Associates Northwest, Inc. v. Beets, 16476
| Decision Date | 02 March 1987 |
| Docket Number | No. 16476,16476 |
| Parties | ASSOCIATES NORTHWEST, INC., an Idaho corporation; Douglas Fowler and Mark Ortman, Plaintiffs-Appellants, v. Roy BEETS d/b/a Heritage Realty and Judy Beets, his wife, Defendants- Respondents. |
| Court | Idaho Court of Appeals |
Dan T. Edwards, Suiter, Edwards & Gere, Eagle, for plaintiffs-appellants.
William F. Yost, III, Nampa, for defendants-respondents.
This appeal comes to us from an award of attorney fees under I.C. § 12-121. The sole issue is whether the trial court properly exercised its discretion in making the award. For the reasons set forth below, we vacate the award and remand the case.
The underlying facts may be stated briefly. During times pertinent to this litigation, Associates Northwest, Inc., was engaged in the sale and management of real estate. The principal shareholders of the corporation were Douglas Fowler and Mark Ortman. The corporation hired Roy Beets as a sales agent. Subsequently, Beets was promoted to the position of designated broker and he became an officer of the corporation.
The corporation's real estate business was not successful. Sales commissions dropped below operating expenses. In an attempt to raise additional capital, Fowler and Ortman offered ownership interests in the corporation to Beets and to the sales agents. None of them accepted the offer. Instead, Beets created his own business, naming it Heritage Realty, and he transferred his brokerage license to the new entity. Beets operated Heritage Realty in the same office where the corporation's business was located. He informed other corporate employees that they could join him in Heritage Realty, or remain with the corporation, or look for employment elsewhere. All chose to follow Beets, effectively putting an end to the corporation's real estate business. Heritage took over the corporation's realty listings. Commissions from those sales were placed in a special trust account and most of the money eventually was paid to Fowler.
Despite the payment of commissions, the corporation and the principal shareholders sued Beets. They sought damages on four theories: breach of fiduciary duty, trespass and conversion, unfair competition, and intentional interference with contractual relations. The case was tried without a jury. The district judge found against the plaintiffs, although he did order payment of some residual commissions as well as compensation for the fair rental value of the corporation's office furniture. The judge declared Beets to be the prevailing party in the lawsuit and awarded him attorney fees under I.C. § 12-121. The judge stated that the plaintiffs had "presented no testimony or evidence on their causes of action for unfair competition and intentional interference of [sic] contractual relationships; therefore, plaintiffs pursued those causes of action frivolously and without foundation."
On appeal the plaintiffs do not challenge the district court's adverse decision on the merits of their damage claim. Rather, they question the judge's determination that the suit was pursued "frivolously and without foundation." They note that the court allowed some monetary recovery, though the judge did not characterize it as a damage award. More fundamentally, they argue that the judge erred in stating that "no evidence" was presented on two of the four asserted theories of recovery.
When an exercise of discretion is reviewed on appeal, the appellate court conducts a multi-tiered inquiry. The sequence of the inquiry is (1) whether the lower court rightly perceived the issue as one of discretion; (2) whether the court acted within the outer boundaries of such discretion and consistently with any legal standards applicable to specific choices; and (3) whether the court reached its decision by an exercise of reason. Standards of Appellate Review in State and Federal Courts, § 3.4, IDAHO APPELLATE HANDBOOK (Idaho Law Foundation, Inc., 1985). Here, the award of attorney fees under I.C. § 12-121 was properly identified as a matter of discretion. E.g., Anderson v. Ethington, 103 Idaho 658, 651 P.2d 923 (1982). The next question is whether the judge's discretionary alternatives were governed by particular legal standards. In this case, we believe they were.
The first such standard is that, under modern pleading practice, a plaintiff may advance alternative theories relating to an alleged set of...
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Lunneborg v. My Fun Life, Corp.
...655, 660 (2010), which judges and lawyers alike can likely recite by heart. It appears to have originated in Assocs. Nw., Inc. v. Beets , 112 Idaho 603, 605, 733 P.2d 824, 826 (Ct. App. 1987), based upon language taken from the Idaho Appellate Handbook, Standards of Appellate Review in Stat......
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Kayser v. McClary
...position of the nonprevailing party is plainly fallacious and, therefore, not fairly debatable.” Assocs., Northwest, Inc. v. Beets, 112 Idaho 603, 733 P.2d 824, 826 (Idaho Ct.App.1987); see also Bonaparte v. Neff, 116 Idaho 60, 773 P.2d 1147, 1151 (Idaho Ct.App.1989). An award of attorneys'......
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Lunneborg v. My Fun Life, Corp., Docket No. 45200
...655, 660 (2010), which judges and lawyers alike can likely recite by heart. It appears to have originated in Assocs. Nw., Inc. v. Beets , 112 Idaho 603, 605, 733 P.2d 824, 826 (Ct. App. 1987), based upon language taken from the Idaho Appellate Handbook, Standards of Appellate Review in Stat......
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Bumgarner v. Bumgarner
...reason. Finding no abuse of discretion, we affirm the district court's award of attorney fees. See Associates Northwest, Inc. v. Beets, 112 Idaho 603, 605, 733 P.2d 824, 826 (Ct.App.1987). Conclusion We affirm the district court's judgment quieting title in Kent to a lot approximately seven......