Opinion ID: 161326
Heading Depth: 1
Heading Rank: 2

Heading: ronan internal policy

Text: 25 Before trial, NESCO filed a motion in limine objecting to planned testimony by Razmik Haftvani, Ronan's director of engineering and manager of the leak detection division, regarding Ronan's alleged internal policy under which it did not enter into binding contracts on nonstandard jobs without first obtaining approval from its engineering department. NESCO argued the internal policy was irrelevant to whether a contract was formed because the Uniform Commercial Code (UCC), as adopted in Oklahoma, allows only objective evidence of a party's intent to form a contract. Because the internal policy was never communicated to NESCO, the policy was indicative of subjective, not objective, intent. See App., vol. I, at 63-64. NESCO further objected that Mr. Haftvani was not an appropriate party to testify about contract negotiations because he was not personally a part of the negotiation process. Id. at 62. The objections were addressed at a pre-trial conference, whose proceedings are not reproduced in the record. 26 At the end of the third day of trial, Ronan requested the court to revisit the issues raised in NESCO's motion in limine. Ronan argued the evidence already presented had laid sufficient foundation for allowing testimony about the internal policy. NESCO continued to object that unexpressed reservations are irrelevant to contract formation under the UCC. The court took the question under advisement overnight. See App., vol. III, at 559-60. The next morning, the court ruled that Mr. Haftvani's testimony regarding Ronan's normal business practice would be allowed. Mr. Haftvani testified regarding the Ronan policy, and NESCO appeals the admission of his testimony. 27 We generally review a district court's determination regarding admission of evidence for abuse of discretion. Boughton v. Cotter Corp., 65 F.3d 823, 832 (10th Cir. 1995). If the complaining party failed to make a contemporaneous objection at trial, however, we review the ruling under a plain error standard. Pandit v. Am. Honda Motor Co., Inc., 82 F.3d 376, 379 (10th Cir. 1996); Fed. R. Evid. 103(d). Ronan contends NESCO's objections to Mr. Haftvani's testimony should be reviewed only for plain error because NESCO did not object at the time of the testimony. We have delineated a three-part test for whether a party must object at the time of trial in order to renew objections made in an earlier motion in limine: To overcome the claim of waiver for failure to contemporaneously object, we must satisfy ourselves that (1) the matter was adequately presented to the district court; (2) the issue was of a type that can be finally decided prior to trial; and (3) the court's ruling was definitive. Pandit, 82 F.2d at 380. 28 Here, the issues were adequately presented to the district court in NESCO's initial motion in limine as well as the arguments presented to the court directly preceding Mr. Haftvani's testimony. Although Mr. Haftvani had not yet testified, it was understood he would testify that Ronan had an internal policy against entering binding contracts on nonstandard jobs without express approval from its engineering department. The district court's ruling did not depend on the actual explanation given by Mr. Haftvani in his testimony; rather, it was a determination whether the testimony should be allowed at all. As such, it was of a type that could be decided prior to trial. Moreover, the court's ruling was definitive, stating Ronan would be allowed to present the challenged testimony and NESCO could cross-examine thereafter. See App., vol. III, at 566. Considering in particular that the issue was revisited directly before the challenged testimony was offered, there was no need for NESCO to renew its objections at the moment the testimony was offered. Consequently, we review this evidentiary issue for abuse of discretion rather than plain error. 29 One of the central questions in this case is whether the communications between Ronan and NESCO were sufficient to constitute a binding contract, or were instead mere negotiations over a possibility of contracting with one another. If no contract was formed, Ronan bore no responsibility to furnish NESCO with the leak detection system. The law does not recognize a contract unless both parties showed a meeting of the minds in their intent to form one. Traditionally, at common law as well as in Oklahoma statutory law, this intent was measured subjectively; consent to form the contract was not mutual unless the parties all agree[d] upon the same thing in the same sense. Bradford v. Plains Cotton Coop. Assoc., 539 F.2d 1249, 1253 (10th Cir. 1976) (quoting pre-UCC Oklahoma statute, Okla. Stat. tit. 15, § 66 (1910)). 1 30 Oklahoma adopted the UCC in 1961, joining a national scheme to replace the varying laws of each state with a set of rules that are uniform among the states. This case is controlled by the post-UCC version of Oklahoma contract law, which provides: 31 (1) A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract. 32 (2) An agreement sufficient to constitute a contract for sale may be found even though the moment of its making is undetermined. 33 (3) Even though one or more terms are left open a contract for sale does not fail for indefiniteness if the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy. 34 Okla. Stat. tit. 12A, § 2-204 (1991). The reliance upon conduct by both parties which recognizes the existence of . . . a contract suggests an increased emphasis on objective, observable manifestations of intent to contract. Thus, we have held that the statute rejects the more subjective test of intent to focus entirely upon objective behavior, asking whether there was mutuality of assent as manifested by the conduct of the parties. Bradford, 539 F.2d at 1253 (construing Oklahoma UCC statute); see also Cargill, Inc. v. Stafford, 553 F.2d 1222, 1224 (10th Cir. 1977) (same conclusion under Colorado UCC statute). 35 NESCO argues Ronan's testimony about its internal policy against entering into binding contracts on nonstandard jobs was offered as evidence that Ronan representatives could not have intended to contract with NESCO during the course of their negotiations. NESCO contends the policy was irrelevant because it was never communicated to NESCO. Under the current UCC standard, only words and actions actually shared with the other party may be considered as evidence of intent. Intent must be determined based solely on a reasonable interpretation of the written and oral communications between the two companies, without regard to any unexpressed reservations. See generally United States v. Commercial Mech'l Contractors, Inc., 707 F.2d 1124, 1127 (10th Cir. 1982) (both oral and written communications can form basis for contract). 36 NESCO is correct in asserting that, under the UCC, it is inappropriate to allow testimony regarding one party's unexpressed subjective reservations as evidence that a contract was never formed. The district court did not allow the testimony for that purpose, however. As the court explained in its denial of NESCO's motion for new trial: 37 [A]t trial, NESCO asserted that Ronan's use of the language cursory view for budgetary purposes was lifted directly from similar language in a quote by Motorola to Ronan and did not reflect Ronan's reservations about entering a non-standard contract. The Court determined that this assertion provided a sufficient evidentiary basis for introduction of Ronan's internal policy regarding non-standard contracts and therefore admitted testimony regarding Ronan's internal policy. 38 App., vol. I, at 209. Thus, the testimony was allowed to rebut other evidence offered by NESCO purporting to explain the meaning of the cursory view language, itself a valid objective manifestation of intent not to contract. 39 If the law requires objective manifestations of a party's intent, as we have just explained it does, these objective signs must be interpreted as they appear to a reasonable observer under the circumstances. No negotiations exist in a vacuum, and the circumstances of the parties' communications can be essential for determining a reasonable interpretation of a particular statement. At trial, testimony established that Ronan representatives mentioned during negotiations they would have to confer with Ronan's engineering department about the radio communications. See, e.g., App., vol. III, at 450 (Mr. Thornton would have to check with the engineers with Ronan before proceeding). To that extent, the challenged testimony could be seen as an explanation of the reason for those actual communications with NESCO. Apparently this was the view taken by the district court. Viewing the evidence in that light, we are not persuaded the trial court abused its discretion in admitting Mr. Haftvani's testimony.