475 P.3d 1231
Kan.2020Background:
- Walton was the general contractor for KU's 1999 press box; BESCO was subcontracted to install structural steel and the glass curtain wall and agreed to indemnify Walton for losses caused by BESCO's work.
- KU discovered leaks and later dangerous inadequate fasteners; KU withheld payment from Walton, Walton withheld $26,548.54 from BESCO, and KU later assigned its claims to Walton after Walton settled with KU for repairs.
- An engineering (Slemmons) report apportioned responsibility among KU, architects, and Walton but did not attribute fault to BESCO for the leaks; KU later discovered BESCO used improper screws, creating a safety hazard and prompting removal/replacement of glass and metal panels.
- Walton sued BESCO for indemnification of remediation costs and attorney fees; the district court initially awarded full remediation costs and fees to Walton.
- Court of Appeals in BESCO I reversed and remanded, directing damages be apportioned only to those costs arising from BESCO's negligent work; BESCO II again reversed portions of a subsequent award (including a 50/50 remediation split and fee allocation) and remanded for apportionment consistent with BESCO's scope under the indemnity clause.
- On a second remand the district court entered a third award (50% glass, 85% metal, and large attorney-fee awards). The Court of Appeals reversed that award for violating the law-of-the-case/mandate rule and for lack of substantial competent evidence but declined to remand; the Kansas Supreme Court affirmed reversal for mandate violation, vacated the substantial-evidence holding, and remanded for a new award consistent with prior mandates.
Issues:
| Issue | Plaintiff's Argument (Walton) | Defendant's Argument (BESCO) | Held |
|---|---|---|---|
| Whether the district court's third damages award complied with appellate mandates / mandate rule | Law of the case/doctrine is discretionary; the district court properly interpreted the record and could enter its award | Mandate from BESCO I and BESCO II bound the district court to apportion only damages attributable to BESCO's work; 50%+ awards violated mandates | District court violated the mandate rule; awards of 50% (glass) and 85% (metal) prohibited and reversed |
| Whether the attorney-fee award complied with appellate mandates | Fees awarded were related to Walton's recovery and the remediations | Many fees predated and were unrelated to BESCO's scope; BESCO II required apportionment tied to indemnity scope | Fee award violated BESCO II mandate; district court must apportion fees to work attributable to BESCO |
| Whether the third award was supported by substantial competent evidence | The existing record supported apportionment and percentages | Prior appellate rulings found lack of substantial competent evidence for such allocations | Supreme Court declined to decide (unnecessary dicta) because mandate violation required reversal |
| Whether the Court of Appeals should have remanded for a new apportionment | District court had opportunity and record exists; remand unnecessary per respondent panel | Remand is appropriate so district court can apply mandates and re-calculate damages/fees | Kansas Supreme Court held remand required and directed district court to enter an award consistent with BESCO I and II |
Key Cases Cited
- Einsel v. Einsel, 304 Kan. 567, 374 P.3d 612 (Kan. 2016) (mandate interpretation and de novo review standard)
- State v. Kleypas, 305 Kan. 224, 382 P.3d 373 (Kan. 2016) (mandate rule binds trial court on remand; trial court may not unilaterally depart)
- Gannon v. State, 303 Kan. 682, 368 P.3d 1024 (Kan. 2016) (trial court must implement both letter and spirit of appellate mandate)
- State v. Tafoya, 304 Kan. 663, 372 P.3d 1247 (Kan. 2016) (substance of appellate ruling controls over form)
- LSF Franchise REO I, LLC v. Emporia Restaurants, Inc., 283 Kan. 13, 152 P.3d 34 (Kan. 2007) (limited instances where remand is unnecessary)
- Cerretti v. Flint Hills Rural Elec. Co-op. Ass'n, 251 Kan. 347, 837 P.2d 330 (Kan. 1992) (reasonable basis for computation of damages)
- Snider v. American Family Mut. Ins. Co., 297 Kan. 157, 298 P.3d 1120 (Kan. 2013) (preservation of appellate review by petition to supreme court)
- In re Estate of Loughmiller, 229 Kan. 584, 629 P.2d 156 (Kan. 1981) (dicta vs. necessary holdings)
- State v. Prine, 297 Kan. 460, 303 P.3d 662 (Kan. 2013) (appellate courts cannot supply omissions or delete statutory provisions)