487 P.3d 465
Utah Ct. App.2021Background
- Rubberball Productions was owned equally by Andersen (through MLA) and Bailey (through AKB); a written buy-sell Agreement (2006) governed buyouts on an Owner’s death and required the Company to be beneficiary of life policies to fund buyouts.
- The Company obtained two $2,000,000 Allianz policies naming the Company beneficiary to fund a buyout; in 2012 each Owner also obtained $2,000,000 Ohio policies naming personal beneficiaries (not the Company).
- In March 2015, Andersen and the Company’s office manager declared that at a private meeting Bailey orally agreed to allow the Allianz policies to lapse and to treat the Ohio policies as satisfying the Agreement’s insurance-funded buyout (the alleged Oral Modification).
- Bailey died in 2016; the Ohio policy paid $2,000,000 to Bailey’s trust. Andersen then engaged an appraiser and offered a buyout amount to the trustee; no settlement was reached.
- AKB sued for breach; Andersen counterclaimed for declaratory relief that the Ohio proceeds satisfied the Agreement under the Oral Modification. The district court granted summary judgment for Andersen; AKB appealed.
Issues
| Issue | AKB's Argument | Andersen's Argument | Held |
|---|---|---|---|
| Whether summary judgment was proper on the Andersen Parties’ declaratory-counterclaim that a 2015 oral modification replaced the Company-beneficiary insurance requirement with the Ohio policies’ proceeds | AKB: The Agreement required written modifications; circumstantial evidence (written Agreement terms, lack of any memorializing writing, nature/purpose of Ohio policies, post-death conduct) creates genuine factual disputes about existence and terms of any oral modification | Andersen: Andersen and the office manager declared the Owners orally agreed in 2015 to allow Allianz to lapse and use Ohio policies for buyouts; declarants’ testimony supports summary judgment | Court: Reversed summary judgment. Circumstantial evidence permits reasonable, conflicting inferences about whether an oral modification occurred; triable issues of material fact exist and case is remanded. |
Key Cases Cited
- Berger v. Ogden Reg’l Med. Ctr., 469 P.3d 1127 (Utah Ct. App. 2020) (summary judgment standard)
- Rusk v. Harstad, 393 P.3d 341 (Utah Ct. App. 2017) (appellate review and inferences at summary judgment)
- Lamb v. B & B Amusements Corp., 869 P.2d 926 (Utah 1993) (nonmoving party need only show existence of material fact)
- Jones v. Mackey Price Thompson & Ostler, 469 P.3d 879 (Utah 2020) (circumstantial evidence may defeat directed verdict/summary judgment)
- USA Power, LLC v. PacifiCorp, 235 P.3d 749 (Utah 2010) (reasonable juror inference standard at summary judgment)
- Fox v. Allstate Ins. Co., 453 P.2d 701 (Utah 1969) (circumstantial evidence and credibility can preclude summary judgment)
- Goodnow v. Sullivan, 44 P.3d 704 (Utah 2002) (conflicting inferences defeat summary judgment)
- Frisbee v. K & K Constr. Co., 676 P.2d 387 (Utah 1984) (when movant’s affidavit shows material fact dispute, summary judgment inappropriate)
- Jenco LC v. Perkins Coie LLP, 378 P.3d 131 (Utah Ct. App. 2016) (summary judgment cannot rest on speculation)