BRECKENRIDGE PROPERTY FUND 2016, LLC, a Delaware limited liability company v. WALLY ENTERPRISES, INC., a Kansas corporation dba WE SERVE IDAHO; WEINSTEIN & RILEY, P.S., a Washington professional corporation; CORNERSTONE PROPERTIES, LLC, an Idaho limited liability company
Docket Nos. 48489 & 48703
IN THE SUPREME COURT OF THE STATE OF IDAHO
August 22, 2022
Boise, April 2022 Term. Melanie Gagnepain, Clerk
Appeal from the District Court of the Seventh Judicial District of the State of Idaho, Bonneville County. Bruce L. Pickett, District Judge.
The decision of the district court is
Holden, Kidwell, Hawn & Crapo, PLLC, Idaho Falls, attorneys for Cornerstone Properties, PLLC. D. Andrew Rawlings argued.
Brassey Crawford, PLLC, Boise, attorneys for Wally Enterprises, Inc. Ryan Janis argued.
BEVAN, Chief Justice
This appeal is about the legality of an auctioneer providing the terms of sale at the time of the foreclosure sale, including acceptable methods of payment, without providing earlier notice to potential bidders. Andrew Ashmore, agent for appellant Breckenridge Property Fund 2016, LLC, (“Breckenridge“) arrived at a foreclosure sale with endorsed checks to support Breckenridge‘s bid. Jesse Thomas, agent for Cornerstone Properties, LLC, (“Cornerstone“) was also present. Before the auction, the auctioneer provided Ashmore and Thomas a packet of paperwork. The last page contained a requirement that endorsed checks would not be accepted as payment for a bid. Because Ashmore only had endorsed checks, the auctioneer gave Ashmore one hour to cure the payment defect, but the auction eventually proceeded with Ashmore unable to secure a different form of payment. The property ultimately sold to Cornerstone. Breckenridge filed a complaint against the two respondents and a third defendant, alleging: (1) violations of
I. FACTUAL AND PROCEDURAL BACKGROUND
A. Factual Background
Weinstein & Riley, P.S., a Washington professional corporation (“W&R“) was the trustee for property subject to a deed of trust in Ammon, Idaho (Bonneville County).1 W&R posted notice of the foreclosure sale and scheduled the auction for June 19, 2020, at 1:00 p.m. in Idaho Falls, Idaho. W&R hired Gary‘s Processing Service (“Gary‘s“) to assist with the sale. Gary‘s
subcontracted with Wally Enterprises, Inc., a Kansas corporation doing business as We Serve Idaho (“Wally“) to hire an auctioneer and post notice of the sale on its website. Wally hired Kathy Cook, an independent contractor, as the auctioneer. Before the sale, Wally posted notice of the property‘s location along with the date, time, and location of the sale on its website. The information on the website gave no other details about the sale, nor did it include any restrictions or information about the form of payment that would be accepted.
Breckenridge is a Delaware limited liability company. It buys real property at foreclosure sales, improves the property, and then sells it for a profit. On the date of the foreclosure sale, Ashmore attended the public auction as an agent for Breckenridge. Before the sale, Breckenridge had given Ashmore cashier‘s checks in various amounts made payable to an entity affiliated with Breckenridge. If Breckenridge turned out to be the highest bidder, Ashmore planned to endorse and deliver the cashier‘s checks to the trustee as payment. Ashmore confirmed the date, time, and location of the auction by emailing W&R the day before the sale. Ashmore also visited the auctioneer‘s website and noted no restrictions on payment methods listed.
When Ashmore arrived at the sale, Cook provided him with a packet of documents that included a payment condition for the auction: “NO ENDORSED CHECKS[.] CHECKS MADE PAYABLE TO WEINSTEIN & RILEY PS.” (Capitalization in original). Ashmore objected to this condition. He had no checks from Breckenridge that were payable to W&R. As a result, Cook agreed to postpone the auction for one hour so Ashmore could attempt to remedy the situation. Breckenridge failed to obtain checks payable to W&R in the time available.
At about 2:00 p.m., Cook went ahead with the auction. At the time, Thomas and Ashmore were the only people in attendance. The opening bid from Cook was $194,000. Thomas bid $194,001. Ashmore tried to bid $195,000, but Cook would not acknowledge his bid. Thus, Cornerstone was the winning bidder at the auction. Thomas gave Cook a $200,000 certified check payable to W&R for the property. W&R later executed a trustee‘s deed conveying the property to Cornerstone. W&R refunded Cornerstone $5,999.00.
