Court Opinion

ID: 5138884
Source: CourtListenerOpinion
Date Created: 2021-12-21 15:21:37.924091+00
Date Added: 2024-06-11T08:24:12.558958
License: Public Domain

2019 UT App 128

              THE UTAH COURT OF APPEALS

   MARIETTA BERGDORF, MEMB VENTURES LLC, AND MODERN
        HEALTH CLINIC FOR ADVANCED MEDICINE LLC,
                        Appellants,
                            v.
          SALMON ELECTRICAL CONTRACTORS INC.,
                         Appellee.

                           Opinion
                      No. 20171024-CA
                      Filed July 26, 2019

        Second District Court, Farmington Department
               The Honorable Thomas L. Kay
                        No. 150700260

        Troy L. Booher, Beth E. Kennedy, and Maurice R.
                 Mitts, Attorneys for Appellants
            Joseph E. Minnock, Attorney for Appellee

  JUDGE DAVID N. MORTENSEN authored this Opinion, in which
   JUDGE JILL M. POHLMAN concurred. JUDGE RYAN M. HARRIS
                   dissented, with opinion.

MORTENSEN, Judge:

¶1     Appellant Marietta Bergdorf appeals the district court’s
grant of summary judgment in favor of Salmon Electrical
Contractors Inc. (Salmon) in which the court concluded that no
reasonable jury could find the existence of a valid contractual
relationship between Bergdorf and Salmon. We affirm.
                   Bergdorf v. Salmon Electrical

                        BACKGROUND 1

¶2     Bergdorf is a healthcare professional who, in 2012,
purchased a building for use as a medical clinic. Although the
building was move-in ready, Bergdorf wanted to remodel some
areas of the building to better suit her needs (Project). Bergdorf
reached out to Randy Krantz and asked if he was able to help
her with both the financing and the construction work associated
with the Project. Krantz had been involved in many construction
projects as a general contractor, and he expressed a willingness
to become involved with the Project, even taking Bergdorf to
look at two other medical clinics he had constructed in the past.
Bergdorf eventually became “comfortable” with Krantz “doing
the construction” on the Project.

¶3     Bergdorf’s initial plan was to finance the Project through a
loan (Loan) with U.S. Bank (Bank). To secure the Loan, the Bank
required Bergdorf and Krantz to submit, among other things, a
building permit (Permit) and a contract outlining the work to be
performed. But there was a problem: Krantz’s contractor license
was expired and he was therefore unable to obtain the Permit.
So, Krantz arranged for Salmon—whom Krantz had worked
with in the past, and who had a valid license—to be the general
contractor.

¶4    Krantz thereafter acted as an intermediary between
Bergdorf and Salmon, and he even visited the Project with
Bergdorf and Salmon, but not with the two together, to discuss
the budget and scope of the Project. Krantz testified that he
“made a list of things that were going to be done in the contract .

1. When reviewing a district court’s grant of summary judgment,
we view the facts in the light most favorable to Bergdorf, the
non-moving party. See Raab v. Utah Ry. Co., 2009 UT 61, ¶ 3, 221
P.3d 219.

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. . that identified the costs for each of the items that [Bergdorf]
wanted done and the amount of . . . overhead that [Salmon]
needed in the contract to do the job.”

¶5     Krantz then prepared a proposed contract detailing
Bergdorf’s wishes for the property and the budget for each area
of the remodel (Proposed Contract). The Proposed Contract
recited that Bergdorf was the owner and that Salmon was the
general contractor. Importantly, the parties never signed the
Proposed Contract. Indeed, Bergdorf indicated at her deposition
that she had never actually seen the Proposed Contract:

      [Attorney]: Let me show you . . . the proposed
      contract that was prepared by Randy Krantz. I
      think he indicated he prepared it and he submitted
      it to you and [Salmon], and I’m wondering
      whether or not you remember ever seeing this?

      [Bergdorf]: I’ve never seen this. I don’t need to
      look. I have never seen it.

      [Attorney]: You have not seen it?

      [Bergdorf]: No.

¶6     Krantz also set about obtaining and gathering the other
documents necessary to secure the Loan. Krantz asked Salmon to
prepare certain documents, including a builder’s statement, a
W-9 form, and a credit authorization, that Salmon had filled out
and signed in July 2012. Later that month, Krantz submitted the
documents and unsigned Proposed Contract to the Bank as part
of the Loan application.

¶7     In September 2012, while the Loan application was
pending, Salmon obtained the Permit from Bountiful City for the
Project. The Permit listed Bergdorf as the owner and Salmon as
the general contractor. When the Permit was issued, Salmon’s

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secretary emailed Krantz a copy of the Permit. Bergdorf never
saw the Permit or the Permit application, and understood that it
had been procured under Salmon’s name only because Krantz
told her so. The Permit expressly stated, “This [P]ermit becomes
null and void if work or construction authorized is not
commenced within 180 days, or if construction or work is
suspended or abandoned for a period of 180 days at any time
after work is commenced.”

¶8    Sometime in the fall of 2012, while the Loan application
was still pending, Krantz hired a subcontractor to perform
demolition work for the Project. The subcontractor removed
some carpet from the building and demolished an interior wall.
Importantly, Krantz did not inform Salmon or Bergdorf that he
had arranged for this work to be completed. And when Krantz
was asked at his deposition about Salmon’s involvement with
the demolition, he indicated that Salmon had none:

      [Attorney]: Okay. Because that contract was not
      signed, you undertook to hire [a subcontractor] to
      perform that work . . . ?

      [Krantz]: Right. . . .

      [Attorney]: Okay. So Salmon, to your knowledge,
      had    no    involvement   with    hiring  [the
      subcontractor]?

      [Krantz]: No.

      [Attorney]: Is that correct, [Salmon] didn’t have
      any involvement?

