971 (listing costs for the Tulsa station). 

As such, Murphy must show an implied waiver. Implied waiver can be

shown by conduct which warrants an inference of an intent to relinquish. 

Barringer, 22 P.3d at 701. In order to waive a legal right, though, there must be a

“clear, unequivocal and decisive manifestation of the party’s relinquishment of

the right.” Id. Here, the change orders themselves distinguish between the

original contract price and the prices associated with the changes, and then add
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the two at the end of the change order. Aplt. App. at 3971-72. Murphy insists

that Trivental’s request for full payment, yet acceptance of only partial payment

pursuant to the change orders submitted by Murphy, establishes as a matter of law

that Trivental intended to relinquish its right to full payment. We do not think

that this evidence ineluctably demonstrates a clear and unequivocal manifestation

of Trivental’s intent to relinquish its right to full payment. See Barringer, 22 P.3d

at 701. 

Murphy’s position overlooks the factual dispute regarding whether

Trivental implicitly waived its rights to full payment. First, there was testimony,

albeit from Mr. Wood, that partial payments from Murphy were accepted due to

Murphy’s inability to pay the full amounts as a result of the number of change

orders it was receiving. See Aplt. App. at 1361. Then there was testimony that

Trivental relied on promises by Murphy representatives that once Murphy was

more stable financially, full payment would be made by adding on to future

projects. Id. at 1360-62. 

Finally, Mr. Wood testified that the only reason he accepted partial

payments on behalf of Trivental was that he was assured in a March 9, 2001

meeting by Murphy representative Kevin Roussel that Trivental ought to accept

the partial payment, because “[w]e’re going to give you so many jobs you’re not

going to have to work for anybody else and there will be money in those jobs to
- 11 -

make up what you’re going to [lose by accepting partial payment].” Id. at 1455. 

The jury verdict on these claims should be reinstated notwithstanding that a

factual dispute existed as to waiver, and no waiver instruction was given the jury. 

Initially, as Trivental objected to an instruction on waiver, the court told Trivental

that there was no jury instruction on waiver. Aplt. App. at 1634. Murphy failed

to object to any instructions, including the lack of an instruction on waiver, given

to the jury on Trivental’s breach of contract counterclaims, apparently relying on

its motion for JMOL. Id. at 1635-37. It now argues that it was not required to

request a waiver instruction because the district court indicated that it would rule

in Murphy’s favor on the waiver defense. Aplee. Br. at 28; Aplt. App. at 478,

687; Fed. R. Civ. P. 51(a)(1). We disagree. 

Given the district court’s decision to submit Trivental’s breach of contract

counterclaims to the jury (and effectively deny Murphy’s JMOL motion at the

time under Rule 50(b), supra), it was incumbent on Murphy to object to the

instructions as incomplete (lacking Murphy’s affirmative defense of waiver) and

to provide a waiver instruction. Fed. R. Civ. P. 51(d)(1)(B); Royal Maccabees

Life Ins. Co. v. Choren, 393 F.3d 1175, 1179 (10th Cir. 2005) (“Absent a proper

objection, a party’s argument is deemed waived.”) (internal citation omitted). 

Murphy did not object. Aplt. App. 687 (“Murphy is not claiming error in failing

to instruct the jury concerning waiver.”). Having stood on the strength of the
- 12 -

waiver evidence, even though the district court submitted the claims to the jury, it

may not now claim that it is entitled to a retrial with a proper waiver instruction. 

Had the district court merely granted JMOL in Murphy’s favor on this issue and

we reversed, there is no question that a trial on the breach of contract

counterclaims with a waiver instruction would be appropriate. But that is not

what occurred here–the breach of contract counterclaims were tried to the jury,

and no objection was made to the failure to instruct on waiver.

2. Breach of Contract and Assigned Contractual Rights - Tulsa and

Hugo stations

The district court granted Murphy JMOL on its claims that Trivental

breached the General Contract and contracts of subcontractors assigned to

Murphy. Trivental argues that the court erred in not allowing these issues to go to

the jury, and in failing to instruct the jury as to its “first breach” defense. We

address each argument in turn. 

It is well settled in Oklahoma that a party to a contract who prevents or

hinders performance thereof cannot seek performance by the other contracting

party. See F.D.I.C. v. Everett A. Holseth & Co., 36 F.3d 1004, 1007 (10th Cir.

1994); Dayton Hudson Corp. v. Macerich Real Estate Co., 812 F.2d 1319, 1323

(10th Cir. 1987); Townsend v. Melody Home Mfg. Co., 541 P.2d 1370, 1374

(Okla. Ct. App. 1975). This is the so-called “first breach” defense.

First, Trivental’s failure to pay its subcontractors constitutes a breach of the
4The dissent apparently rejects the concept of the General and Specific

Contracts forming an interrelated “exchange of promises,” see Restatement

(Second) of Contracts, § 237 (1981), through referencing and incorporating each

other. The general contract covers “work performed at Murphy facilities,” Aplt.

