Sterrett Properties, LLC, 3 Creek Ranches, LLC, Utah Limited Liability Companies, and Morris R. Sterrett, an individual v. Big-D Signature Corporation, a Wyoming Corporation
2013 WY 154
Wyo.2013Background
- Big-D built a home under a contract with Sterrett parties; disputes arose over four Prime Contract Change Orders (PCCOs). PCCO Nos. 1 and 2 were signed; PCCO Nos. 3 and 4 were proposed but unsigned.
- Big-D sued for breach of contract and unjust enrichment; Sterretts counterclaimed for breach related to delay and sought credits for alleged improper billing.
- The district court granted partial summary judgment for Big-D on PCCO Nos. 1 and 2 (judgment ≈ $441,612.41) and initially left PCCO Nos. 3 and 4 and Sterretts’ delay counterclaims for trial; later the court dismissed PCCO Nos. 3 and 4 claims and Sterretts’ counterclaims; the Wyoming Supreme Court affirmed summary judgment but reversed dismissal of PCCO Nos. 3 and 4 (remanding to consider possible oral modification and whether items were escalation costs vs. consequential damages).
- On remand Big-D voluntarily dismissed its remaining PCCO Nos. 3 and 4 claims (value ≈ $11,000); the district court entered dismissal with prejudice and held Sterretts’ counterclaims were moot.
- Sterretts moved for costs and attorney’s fees under W.R.C.P. 54 and requested conditions under W.R.C.P. 41(a)(2); the district court denied fees and imposed sanctions on Sterretts’ original counsel; Sterretts appealed.
Issues
| Issue | Plaintiff's Argument (Big-D) | Defendant's Argument (Sterrett) | Held |
|---|---|---|---|
| Whether district court abused discretion by dismissing Sterretts’ counterclaims after Big-D’s voluntary dismissal | Big-D argued counterclaims were moot once it voluntarily dismissed PCCO Nos. 3 and 4 | Sterretts argued their counterclaims (credits for improper billing/consequential damages) survived and must be adjudicated per remand | Court held Sterretts had no counterclaims remaining after the prior appeal; voluntary dismissal rendered defenses and issues moot; no abuse of discretion |
| Whether Sterretts was entitled to costs/attorney’s fees under W.R.C.P. 54 as prevailing party | Big-D argued dismissal made issues moot and Sterretts were not prevailing party | Sterretts argued dismissal with prejudice made them prevailing and entitled to fees; sought conditions under Rule 41(a)(2) | Court held Sterretts were not prevailing (they suffered a $441k judgment earlier); denying fees was not an abuse of discretion |
| Whether district court abused discretion by not imposing fees/conditions under Rule 41(a)(2) when allowing dismissal with prejudice | Big-D argued court could allow voluntary dismissal without fee award absent exceptional circumstances | Sterretts argued equity required terms/fees given litigation costs and prior judgment | Court applied precedent; no exceptional circumstances shown; declining to require fees or conditions was proper |
| Whether remand required district court to segregate credits/charges labeled escalation vs consequential damages on remand | Big-D noted remand only left PCCO Nos. 3 and 4 claims | Sterretts contended remand required adjudication of credits claimed for earlier PCCOs and segregation of consequential damages | Court found remand did not leave any surviving counterclaims for Sterretts; segregation/credit claims related to PCCO Nos.1–2 were resolved by earlier summary judgment; dismissal made remaining defensive issues moot |
Key Cases Cited
- Big-D Signature Corp. v. Sterrett Props., LLC, 288 P.3d 72 (Wyo. 2012) (prior appeal: affirmed summary judgment on PCCO Nos. 1–2; reversed dismissal of PCCO Nos. 3–4 and remanded)
- EOG Res., Inc. v. State, 64 P.3d 757 (Wyo. 2003) (standard and considerations for voluntary dismissal under Rule 41(a)(2))
- Elk Ridge Lodge, Inc. v. Sonnett, 254 P.3d 957 (Wyo. 2011) (abuse of discretion standard for fee awards)
- Vanguard Envtl., Inc. v. Kerin, 528 F.3d 756 (10th Cir.) (a defendant generally may not recover attorney’s fees when plaintiff voluntarily dismisses with prejudice absent exceptional circumstances)
- Aerotech, Inc. v. Estes, 110 F.3d 1523 (10th Cir.) (same principle regarding fees after dismissal with prejudice)