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Pete Horn and Elva Horn v. Bull River Country Store

October 30, 2012

PETE HORN AND ELVA HORN, PLAINTIFFS AND APPELLANTS,
v.
BULL RIVER COUNTRY STORE PROPERTIES, LLC, DEFENDANT, THIRD-PARTY PLAINTIFF AND APPELLEE,
v.
JERRY AMORUSO, INDIVIDUALLY AND D/B/A JERRY'S REPAIR, THIRD-PARTY DEFENDANT AND APPELLEE.



APPEAL FROM: District Court of the Twentieth Judicial District, In and For the County of Sanders, Cause No. DV 10-03 Honorable Deborah Kim Christopher, Presiding Judge

The opinion of the court was delivered by: Beth Baker

Submitted on Briefs: August 8, 2012

Decided: October 30, 2012

Filed:

Clerk

Justice Beth Baker delivered the Opinion of the Court.

¶1 After a five-day trial in October 2011, a Sanders County jury decided that Appellee Bull River Country Store Properties, LLC, (Bull River) was not negligent in connection with the plaintiffs' claim that it sold water-contaminated diesel fuel. Appellants Pete and Elva Horn (Horn) appeal the Twentieth Judicial District Court's order denying their motion for a new trial. We affirm.

¶2 We restate the issues as follows:

¶3 1. Is Horn entitled to a new trial because Bull River's reliance on the settled-party defense authorized by § 27-1-703, MCA, violated his due process rights?

¶4 2. Did the District Court abuse its discretion when it allowed Bull River to question Pete Horn about his unrelated insurance claims?

¶5 3. Did the District Court abuse its discretion when it denied Horn's motion for a new trial based on Bull River's insurance-related arguments?

¶6 4. Is Horn entitled to a new trial on the ground of juror misconduct?

PROCEDURAL AND FACTUAL BACKGROUND

¶7 Pete Horn filed suit against Bull River and other fictitious defendants on January 6, 2010. Horn alleged that he purchased forty-two gallons of water-contaminated diesel fuel at the Bull River store in Noxon, Montana in late February and early March of 2008. Horn allegedly transported that fuel in five-and-six gallon jugs to his work site in Grand Coulee, Washington, where he used heavy machinery to engage in landscaping work on land owned by his son, Jason Horn. In mid-March 2008, Pete Horn used the diesel fuel from those jugs to fill the fuel tanks of two heavy machines that he owned-a Case W-11 Articulated Wheel Loader (Case) and a Kobelco Sk045 Mini-Excavator (Kobelco). The engines in those machines began to run poorly shortly thereafter.

¶8 Pete Horn and his mechanic, Jerry Amoruso, determined the engine problems were caused by water-contaminated diesel fuel and Horn called Bull River to complain. A Bull River employee informed Horn that the gas station had received multiple complaints regarding recently-sold diesel fuel and invited Horn to call Bull River's owners, Robert and Carol Page. Horn called Carol Page, who told Horn to contact Bull River's insurance company, Farmers Insurance Exchange (Farmers).

¶9 Upon learning from other customers that there was a problem with its diesel fuel, Bull River immediately shut down the diesel fuel pumps and called its diesel fuel supplier, Moore Oil Co., Inc. (Moore Oil), to report the problem. Bull River and Moore Oil each tested Bull River's diesel tank for the presence of water, and each found a small amount of water at the bottom of the tank. Bull River claimed the water was a normal result of condensation and was pooled beneath the pump intake. Moore Oil nonetheless pumped the water out of the tank and replaced the diesel fuel.

¶10 Horn formally reported a claim to Farmers for damages to both his Case and Kobelco machines on April 15, 2008. Ruth Mikulic, an insurance adjuster who worked for Farmers, handled Horn's claim. Mikulic was responsible for resolving eleven other claims against Bull River, all of which involved allegations that diesel fuel purchased at the gas station in late February or early March damaged the engines of various vehicles and pieces of machinery. All eleven of those other claims settled without problem after those claimants submitted documents to Farmers evidencing their repair costs.

¶11 Farmers ultimately tendered to Horn $16,042, but was unable to resolve Horn's remaining claims for damage to his machinery. Horn filed suit against Bull River on January 6, 2010, claiming loss of use damages for both machines during a 1,320-day period that began on March 10, 2008, and ended on the final day of the trial. The parties stipulated that a reasonable rental rate for machines similar to Horn's was $400 per day for each machine. In total, Horn sought damages from Bull River in excess of one million dollars. Horn argued that Farmers, as the agent of Bull River, inadequately investigated the damage to his equipment and delayed payment of his claim. Since he did not have the resources to pay for the equipment repairs himself, Horn claimed he was unable to get back to work without Farmers' payment of the costs.

¶12 Bull River claimed that Horn could not trace water contamination to fuel obtained from its store and that if he did purchase contaminated fuel there, his injuries, if any, were caused by others, including Horn's mechanic and Horn himself for running the damaged engines until they burned up. Bull River also argued to the jury that Horn had failed to prove any negligence by Bull River or the Pages.

¶13 At the conclusion of trial, ten jurors agreed that Bull River was not negligent and the jury returned a defense verdict. Horn filed a motion for a new trial on November 21, 2011, which the District Court denied on December 14, 2011. Horn appeals.

STANDARD OF REVIEW

¶14 "Our standard of review of a district court's denial of a motion for a new trial depends on the basis of the motion." Stebner v. Associated Materials, Inc., 2010 MT 138, ¶ 11, 356 Mont. 520, 234 P.3d 94. As such, the standards of review are discussed below as applicable to the issues raised. Our review of constitutional questions is plenary. City of Billings v. Albert, 2009 MT 63, ¶ 11, 349 Mont. 400, 203 P.3d 828.

DISCUSSION

¶15 1. Is Horn entitled to a new trial because Bull River's reliance on the settled-party defense authorized by § 27-1-703, MCA, violated his due process rights?

ΒΆ16 Although Horn's original complaint named only Bull River and fictitious parties as defendants, Horn later amended the complaint to include Moore Oil and Richard Watts Jr. Trucking, Inc. (Watts Trucking), which had delivered the fuel to Bull River. Horn later settled his claims against Moore Oil and ...


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