B. Procedural Background
On June 24, 2020, Breckenridge recorded a lis pendens against the property. Breckenridge also filed a complaint against Cornerstone, Wally, and W&R alleging violations of
defendant answered the complaint. Cornerstone included a counterclaim, crossclaim, and demand for jury trial. Relevant to this appeal, Cornerstone counterclaimed against Breckenridge seeking a declaratory judgment or to quiet title. On August 24, 2020, Cornerstone recorded its deed in Bonneville County.
Cornerstone moved for judgment on the pleadings and to quash the lis pendens. In response, Breckenridge moved for summary judgment on Count I of its complaint (violation of
The district court ultimately granted partial summary judgment to Cornerstone and certified the judgment as final under
II. ISSUES ON APPEAL
- Did the district court err in concluding the trustee‘s agent had the discretion to reject Breckenridge‘s bid?
- Did the district court err in concluding that W&R and Wally complied with the provisions of
Idaho Code section 45-1506 ? - Did the district court err in concluding that it could not set aside the sale?
- Did the district court err in dismissing Breckenridge‘s claims of estoppel, negligence, and negligence per se?
- Did the district court err in awarding attorney fees to Cornerstone and Wally under
Idaho Code section 12-120(3) ? - Are any of the parties entitled to attorney fees on appeal?
III. STANDARDS OF REVIEW
“After the pleadings are closed, but early enough not to delay trial, a party may move for judgment on the pleadings.”
opportunity to present all the material that is pertinent to the motion.”
“This Court employs the same standard as the district court when reviewing rulings on summary judgment motions.” Owen v. Smith, 168 Idaho 633, 640, 485 P.3d 129, 136-37 (2021) (quoting Trumble v. Farm Bureau Mut. Ins. Co. of Idaho, 166 Idaho 132, 140-41, 456 P.3d 201, 209-10 (2019)). “Summary judgment is proper ‘if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.‘” Id. (quoting
This Court exercises free review over questions of law, which includes whether the district court correctly determined that a case is based on a “commercial transaction” for the purpose of
IV. ANALYSIS
A. The district court correctly concluded that W&R and Wally properly rejected Breckenridge‘s bid.
Breckenridge argues the district court erred in holding that W&R and Wally could refuse to accept Breckenridge‘s bid. From this, Breckenridge puts forth two ancillary arguments. First, Breckenridge claims Kivett v. Owyhee Cnty., 58 Idaho 372, 74 P.2d 87 (1937), which the district court partly relied on below, does not support the court‘s findings. Second, Breckenridge argues the district court erred in holding it was not reasonable to require W&R and Wally to allow Breckenridge forty-eight hours to pay for its bid. For the reasons below, we affirm the district court‘s decision.
1. Kivett v. Owyhee County supports the district court‘s decision.
In the district court‘s memorandum decision on Breckenridge‘s motion for summary judgment, the court held a trustee at a nonjudicial foreclosure sale could reject a bid based on terms announced at the beginning of the sale. The district court based its analysis, in part, on this Court‘s decision in Kivett. The district court concluded Kivett‘s rationale supported its interpretation of
In Kivett, this Court considered whether the sale of property at a public auction on credit was valid when the sale was advertised to occur in cash. The statute at issue in Kivett required notice to the homeowner that property deeded to the county because of delinquent taxes would be auctioned so the owner could exercise the right of redemption. Id. at 375, 74 P.2d at 88. The clerk who conducted the sale for the county commissioners was aware of the cash payment term and orally noted the requirement for cash bids before the auction. Id. The winning bidder, however, made a credit bid for $1,660.00 to be paid in installments, which the clerk accepted. Id. Kivett, the property owner, challenged the sale, ultimately before this Court, arguing the sale was invalid under
In the Kivett decision, this Court adopted language from the Corpus Juris, which explains:
(19) Printed conditions under which a sale proceeds are binding on both buyer and seller, and cannot be varied, although they may be explained by verbal statements of the auctioneer made at the time of the sale. Thus an auctioneer may, at the time of the sale, explain the meaning of advertisements published before the sale.
