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Ryffel Family Partnership Ltd. v. Alpine Country Construction, Inc.

Supreme Court of Montana

December 28, 2016

RYFFEL FAMILY PARTNERSHIP LTD., Plaintiff and Appellant,
ALPINE COUNTRY CONSTRUCTION, INC., Defendant, Appellee, and Cross-Appellant, APLINE COUNTRY CONSTRUCTION, INC., Counter-Claimant, Appellee, and Cross-Appellant,
RYFFEL FAMILY PARTNERSHIP LTD., Counter-Defendant and Appellant.

          Submitted on Briefs: September 28, 2016

         District Court of the Eighteenth Judicial District, In and For the County of Gallatin, Cause No. DV 08-372C Honorable John C. Brown, Presiding Judge

          For Appellant: Rhett B. Nemelka, Nemelka Law, P.C., Bozeman, Montana

          For Appellee: Jesse Beaudette, Nathan A. Fluter, Bohyer, Erickson, Beaudette & Tranel, PC, Missoula, Montana


          Laurie McKinnon, Justice

         ¶1 Plaintiff and Appellant Ryffel Family Partnership, Ltd. (Ryffel Partnership) appeals from a jury verdict entered in the Eighteenth Judicial District Court, Gallatin County. The jury found that Ryffel Partnership had breached two oral contracts with the Appellee Alpine Construction (Alpine), but awarded zero damages. The first agreement was entered into in January of 2007 and the second agreement was entered into in September of 2007. Although awarding zero damages for Ryffel Partnership's breach, the jury found Ryffel Partnership was unjustly enriched by Alpine's labor and awarded Alpine $50, 348.18 in damages. Finally, the jury awarded $25, 000 to Alpine for Ryffel Partnership's breach of the covenant of good faith and fair dealing.

         ¶2 The District Court issued an order pursuant to M. R. Civ. P. 59, amending the judgment to assign the jury's damages award for unjust enrichment to its finding that Ryffel Partnership breached its contract. The District Court did so upon the basis that breach of contract and unjust enrichment are inconsistent legal theories of recovery. The District Court's order also struck the jury's award of $25, 000 for breach of the covenant of good faith and fair dealing, concluding no evidence in the record supported the award. Alpine filed a motion to amend the judgment for pre-judgment interest pursuant to § 27-1-211, MCA, which the District Court denied by allowing the motion to expire. In its appeal, Ryffel Partnership seeks a new trial, alleging the jury's verdict was inconsistent and that there was not substantial evidence to support breach of the second agreement entered into in September of 2007. Ryffel Partnership does not raise any issue regarding the first agreement entered into in January of 2007, which the jury found it had also breached. Alpine cross-appeals the District Court's denial of pre-judgment interest. We affirm the District Court's ruling, including its denial of pre-judgment interest, and deny Ryffel Partnership's appeal to review the verdict for lack of substantial evidence. We restate the issues on appeal as follows:

1. Whether the jury's verdict regarding the parties' second agreement was supported by substantial evidence.
2. Whether the District Court erred in denying Ryffel Partnership's motion for a new trial based on an inconsistent or illegal jury verdict.
3.Whether the District Court erred in denying Alpine's motion for pre-judgment interest pursuant to § 27-1-211, MCA.


         ¶3 Although James Ryffel (Ryffel) was born in Bozeman, Montana, Ryffel Partnership is a Texas-based partnership consisting of Ryffel, his wife, and a family trust as partners. Ryffel often travels to Montana and purchased the property at issue because of its scenic nature and beauty, along with its suitability as a location for a family home. Part of the property's appeal to Ryffel and his wife were the statuesque "specimen trees" and the "hilly knoll" upon which many of these trees were located.

         ¶4 Ryffel and his wife wanted to build a home on the property that would, among other things, look upon the beauty of the knoll and its trees. To implement that vision, Ryffel hired Steve Hanson (Hanson) as a general contractor to oversee the building and logging work the project would require. Hanson is an experienced builder of custom log homes. Ryffel's testimony reflects that, overall, he wanted to cut only the trees necessary to build a road on the property to the home, the trees to build the home itself, thin those trees that then remained on the property, clear those trees that were dead and fallen, and then preserve specimen trees greater than 24 inches in diameter. To those ends, some trees were specially marked for use as house logs in the upcoming construction of the Ryffel Partnership residence on the property.

         ¶5 Bob Kammers (Kammers) is one of the owners of Alpine Construction. Seeking the potentially substantial logging business on the Ryffel Partnership property, Kammers met Hanson through a mutual acquaintance, Scott Cooper (Cooper). Cooper, Kammers, and Hanson all gathered on the Ryffel Partnership property in January of 2007, and discussed the job. Hanson hired Alpine for logging work on the property: logs were to be delivered to the upper landing where the house would be built, and the thinning would have to be done within parameters, i.e. no specimen trees greater than 24 inches would be cut. Hanson hired Alpine in January of 2007. He showed Kammers where the house logs were and where they should be placed for use in construction.

         ¶6 Although Hanson could not remember if Kammers gave him a rate sheet for the work, Cooper and Kammers both testified that the terms of the agreement were for Alpine to be paid by the hour. Kammers believed that an hourly rate was the only acceptable payment method under the circumstances because all of the "good logs" were to be used for the Ryffel Partnership house construction, while all of the "butts, tips, and crooked logs" were to go to the mill. However, Kammers contended that it was impossible for him to determine beforehand what should stay on the property, and what should go to the mill, making it difficult to estimate the labor on a lump sum basis. Kammers testified that payments from what he took to the mill were to be offset against Alpine's costs, and that Alpine would charge a flat fee for delivering each load to the mill. Kammers also testified that Hanson never mentioned the specimen tree restrictions.

         ¶7 Hanson explained that Alpine performed side jobs as well. According to Hanson, Alpine hauled materials and equipment, and cleared snow and ice from the property's road to ensure timely deliveries of material and the safe traversal of workers constructing the house. Alpine also cleared trees along the road, and hauled logs that would later serve as trusses for the home. Alpine's work on the road was frequent, as the road was cleared of materials every ...

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