Atlas Const. Co. v. Slater, 86-245

• Decision Date: 12 November 1987
• Docket Number: No. 86-245,86-245
• Citation: 746 P.2d 352
• Parties: ATLAS CONSTRUCTION COMPANY, a Wyoming corporation, Atlas, Inc., a Wyoming corporation, and Francis Ferguson, Appellants (Defendants), v. Dale R. SLATER, Jr., Appellee (Plaintiff).
• Court: Wyoming Supreme Court

Page 352

746 P.2d 352

ATLAS CONSTRUCTION COMPANY, a Wyoming corporation, Atlas, Inc., a Wyoming corporation, and Francis Ferguson, Appellants (Defendants), v. Dale R. SLATER, Jr., Appellee (Plaintiff).

No. 86-245.

Supreme Court of Wyoming.

Nov. 12, 1987.

Harold F. Buck of Kline, Buck & Asay, Cheyenne, for appellants (defendants).

Thomas L. Sansonetti of Sheehan, Stevens & Sansonetti, Gillette, for appellee (plaintiff).

Before BROWN, C.J., THOMAS, CARDINE and MACY, JJ., and GUTHRIE, J., Retired.

CARDINE, Justice.

A jury found appellants liable for negligence and breach of an implied warranty of habitability after the house they built for appellee was condemned for structural defects. Appellants raise the following issues on appeal: (1) Whether the trial court erred in transferring the trial from Laramie County to Campbell County; (2) Whether the trial court improperly granted partial summary judgment for appellee on the issue of piercing the corporate veil when depositions and affidavits in support of appellee's motion for summary judgment were not filed with the motion or when the court heard the motion, and the hearing on the motion was held with less than ten days' notice to appellants; (3) Whether an affidavit filed by appellants created an issue of material fact precluding summary judgment; (4) Whether appellee was properly awarded damages for rental expenditures after his house became uninhabitable; and (5) Whether appellants were unfairly prejudiced by consolidation of their trial with a similar action concerning another home built by appellants.

We affirm in part and reverse in part.

FACTS

In 1977 appellee Dale Slater bought a new home in a Gillette subdivision called Highland Estates. In the spring of 1983, he began to notice cracking problems in the walls and foundation of the house. By November 1984, the structural problems had become so serious that the natural gas lines to the home were disconnected and the house was condemned.

Appellee filed an action against appellants and several other defendants on theories of negligence and breach of an implied warranty of habitability. Appellant Atlas Construction Company, the builder of the home, is a wholly-owned subsidiary of appellant Atlas, Inc. Appellant Francis Ferguson and his family own all of the stock of Atlas, Inc.

A jury trial was held, and the jury found defendant Atlas Construction Company liable for the diminution in value of the house, the cost of demolition, and rental expenditures incurred by Mr. Slater when he found it necessary to rent another home. On the day the jury returned its verdict, the trial court entered an order granting partial summary judgment in favor of appellee on the issue of piercing the corporate veils of Atlas Construction Company and Atlas, Inc. The two corporations and Francis Ferguson were held jointly and severally liable for the judgment entered upon the jury's verdict.

TRANSFER

Appellee originally filed this action in Campbell County. After the court entered summary judgment in favor of defendants City of Gillette and Campbell County, the remaining defendants obtained a change of venue to Laramie County. Appellee then moved the court to transfer the trial back to Campbell County pursuant to Rule 40.1(a)(1), W.R.C.P., on the grounds of convenience of witnesses, reduction of the costs of trial, and the need for a jury view of the home. The court concluded that Campbell County was "the most convenient forum for the trial" and granted appellee's motion. Appellants contend that the Rule 40.1, W.R.C.P., provides that upon motion of any party, the court "shall transfer the action to another county for trial if the court is satisfied that * * * the convenience of witnesses would be promoted thereby." The rule further provides that "[t]he presiding judge may at any time upon his own motion order a transfer of trial when it appears that the ends of justice would be promoted thereby."

court's ruling constitutes an abuse of discretion.

Rule 40.1 obviously vests considerable discretion in the trial court. In defining judicial discretion, we have said that it is

"a composite of many things, among which are conclusions drawn from objective criteria; it means a sound judgment exercised with regard to what is right under the circumstances and without doing so arbitrarily or capriciously." Martin v. State, Wyo., 720 P.2d 894, 897 (1986).