(20) The conditions of a public sale, announced by the auctioneer at the time and place of the sale, are binding upon a purchaser, whether he knew them or not. So also, where it is the custom to post up the conditions in the auctioneer‘s room, and the auctioneer announces that the conditions are as usual, a purchaser is bound by the conditions, whether he sees them or not.
Kivett, 58 Idaho 372, 383, 74 P.2d at 91 (quoting 6 C.J. 827, 828, §§ 19 and 20) (emphasis added). While Kivett addressed a different statutory provision than the section at issue here, the above referenced language this Court adopted speaks to the broader circumstances at play during a public auction. This Court adopted the language that specifies “conditions of a public sale, announced by the auctioneer at the time and place of the sale, are binding upon a purchaser, whether he knew them or not.” Id.
At the sale here, which was public, Cook handed out a packet to Ashmore and Thomas that contained the payment conditions before the auction began; those were the terms of the sale announced by the auctioneer at the time and place of the sale. Those terms complied with Kivett because they were announced before the sale and were, therefore, binding on Breckenridge. Although Cook gave Ashmore time to secure a form of payment that complied with the conditions of the sale, Breckenridge‘s failure to obtain the proper form of payment, whether it had notice of the condition or not, does not negate the binding nature of the term.
The district court properly applied Kivett to illustrate how this Court has analyzed payment conditions at public auctions. The district court analyzed the facts under the relevant statute and ultimately rejected Breckenridge‘s interpretation of
Consistent with our adoption of sections 19 and 20 of Corpus Juris in Kivett, the printed conditions of the foreclosure sale were binding on Breckenridge when announced by the auctioneer, whether Breckenridge knew of the conditions beforehand or not. Breckenridge has alleged no other failure in relation to the pre-sale procedure. For these reasons, we conclude the district court did not err.
2. The district court did not err in holding it would have been unreasonable to require W&R and Wally to allow Breckenridge 48 hours to pay for its bid.
Breckenridge also argues the district court erred in concluding it would have been unreasonable to require W&R and Wally to allow Breckenridge forty-eight hours to pay its bid.
Breckenridge contends the district court inaccurately characterized its position when it concluded, “[t]o infer that section 45-1506(9) somehow limits the trustee‘s discretion to require bidders to provide acceptable payment on the day of the auction is unreasonable.” Breckenridge maintains it was not arguing that trustees could not require acceptable payment on the date of the auction, but the trustee must advertise before the sale what payment methods will be accepted. If the trustee does not advertise what payment methods are accepted before the sale, Breckenridge contends the winning bidder must be afforded reasonable time to pay the bid.
Cornerstone urges this Court to adhere to the strict application of unambiguous
The interpretation of a statute must begin with the literal words of the statute; those words must be given their plain, usual, and ordinary meaning; and the statute must be construed as a whole. If the statute is not ambiguous, this Court does not construe it, but simply follows the law as written. We have consistently held that where statutory language is unambiguous, legislative history and other extrinsic evidence should not be consulted for the purpose of altering the clearly expressed intent of the legislature.
Verska v. Saint Alphonsus Reg‘l Med. Ctr., 151 Idaho 889, 893, 265 P.3d 502, 506 (2011) (internal quotations and citations omitted). “Ambiguity occurs where reasonable minds might differ as to interpretations.” Hayden Lake Fire Prot. Dist. v. Alcorn, 141 Idaho 307, 312, 109 P.3d 161, 166
(2005) (internal citation omitted). “However, ambiguity is not established merely because the parties present differing interpretations to the court.” Id.
The district court explained in its memorandum decision that Cook was not required to accept bids from Breckenridge “where it did not have checks that conformed to the payment conditions for the auction.” The court continued that “[u]nder Breckenridge‘s interpretation [of
On appeal, Breckenridge claims that its position to allow reasonable time to secure adequate payment reflects the spirit of section 45-1506, which requires the high bidder to “forthwith pay the price bid[.]” Because no Idaho cases interpret the meaning of “forthwith,” Breckenridge proposes this Court look to United States v. Bradley, 428 F.2d 1013 (5th Cir. 1970) for guidance. There, that court explained “forthwith” was “deliberately undefined...to allow courts to interpret it in the context of ‘reasonableness,’ on a case-by-case basis.” Id. at 1015-16. The Fifth Circuit decided “‘forthwith’ requires no more or less than reasonable promptness, diligence or dispatch[.]” Id. While Breckenridge concedes Cornerstone had the funds on hand, it contends it would have taken Breckenridge forty-eight hours to satisfy W&R‘s requirement to obtain cashier checks payable to W&R. As a result, Breckenridge argues it satisfied the statutory requirement to “forthwith pay the price bid,” and the district court erred in holding it was not entitled to sufficient time to tender payment.
