Opinion ID: 507204
Heading Depth: 2
Heading Rank: 8

Heading: Liability of Brown and Bjordahl as Agents of WPSC.

Text: 49 The jury in this case found against Western Plains Service Corporation and against its employees Brown and Bjordahl on the promissory estoppel claim. The jury awarded damages against all three defendants. WPSC, Brown, and Bjordahl argue that Brown and Bjordahl were agents of Western Plains acting within the scope of their employment and therefore cannot be held liable for their corporation's failure to keep its promise to loan plaintiffs 2.2 million dollars. 50 The court gave the jury no instruction on how to determine which of the defendants could be held liable under a theory of promissory estoppel. So, WPSC does not argue that the jury misapplied the law as it was given to them. Their claim of error, then, necessarily goes to the incompleteness of the instructions. However, the defendants neither requested an appropriate instruction nor objected to its absence. By failing to lodge a timely objection to the incomplete instructions before the jury retired to deliberate, WPSC waived this argument. Thus, we will reverse only if the error was patently plainly erroneous and prejudicial, Moe, 727 F.2d at 924, and resulted in a miscarriage of justice, Brown v. McGraw-Edison Co., 736 F.2d 609, 614 n. 6 (10th Cir.1984). 51 To determine whether there was reversible error we look to Wyoming law regarding the liability of agents. The test for determining agent liability differs depending on the nature of the cause of action. Wyoming follows the rule that if actions of an agent constitute a tort, the agent cannot escape liability on the ground that he or she was acting for the principal. Cline v. Sawyer, 600 P.2d 725, 727 (Wyo.1979). However, if the cause of action sounds in contract, a different rule applies. The Wyoming Supreme Court has held that [a]n agent who contracts on behalf of a disclosed principal, in the absence of some other agreement to the contrary or other circumstances showing that he has expressly or impliedly incurred or intended to incur personal responsibility, is not liable to the other contracting party. Kure v. Chevrolet Motor Div., 581 P.2d 603, 609 (Wyo.1978). Although Wyoming has not announced which, if either, of these tests applies for determining the liability of agents in promissory estoppel, we find that Wyoming would apply contractual principles to this issue and that the Kure test governs. See Oyler v. State, 618 P.2d 1042, 1055-56 (Wyo.1980) (Raper, C.J., dissenting) (applying Kure to a promissory estoppel claim); Froelich v. Aspenal, Inc., 369 N.W.2d 37 (Minn.Ct.App.1985) (applying a contractual standard to determine agent's liability in promissory estoppel). 52 This is one of the rare cases in which reversal is warranted despite a failure to object. See Aspen Highlands, 738 F.2d at 1516. The jury did not consider any of the Kure requirements in determining that defendants Brown and Bjordahl were liable on the promissory estoppel claim. The jury was told what standards to apply in determining whether plaintiffs asserted a valid promissory estoppel claim, but the jury was given no guidance whatsoever in determining which of the defendants were liable. To enter judgment of 1.5 million dollars against Brown and Bjordahl when there was no determination of their individual liability is patently plainly erroneous and prejudicial, Moe, 727 F.2d at 924, and a miscarriage of justice, Brown, 736 F.2d at 614 n. 6. We therefore consider WPSC's arguments despite its failure to object at trial. 53 None of the grounds announced in Kure for holding agents liable is applicable in this case. Since Brown and Bjordahl were acting on behalf of a disclosed principal, they cannot be held liable under the first element of the Kure test. Plaintiffs do not allege that Brown and Bjordahl failed to disclose that they were acting on behalf of their corporation. Furthermore, the plaintiffs' own pleadings allege that Brown and Bjordahl were acting within the scope of their employment, and the jury so held. 54 The second question under Kure is whether Brown and Bjordahl agreed to accept personal liability for the promise to loan 2.2 million dollars. Plaintiffs do not allege that such an agreement existed. 55 Finally, the Kure test requires us to determine whether, even in the absence of an agreement, the circumstances of the transaction show that Brown and Bjordahl incurred or intended to incur personal liability. Plaintiffs argue that Brown and Bjordahl were acting on their own behalf. The only facts in the record which support this contention concern Brown and Bjordahl's compensation. There is testimony that Brown and Bjordahl each received a percentage of the loans they serviced. The plaintiffs admit that WPSC's board of directors was fully aware of the nature of Brown and Bjordahl's compensation. Furthermore the jury expressly found that Brown and Bjordahl were acting within the scope of their employment. These facts do not establish that Brown and Bjordahl incurred or intended to incur personal liability for WPSC's promise to loan plaintiffs 2.2 million dollars. We hold that, as a matter of law, Brown and Bjordahl are not liable under Kure. 56 The jury found that no tort was committed. Since the jury found for the plaintiffs on only the promissory estoppel claim, it would be improper for the jury to hold Brown and Bjordahl personally liable for their corporation's failure to keep its promise. We therefore reverse. 57 In summary, the jury should have been instructed on the law governing the liability of agents for breach of contract by the principal. Because this error was patently plainly erroneous and worked a miscarriage of justice we have considered it despite WPSC's failure to make a timely and specific objection at trial. Because the evidence is insufficient as a matter of law to hold Brown and Bjordahl liable, we reverse the judgment against them on the promissory estoppel claim. 58