We have also stated that

" '[a] court does not abuse its discretion unless it acts in a manner which exceeds the bounds of reason under the circumstances. In determining whether there has been an abuse of discretion, the ultimate issue is whether or not the court could reasonably conclude as it did.' " Id. at 896 (quoting Martinez v. State, Wyo., 611 P.2d 831, 838 (1980)).

Appellants have failed to demonstrate an abuse of discretion. When the trial court ruled on appellee's motion for transfer, appellee's action had been consolidated with similar cases brought against appellants by three other plaintiffs. The consolidated plaintiffs anticipated that over twenty-five of their witnesses would be from Campbell County. They also contended that a jury view of the homes would be necessary. With these considerations in mind, the trial court concluded that in the interest of convenience, the trial should be held in Campbell County. This determination was based on objective criteria, was not arbitrary or capricious, and was well within the bounds of reason. Accordingly, it was not an abuse of discretion.

Appellants next suggest that the trial court erred in granting appellee's transfer motion because it was not supported by sworn testimony. Rule 40.1 contains no requirement that the court may rely only upon sworn testimony in determining whether to transfer a trial. The court properly relied upon information contained in the jointly filed motion, witness lists on file, and arguments of counsel. We find no error in the transfer of the trial to Campbell County.

SUMMARY JUDGMENT

Procedural Sufficiency

Appellants contend that the trial court erred in granting appellee's motion for partial summary judgment on the issue of piercing the corporate veil because the depositions relied upon by the court were not properly filed until after the court had signed the order granting partial summary judgment. Rule 56(c), W.R.C.P. provides:

"The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (Emphasis supplied.)

Likewise, Rule 302(b) of the Uniform Rules for the District Courts of the State of Wyoming provides:

"At the time of filing a motion for summary judgment the movant shall designate and file relevant portions of the discovery documents relied upon." (Emphasis supplied.)

While the record reveals a lack of compliance with these requirements, it also reveals that the trial court had requested and received the depositions in question at a motion hearing on October 31, 1985, some eight months before entering the partial summary judgment order. The trial court explained the situation as follows:

"THE COURT: Gentlemen, I'll tell you something, when we heard the Motions originally in Douglas--and this may be the problem which I'm not going to get It is clear in this instance that appellee's failure to file the depositions was merely a technical imperfection not affecting a substantial right of appellants. Appellants have failed to demonstrate that they were prejudiced by lack of notice, or for that matter, in any way. It has been said that

this far enmeshed in again in handling a case long distance--I had the depositions. I thought the depositions were--Because in Douglas there is just a local rule, the guys ask to have the depositions filed and I allow them to be filed because I like the stuff to be in the record when I'm considering any kind of a Motion that has to do with depositions or any kind of discovery. Because we argued the Motion that day and used the depositions in the argument, and so on, I guess I assumed that they were a matter of record. Because the case was not in Douglas, then my gal sent them back to Gillette, I assumed, to be put in the file. But, you know, they weren't, because the Motion wasn't made. But I am going to admit them * * *."

"[p]erfection is an aspiration, but the failure to achieve it in the judicial process, as elsewhere in life, does not, absent injury, require a repeat performance." Miles v. M/V Mississippi Queen, 753 F.2d 1349, 1352 (5th Cir.1985).

We find no reversible error in the procedure followed by the court in ruling on appellee's motion for summary judgment. ¹

Substantive Sufficiency

On the day the jury returned its verdict, the trial court entered partial summary judgment for appellee on the issue of piercing the corporate veil. Apparently the court had informed the parties before trial that it would grant partial summary judgment on that issue. No evidence was introduced on the piercing issue at trial; instead, the court relied upon depositions and affidavits. The court, relying upon Amfac Mechanical Supply Co. v. Federer, Wyo., 645 P.2d 73 (1982), concluded there was no genuine issue of material fact and pierced the corporate veil. The ruling was erroneous. Partial summary judgment should not have been entered.

Initially, we note that the issue of piercing the corporate veil is not usually decided by summary judgment:

"It is recognized that the determination of whether there are sufficient grounds for piercing the corporate veil ordinarily should not be disposed of by summary judgment, in view of the complex economic questions often involved, especially if fraud is alleged, but summary judgment may be granted in a proper case where no genuine issue of fact is raised or shown." (Footnotes omitted.)...