Breckenridge‘s position is unavailing for two reasons. First, Bradley is distinguishable from the facts here. In Bradley, the Fifth Circuit considered whether officers validly executed a search warrant when the officers delayed the search, despite the warrant‘s requirement that officers search “forthwith” for the wanted person. Id. at 1016. The Fifth Circuit rejected a rigid test that required the search warrant to be executed in ten days, holding that “[Federal] Rule [of Criminal Procedure] 41(d) sets a maximum time within
affords a creditor the right to nonjudicial foreclosure and a shorter 120-day period of cure[.]” Kelly Arthur Anthon, Buyer (& Debtor) Beware, 50 THE ADVOCATE 28 (2007) (citing
Second, we reject Breckenridge‘s position because, as stated above, interpreting a statute begins with its literal words. Verska, 151 Idaho at 893, 265 P.3d at 506. No matter how other courts have interpreted “forthwith,” this Court must give the word its “plain, usual, and ordinary meaning” and, if that definition is unambiguous, the Court “does not construe it, but simply follows the law as written.” Id.
In short, this Court first examines the literal words of section 45-1506 to determine whether they support the parties’ differing interpretations. Section 45-1506 provides:
The purchaser at the sale shall forthwith pay the price bid and upon receipt of payment the trustee shall execute and deliver the trustee‘s deed to such purchaser, provided that in the event of any refusal to pay purchase money, the officer making such sale shall have the right to resell or reject any subsequent bid as provided by law in the case of sales under execution.
Therefore, we hold the district court did not err in concluding W&R was not required to either (1) accept Breckenridge‘s bid or (2) give Breckenridge forty-eight hours to remit proper payment.
B. The district court did not err in concluding that Wally and W&R complied with the requirements of Idaho Code section 45-1506 by selling the property to Cornerstone.
Breckenridge alleges W&R and Wally violated the requirements of section 45-1506 that the property be sold to the highest bidder and violated its duty to get the highest price for the property. Breckenridge asserts that, when read together, two sentences in
(8) The sale shall be held on the date and at the time and place designated in the notice of sale or notice of rescheduled sale as provided in section 45-1506A, Idaho Code, unless the sale is postponed as provided in this subsection or as provided in section 45-1506B, Idaho Code, respecting the effect of an intervening stay or injunctive relief order. The trustee shall sell the property in one (1) parcel or in separate parcels at auction to the highest bidder.
The issue at the sale was with the form of Breckenridge‘s bid. Nothing in this subsection, or anywhere else under section 45-1506, requires a trustee to accept every bid made. But Breckenridge maintains that, despite arriving with endorsed checks and being unable to register as a bidder, it was the highest bidder at the sale. We disagree. Before the auction begins, trustees can impose reasonable restrictions on the acceptable forms of payment in which a bid can be made at a trustee‘s sale. Kivett, 58 Idaho at ___, 74 P.2d at 91. Breckenridge‘s claim that it was the highest bidder disregards the undisputed fact that it was unable to make a qualifying bid.
Below, the district court explained, “Breckenridge was not recognized to bid based on its inability to obtain checks on the day of the sale that conformed to the payment conditions set for the sale. Cornerstone was the only recognized bidder at the sale, and the auctioneer accepted Cornerstone‘s bid as the highest bid.” Breckenridge acknowledged this when it moved for summary judgment: “Had Cook not ignored Ashmore‘s bid and Breckenridge been recognized as
the highest bidder, Ashmore could have delivered to Cook checks payable to W&R within two (2) business days, if not sooner.” (Emphasis added).
Because Breckenridge failed to establish it was registered to bid, let alone the high bidder, we affirm the district court‘s decision that Wally and W&R complied with
C. The district court did not err by refusing to set aside the sale.
Breckenridge broadly contends the district court erred in refusing to set aside the sale. As part of this argument, Breckenridge also asserts that
Under
Discussing the sale of property at a trustee‘s sale, this Court has explained “the sale is final once the trustee accepts the bid as payment in full unless there are issues surrounding the notice of the sale.” Spencer v. Jameson, 147 Idaho 497, 504, 211 P.3d 106, 113 (2009). This finality, echoed in
Breckenridge claimed no defects in the notice of sale. It alleges only that W&R did not provide sufficient notice of the payment restrictions, which is not required by
sale remains final. There was no such violation here and therefore whether Cornerstone was a purchaser in good faith for value is immaterial and we need not reach that issue.
