925 N.W.2d 737
N.D.2019Background
- Pavlicek bought a steel building from American Steel; his contract made him responsible for hiring subcontractors to erect the building and install concrete.
- JRC Construction installed the building’s concrete floor; the slab developed peeling, cracking, delamination, and bubbling, and JRC’s repairs failed.
- Pavlicek sued American Steel and JRC for breach of contract; American Steel defaulted and Pavlicek obtained a $185,800.80 default judgment against it.
- At trial against JRC, Pavlicek testified he received a verbal proposal from JRC, agreed, paid JRC, and JRC performed the work; on cross he also testified American Steel hired JRC.
- JRC moved for judgment as a matter of law, arguing Pavlicek’s contradictory testimony failed to establish a contract with JRC and any recovery would duplicate the default judgment; the district court denied the motion and the jury awarded Pavlicek $217,244.55.
- The Supreme Court affirmed, finding sufficient evidence for the jury to conclude a contract existed between Pavlicek and JRC and rejecting the double‑recovery argument; a concurring opinion noted Pavlicek could also have recovered as a third‑party beneficiary of a JRC–American Steel contract.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pavlicek proved a contract with JRC sufficient to submit to the jury | Pavlicek asserted he agreed to JRC’s verbal proposal, paid JRC, and JRC performed the work | JRC argued Pavlicek’s testimony was contradictory (he also said American Steel hired JRC), so no legally sufficient evidence of a contract | Court held sufficient evidence (viewing record in plaintiff’s favor) existed to submit issue to jury and affirm verdict |
| Whether judgment as a matter of law was required because testimony was inherently contradictory (Thompson rule) | Pavlicek relied on contract terms with American Steel and testimony that JRC began work after he accepted JRC’s proposal | JRC argued Pavlicek’s conflicting statements were akin to inherently improbable testimony warranting a directed verdict | Court distinguished Thompson: testimony was not the sole proof and was corroborated by contract allocation of hiring and undisputed facts (payment and performance), so issue was for jury |
| Whether permitting the jury verdict produces a double recovery given prior default judgment against American Steel | Pavlicek sought damages to replace the floor; default judgment against American Steel already awarded replacement cost | JRC argued awarding damages against JRC duplicates the American Steel judgment and mandates judgment as a matter of law | Court rejected the argument; noted remedies exist (e.g., postjudgment procedures) to prevent double recovery and JRC cited no authority mandating JMOL on this basis |
| Whether Pavlicek could alternatively recover as a third‑party beneficiary of a contract between JRC and American Steel | (raised by concurrence) Pavlicek could enforce contracts made expressly for his benefit | — | Concurring justice observed that even if no direct JRC–Pavlicek contract existed, Pavlicek could enforce a JRC–American Steel contract as an intended third‑party beneficiary |
Key Cases Cited
- Bjorneby v. Nodak Mut. Ins. Co., 882 N.W.2d 232 (N.D. 2016) (standard and deference for reviewing Rule 50 motions and viewing evidence in the light most favorable to the nonmoving party)
- Minto Grain, LLC v. Tibert, 776 N.W.2d 549 (N.D. 2009) (describing Rule 50 standard and appellate review)
- Thompson v. Hannah Farmers Coop. Elevator Co., 79 N.W.2d 31 (N.D. 1956) (testimony so inherently contradictory or improbable it cannot be submitted to a jury)
- Okken v. Okken, 325 N.W.2d 264 (N.D. 1982) (evidence sufficiency and credibility issues)
- Peoples State Bank of Truman, Inc. v. Molstad Excavating, Inc., 721 N.W.2d 43 (N.D. 2006) (third‑party beneficiary principles and enforcement under statutory framework)
- Apache Corp. v. MDU Resources Group, Inc., 603 N.W.2d 891 (N.D. 1999) (third‑party beneficiary requires intended benefit to third party)
- O’Connell v. Entertainment Enterprises, Inc., 317 N.W.2d 385 (N.D. 1982) (ascertaining contracting parties’ intent from the written contract)