Opinion ID: 2570261
Heading Depth: 3
Heading Rank: 3

Heading: Denial of Tufco's Request To Amend Its Complaint

Text: After the superior court ruled against Tufco on its claims for eviction and damages, Tufco moved to amend its complaint under Civil Rule 15(b) to conform to the evidence presented at trial. As we have already described above, Tufco claimed that the parties had litigated the issue of a pretrial lease modification that, in Tufco's view, required Penco to purchase insurance protecting the Anchorage property against damages caused by pollution. Tufco sought to have its complaint amended to reflect this claim. At the same time, it asked the court to reconsider its original findings by entering additional findings resolving this claim. The superior court denied Tufco's motions, finding that the lease-modification issue had neither been litigated nor raised. Tufco challenges this ruling. Civil Rule 15(b) allows a party to amend its original pleadings to include issues that the parties either expressly or impliedly litigated at trial: When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment; but failure so to amend does not affect the result of the trial of these issues. [7] We have interpreted this rule to apply when evidence supporting the post-trial amendment was admitted at trial by consent of the parties or with the court's approval despite the opposing party's objection that the evidence addressed issues outside the pleadings. [8] Here, Tufco's original complaint alleged that Penco had breached the lease and, based on this allegation, set out claims for eviction and damages. The complaint did not allege that the lease had been modified or seek a declaration of the parties' obligations under the modified lease. During the course of the parties' pretrial discussions to resolve their dispute, Penco indicated that it would purchase an insurance policy for Tufco's premises effective May 2003 if Tufco allowed it to remain on the premises. Although Penco's agreement to purchase insurance was mentioned at trial, the record fails to support Tufco's contention that the issue of lease-modification was litigated by express consent of the parties. To the contrary, when Tufco's counsel asked a witness whether Penco had provided Tufco with a certificate of insurance, Penco's attorney objected, insisting that there is no issue that [Tufco] indicated with regard to this hearing involving the ... procurement or failure to procure insurance. It's not part of the complaint. In response to this objection, the trial court observed that it might be more trouble than it's worth to discuss the matter. Tufco's attorney then simply indicated that he would move on. Nor does the record support Tufco's contention that the lease-modification issue was tried with the parties' implied consent. Implied consent ... is ... difficult to establish and seems to depend on whether the parties recognized that an issue not presented by the pleadings entered the case at trial. If they do not, there is no consent and the amendment cannot be allowed. [9] Tufco notes that Penco introduced its new insurance policy as an exhibit at trial. But as Penco correctly points out, the record indicates that Penco introduced the exhibit together with other transactional documents for a limited reason: to present a complete picture of the parties' pretrial transactions so as to avoid any implication that Penco might have admitted Tufco's allegations of breach. The record provides no indication that either party went further by seeking to litigate the substantive issue of whether Penco's agreement to purchase insurance was intended to prospectively modify the parties' original lease. Clifford Dart, Penco's Chief Financial Officer and Vice President, testified that Penco obtained the insurance in the course of discussing a possible settlement only to satisfy Tufco's demands that Penco immediately buy the insurance. Tufco's attorney did not pursue the issue further, and the court admitted the policy as a trial exhibit without objection or additional explanation. Notably, during its closing arguments, Tufco did not contend that the lease had been modified; to the contrary, it expressly acknowledged that waiver and estoppel were the only issue[s before the court]. Because the record provides abundant support for the superior court's finding that the issue of lease modification was not actually litigated, its denial of Tufco's motion to amend under Rule 15(b) cannot fairly be characterized as arbitrary, capricious, or manifestly unreasonable. It follows that the superior court did not abuse its discretion in denying the motion.