D. The district court did not err in dismissing Breckenridge‘s claims against Wally for negligence, negligence per se, and equitable estoppel.
Breckenridge argues the district court erred in dismissing its claims against Wally for negligence, negligence per se and estoppel. Breckenridge challenges two aspects of this portion of the district court‘s decision on appeal. First, Breckenridge asserts the district court erred in dismissing its negligence claims by holding W&R and Wally did not violate
1. The district court‘s decision to dismiss Breckenridge‘s negligence and negligence per se claims is affirmed.
Breckenridge argues the district court‘s decision to dismiss its claims for negligence and negligence per se was erroneous because a trustee has a duty to provide advance public notice of the terms of the sale, and W&R and Wally failed to do so. Wally responds that it complied with the statutory notice requirements and carried out the terms of the sale set by W&R.
To show common law negligence, a party must prove:
(1) a duty, recognized by law, requiring the defendant to conform to a certain standard of conduct; (2) a breach of that duty; (3) a causal connection between the defendant‘s conduct and the resulting injury; and (4) actual loss or damage.” [] Self-evident in the formulation of these elements is that a party cannot be held liable for negligence when there was no legal duty imposed under the circumstances.
Oswald v. Costco Wholesale Corp., 167 Idaho 540, 550, 473 P.3d 809, 819 (2020) (citing Stevens v. Fleming, 116 Idaho 523, 525, 777 P.2d 1196, 1198 (1989)). “[I]n Idaho, it is well established that statutes and administrative regulations may define the applicable standard of care owed, and that violations of such statutes and regulations may constitute negligence per se.” O‘Guin v. Bingham Cnty., 142 Idaho 49, 52, 122 P.3d 308, 311 (2005) (internal quotations omitted). “Establishing negligence per se through a violation of a statute or regulation conclusively establishes the first two elements of a cause of action in negligence.” Obendorf v. Terra Hug Spray
Co., Inc., 145 Idaho 892, 898, 188 P.3d 834, 840 (2008) (citing O‘Guin, 142 Idaho at 52, 122 P.3d at 311).
Below, the district court dismissed Breckenridge‘s negligence/negligence per se claim against Wally after concluding that W&R and Wally had not violated section 45-1506. The district court determined that because W&R and Wally had not violated that section, Breckenridge could not prove its claim of negligence or negligence per se because Wally had breached no duty to Breckenridge.
Breckenridge alleged the following as to its negligence claim:
50. Pursuant to
Idaho Code § 45-1506 , W&R and Wally owed a duty to Breckenridge to acknowledge Breckenridge‘s bid and convey title to the Subject Property to Breckenridge.51. W&R and Wally have breached their duty to Breckenridge, which breach has directly and proximately cause Breckenridge to incur damages in an amount to be proven at trial, but which exceed $10,000.
While we have already held that the district court did not err in ruling against Breckenridge on its claim that W&R and Wally violated
Since Wally did not violate
Idaho Code section 45-1506 , it cannot establish its claim for negligence/negligence per se. Breckenridge argues that section 45-1506 sets forth the statutory duty for its negligence claim. However, Breckenridge cannot demonstrate that Wally violated a statutory duty contained in section 45-1506. Breckenridge also has not argued nor demonstrated that Wally violated any specified common law duty owed to Breckenridge. Where the [c]ourt has found that Wally did not violateIdaho Code section 45-1506 , Breckenridge‘s basis for its negligence/negligence per se claims also fail. Thus, the [c]ourt finds even when construing the undisputed evidence in favor of the non-moving party, Breckenridge cannot establish its claims for negligence/negligence per se against Wally.
We agree with the district court‘s analysis. Breckenridge cannot show a violation of section 45-1506 to establish negligence per se and it has not shown Wally owed any common law duty to
it to support its claim for negligence. Accordingly, the district court‘s decision dismissing Breckenridge‘s claim for negligence and negligence per se is affirmed.