      [Krantz]: None.

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Krantz also stated that Salmon’s Permit was not used for this
demolition work or any work that was done on the Project, at
any time:

      [Attorney]: Did      [Salmon]    hire   any     general
      contractors?

      [Krantz]: I—I don’t think so.

      [Attorney]: Any subcontractors?

      [Krantz]: There was never—the [P]ermit was never
      used. There was never any work done on this
      [Permit]. There was a contract—a building contract
      was drawn up that was—[Bergdorf] had a copy,
      the [B]ank had a copy that has never been signed.
      So if the—there was never anything done because
      the [P]ermit—or the [Loan] had never been closed.

Upon learning that the wall had been demolished, Bergdorf was
unhappy with Krantz. Though she had spoken with Krantz
about the possibility of removing the wall, she did not consider
the plan finalized. After this episode, Bergdorf told Krantz to
stop construction because funds were not yet available from the
Loan.

¶9      After the demolition was performed in the fall of 2012, no
additional work was completed on the Project for the next two
years. Bergdorf testified that although the Loan was eventually
approved, she “was very busy” and decided to “[give] up” on
closing the Loan and starting work on the Project. Because
construction did not commence on the Project, Salmon’s Permit
self-terminated.

¶10 In September 2013, about one year after the unauthorized
demolition, Bergdorf contacted Bountiful City and, without
Salmon’s knowledge or consent, somehow “renewed” the

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Permit. 2 Neither Bergdorf nor Bountiful City contacted or
otherwise notified Salmon about the renewal.

¶11 With a renewed Permit in hand, Bergdorf independently
obtained bids from several contractors, and because Krantz
submitted the low bid, Bergdorf entered into a new contract with
him to act as the general contractor. Salmon was not invited to
bid, nor did Krantz or Bergdorf contact Salmon about serving as
the general contractor. Indeed, Bergdorf testified that when the
Project resumed in 2014, she had no general contractor in place:

      [Attorney]: [L]et me ask you this: Who did you
      view as the general contractor for that work in
      2014?

      [Bergdorf]: I didn’t have anyone.

Further, Bergdorf plainly stated that she never had any kind of
contractual relationship with Salmon, at any time:

      [Attorney]: And you, yourself, never entered into
      any contractual relationship with Salmon to do
      either any subcontract work or general contracting
      work?

      [Bergdorf]: No.

      [Attorney]: Is that correct?

2. In ruling on the summary judgment motion, the district court
expressly determined that the Permit expired and that certain
steps were required to renew it. The court ruled, “These steps
were not taken and, therefore, as a matter of law, the [P]ermit
could not be extended.” Bergdorf has not challenged this
determination.

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      [Bergdorf]: Yes. Correct.

Later in her deposition, Bergdorf was asked to explain why
Krantz was not listed on the Permit when it was renewed.
Bergdorf testified as follows:

      [Bergdorf]: In the beginning as we restarted or
      rekindled that working relationship, I said don’t
      you want to change [the Permit] with the City,
      because it was due for renewal. I said don’t you
      want to change it under your name. [Krantz] said,
      no, it doesn’t matter. We’ll continue under
      [Salmon].

      [Attorney]: In terms of who the [P]ermit would be
      under?

      [Bergdorf]: Yes. As a general contractor.

      [Attorney]: But all of your contractual relationships
      were directly with [Krantz]?

      [Bergdorf]: Yes.

      [Attorney]: Okay.

      [Bergdorf]: I don’t know contract.             All   my
      relationships were with [Krantz].

¶12 Bergdorf and Krantz entered into a contract under the
newly submitted Krantz bid—which Krantz did not purport to
be on behalf of Salmon—and resumed work on the Project in
2014. At this time, Bergdorf viewed Krantz, and only Krantz, as
the    general    contractor.    Accordingly,   Krantz     hired
subcontractors, obtained materials, and performed labor. In turn,
Bergdorf issued payments to Krantz and his company, Eastwind.
Bergdorf testified that she believed use of Salmon’s Permit was

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proper, despite the fact that she issued payments only to Krantz,
because Krantz told her, “[Salmon] is [my] friend and partner
and [I] work[] with [Salmon, so] it doesn’t really matter.” In
January 2015, Bergdorf’s lawyer wrote Krantz to terminate him
from the Project.

¶13 Later, an allegedly unpaid subcontractor sued Bergdorf
and sought to foreclose a mechanic’s lien on the Project. In
response, Bergdorf filed a third-party complaint against Krantz
seeking damages for the $130,000 she had paid Krantz and for
physical damage to the building that left the building unsafe and
unusable. Only later did Bergdorf recall that Salmon was
identified as the general contractor on the Permit obtained in
2012 in connection with the abandoned Loan. Based upon
Salmon’s name being on the Permit, Bergdorf sued Salmon.

¶14 Salmon filed a motion for summary judgment, arguing
that it had never consummated a contractual relationship with
Bergdorf, that Bergdorf’s only true contractual relationship was
with Krantz, and that Krantz was not Salmon’s agent. Salmon
also pointed to Bergdorf’s deposition testimony that “all of
[Bergdorf’s] contractual relationships were directly with
[Krantz]” and “[a]ll [Bergdorf’s] relationships were with
[Krantz].” After briefing and oral argument, the district court
granted Salmon’s motion.

¶15   Bergdorf appeals.

             ISSUE AND STANDARD OF REVIEW

¶16 Bergdorf argues that the district court erred in granting
summary judgment, because there is sufficient evidence that a
contractual relationship between her and Salmon exists and
therefore Salmon is not entitled to judgment as a matter of law.
We review a “grant of summary judgment for correctness,
granting no deference to the district court’s legal conclusions.”

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                   Bergdorf v. Salmon Electrical

Salt Lake City Mission v. Salt Lake City, 2008 UT 31, ¶ 5, 184 P.3d
599.