App. 4034, and the entire course of performance dictates that the projects were

interrelated. Not only is this consistent with the reality of the construction

business, but also the evidence adduced at trial. See Aplt. App. at 931-34, 942-

43, 979-80, 4022, 4038. While the three Specific Contracts and the General

Contract may be “separate” in some attenuated or formalistic manner, we are

reminded that “[t]he form of the agreement is not controlling, and the actual

bargain of the parties is not to be determined merely by reference to such criteria

as whether . . . separate promises are contained in a single writing or in separate

writings.” Restatement (Second) of Contracts § 231, cmt. d.

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General Contract with Murphy. Trivental contends that Murphy’s breach of

contract regarding the Tulsa and New Iberia projects precipitated its breach. Both

the General Contract and the Specific Contracts reference and incorporate each

other. See Aplt. App. at 4038 (The General Contract provides that “Prior to the

commencement of any work under the GENERAL CONTRACT, the parties will

enter into a SPECIFIC CONTRACT to cover matters such as the scope of the

work, contract price, terms of payment, completion date, and other matters not

provided herein . . . .”) (emphasis in original); see also id. at 4022 (The Oklahoma

City Specific Contract, like all the others provided in the record, provides that the

“[c]ontractor shall furnish the materials, labor [etc.] . . . necessary to construct

and finish expeditiously, in a workmanlike manner and in accordance with the . . .

documents hereinafter listed . . . [including the] General Contract No. 2005-05.”). 

The parties have treated the contracts together and so do we.4
5The dissent contends that as Murphy’s breach pre-dated the Oklahoma City

station contract’s formation, it “would mean that Trivental already had a defense

to its failing to pay” the subcontractors before entering into the Oklahoma City

contract. Dissent at 6. But Trivental would not have had any notion that it had a

“defense” to its breach with regard to the subcontractors at the time of the

Oklahoma City contract’s formation, because it still believed that Murphy was

going to pay for the extra work as promised.

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Trivental presented evidence that its inability to pay the subcontractors

from which this breach of contract claim derived resulted directly from the debt

Trivental incurred for the extra work that it was required to perform in Hugo,

New Iberia, and Tulsa. Aplt. Br. at 41-42; Aplt. App. at 1409-1410. Trivental

has also presented evidence that Murphy promised to pay Trivental for this extra

work. Aplt. App. at 1409-10. It should be noted, of course, that the jury did find

that Trivental was entitled to compensation from Murphy for extra work

performed at those stations, and therefore this evidence could support a jury

finding that Murphy’s breach of the contract in not paying with regard to these

three stations constituted a “first breach” of the Oklahoma station contract. See

Townsend, 541 P.2d at 1374-75. As such, the district court erred in refusing to

submit Murphy’s breach of contract claim, and Trivental’s “first breach” defense,

to the jury.5

Murphy also claims that it is entitled to the damages based on an

assignment of the claims subcontractors had against Trivental. The district court

agreed, granting Murphy JMOL on the issue. Aplt. App. at 475. It is true that
6We note that the purported assignment to Murphy of claims arising under

Okla. Stat. tit. 42, §§ 152, 153 is presumed invalid, as the common-law

prohibition against the assignment of a tort action, such as breach of a fiduciary

duty, obtains unless otherwise provided by statute. See Dippel v. Hunt, 517 P.2d

444, 447 (Okla. Civ. App. 1973). While Okla. Stat. tit. 42, §§ 152, 153 do appear

to allow the assignment of a valid lienable claim, Murphy surely cannot file a lien

against its own property in order to recover against Trivental. In any case,

Murphy does not need to stand on this assignment in order to press the breach of

fiduciary duty claim, because the statutory provisions are construed to include

owners as beneficiaries of the trust, provided the existence of a valid lienable

claim. See In re Harris, 49 P.3d 710, 715-718 (Okla. 2002). 

- 15 -

Murphy secured a valid assignment of claims from various subcontractors,6 for

Oklahoma law is clear that the lien statutes are cumulative, i.e., they do not

preclude aggrieved parties from pressing alternative claims, such as breach of

contract. See Wyant v. Davidson & Case Lumber Co., 49 P.2d 151, 154 (Okla.

1935) (“[T]his court has repeatedly held that the remedy provided by statute in

this state for foreclosure of mechanic’s or materialman’s lien is a cumulative

remedy.”); see also Love v. Caylor, 227 P. 98, 98 (Okla. 1924) (“The plaintiff

was not required to foreclose his lien and exhaust his remedy in that manner

before he could maintain a personal action against the defendants to recover the

amount of this indebtedness.”). But the JMOL cannot be upheld under this theory

either, for the subcontractors’ breach of contract claims (validly assigned to

Murphy) implicate Murphy’s alleged refusal to pay for additional work, just as

Murphy’s own breach of contract claim does, and still present questions of fact

for the jury. As the assignee, Murphy’s rights against Trivental would be subject
7The dissent argues for an overly narrow reading of § 336(4), yet despite

the thoughts of one federal district court judge in Georgia (sitting by designation

in Tennessee) cited by the dissent, the better rule is that explained in State v.

Hogg, 535 A.2d 923, 934-35 (Md. 1988) (overruled on other grounds), and amply

supported by the authorities listed therein, including two treatises, see 4 A.