2. The district court‘s decision dismissing Breckenridge‘s equitable estoppel claim is affirmed.
Breckenridge next claims the district court erred in dismissing its claim of equitable estoppel because it is the trustee‘s duty to give public notice of the terms of the sale, and that the prospective bidder has no obligation to inquire into each term that may be imposed. Breckenridge posits that such a requirement unfairly advantages those who guess the correct questions over those who do not, which contradicts the policy established by the legislature and this Court.
The elements of equitable estoppel are as follows:
(1) a false representation or concealment of a material fact with actual or constructive knowledge of the truth; (2) that the party asserting estoppel did not know or could not discover the truth; (3) that the false representation or concealment was made with the intent that it be relied upon; and (4) that the person to whom the representation was made, or from whom the facts were concealed, relied and acted upon the representation or concealment to his prejudice.
Silicon Int‘l Ore, LLC v. Monsanto Co., 155 Idaho 538, 548-49, 314 P.3d 593, 603-04 (2013) (quoting Ogden v. Griffith, 149 Idaho 489, 495, 236 P.3d 1249, 1255 (2010)).
The doctrine of equitable estoppel “assumes the existence of a complete agreement,” which is not unenforceable as vague or incomplete. Lettunich v. Key Bank Nat‘l Ass‘n, 141 Idaho 362, 367, 109 P.3d 1104, 1109 (2005). Failing to establish even one element subjects the claim to dismissal at summary judgment. See Idaho Title Co. v. American States Ins. Co., 96 Idaho 465, 468, 531 P.2d 277, 230 (1975). The district court explained below:
The undisputed facts show that Wally did not make a false representation or conceal the payment conditions from Breckenridge. First, there is no allegation or evidence showing that Wally‘s notice contained false statements about the payment conditions. The notice did not say that the sale did not have any payment conditions. . . . Idaho law does not require the conditions for a sale to be posted in the notice for a public sale of a deed of trust. The conditions may be provided to potential bidders at the time and place of the sale. Thus, even in construing all reasonable inferences in favor of the non-moving party, Breckenridge cannot establish that Wally made any misrepresentation to Breckenridge.
Breckenridge also cannot show that information about the payment conditions was concealed by Wally. As set forth above, the public notices posted by Wally were not varied from the notice it received from W&R. Wally was not required to provide advance[ ] notice of the payment conditions for the sale. Breckenridge also did not contact Wally regarding the existence of any conditions. Thus, even when drawing
all reasonable inferences in favor of the non-moving party, the Court finds that Breckenridge cannot establish that Wally concealed facts about the payment conditions from Breckenridge. Therefore, the Court finds that Breckenridge cannot establish its estoppel claim against Wally.
On appeal, Breckenridge makes no argument that addresses the elements of equitable estoppel. Breckenridge does not suggest Wally made a false representation nor does it contend it could not discover the purchase conditions. To the contrary, as Wally notes on appeal, “the actions of [Cornerstone‘s agent] unequivocally demonstrated through relatively minimal efforts in reading the sale website and contacting Wally[,]” Breckenridge could discover the purchase conditions. Thus, Breckenridge has failed to establish either of these elements was met here.
Beyond that, Breckenridge provided no argument to support why the district court‘s decision to dismiss its claim for estoppel against Wally was in error. See Bach v. Bagley, 148 Idaho 784, 790, 229 P.3d 1146, 1152 (2010) (“A general attack on the findings and conclusions of the district court, without specific reference to evidentiary or legal errors, is insufficient to preserve an issue.“). Accordingly, we affirm the district court on this ground as well.
E. The district court abused its discretion in awarding attorney fees to Cornerstone and Wally under Idaho Code section 12-120(3).
Breckenridge next argues the district court erred in awarding attorney fees to Cornerstone and Wally. Breckenridge contends there was no commercial transaction alleged between the parties nor was recovery sought based on a commercial transaction. Since the opposing parties are only indirectly related, Breckenridge argues that section 12-120(3) does not provide a basis for attorney fees.
Cornerstone responds that the district court correctly awarded attorney fees under
The awarding of attorney fees and costs is within the discretion of the district court and is subject to the abuse of discretion standard of review. Idaho Transp. Dep‘t v. Ascorp, Inc., 159 Idaho 138, 140, 357 P.3d 863, 865 (2015). When this Court considers whether the district court abused its discretion, it applies a four-part test: (1) whether the court correctly perceived the issue as discretionary; (2) whether the court acted within the outer boundaries of its discretion; (3)
whether the court acted consistently with the legal standards applicable to the specific choices available; and (4) whether the district court reached its decision by an exercise of reason. Lunneborg v. My Fun Life, 163 Idaho 856, 863, 421 P.3d 187, 194 (2018).