                           ANALYSIS

¶17 Bergdorf argues that the evidence in this case is sufficient
to show that a contractual relationship between her and Salmon
exists either directly or through Krantz acting as Salmon’s agent.
We will first address the issue of agency and thereafter the
existence, or nonexistence, of a contract.

            I. Apparent Authority to Enter a Contract

¶18 Bergdorf does not contend that Krantz had “actual
authority” to act on behalf of Salmon. See Grazer v. Jones, 2012 UT
58, ¶ 10, 289 P.3d 437 (discussing that a principal may provide
an agent with “actual authority” to perform certain actions on its
behalf). Bergdorf does argue, however, that Salmon cloaked
Krantz with “apparent authority” to act as its agent. See id. ¶ 11
(discussing that a principal may create an agency relationship by
taking actions that “support a third party’s reasonable belief that
the agent has the authority to act”). We conclude that Salmon
did not undertake actions, or remain silent, in such a way that a
jury could find that Bergdorf reasonably believed that Salmon
had clothed Krantz with apparent authority to enter into a
contract with her on Salmon’s behalf.

¶19 Our supreme court has articulated a three-part test to
determine whether an agent has apparent authority to perform
certain acts on behalf of a principal:

      (1) that the principal has manifested his or her
      consent to the exercise of such authority or has
      knowingly permitted the agent to assume the
      exercise of such authority;

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                    Bergdorf v. Salmon Electrical

       (2) that the third person knew of the facts and,
       acting in good faith, had reason to believe, and did
       actually believe, that the agent possessed such
       authority; and

       (3) that the third person, relying on such
       appearance of authority, has changed his or her
       position and will be injured or suffer loss if the act
       done or transaction executed by the agent does not
       bind the principal.

Burdick v. Horner Townsend & Kent, Inc., 2015 UT 8, ¶ 23, 345 P.3d
531 (cleaned up).

¶20 “Where corporate liability is sought for acts of its agent
under apparent authority, liability is premised upon the
corporation’s knowledge of and acquiescence in the conduct of
its agent which has led third parties to rely upon the agent’s
actions.” City Elec. v. Dean Evans Chrysler-Plymouth, 672 P.2d 89,
90 (Utah 1983) (cleaned up). “Nor is the authority of the agent
apparent merely because it looks so to the person with whom he
deals.” Id. (cleaned up). “It follows that one who deals
exclusively with an agent has the responsibility to ascertain that
agent’s authority despite the agent’s representations.” Id.
(cleaned up); see also Sutton v. Byer Excavating, Inc., 2012 UT App
28, ¶ 12, 271 P.3d 169; Bodell Constr. Co. v. Stewart Title Guar. Co.,
945 P.2d 119, 124 (Utah Ct. App. 1997). Accordingly, apparent
authority cannot be premised on the manifestations of the
purported agent. City Elec., 672 P.2d at 90; see also Zions First
Nat’l Bank v. Clark Clinic Corp., 762 P.2d 1090, 1095 (Utah 1988).

¶21 Here, Bergdorf did nothing to ascertain Krantz’s
authority, nor does she claim that she did. And now, on appeal,
Bergdorf attempts to look at the totality of the circumstances to
find apparent authority instead of focusing on Salmon’s
manifestations to her. Applying the facts of this case to the
controlling law—particularly the analysis outlined in Burdick—

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leads to a conclusion that apparent authority cannot be found
here. Under Burdick, all three factors must be shown. 2015 UT 8,
¶ 23; accord Luddington v. Bodenvest Ltd., 855 P.2d 204, 209 (Utah
1993); 3 Am. Jur. 2d Agency § 80 (2019). We address each of the
Burdick factors in turn.

A.    Whether Salmon manifested its consent for Krantz to
      enter into a contract with Bergdorf on Salmon’s behalf

¶22 The first Burdick factor is whether “the principal has
manifested his or her consent to the exercise of such authority or
has knowingly permitted the agent to assume the exercise of
such authority.” 2015 UT 8, ¶ 23 (cleaned up). To be clear, the
law focuses not on just any manifestation, but only on
manifestations of the principal (i.e., Salmon) to the third party
(i.e., Bergdorf). See id. ¶ 22. There is simply no evidence in the
record that Salmon manifested its consent to Krantz to contract
with Bergdorf on Salmon’s behalf. Bergdorf points to three facts
she claims meets this factor: (1) Salmon’s secretary signed and
paid for the Permit for the Project, (2) Salmon filled out and
allowed to be submitted a number of documents connected with
the Loan application, 3 and (3) Krantz had been telling Bergdorf
all along that he was acting through Salmon. These facts do not
constitute manifestations of consent to Krantz’s exercise of
authority. 4 First, representations by Krantz are not

3. Bergdorf notes that in July 2013, Krantz sent some documents
to Salmon to review. Among those documents was an
assignment document that references a contract. There is no
evidence in the record that Bergdorf ever knew of the
assignment document, nor is there any evidence that Salmon
signed the assignment.

4. In addition to the three facts identified by Bergdorf, the
dissent relies on additional facts to find support for Bergdorf’s
                                                   (continued…)

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                    Bergdorf v. Salmon Electrical

manifestations of the principal—Salmon. Second, Bergdorf’s two
remaining alleged manifestations of consent go only to whether
Salmon agreed to act as a general contractor in connection with
the Loan that never closed. These were not manifestations
endowing Krantz with apparent authority to bind Salmon to a
contract. Thus, manifestations of “such authority”—in this case,
the authority to enter into a contract—are simply missing as a
matter of law.