Corbin, Corbin on Contracts § 896, at 527 (1951); Lord, Williston on Contracts §

74.47, at 538 (4th ed. 2005), and Winchester v. Hackley, 6 U.S. (2 Cranch) 342,

343 (1805); Pates v. St. Clair, 52 Va. 22, *2 (1854); Restatement (Second) of

Contracts § 336(4); Restatement of Contracts § 167(2) (1932) (“an assignee’s

right against the obligor is subject to all set-offs and counterclaims which would

have been available against the assignee if he were the original obligee”). As the

court said in Hogg, the alternative position suggested by the dissent attempts to

“state[] the universe of rules applicable to assignments” yet fails to “undertake to

describe, one way or the other, the effect of antecedent defenses against the

assignee.” Hogg, 535 A.2d at 935. Merely because the Restatement (Second) of

Contracts illustrated the situation the dissent describes does not mean that the

illustration is exclusive. Indeed, this rule makes perfect sense here given the

allegations – Trivental contends that Murphy’s conduct resulted in Trivental’s

breach of the subcontracts. 

8Section 152 provides, in pertinent part, that the amount “payable under any

building or remodeling contract shall, upon receipt by any contractor or

subcontractor, be held as trust funds for the payment of all lienable claims due

and owing or to become due and owing by such contractors or subcontractors by

- 16 -

to any setoffs or counterclaims that Trivental might have against Murphy, and to

defenses as a result of Murphy’s conduct. See 6 Am. Jur. 2d § 149 (2d ed. 1999);

Restatement (Second) of Contracts, § 336(4).7

3. Breach of Fiduciary Duty

The district court also granted Murphy JMOL on its claim that Trivental

breached its fiduciary duty under Okla. Stat. tit. 42, §§ 152, 153, by spending

money entrusted by Murphy for purposes other than payment of the invoices of

the subcontractors.8 Trivental argues that Murphy cannot prevail on this claim
reason of such building or remodeling contract.” Okla. Stat. tit. 42, § 152(1)

(1968). Section 153 provides, in pertinent part: “The trust funds created under

Section 152 of this title shall be applied to the payment of said valid lienable

claims and no portion thereof shall be used for any other purpose until all lienable

claims due and owing or to become due and owing shall have been paid.” Okla.

Stat. tit. 42, § 153(1) (1968).

- 17 -

because in order to obtain the statutory remedy there must exist a valid lienable

claim at the time of the breach. Murphy argues that the breach occurs upon the

misapplication of the trust funds, and as liens could have been filed during that

time, they are entitled to the statutory remedy. 

Oklahoma law is clear that the statutory duty imposed on a general

contractor to hold funds in trust for the payment of subcontractors creates a

fiduciary relationship between the owner and the contractor. See Okla. Stat. tit.

42, §§ 152, 153; see also In re Harris, 49 P.3d at 716. The fiduciary duty,

however, exists only to the extent that there are lienable claims due and owing by

reason of a building or remodeling contract. In re Harris, 49 P.3d at 716. It is

also well settled that the owner of real property who places trust funds with a

general contractor pursuant to the Oklahoma construction trust fund statutes is a

beneficiary of the statutory construction lien scheme to the extent of any valid

lienable claims arising from the contract between the owner and the general

contractor. See In re Harris, 49 P.3d at 716; see also In re Tefertiller, 772 P.2d

396, 397-98 (Okla. 1989). 
- 18 -

A subcontractor’s valid lienable claim arises upon commencement of work

or the furnishing of materials pursuant to a subcontract. In re Tefertiller, 772

P.2d at 399; Fleharty & Co. v. Nat’l Loan & Inv. Co., 215 P. 744 (Okla. 1923). 

From that point onward, this lienable claim remains “inchoate” throughout the

construction period and for ninety days following the last furnishing of materials

or performance of labor under the subcontract. Id. 

If the subcontractor takes no action to enforce the lien, or if the lien is not

perfected according to the statutory procedures, then the lienable claim loses “all

its vitality and force.” In re Tefertiller, 772 P.2d at 399; Bohn v. Divine, 544

P.2d 916, 920 (Okla. 1975) (“Unless the lienable claim was perfected within 90

days of completion of the work or the furnishing of materials, the character of the

claim was no longer ‘lienable.’”). As such, a subcontractor can only recover

under the construction trust fund statutes if “there was a perfected lien at the time

[it] brought suit.” Bohn, 544 P.2d at 920. 

Murphy, as the project owner, is subject to a slightly more nuanced rule. A

common sense reading of the statute would not require a project owner to file a

lien on his own property, nor is it good policy to require the owner to wait ninety

days before paying subcontractors. Okla. Stat. Ann. tit. 42, §§ 152, 153. 

Furthermore, requiring a project owner to file a lien on his own property could

cloud title, even if temporarily, and would require an eventual release of the lien. 
9Only one lien was filed and perfected by a subcontractor, Mustang Electric

Company, in the amount of $27,525. See Aplt. App. at 1816-18. From all

appearances, Mustang complied with Okla. Stat. tit. 42, § 143’s notice and

perfection procedures, and the lien claim was timely filed. Id. The relevance of

this, if any, will be taken into account by the jury on remand.