“[I]n any commercial transaction unless otherwise provided by law, the prevailing party shall be allowed a reasonable attorney‘s fee to be set by the court, to be taxed and collected as costs.”
“[W]hether a party can recover attorney fees under
Idaho Code section 12-120(3) depends on whether the gravamen of aclaim is a commercial transaction.” Stevens v. Eyer, 161 Idaho 407, 410, 387 P.3d 75, 78 (2016). “A gravamen is ‘the material or significant part of a grievance or complaint.’ ” Id. (quoting Merriam Webster‘s Collegiate Dictionary 509 (10th ed. 1993)). “[C]ourts analyze the gravamen claim by claim.” Id. (citation omitted). “To determine whether the significant part of a claim is a commercial transaction, the court must analyze whether a commercial transaction (1) is integral to the claim and (2) constitutes the basis of the party‘s theory of recovery on that claim.” Id. (citation omitted).
SilverWing at Sandpoint, LLC v. Bonner Cnty., 164 Idaho 786, 799-800, 435 P.3d 1106, 1119-20 (2019).
We begin by noting that this Court‘s jurisprudence on
basis on which [the plaintiff] was attempting to recover.” 151 Idaho 462, 469, 259 P.3d 608, 615 (2011) (quoting Great Plains Equip., Inc. v. Northwest Pipeline Corp., 136 Idaho 466, 471, 771, 36 P.3d 218, 223, 224 (2001) (Great Plains Equip. II)).
The second line of cases clarifies and limits this broad approach. Under this analysis, “[w]hether a party can recover attorney fees under
[I]f more than one claim is pled, there can be more than one “gravamen,” and attorney fees can still be awarded for a specific claim, if a claim is of the type covered by
I.C. § 12-120(3) “even though a claim is covered by other theories that would not have triggered application of the statute.”
136 Idaho at 472, 36 P.3d at 224 (quoting Brooks v. Gigray Ranches, Inc., 128 Idaho 72, 79, 910 P.2d 744, 751 (1995)). Thus, the notion of focusing on the gravamen of the lawsuit can be confounding. The analysis requires a deeper dive into the gravamen of the claims in the case and the basis for the lawsuit itself. It is not enough that a commercial transaction was tangentially involved in a particular litigation.
There are “two stages of analysis to determine whether a prevailing party could avail itself of
[An] award of attorney‘s fees is not warranted every time a commercial transaction is remotely connected with the case. Rather, the test is whether the commercial transaction comprises the gravamen of the lawsuit. Attorney‘s fees are not appropriate under
I.C. § 12-120(3) unless the commercial transaction is integral to the claim, and constitutes the basis upon which the party is attempting to recover. To hold otherwise would be to convert the award of attorney‘s fees from an exceptional remedy justified only by statutory authority to a matter of right in virtually every lawsuit filed.
Id. at 784, 792 P.2d at 349 (emphasis added).
Following this authority, analysis of the gravamen of Breckenridge‘s claims as well as the gravamen of the lawsuit convinces us that attorney fees were improperly awarded here. Breckenridge‘s complaint against Cornerstone and Wally alleged a violation of
Count I, alleging a violation of
Count II, alleging estoppel, requested W&R and Wally be estopped from restricting the form of payment at a future sale, and requested an order from the district court requiring W&R and Wally to convey title to the property to Breckenridge after it paid for the property. This claim is also an equitable one. See Boesiger v. Freer, 85 Idaho 551, 559-61, 381 P.2d 802, 806-07 (1963) (identifying estoppel as an equitable doctrine).
Count III, alleging negligence/negligence per se against Wally and W&R requested an order voiding any instrument conveying title to Cornerstone while granting a judgment against W&R and Wally for damages. Once again, claims in negligence sound in tort, not in contract. Thus, the statutory availability of attorney fees is also unavailable on this claim.
In sum, the gravamen of these claims was not a commercial transaction. And while a commercial relationship existed between Cornerstone and Wally, and between Wally and W&R,
Breckenridge had no commercial relationship with either Cornerstone or Wally. Indeed, Breckenridge‘s efforts to establish a relationship with Wally failed because its bid was rejected. From that limited connection, Wally and Cornerstone cannot prevail under 12-120(3) against Breckenridge for fees.