(…continued)
position that Salmon clothed Krantz with authority to enter into
a contract on Salmon’s behalf. Infra ¶ 48. First, the dissent argues
that Salmon conferred authority on Krantz because Salmon had
worked with Krantz on over one hundred construction projects
and they were business partners on another. These facts do not
demonstrate a manifestation of Salmon’s consent to Krantz
entering into a contract on its behalf. As an initial matter, there is
no indication in the record that Bergdorf was ever aware of these
facts, let alone during the relevant time period (2012–2014).
Further, the fact alone that Krantz and Salmon had worked
together in the past does not show or even imply that Krantz
was authorized to enter into contracts for Salmon.
        Second, the dissent relies on the fact that Krantz listed
himself as a project manager for Salmon in a 2013 email
concerning renewal of the Permit. Infra ¶ 48. This email,
however, is the manifestation of Krantz, not Salmon—and was
sent in an effort to renew Salmon’s Permit without Salmon
knowing. Further, Krantz sent this email in May 2013 after the
Permit had self-terminated and after Bergdorf had solicited new
bids for the Project. In other words, Salmon was no longer
involved in the Project at the time this email was sent. Thus, this
2013 email cannot lend support to the dissent’s conclusion that a
reasonable jury could find apparent authority “at least during
the 2012 part of the project’s timeframe.” Infra ¶ 55.

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                   Bergdorf v. Salmon Electrical

B.    Whether Bergdorf knew of the manifestations, had reason
      to believe, and did actually believe, that Krantz had
      authority to bind Salmon

¶23 The second Burdick factor is whether the “third person
knew of the facts and, acting in good faith, had reason to believe,
and did actually believe, that the agent possessed such
authority.” 2015 UT 8, ¶ 23 (emphasis added) (cleaned up). As
stated above, all three Burdick factors must be shown to establish
apparent authority. Id. Likewise, all three discrete components of
the second Burdick factor must be shown. See id. Thus, to satisfy
the second Burdick factor, Bergdorf must have (1) known of the
“facts” (manifestations of authority), (2) had reason to believe,
and (3) actually believed that Krantz had authority to bind
Salmon contractually. See id. But because Bergdorf did not know
of the facts now claimed in support of a finding of apparent
authority, none of these assumed facts can establish a reasonable
belief of apparent authority under the law.

¶24 Specifically, there is no evidence in the record that
Bergdorf had any knowledge—at the relevant time—of Salmon
applying for or paying for the Permit. The record actually
establishes that Bergdorf first learned of Salmon’s obtaining the
Permit when the construction recommenced in 2014. Likewise,
there is no evidence that Bergdorf was aware of any of the
documents that Salmon allegedly filled out in connection with
the Loan application. Whether others may have known of these
facts is immaterial. To rely on a theory of apparent authority to
bind Salmon, it is Bergdorf who must have known of these facts.

¶25 Perhaps even more importantly, there is no evidence in
the record that Bergdorf actually believed that Krantz was acting
as Salmon’s agent for the purpose of entering into a contract.
Indeed, when deposed, Bergdorf testified that all of her
contractual relationships were directly with Krantz. Granted,
Bergdorf’s testimony was inconsistent as to whom she thought

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was acting as the general contractor. But Bergdorf did not claim
that she thought she had a contract with Salmon. Nor does
Bergdorf’s testimony establish that she believed Krantz was
Salmon’s agent. 5 At most, a jury could reasonably infer only that
Bergdorf believed Salmon had agreed to serve as the general
contractor for the Project if the Loan closed—but it never did.

¶26 At oral argument on appeal, Bergdorf relied heavily on an
email sent by the Bank confirming that Salmon was approved as
the general contractor. This email confirmed only the
understanding that Salmon agreed to act as the general
contractor if the Loan was approved. But it does not support a
finding that Bergdorf reasonably believed that Krantz had the
authority to agree to the terms of a contract with Bergdorf on
Salmon’s behalf. Similarly, Salmon’s silence at that time signifies

5. The dissent argues that a jury could reasonably infer such
belief from Bergdorf’s statement, “I don’t know contract.” We
disagree. On summary judgment all reasonable inferences are
made in the non-moving party’s favor, Heslop v. Bear River
Mutual Ins. Co., 2017 UT 5, ¶ 21, 390 P.3d 314, but the non-
moving party is not entitled to unreasonable inferences, id.
(“[T]o be reasonable, the inference must present something more
than pure speculation.”). Here, Bergdorf’s testimony can be
construed as a representation either that she did not hold such a
belief or that she had no belief one way or the other. To construe
Bergdorf’s statements as expressing an actual belief that Krantz
had authority to bind Salmon stretches the permissible inference
beyond reasonableness to speculation. Under oath, Bergdorf
testified that she did not enter into a contract with Salmon. And
later in her deposition when she stated, “I don’t know contract,”
she then broadly testified, “All my relationships were with
[Krantz].” The only reasonable inference—in context—is that
Bergdorf’s actual belief was that all of her relationships—
contractual or otherwise—were with Krantz.

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little as to the apparent authority of Krantz to contract on
Salmon’s behalf. Since no contract had been entered into, and no
funding had yet been obtained, Salmon had no reason to object
to the Bank’s email. It was true that should the Bank actually
close the Loan, and should the parties agree on the terms of a
contract, Salmon was agreeable to serving as the general
contractor. But this email, which was not even copied to Krantz,
did not manifest Salmon’s intent that Krantz act as Salmon’s
agent.

C.     Whether Bergdorf changed her position in reliance on
       Salmon’s manifestations

¶27 The third Burdick factor is whether Bergdorf, “relying on
such appearance of authority, has changed [her] position and
will be injured or suffer loss if the act done or the transaction
executed by [Krantz] does not bind [Salmon].” See 2015 UT 8,
¶ 23 (cleaned up). In this case, the record reflects no change of
position or injury suffered by Bergdorf flowing from any
reliance on Krantz’s apparent authority. Initially, this third factor
must still be connected to the manifestations, or “the facts,”
identified in the first two factors. In this case, the record
establishes that at no relevant time did Bergdorf even know of
“the facts”—that the Loan documents signed by Salmon had
been submitted to the Bank or that Salmon had submitted an
application and paid for the Permit. In short, Bergdorf cannot
rely on knowledge she did not have. See Luddington v. Bodenvest
Ltd., 855 P.2d 204, 210–11 (Utah 1993).