10It should be noted, of course, that Murphy cannot recover, as a matter of

law, under the construction trust fund statutes for any of its other payments to

subcontractors if those payments came after those subcontractors’ lienable claims

became extinguished.

11The district court was correct insofar as it found that if Murphy is entitled

to any remedy for breach of trust, it can proceed against Trivental’s officers

individually. See Okla. Stat. tit. 42, § 153(3) (“For purposes of this section, the

natural persons subject to punishment shall be the managing officers of [the]

corporation. . . .”).

- 19 -

Therefore, project owners, who pay subcontractors within the ninety day period in

which the subcontractor could have filed a lien, should be deemed to have a

“lienable claim.” 

After thorough review of the record, it appears that four claims were paid

by Murphy to subcontractors for work performed at the Oklahoma City station

before the ninety day period expired. These payments include those to: (1) S. R.

Dutch Construction, paid on June 26, 2002 in the amount of $16,002.22; (2)

Metroplex Sprinkler, paid on July 2, 2002, in the amount of $7,347; and (3)

George Patrick’s Plumbing Company, paid on July 9, 2002, in the amount of

$2200; and 4) Mustang Electric Company, in the amount of $27,525.9

 See Aplt.

App. at 462; see also Aplt. Supp. Br. at 1-2.10 Thus, the district court’s entry of

JMOL for Murphy was in error.11
- 20 -

Nevertheless, regardless of whether Murphy is allowed to proceed under

the construction fund statutes on these four claims, Trivental may still argue (as it

has) that it was Murphy’s “first breach” that precipitated Trivental’s breach of its

fiduciary duty to its contractors. That is, a jury question remains as to whether

Murphy can show it felt obliged to pay the subcontractors and its conduct vis-avis Trivental was not the precipitating cause of the non-payment. 

4. Mr. Wood’s Counterclaims

Mr. Wood, a managing officer of Trivental and a codefendant, appeals the

district court decision that he lacked standing to pursue his personal tort

counterclaims. The district court was correct. Mr. Wood counterclaimed against

Murphy seeking to recover monies he voluntarily advanced to Trivental when

Murphy failed to reimburse Trivental pursuant to the alleged Murphy-Trivental

oral agreement. Mr. Wood does not have standing to recover what is essentially

an obligation owed to Trivental. See J. F. Shea Co., Inc. v. City of Chicago, 992

F.2d 745, 749 (7th Cir. 1993) (holding that employee cannot assert claims of

corporation). Indeed, the amounts advanced to Trivental by Mr. Wood are

included in and part of the very same damages sought by Trivental itself against

Murphy. 

Were this any different, presumably anytime a shareholder was required to
- 21 -

contribute capital or make a loan to a cash-strapped corporation, the shareholder

could then seek to collect on monies owed the corporation. This would result in

liability mayhem. Mr. Wood’s recourse, in the absence of any direct relationship

with Murphy, would only lie against Trivental. As such, Mr. Wood lacks standing

to press his individual claims against Murphy. 

5. Actual and Constructive Fraud

Trivental argues that the district court erred in combining the fraud claims

related to the Hugo, Oklahoma station and the New Iberia, Louisiana station

under one instruction. Trivental argues that this instruction only states fraud

under Louisiana law, and there are “substantial differences” between Louisiana

and Oklahoma law. Trivental also argues that the district court erred in failing to

instruct the jury on constructive fraud. We address each of these arguments in

turn.

While it is clear that a party is entitled to an instruction on her theory of the

case if the instruction is a correct statement of law and she has submitted

sufficient evidence for the jury to find in her favor, it is certainly “not error to

refuse to give a requested instruction if the same subject matter is adequately

covered in the general instructions.” F.D.I.C. v. Schuchmann, 235 F.3d 1217,

1222 (10th Cir. 2000). We review the district court’s decision to give a particular

jury instruction for an abuse of discretion. Id. at 1221. The instructions are
- 22 -

considered as a whole de novo to determine whether they accurately informed the

jury of the governing law. Id. at 1222. 

While the fraud instruction in this case does not employ Trivental’s

preferred wording for fraud in Oklahoma verbatim, the instruction clearly spells

out that Murphy could be held liable if it intentionally made misrepresentations in

order to obtain “an unjust advantage for one party or to cause a loss or

inconvenience to the other.” See Aplt. App. at 424. This more than adequately

states the governing law of fraud for both Oklahoma and Louisiana. See

Schuchmann, 235 F.3d at 1223. As such, the jury instruction on fraud was not

error.

With regard to Trivental’s claim that the district court erroneously failed to

instruct on constructive fraud, we note that constructive fraud does not require an

intent to deceive; indeed, negligent or even innocent misrepresentation may

provide the basis for a finding of constructive fraud. Faulkenberry v. Kansas City

S. Ry. Co., 602 P.2d 203, 206 (Okla. 1979). Nevertheless, in order to recover

under a theory of constructive fraud, there must be a “special relationship”

between the parties that requires the party charged with constructive fraud to

comply with an affirmative statutory duty. Silver v. Slusher, 770 P.2d 878, 882

(Okla. 1988). In its brief, Trivental failed to elucidate the existence of a “special

relationship” between the parties that would impose a statutory duty on Murphy
12Trivental also argues on appeal that the district court erred in not

instructing the jury on constructive fraud under Louisiana law. We decline to

reach this argument, as Trivental waived it on appeal by failing to object at trial. 