The district court found that Breckenridge‘s attempt to set aside a commercial transaction between W&R and Cornerstone made it a party to a commercial transaction:
[T]he gravamen of Breckenridge‘s claims attempted to enforce a commercial transaction for the sale of the subject property against W&R by attempting to invalidate the commercial transaction between W&R and Cornerstone. Thus, for purposes of determining attorney fees under
I.C. § 12-120(3) , the Court finds that a commercial transaction was alleged between Breckenridge and Cornerstone.
We disagree with this analysis. There was never a commercial transaction attempted or intended between Cornerstone and Breckenridge. These two entities were in competition against each other—they were never engaged in a commercial transaction with each other. As to Wally, as noted above, Breckenridge‘s claims were not commercial in nature.
In addition, Breckenridge‘s complaint did not assert a right to attorney fees under
general language in Breckenridge‘s complaint. Indeed, in Garner we made this point while referencing Great Plains Equip. II:
Great Plains thus attempted to clarify that a mere request for attorney fees pursuant to
I.C. § 12-120(3) , without more, is not sufficient to trigger the commercial transaction prong of that section. In other words, neither a claim or request in the prayer of a complaint for fees underI.C. § 12-120(3) , nor a request or claim for attorney fees in a memorandum of costs and fees, is sufficient to trigger application of that fee provision. A party seeking fees based on a mere request underI.C. § 12-120(3) must show that a commercial transaction was the gravamen of the action before a court may award fees.
151 Idaho at 470, 259 P.3d at 616 (emphasis added).
We now follow this reasoning precisely. Breckenridge‘s complaint simply made a passing reference to “12-120,” without even mentioning section 12-120(3) specifically. While Cornerstone rightly pointed out that Breckenridge‘s reference to 12-120, without more, could not have meant anything but 12-120(3), we rely on the distinction made in Great Plains that a “mere request for attorney fees pursuant to” section 12-120 is insufficient to estop Breckenridge in this case.
We caution that this result does not mean that commercial claims that are intertwined with non-commercial claims precludes an award of attorney fees. As we explained recently in Knudsen v. J.R. Simplot Co.:
[W]here there are multiple claims in an action, and only some qualify for a fee award under
section 12-120(3) , attorney‘s fees are properly denied if those claims are “inseparably intertwined.” See Brooks v. Gigray Ranches, Inc., 128 Idaho 72, 77-79, 910 P.2d 744, 749-51 (1996) (concluding that a district court‘s denial of attorney‘s fees undersection 12-120(3) was appropriate where the district court determined the fees associated with claims that satisfied section 12-120(3) were “inseparably intertwined” with those that did not). When a party has prevailed on claims for which it is statutorily entitled to an award of attorney‘s fees and claims upon which it is not, this Court has held “that the prevailing party must apportion the fees between the claim upon which it was entitled to recover ... and the claim upon which it was not.” Advanced Med. Diagnostics, LLC v. Imaging Ctr. of Idaho, LLC, 154 Idaho 812, 815, 303 P.3d 171, 174 (2013). “Where fees were not apportioned between a claim that qualifies underI.C. § 12-120(3) and one that does not, no fees are to be awarded.” Rockefeller v. Grabow, 136 Idaho 637, 645, 39 P.3d 577, 585 (2001) (citing Brooks, 128 Idaho at 79, 910 P.2d at 752).
168 Idaho 256, 273, 483 P.3d 313, 330 (2021).
Our analysis here clarifies, once again, the potentially disparate reasoning of several cases involving fees awardable under
recognized the issue as one of discretion, and acted within the outer bounds of its discretion, we conclude the district court acted inconsistent with applicable legal standards and abused its discretion in awarding Cornerstone and Wally fees under
F. Attorney fees are not awarded on appeal.
Both respondents request attorney fees under
“An award of attorney fees under [
Since we have reversed the district court‘s award of attorney fees based on the lack of a commercial transaction, we decline to award fees to any of the parties under
VI. CONCLUSION
For the reasons set forth above, we affirm the district court‘s decision dismissing Breckenridge‘s claims against Wally, W&R, and Cornerstone. The district court‘s judgment awarding attorney fees to Wally and Cornerstone under
Justices BRODY, STEGNER, MOELLER, and ZAHN CONCUR