¶28 Further, Bergdorf cannot show a change of position or
injury stemming from reliance on Krantz’s alleged apparent
authority in connection with the 2012 demolition work
because Bergdorf did not authorize that work. The record
exhibits that Krantz undertook—and paid for—the demolition
without informing Salmon or Bergdorf. Indeed, “upon learning
that the interior wall had been demolished, Bergdorf was

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unhappy, stating that she had only wanted the carpet to be
removed at the time. Though she had spoken with Krantz about
the possibility of removing the wall, she did not consider the
plan finalized.” 6 One can hardly claim that Bergdorf acted in
reliance on Salmon’s alleged manifestation of Krantz’s authority
when she only found out about this activity after the fact,
claimed to have not wanted it to happen, and did not consider
the plans finalized.

¶29 The only thing Bergdorf apparently did—based upon
Salmon’s agreement to serve as the general contractor—was
apply for the Loan, which never closed. Because the Loan
never closed, no work was done pursuant to that financing.
Further, Salmon did not engage any subcontractors to do
anything. The fact that Krantz, unbeknownst to both
Bergdorf and Salmon, hired a subcontractor to perform
demolition work that was not approved by Bergdorf or Salmon,
cannot be considered reliance by Bergdorf on Salmon’s
manifestations. In other words, the record does not support the
assertion that Bergdorf initiated any work based upon the
belief that she had a contract with Salmon to be her general
contractor.

¶30 When work recommenced in 2014, Bergdorf testified that
she viewed Krantz, not Salmon, as her general contractor—and

6. Indeed, this testimony is consistent with Bergdorf’s third-
party complaint which alleges: “Krantz, before approval to
proceed with work and approval of plans and the scope of work,
entered the Property and removed carpet, demolished walls, and
removed other property leaving the Property in an unsafe and
unusable state resulting in more expense for [Bergdorf].” We
find no support in the record, and indeed Bergdorf did not
allege below, that she authorized Krantz to begin work on the
Project as stated in the dissent. See infra ¶ 54.

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Bergdorf viewed Krantz as such for the remainder of 2014. 7
Accordingly, neither the work in 2012 (the demolition that
Bergdorf was unaware of) nor the work in 2014 (where Bergdorf
believed Krantz was the general contractor) meets the
requirement of reliance. 8

¶31 Under these facts, reasonable minds could not differ in
concluding that apparent authority did not exist. Penunuri v.
Sundance Partners, Ltd., 2017 UT 54, ¶ 33, 423 P.3d 1150 (holding
that summary judgment should be granted when reasonable
minds could not differ). Accordingly, to the extent the district
court’s ruling depends on the existence of apparent authority, it
was correct in granting summary judgment.

                           II. Contract

¶32 Because Bergdorf cannot show that Salmon cloaked
Krantz with apparent authority, it follows that a jury could not

7. The payments Bergdorf made all occurred in 2014 or later
when Bergdorf considered Krantz to be the general contractor
and when Bergdorf and Krantz had completely bypassed
Salmon and engaged subcontractors on their own. Accordingly,
such payments cannot constitute reliance on apparent authority.

8. Bergdorf also notes that Krantz told her that Salmon was his
“partner” and was going to act as the general contractor. See infra
¶¶ 53–54. But this testimony from Bergdorf was referring to a
conversation in 2014, after Bergdorf had solicited new bids for
the Project, and when Krantz was explaining how they (Bergdorf
and Krantz) could renew the building Permit using Salmon’s
name. However, even at that time, Bergdorf testified that she
believed Krantz, not Salmon, to be the general contractor under
the newly accepted bid. And in any event, the representations of
Krantz are not manifestations of Salmon.

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                   Bergdorf v. Salmon Electrical

find that Krantz entered into a contractual relationship with
Bergdorf on Salmon’s behalf. If anything, the only agreement
between Salmon and Bergdorf (via Krantz) was for Salmon to act
as a general contractor for the Project funded by a Loan from the
Bank. Since the Loan never closed, no contractual obligations
attached to Salmon. Indeed, it would likely come as a shock to
many contractors that a preliminary agreement to act as a
general contractor contractually obligates them to be answerable
in damages for any work done on that project when they never
agreed to terms, did not oversee the work, and were not paid for
doing the job. Thus, we agree with the district court’s conclusion
that there was never mutual assent sufficient to form a contract.

¶33 On summary judgment, Bergdorf is entitled to have
factual inferences construed in her favor. Heslop v. Bear River
Mutual Ins. Co., 2017 UT 5, ¶ 15, 390 P.3d 314. However, the
court is not required to draw every possible inference of fact, no
matter how remote or improbable, in her favor. See id. ¶ 21.
Rather, Bergdorf is only entitled to reasonable inferences. See id.
(“[T]o be reasonable, the inference must present something more
than pure speculation.”).

¶34 Bergdorf concedes that there was neither a signed offer
nor an acceptance as between Bergdorf and Salmon.
Nevertheless, Bergdorf urges us to hold that issues of fact exist
whereupon a jury could conclude that the parties mutually
assented through conduct. Again, Bergdorf focuses on the
representations of Krantz and thus is dependent on apparent
authority and the specific representation of Krantz that Salmon
was his friend and partner. In our view, this contorts the
evidence beyond any reasonable inference. As previously
pointed out, the conversation about Salmon being Krantz’s
“partner” took place in 2014, after the Permit had expired and
after Bergdorf had abandoned the Loan. At best, Krantz was
representing—without Salmon’s knowledge—that he could use
his “partner’s” contractor’s license to renew the Permit.

