Opinion ID: 2604741
Heading Depth: 3
Heading Rank: 2

Heading: MEG's Objections

Text: MEG has three specific objections to the jury instructions on damages. First, MEG contends that because NTC's 1980 cost per thousand reflects the cost of producing domestic logs at Shakan Bay as well as export logs, the damages figure misrepresents the expense incurred by NTC in completing MEG's work. The 1979 figures do not include the costs of domestic timber because the logging agreement signed by MEG called for only export timber. Therefore, MEG argues, it should not have to bear the cost of NTC's domestic logging. Second, in 1979, NTC paid a ten percent commission to Pacific Timber Products, a company which acted as a broker between NTC and 3-M. In 1980, when NTC took over the logging operation, it did not pay a sales commission. MEG contends that this was an avoided cost, and that the jury should have been instructed to deduct the amount of the sales commission from any damages awarded to NTC. Finally, MEG argues that the measure of damages should be the difference in profits, not the difference in costs. According to MEG, NTC made $118.67 per thousand board feet (MBF) in 1979 and only $98.64 per MBF in 1980, so that the effect of the loss of MEG's services may be calculated by multiplying the difference in profits ($20.03) by the number of board feet of export timber NTC produced in 1980 (2.183 MMBF). [5] MEG charges that it was not reasonable and foreseeable that NTC would log domestic timber in 1980 in order to mitigate its losses. MEG does not squarely address the propriety of the specific jury instruction concerning mitigation, however, which appears to dispose of the issue. The jury was correctly instructed about the domestic timber in Instruction No. 26: If you find that logging and selling that timber was done in an effort to minimize losses or damages, you should include them in assessing NTC's damages. If you find that logging and selling that timber was not done to minimize losses or damages but rather as a separate operation, you should not include them in assessing NTC's damages. Instruction No. 26 by itself would have allowed the jury to decide whether the mitigation was reasonable, which is normally a question of fact. West v. Whitney-Fidalgo Seafoods, Inc., 628 P.2d 10, 18 (Alaska 1981). But the jury's discretion in this matter was undercut by the court's further instruction regarding the measure of damages.