Aplt. App. 1630-31.

- 23 -

upon which the claim for constructive fraud could possibly stand. See Aplt. Br.

44-45.12 As such, the district court’s failure to instruct the jury on constructive

fraud was not an abuse of its discretion.

6. Shifting Burden, Attorney’s Fees, and Pre-Judgment Interest

Trivental argues that when the district court required Trivental to prove that

the extra work it claimed fell outside the General Contract, it erred in shifting the

burden to prove damages from Murphy to Trivental. Trivental also argues that

the district court erred in awarding Murphy attorney’s fees. Finally, Trivental

argues that the district court erred in awarding Murphy pre-judgment interest. 

We decline to address these arguments, for the basis of these awards, if

any, will be reevaluated on remand.

B. Murphy’s Cross-Appeal (04-6239)

1. Breach of Contract - New Iberia station

On cross-appeal, Murphy argues that the district court erred in neither

granting its motion for JMOL nor granting its request for a new trial with regard

to the New Iberia station. As discussed, the district court ruled that waiver did

not apply to this contract, because it was decided under Louisiana law. Trivental
- 24 -

argues that there was sufficient evidence for the jury to find as it did. 

As noted above, JMOL is appropriate only if the evidence points but one

way and is susceptible to no reasonable inferences which may support the

opposing party’s position. See Miller v. Eby Realty Group, LLC, 396 F.3d 1105,

1110 (10th Cir. 2005); see also Cummings, 365 F.3d at 951. A motion for a new

trial on the ground that the verdict is against the weight of the evidence presents a

question of fact, not of law. See Patton v. TIC United Corp., 77 F.3d 1235, 1242

(10th Cir. 1996). Thus, the district court will not be reversed unless the verdict is

clearly, decidedly, or overwhelmingly against the weight of the evidence. See id.

(internal citations and quotations omitted).

The Louisiana oral modification statute requires that an oral contract, such

as the one alleged here by Trivental, that exceeds $500 in price, “must be proved

by at least one witness and other corroborating circumstances.” See La. Civ.

Code Ann. art. 1846 (1985). It is well settled in Louisiana that a party may

qualify as its own witness to prove the contract’s existence. See Suire v.

Lafayette City-Parish Consol. Gov’t, 907 So. 2d 37, 58 (La. 2005). The

corroborating circumstances need only be general, that is, independent proof of

every detail of the agreement is not required. Id. Yet, the corroborating

circumstances must come from someone other than the party asserting the

agreement’s existence. Id.; see also Deubler Elec. Inc. v. Knockers of La., Inc.,
- 25 -

665 So. 2d 481, 484 (La. Ct. App. 1995).

With regard to the first prong, Trivental has presented evidence of an oral

agreement. Mr. Wilson has testified that extra work was performed at the New

Iberia station, and that it was specifically suggested by Murphy. See Aplt. App.

at 1205. Further, Mr. Wilson testified that Murphy required that they keep

workers onsite even when the weather conditions precluded meaningful work. Id.

at 1203. Mr. Wood testified to these same oral modifications with Murphy, with

particular emphasis on the New Iberia station. Id. at 1455-57. As such, it is clear

that Trivental provided enough evidence that an oral agreement existed for the

jury’s consideration.

With regard to the second prong, Murphy argues that Trivental’s

corroborating circumstances only come from its own representatives, and thereby

fail to satisfy the requirement that they arise from someone other than the party. 

To the contrary, Mr. Buzbee, a Murphy representative, testified that if there were

errors in the grading of the New Iberia site, then Trivental would be required to

perform extra work. See Aplt. App. at 1244-45. Mr. Buzbee further testified that

after negotiation on extra work generally, or a change order specifically, Murphy

would agree to pay Trivental (or any contractor) for the extra costs. Id. at 1244-

46. 

As such, we find that because Trivental has presented corroborating
- 26 -

circumstances of the agreement that do not come from its own representatives,

combined with other evidence that does, it has satisfied the two part showing

required under the Louisiana statute and case law. See La. Civ. Code Ann. art.

1846; see also Suire, 907 So. 2d at 58. Therefore, the district court did not err in

denying Murphy’s motions for JMOL or a new trial.

2. Remittitur 

Murphy claims that the district court erred by failing to grant its motion for

remittitur. Such a denial is entitled to considerable deference on appeal. We will

not disturb this determination absent a gross abuse of discretion. See Sheets v.

Salt Lake County, 45 F.3d 1383, 1390 (10th Cir. 1995). We will only find an

abuse of discretion if the jury award is “so excessive . . . as to shock the judicial

conscience and to raise an irresistible inference that passion, prejudice, corruption

or another improper cause invaded the trial.” Id. (internal citations and

quotations omitted). As the awarding of damages is traditionally within the

province of the jury, and the jury’s award of $137,500 certainly does not shock

our conscience, we thus affirm the district court’s denial of remittitur.