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                   Bergdorf v. Salmon Electrical

¶35 Bergdorf places great significance on the fact that Salmon
agreed to act as a general contractor if and when Bergdorf’s
Project moved forward with Bank financing. But that Loan never
closed. The record in this case demonstrates that Bergdorf did
not think she had a contract with Salmon. At most, there was an
agreement to act as a general contractor on a remodeling project
that was not defined or funded. A preliminary agreement to act
as a general contractor on an undefined project, contingent on
financing, neither establishes a basis for finding that a contract
exists or otherwise concluding that an implied contract resulted.
Similarly, while Bergdorf argues that Salmon’s silence in
response to a single email from the Bank—approving Salmon as
a general contractor—ratified something, we are hard pressed to
see how that silence ratified anything other than the same
agreement to serve as a general contractor if the Project
proceeded and if the Project was funded. 9

¶36 Further, as highlighted by the district court, it is
undisputed that the Permit obtained by Salmon self-terminated
when work was not commenced within, or ceased for a period
of, 180 days. The demolition work was not completed by Salmon
or at the direction of Salmon. And except for the demolition, no
work was done for more than 180 days after the Permit was
issued. Therefore, the Permit expired. Although the Permit was
renewed, it is undisputed that it was renewed without the
consent or knowledge of Salmon. And similarly, in 2014, when
work was performed under the Permit, Salmon was not notified.

¶37 In any event, an implied contract based on mutual assent
does not obtain under these facts. Bergdorf looks to Ellsworth v.
American Arbitration Ass’n, 2006 UT 77, 148 P.3d 983, for the
proposition that mutual assent can be evidenced by things other

9. We note that the theory of ratification by silence was not
argued to the district court.

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than a signed contract. This is a correct but incomplete statement
of the law. First, the ultimate holding in Ellsworth was that a
person’s name appearing on an unsigned contract as a party—as
is the case here—is not direct evidence of assent. Id. ¶ 18. This is
especially true here, where there is no evidence that Salmon (or
Bergdorf) participated in any way in negotiating or drafting
Krantz’s Proposed Contract. Second, when mutual assent is
based on conduct or performance, the law requires that words or
actions of a party must be reasonably “‘interpretable as
indicating an intention to make a bargain with certain terms or
terms which reasonably may be made certain.’” Heideman v.
Washington City, 2007 UT App 11, ¶ 25, 155 P.3d 900 (emphasis
added) (quoting Rapp v. Salt Lake City, 527 P.2d 651, 654 (Utah
1974)). In Heideman, this court affirmed a grant of summary
judgment and concluded that no mutual assent could be shown
as a matter of law even though one of the parties had accepted
payment. Id. ¶¶ 24, 27. The plaintiff in Heideman, a developer,
argued that because Washington City accepted payment for
sixty-six water impact fees at a lower rate, even though the rate
had been raised effective the day the plaintiff paid, a contract
had been formed and the higher rate could no longer be sought.
Id. ¶¶ 2, 3, 9. This court determined that a contract could not be
found because there was “no communication that would
indicate any type of meeting of the minds.” Id. ¶ 25. In short, the
acceptance of payment without other terms was insufficient.

¶38 The same can be said here. There was simply no
communication between Bergdorf and Salmon that exhibits a
meeting of the minds on any certain terms. Indeed, it is
undisputed that Bergdorf never saw, much less signed, the
Proposed Contract. Bergdorf never met Salmon. Bergdorf and
Salmon never agreed on a definite price. And Bergdorf testified
that there was not a definite plan when Krantz ordered the
demolition work to be completed in 2012. Likewise, there is no
evidence Salmon agreed to perform any certain scope of the
work for the Project. Therefore, we conclude that Salmon’s

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agreement to be listed as a general contractor and apply for the
Permit in 2012, without more, did not indicate assent to a
contract with certain terms sufficient to be binding. See id. (“‘The
application for an issuance of a building permit does not
constitute a voluntary agreement between the parties to enter
into binding contract.’” (quoting Trevino & Gonzales Co. v. R.F.
Muller Co., 949 S.W.2d 39, 42 (Tex. Ct. App. 1997))).

¶39 Bergdorf, as in her agency analysis, grounds her position
on the activities of Salmon in supplying documents for the Loan.
Again, the most that Salmon thereby assented to was to act as
the general contractor if and when the Loan closed. It is an
undisputed fact in this case that the Loan never closed. It is also
undisputed that Bergdorf abandoned the Loan. The record is
devoid of any evidence that Salmon agreed to do any work for
any price to be paid directly by Bergdorf. Therefore, an implied
contract simply does not exist.

¶40 Bergdorf also places weight on payments made during
the Project. However, these payments were not made to Salmon;
instead they were made to Krantz or entities owned by Krantz.
Indeed, at any time that Bergdorf made payments related to the
Project, she unequivocally testified that she thought Krantz, not
Salmon, was her general contractor. These payments are
therefore only possibly evidence of performance if Krantz is
considered the agent of Salmon. Because we conclude that
apparent authority cannot be found here, these payments are
evidence that Bergdorf’s contract, if it existed, was with Krantz
and not Salmon.

¶41 Bergdorf also places significance upon the fact that, until
December 2014, Salmon did not take any steps to remove its
name from the Permit. But since the Permit had expired by its
own terms and the Loan had never closed, there was no reason
for Salmon to anticipate that Krantz would—without Salmon’s
knowledge—renew its expired Permit. Bergdorf and Krantz’s

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unauthorized renewal of the Permit cannot constitute assent by
Salmon. 10

¶42 For these reasons, we conclude that no contract between
Bergdorf and Salmon was formed as a matter of law and that the
district court therefore properly granted summary judgment in
favor of Salmon.

