David Griffith v. Roger Hemphill and Donald Davis
521 P.3d 584
Alaska2022Background
- In 2008 Griffith (landlord) leased a commercial building to Hemphill and Davis (tenants) who operated an automotive repair business; the written lease required Griffith to maintain the premises and carry property insurance and gave tenants a purchase option.
- Roof leaks first damaged equipment in 2010; Griffith refused to pay for repair or replacement. In 2016 clogged scuppers caused a more serious roof failure; tenants repaired the damage themselves and paid property insurance premiums in 2016 and 2017.
- Tenants tried to exercise their purchase option in November 2018; Griffith refused. After the lease expired tenants held over; Griffith filed a forcible entry and detainer action in January 2019 and sought damages.
- Tenants counterclaimed for breach of contract (and related claims). They served a Rule 68 offer of judgment for $20,000 (inclusive) in April 2019; Griffith did not accept.
- After a two-day bench trial the superior court found Griffith breached the lease, awarded tenants $19,330 for insurance and repair costs (limited by the 3-year contract SOL), and awarded attorney’s fees under Alaska R. Civ. P. 68; final judgment ~ $85,896.
- Griffith appealed arguing (1) the counterclaim was time-barred, (2) damages lacked evidentiary support, and (3) the Rule 68 fee award was improper. The Alaska Supreme Court affirmed.
Issues
| Issue | Plaintiff's Argument (Griffith) | Defendant's Argument (Hemphill & Davis) | Held |
|---|---|---|---|
| Timeliness (statute of limitations) of breach claims | Counterclaim accrued in 2010; claims filed in 2019 are time-barred by 3-year contract SOL | Each failure to maintain/repair was a separate breach; the 2016 roof failure gave rise to a new claim within SOL | Court: Each new failure (including 2016) is a separate breach; counterclaim timely as to 2016-related damages |
| Sufficiency of damages evidence / Rule 26 disclosure | Tenants failed to disclose damage evidence and lacked documentary receipts; oral testimony insufficient | Tenants produced credible testimony quantifying repair and insurance costs; documentary proof not required | Court: Tenant testimony was credible and legally sufficient; plaintiff waived exclusion argument by withdrawing motion to exclude |
| Rule 68 attorney’s fees (offer of judgment) | Fee award improper; questions about who is prevailing party | Tenants’ unaccepted $20,000 Rule 68 offer was more favorable than Griffith’s trial outcome; Rule 68 entitles offeror to fees when offeree fares worse | Court: Tenants did not need "prevailing party" status under Rule 82; Griffith failed to beat the Rule 68 offer so fee award (per Rule 68(b)) was proper |
| Calculation / percentage of fees under Rule 68 | Challenges to fee amount and prevailing-party reasoning | Offer served within 60 days of initial disclosures so applicable fee percentage is 75%; tenants’ affidavit showed judgment exceeded offer by >5% | Court: Calculation unchallenged in superior court; award of 75% of reasonable post-offer fees consistent with Rule 68(b) |
Key Cases Cited
- Gefre v. Davis Wright Tremaine, LLP, 306 P.3d 1264 (Alaska 2013) (statute-of-limitations accrual and discovery-rule principles)
- Bibo v. Jeffrey’s Rest., 770 P.2d 290 (Alaska 1989) (repeated breaches may give rise to multiple separate causes of action)
- Hanson v. Kake Tribal Corp., 939 P.2d 1320 (Alaska 1997) (each wrongful payment can accrue a separate cause of action)
- Conam Alaska v. Bell Lavalin, Inc., 842 P.2d 148 (Alaska 1992) (oral testimony can suffice to establish damages when credible and reasonably specific)
- Whittenton v. Peter Pan Seafoods, Inc., 421 P.3d 1133 (Alaska 2018) (method for comparing trial outcome plus interest/costs to a Rule 68 offer)
- Thomann v. Fouse, 93 P.3d 1048 (Alaska 2004) (Rule 68 permits recovery of fees/costs when offeree fares worse than offer)