3. Laches

Murphy argues that Trivental unreasonably delayed in asserting any claim it

may have had against Murphy, and that the district court’s refusal to instruct the

jury on laches amounted to an abuse of discretion. It is well settled in Louisiana
- 27 -

that the time for prescription is “determined by the character which the plaintiff

gives his pleadings and that the form of the action governs prescription.” Antoine

v. Franichevich, 167 So. 98, 99 (La. 1936). According to the Louisiana Supreme

Court, “[t]here is no prescription other than that established by legislation.” 

Fishbein v. State, 898 So. 2d 1260, 1270 (La. 2005) (quoting La. Civ. Code Ann.

art. 3457, cmt. b). Indeed, the “common law doctrine of laches does not prevail

in Louisiana and the legislature may create, shorten, lengthen or abolish

prescriptive periods at its discretion.” Id. (holding that to the extent that other

cases had left open the possibility of laches’ applicability, those cases were

overruled as inconsistent with the state’s statutory scheme); see also Picone v.

Lyons, 601 So. 2d 1375, 1377 (La. 1992); Corbello v. Sutton, 446 So. 2d 301, 302

(La. 1984) (“The doctrine of laches has no place in the law of this state.”). 

While we note that there is some dispute regarding the statutory

prescriptive period for breach of contract claims relating to general contractors,

the Louisiana Supreme Court has held that “the law is clear that a contractor’s

claim is prescribed by ten years” rather than the three year period that governs a

suit to recover past wages. See Antoine, 167 So. at 99 (noting that suits by

contractors who furnish labor and materials in performing jobs for another under

a verbal agreement are governed by article 3544, and not article 3538); see also

La. Civ. Code Ann. arts. 3544, 3538.
- 28 -

Even if the statute of limitations covering this breach of contract claim

were three years though, Trivental would not be barred because less than two

years elapsed before it filed suit. As such, the district court did not err in

refusing to instruct the jury on laches, an affirmative defense that does not exist

in Louisiana.

4. Punitive Damages and Attorney’s Fees

Murphy argues that it is entitled to JMOL on its claim for punitive damages

from Trivental on Murphy’s claim for breach of fiduciary duty. Murphy also

argues that it is entitled to attorney’s fees relating to Trivental’s counterclaims. 

Given our disposition of the breach of fiduciary duty claims, we need not reach

either of these claims.

Conclusion

With regard to Trivental’s appeal, the district court’s order on JMOL as to

(1) the waiver of Trivental’s two breach of contract counterclaims, (2) Murphy’s

breach of contract claim, and (3) Murphy’s breach of fiduciary duty claim, is

reversed. The district court shall reinstate the jury verdict in favor of Trivental

on its two breach of contract counterclaims, and conduct a new trial in accordance

with this opinion. The district court’s award of attorney’s fees and pre-judgment

interest to Murphy are reversed, as these matters may be considered if the need
- 29 -

arises in connection with the trial on remand in accordance with this opinion.

With regard to Murphy’s cross-appeal, we affirm the judgment on the jury

verdict in favor of Trivental on its counterclaim for breach of contract for the

New Iberia station, and any recovery of punitive damages or attorney’s fees

related to Trivental’s counterclaims by Murphy may be considered if the need

arises in connection with the trial on remand in accordance with this opinion.

AFFIRMED in part, REVERSED in part, and REMANDED. 
Trivental v. Murphy Oil, Nos. 04-6183, 04-6239

EBEL, Circuit Judge, dissenting in part.

While I agree with much of the majority opinion, I must dissent from the

majority’s decision to overturn the judgment as a matter of law entered in

Murphy’s favor on its claim for breach of contract. Because I would conclude

that the district court correctly determined that Murphy was entitled as a matter of

law to recover on both its breach-of-contract theories, I respectfully dissent from

that portion of the majority’s opinion.

Murphy’s breach-of-contract claim sought to recover from Trivental for

money Murphy paid Trivental’s unpaid subcontractors on the Oklahoma City

project. Murphy asserted two different theories supporting this breach-of-contract

claim. First, Murphy asserted that Trivental had breached the General Contract

between Murphy and Trivental, which expressly required Trivental to pay all

subcontractors on any project it undertook for Murphy. Second, Murphy asserted

that, by failing to pay the Oklahoma City subcontractors, Trivental breached its

contracts with those subcontractors and that Murphy, as the assignee of those

subcontractors, is now entitled to recover from Trivental for its breach. Trivental

has never disputed that it failed to pay some of the Oklahoma City subcontractors

as required by both the General Contract and the individual contracts between

Trivental and the subcontractors. In light of that, Murphy is entitled as a matter
- 2 -

of law to recover, under either theory, for breach of contract. 

The majority, however, concludes that a jury should have considered

Trivental’s defense to these breaches, premised on Murphy’s own breach of the

Specific Contracts governing the New Iberia, Tulsa and Hugo projects. While

Murphy’s breach of those three Specific Contracts certainly provides Trivental

with a counterclaim that it can, and has, asserted against Murphy, it does not

provide Trivental with a defense to its breaching of the General Contract and the

contracts Trivental had with its Oklahoma City subcontractors. For this reason, I

dissent.