                         CONCLUSION

¶43 Bergdorf’s position rests primarily on her reliance on
Krantz’s apparent authority to contract with Bergdorf on
Salmon’s behalf—with which we do not agree. Independently,
the record does not support a conclusion that the parties entered
into a contract as a matter of law. Because reasonable minds
could not differ that the parties did not mutually assent, and no
contract was formed as a matter of law, Salmon was entitled to
summary judgment.

¶44   Affirmed.

HARRIS, Judge (dissenting):

¶45 I would not characterize Bergdorf’s claim against Salmon
as a strong one. Odds are, she would not prevail at a trial on the
merits against Salmon if she were ever afforded one. But our
task in reviewing this appeal is not to assess who has the better

10. Bergdorf also suggests that a walkthrough of the Project is
evidence of assent. A walkthrough of a remodel project is part
and parcel of any bid process and is hardly indicative of assent
to contractual terms. Instead, a walkthrough is simply pre-
contract due diligence.

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                    Bergdorf v. Salmon Electrical

claim, or predict who is most likely to prevail at trial. Rather, our
task is to determine if “a reasonable jury” could find in favor of
Bergdorf on her claim against Salmon, see Helf v. Chevron U.S.A.
Inc., 2015 UT 81, ¶ 4, 361 P.3d 63, and in making this
determination, we must view the record evidence “in the light
most favorable” to Bergdorf, the party who is resisting summary
judgment, see Raab v. Utah Ry., 2009 UT 61, ¶ 3, 221 P.3d 219.

¶46 The majority correctly recites this standard, see supra note
1, but I disagree that it has appropriately applied it. In my view,
the majority emphasizes the (ample) evidence supporting
Salmon’s position, while minimizing some of the (less copious)
evidence supporting Bergdorf’s position. Certainly, the question
about whether “a reasonable jury” could possibly find in favor
of a party on a specific claim is the type of inquiry upon which
reasonable minds might reasonably differ, and on the record
presented here I respectfully disagree with the majority’s general
conclusion that no reasonable jury could possibly find for
Bergdorf.

¶47 Chiefly, I disagree with the majority’s conclusion that no
reasonable jury could find that Krantz had apparent authority to
act as Salmon’s agent. The majority correctly recites the elements
of apparent authority: (1) that the principal has either
“manifested” consent to the agent’s exercise of authority or at
least “knowingly permitted the agent” to exercise authority; (2)
that the third person, based on actions of the principal,
reasonably believed that the agent had apparent authority; and
(3) that the third person has relied to her detriment on the
appearance of authority. See Burdick v. Horner Townsend & Kent,
Inc., 2015 UT 8, ¶ 23, 345 P.3d 531 (quotation simplified). But I
disagree with the majority’s application of those elements to the
facts of this case.

¶48 The first Burdick factor is satisfied simply by the
principal’s manifestation of consent to the agent’s exercise of

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authority, or even by the principal’s knowing decision to
“permit[] the agent to assume the exercise of such authority.” Id.
(quotation simplified). And in this case there exists ample
evidence to support a finding that Salmon took actions intended
to clothe Krantz with authority to act as its agent on Bergdorf’s
Project. At trial, the jury would have learned, by way of
background, that Salmon and Krantz had worked together on
over a hundred construction projects, and that they were
business partners in a commercial development project. Indeed,
Krantz was familiar enough to Salmon’s employees that he had
the power to tell them to carry out tasks—like apply for and pay
for the Permit—and they would follow Krantz’s orders. On this
particular Project, Salmon agreed—at Krantz’s request—to act as
the general contractor on Bergdorf’s Project, and Salmon
provided information to Krantz to assist him in drafting
the written (but ultimately unsigned) Contract that listed
Salmon as the contractor and Bergdorf as the client/owner.
Salmon filled out a set of documents—including a W-9 form, a
credit authorization, and a “builders statement” that
listed Salmon as the “contractor” on the Project—for submission
to the Bank in connection with the Loan, and then Krantz
submitted those documents to the Bank. And according to
Salmon’s principal Chad Salmon, Krantz walked into Salmon’s
offices and asked the secretary there to submit an application for
the Permit on Bergdorf’s Project that listed Salmon as the general
contractor on the Project, and the secretary complied, including
paying the four-figure permit fee out of Salmon’s funds.
Moreover, in later communications, Krantz listed himself as
“Randy Krantz, Project Manager, Salmon Electrical Contractors.”
In my view, there is no question that sufficient evidence exists,
viewed in the light most favorable to Bergdorf, to satisfy the first
Burdick factor.

¶49 Salmon’s best argument lies with the second Burdick
factor, which is where Bergdorf’s knowledge of these events
becomes relevant. See id.(describing the second factor as whether

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                    Bergdorf v. Salmon Electrical

“the third person knew of the facts and, acting in good faith, had
reason to believe, and did actually believe, that the agent
possessed such authority” (quotation simplified)). I
acknowledge that this is the closest question presented, and that
the evidence of Bergdorf’s knowledge is thinner than the
evidence of Salmon’s assent to Krantz’s agency or of Bergdorf’s
reliance. But even here, I think there is enough to support a
finding by a reasonable jury that Bergdorf reasonably believed
that Krantz was acting as Salmon’s agent.

¶50 Certainly, there is evidence that Krantz told Bergdorf that
he and Salmon were “partners” and that Salmon would be the
general contractor for the Project. But the majority correctly
notes that Bergdorf’s reasonable belief needs to be based, at least
in part, on some action of the principal; an agent’s
representations are not enough. See supra ¶ 20. However, a
principal’s action endorsing the act of the agent can occur even
after the agent’s act has taken place, if the principal acts to ratify
the previous act of the agent. See Bradshaw v. McBride, 649 P.2d
74, 78 (Utah 1982). Ratification “need not be express,” and
“silence with full knowledge of the facts may manifest
affirmance and thus operate as a ratification.” Id. (quotation
simplified). A principal may not “escape ratification” through
being “wilfully ignorant, nor may he purposely shut his eyes to
means of information within his possession and control.” Id.
(quotation simplified).

¶51 In this case, Salmon filled out the Loan application
paperwork, and allowed Krantz to submit it to the Bank; that
documentation listed Salmon as the general contractor on
Bergdorf’s Project. While there is no evidence that Bergdorf
knew about the loan documentation when it was submitted, she
certainly learned later—when the Bank sent a confirmation
email, copied to both Bergdorf and Chad Salmon, notifying them
that Salmon “has been accepted as the General Contractor” on
the Project—that Salmon had submitted some form of

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application to the Bank seeking to be treated as the contractor on
her Project. After receiving this email, Salmon took no action to
disabuse anyone, including Bergdorf, of the notion that it was
the general contractor on the Project. A reasonable jury could
conclude that this email—and Salmon’s decision not to
contradict it—confirmed, in Bergdorf’s mind, all of the things
Krantz had been telling her about his relationship with Salmon,
and could infer from this evidence that Bergdorf reasonably
believed, based in part on Salmon’s actions, that Salmon had
authorized Krantz to act as its agent.

¶52 The majority believes that, because the Loan never closed,
the documents related to the Loan—including the email—
somehow lose their relevance. I simply disagree. Whether the
Loan ever closed does not necessarily have anything to do with
whether Salmon agreed to act as the general contractor on the
Project or with whether Salmon agreed to allow Krantz to act as
its agent. Bergdorf correctly points out that a contract to build a
structure, and the financing for that contract, are entirely
different conceptually, and that “the fact that [Bergdorf’s]
construction loan was not approved means she needed to get
funding elsewhere, not that she needed a new construction
contract.” I therefore disagree with the majority’s contention that
“a jury could reasonably infer only that Bergdorf believed
Salmon had agreed to serve as the general contractor for the
Project if the Loan closed.” See supra ¶ 25. Contractors generally
do not care where the money that pays them comes from, as long
as they get paid. There is a reasonable inference to be drawn—
certainly “more than pure speculation,” Heslop v. Bear River
Mutual Ins. Co., 2017 UT 5, ¶ 21, 390 P.3d 314—that Salmon’s
agreement to act as the general contractor on Bergdorf’s Project
was not conditional on the Loan closing, but instead was only
conditional on it getting paid from some source.

¶53 I acknowledge that some of Bergdorf’s own deposition
statements are harmful to her cause regarding the second Burdick

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                   Bergdorf v. Salmon Electrical

factor. As the majority notes, at one point during her deposition
Bergdorf stated that she did not believe she had entered into any
contractual relationship with Salmon. See supra ¶ 11. But at other
points in Bergdorf’s deposition, she testified that she believed
that Salmon was the general contractor on the Project, and that
Salmon and Krantz were “partners” on the Project. And she
clarified that, while she believed that “all [her] relationships
were with” Krantz, she does not understand the legal niceties of
contractual relationships. Bergdorf’s seemingly contradictory
deposition testimony is admittedly confusing, and would
require some explanation at trial, but in my view a reasonable
jury could view that testimony as consistent with the notion that,
while all of her person-to-person relationships were with Krantz,
he was acting as Salmon’s agent.

¶54 Moving now to the third Burdick factor, in my view there
exists sufficient evidence that Bergdorf took action in reliance on
her belief that Krantz was acting as Salmon’s agent. See Burdick,
2015 UT 8, ¶ 23. Bergdorf submitted a Loan application to the
Bank seeking financing for the Project on which Salmon was to
be the general contractor. Bergdorf knew that Krantz did not
have a valid contractor’s license at the time, and Krantz told her
that his “partner” Salmon was going to be acting as the general
contractor on the Project. Bergdorf hired Krantz to perform work
on the Project, and Krantz—with or without her knowledge—
hired a demolition subcontractor who removed one of the
building’s interior walls, an act that Bergdorf alleges led to
damages. Moreover, Bergdorf began the building process
pursuant to the Permit listing Salmon as her general contractor,
thereby believing that she had a licensed general contractor on
her Project. 11

11. Having a licensed general contractor on a project is important
for several reasons, not the least of which is that licensed general
                                                       (continued…)

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                   Bergdorf v. Salmon Electrical

¶55 In short, I think there is enough evidence on all three of
the Burdick factors to permit a reasonable jury to conclude that—
at least during the 2012 part of the Project’s timeframe—Krantz
had apparent authority to act as Salmon’s agent. And once that
conclusion is drawn, it necessarily follows that a jury could also
reasonably find in Bergdorf’s favor on the question of whether a
valid contract ever existed between her and Salmon. It is
undisputed that Bergdorf asked Krantz to work on her Project,
and that Krantz did so. To the extent that Krantz was taking
those actions in the capacity as Salmon’s agent, Salmon and
Bergdorf had a contractual relationship.

¶56 As noted, merely because I believe that summary
judgment was improvidently granted here does not mean that I
believe that Bergdorf has a fantastic case against Salmon. In the
end, the factfinder might find this evidence unpersuasive, or at
least less persuasive than the evidence that unquestionably exists
on the other side of the ledger. But that should be the jury’s
choice to make, and I cannot say that a determination in favor of
Bergdorf on the contractual question would be unreasonable.
For these reasons, I would reverse and remand for further
proceedings.

(…continued)
contractors are required to have liability insurance. See Utah
Admin. Code R156-55a-302d.

20171024-CA                    28                  2019 UT App 128