I. Trivental’s asserted defense.

Trivental asserts a “first breach” defense, arguing that Murphy’s earlier

breach of the Specific Contracts covering the New Iberia, Hugo and Tulsa

projects provides Trivental with a defense to Trivental’s later breach of its

General Contract with Murphy. And although Trivental never makes the

argument on appeal, the majority concludes that this same “first breach” defense

should also apply to Murphy’s breach-of-contract claim that Murphy asserts as the

subcontractors’ assignee. 

Under such a defense, one party’s material breach of a contract will excuse

the other party from performing his reciprocal obligations due under that same

contract. “[I]t is a condition of each party’s remaining duties to render
- 3 -

performance to be exchanged under an exchange of promises that there be no

uncured material failure by the other party to render any such performance due at

an earlier time.” Restatement (Second) of Contracts § 237 (1981). The

Restatement recognized that, similar to this case, “[i]n many disputes over failure

of performance, both parties fail to finish performance, and the question is

whether one of them is justified in doing so by the other party’s failure.” Id.

§ 237 cmt. b. 

This “first breach” defense, however, applies only when the entities

involved are parties to the same contract: “Under the [first breach] rule stated in

[§ 237], only duties with respect to the performances to be exchanged under the

particular exchange of promises are affected by a failure of one of those

performances. A duty under a separate contract is not affected.”

Id. § 237 cmt. e; see also id. § 231 cmt. d (noting that “[t]he rules that protect

parties whose performances are to be exchanged under an exchange of promises

apply only when the promises are exchanged as part of a single contract”). 

This is where Trivental’s “first breach” defense fails. Trivental seeks to

excuse its breach of the General Contract as it pertains to Trivental’s paying the

Oklahoma City subcontractors, and its contracts with the Oklahoma City

subcontractors, by relying on Murphy’s breach of other, separate contracts

addressing the New Iberia, Hugo and Tulsa projects. 
- 4 -

II. The General and Specific Contracts are not one single contract.

At the outset of the parties’ business relationship, Trivental and Murphy

entered into a General Contract. That General Contract did not award Trivental

any specific construction project, but instead contemplated that any construction

project that Trivental undertook for Murphy in the future would be governed both

by the terms of the General Contract and by a Specific Contract that addressed the

details of that particular project. Each project had its own separate Specific

Contract. While the General and Specific Contracts were certainly related, they

cannot be considered all one contract. Nor can the separate Specific Contracts be

considered together to create a single contract. 

Because they are not all one contract, Murphy’s breach of the Specific

Contracts governing the New Iberia, Hugo and Tulsa projects cannot give

Trivental a defense to its own breach of the General Contract. The General

Contract required that Trivental pay the subcontractors on all projects. But it did

not include a reciprocal provision requiring Murphy to pay Trivental on each

specific project. Rather, the Specific Contract governing each particular project

addressed Murphy’s duty to pay Trivental. Therefore, Murphy’s failure to pay

Trivental in full for the New Iberia, Hugo and Tulsa projects was a breach of the

Specific Contracts governing each of those projects. Murphy’s breach would
1 The General Contract’s paragraph 8 reiterates this:

[Murphy] retains the right to withhold, retain, and/or set off any

payments due to [Trivental] in this or any other transaction or under

any contract such amounts as [Murphy] deems sufficient to protect

[Murphy] and its property against any claim by [Trivental’s] employees,

fabricators, material men, subcontractors, suppliers, and workmen

which could or may become a lien or claim against [Murphy] or its

property. [Murphy] may at any time pay and discharge such lien or

claim and deduct the amount so paid with together with costs and

attorney’s fees, from any payment then due or thereafter to become due

to [Trivental]. 

This language also further indicates that each project was governed by a separate

contract.

- 5 -

certainly give Trivental a cause of action to recover against Murphy.1 But

Murphy’s breach of those Specific Contracts would not amount to a breach of the

General Contract. 

The result is the same even if we assume that the Specific Contracts each

incorporate the General Contract’s terms. In that case, because the Specific

Contracts represent separate contracts between Trivental and Murphy, the fact

that Murphy breached the Specific Contracts governing the New Iberia, Hugo and

Tulsa projects would not excuse Trivental from paying the subcontractors under

the separate Specific Contract addressing the Oklahoma City project. 

To conclude otherwise and treat all these agreements as a single contract

produces an anomalous result. Timewise, Murphy breached the Specific

Contracts concerning the New Iberia, Hugo and Tulsa projects before Trivental
2

It is difficult to say exactly when Murphy breached those orally

modified Specific Contracts. Trivental asserts that Murphy agreed to pay for

extra work Trivental performed on these projects through later payments Murphy

would make to Trivental on future projects. Nevertheless, it seems safe to say

that Trivental considered Murphy to have breached that promise before Trivental

ever agreed to construct the Oklahoma City project.

- 6 -

and Murphy agreed to undertake the Oklahoma City project.2 Viewing all these

contracts as one, therefore, would mean that Trivental already had a defense to its

failing to pay the Oklahoma City subcontractors before the parties even agreed to

the Specific Contract addressing the Oklahoma City project. I cannot accept such

a view of Trivental’s and Murphy’s business relationship. 

III.. Trivental’s breach of the contracts with its Oklahoma City

subcontractors.

Even if the General and Specific Contracts between Trivental and Murphy

can be considered a single contract, Murphy’s breach of that contract by not

paying Trivental in full on the New Iberia, Hugo, and Tulsa projects would still

not excuse Trivental from paying its Oklahoma City subcontractors the amount

Trivental owed on the separate contracts Trivental had with these subcontractors. 

It is telling that Trivental does not even rely on such a defense in its arguments to

this court. And there is no suggestion that Trivental’s contracts with its

subcontractors should be considered part of the contractual relationship between

Trivental and Murphy. Moreover, Trivental concedes that it breached its

contracts with several subcontractors by failing to pay them in full on that project. 
- 7 -

Murphy, therefore, as the subcontractors’ assignee, is entitled as a matter of law

to recover from Trivental for Trivental’s breach of its contracts with those

subcontractors. 

In nevertheless providing Trivental with a defense, the majority relies upon

the Restatement (Second) of Contracts § 336(4) (1981), which indicates that “[a]n

assignee’s [here Murphy’s] right against the obligor [Trivental] is subject to any

defense or claim arising from his conduct or to which he was subject as a party or

a prior assignee because he had notice.” But § 336’s comment h further explains

that 

[t]he conduct of the assignee [here Murphy] or his agents may, like that

of any obligee, give rise to defenses and claims which may be asserted

against him by the obligor [here Trivental]. An obligee who is subject

to such a defense or claim cannot improve his position by assigning the

right to an assignee who is not subject to the defense or claim and then

take a reassignment.

Id. cmt. h (emphasis added). By way of example, the comment gives this

illustration:

A is fraudulently induced by B, the agent of C, to sell goods to C. C

assigns his rights to D, who pays value in good faith and without notice.

D assigns to E, who knows of the fraud. A cannot avoid the contract as

against E, who succeeded to D’s rights. But if E assigns to C, A’s

power of avoidance will revive.

Id. illus. 15. 

Section 336’s comment h and illustration 15 do not at all describe what

occurred here. Therefore, that section of the Restatement would arguably not
- 8 -

even apply to this situation. But even if this court interpreted § 336(4) to apply

beyond the language and example used by comment h and its illustration 15, there

is no indication that § 336(4) suggests that an assignee’s conduct in the

performance of a completely separate contract, occurring prior to the assignment,

would give an obligor such as Trivental a defense to its breach of a contract with

an assignor who then later assigned his rights to that assignee. 

Although there is only minimal case law applying the Restatement’s

§ 336(4), those cases for the most part support this narrow interpretation of

§ 336(4). In particular, Federal Deposit Insurance Corporation v. Dempster, 637

F. Supp. 362 (E.D. Tenn. 1986), held that “[a] careful reading of Section 336

indicates that the assertion of any defenses against an assignee applies only in

instances where the assignee is a party to the underlying contract or where the

conduct of the assignee occurs subsequent to the initial assignment but prior to a

reassignment.” Id. at 366 (emphasis added) (relying on American Training

Servs., Inc. v. Commerce Union Bank, 415 F. Supp. 1101 (M.D. Tenn. 1976),

aff’d, 612 F.2d 580 (6th Cir. 1979)); see also F.D.I.C. v. Manatt, 723 F. Supp. 99,

105 (E.D. Ark. 1989) (following Berry and holding that litigant could not “assert

defenses against the FDIC as assignee based on actions taken by the FDIC in its

corporate capacity prior to the assignment”); F.D.I.C. v. Berry, 659 F. Supp.

1475, 1482 (E.D. Tenn. 1987) (following Dempster). In reaching this conclusion,
- 9 -

the district court in Dempster relied on the “general principle of assignment [that]

provides that the assignee steps into the shoes of the assignor upon assignment of

the interest and takes the assignment subject to the defenses assertable against the

assignor.” Dempster, 637 F. Supp. at 165-66. But to read Restatement § 336 to

permit “actions by the assignee [occurring] prior to the assignment” would

improperly subject the assignee “to actions not assertable against the assignor and

therefore [the assignee] would have additional characteristics not applicable to the

assignor and would not be, as it were, stepping into the shoes of the assignor or

taking on the characteristics of the assignor.” Id. at 366. 

The only contrary case, which does expressly reject the reasoning in

Dempster and Berry, State v. Hogg, 535 A.2d 923, 933-35 (Md. 1988), has been

overruled on other grounds. See Dawkins v. Baltimore City Police Dep’t, 827

A.2d 115, 115-16 (Md. 2003). And Oklahoma courts do not appear to have ever

adopted or applied this Restatement provision. In light of this uncertainty, I

would not rely upon § 336(4) to grant Trivental a new trial based upon a theory

that Trivental never argued to this court. 

IV. Conclusion

Because I do not think that Murphy’s failure to pay Trivental in full on the

New Iberia, Hugo, and Tulsa projects gave Trivental any defense to its failure to

pay its subcontractors on the later Oklahoma City project, I respectfully dissent
- 10 -

from the majority’s decision to reverse the district court’s judgment for Murphy,

entered as a matter of law, on Murphy’s breach-of-contract claim.