B Bar J Ranch, LLC v. Carlisle Wide Plank Floors, Inc., DA 12–0080.

• Citation: 366 Mont. 506,288 P.3d 228,2012 MT 246
• Decision Date: 30 October 2012
• Docket Number: No. DA 12–0080.,DA 12–0080.
• Parties: B BAR J RANCH, LLC, Plaintiff and Appellant, v. CARLISLE WIDE PLANK FLOORS, INC., Defendant and Appellee.
• Court: United States State Supreme Court of Montana

366 Mont. 506

288 P.3d 228

2012 MT 246

B BAR J RANCH, LLC, Plaintiff and Appellant,

v.CARLISLE WIDE PLANK FLOORS, INC., Defendant and Appellee.

No. DA 12–0080.

Supreme Court of Montana.

Submitted on Briefs Aug. 29, 2012.

Decided Oct. 30, 2012.

For Appellant: Christian T. Nygren, W. Adam Duerk; Milodragovich, Dale, Steinbrenner & Nygren, PC, Missoula, Montana.

For Appellee: David B. Cotner, Joslin E. Monahan; Datsopoulos, MacDonald & Lind, Missoula, Montana.

Chief Justice MIKE McGRATH delivered the Opinion of the Court.

[366 Mont. 507]¶ 1 B Bar J Ranch, LLC (B Bar J) appeals from the judgment against it in favor of Carlisle Wide Plank Floors, Inc., (Carlisle) from the District Court for the Fourth Judicial District, Mineral County. We affirm.

¶ 2 B Bar J presents the following issues for review:

¶ 3 Issue One: Whether the District Court erred by allowing Carlisle to disclose an expert witness after the scheduling order deadline.

¶ 4 Issue Two: Whether the District Court erred by awarding Carlisle attorney fees under the Montana Consumer Protection Act.

PROCEDURAL AND FACTUAL BACKGROUND

¶ 5 B Bar J owns and operates a 680–acre ranch located in the Lolo National Forest near Tarkio, Montana. The ranch's defining feature is its 18,000 square-foot lodge that boasts ten bedrooms, a full commercial kitchen, a conference room, a massage room, and a saloon. Carlisle is a custom manufacturer of high-end wide-plank wood flooring. While building the lodge in 2005, B Bar J bought roughly 6,000 square feet of wood flooring from Carlisle. After being installed, approximately 2,000 square-feet of the Carlisle flooring in the basement started buckling and had to be replaced with an alternative product.

¶ 6 B Bar J sued Carlisle in May of 2008, alleging negligent misrepresentation, breach of an implied warranty of suitability for a particular purpose, and violation of the Montana Unfair Trade Practices and Consumer Protection Act, §§ 30–14–101 et seq., MCA (MCPA). In April 2009, Carlisle joined B Bar J's general contractor who built the lodge and the subcontractor who installed the flooring as third-party defendants. In its scheduling order, the District Court set December 15, 2010, as the deadline for disclosing expert witnesses and February 1, 2011, as the deadline for discovery. In February of 2011, Carlisle moved the court to disclose an accountant as a tax expert for trial. The District Court granted Carlisle's motion over B Bar J's objection on March 1, 2011. B Bar J settled its claims against the general contractor and subcontractor, but it proceeded to trial against Carlisle on March 21, 2011.

¶ 7 One of the issues at trial was whether B Bar J met the statutory definition of a consumer under the MCPA. For B Bar J to be a consumer under the MCPA, the lodge had to be used primarily for personal, family, or household purposes. If, instead, the jury found that B Bar J had used the lodge for business purposes, then it would not be a consumer under the MCPA and its claim would fail.

¶ 8 B Bar J presented four witnesses who testified that B Bar J's sole owner and member, Michael Borden, had used the lodge primarily as a second residence. In response, Carlisle introduced B Bar J's tax returns and accounting records into evidence, and had Craig Langel, its tax expert, explain how the records indicated that B Bar J treated the lodge as a business asset for tax purposes and not as a personal residence. Among other things, Langel explained to the jury how B Bar J had reported income from use of the lodge, had reported the lodge as a depreciable asset, and had taken specific business deductions on the lodge that are not allowed for personal residences. He then explained how B Bar J's tax returns should have been completed had the lodge been used as either a full-time or part-time personal residence.

¶ 9 The jury returned a verdict in Carlisle's favor on all of B Bar J's claims on March 28, 2011, including a 12–0 verdict on the MCPA claim. After successfully defending against all of B Bar J's claims, Carlisle moved the District Court for an award of attorney fees as the prevailing party under the MCPA, which the court granted. B Bar J now appeals the District Court's order that allowed Carlisle to disclose Langel as an expert witness after the scheduling order deadline and the order awarding Carlisle attorney fees.

STANDARD OF REVIEW

¶ 10 We review both a district court's evidentiary rulings and award of attorney fees for an abuse of discretion. Mason v. Ditzel, 255 Mont. 364, 370–371, 842 P.2d 707, 712 (1992); Tripp v. Jeld–Wen, Inc., 2005 MT 121, ¶ 12, 327 Mont. 146, 112 P.3d 1018. A district court abuses its discretion when it acts arbitrarily without employment of conscientious judgment or exceeds the bounds of reason resulting in substantial injustice. Tripp, ¶ 12.

DISCUSSION

¶ 11 Issue One: Whether the District Court erred by allowing Carlisle to disclose an expert witness after the scheduling order deadline.

¶ 12 B Bar J argues on appeal that the District Court abused its discretion by allowing Carlisle to disclose Langel as an expert witness after the scheduling order deadline because Carlisle's failure to comply with the scheduling order was a result of its own procrastination. B Bar J contends that because Carlisle first knew that it was interested in the tax records as early as October of 2008, it should have disclosed a tax expert before receiving the records. The District Court considered a similar argument that B Bar J's counsel made at the March 1, 2011, final pretrial conference but reasoned that Carlisle could not have known that it would need a tax expert until after it received the tax returns. Because B Bar J did not produce the tax returns until February 2, 2011, well after the deadline to disclose expert witnesses, the court allowed Carlisle's late disclosure and permitted Langel to testify at trial. Alternatively, B Bar J argues that Carlisle should have taken additional measures to make sure that it obtained the records before the deadline for disclosing experts.

¶ 13 The court's decision to permit the late disclosure is an evidentiary ruling that we review for an abuse of discretion. Mason, 255 Mont. at 371, 842 P.2d at 712. District courts have the authority to control trial administration and inherent discretionary power to control discovery. Anderson v. Werner Enters., Inc., 1998 MT 333, ¶ 13, 292 Mont. 284, 972 P.2d 806.Montana Rule of Civil Procedure 16(b) provides that a district court's scheduling order can only be modified with leave from the judge and for good cause. Therefore, the question before us is whether the District Court acted arbitrarily without employment of conscientious judgment or exceeded the bounds of reason when it determined that Carlisle had good cause to modify the scheduling order. We hold that it did not.

¶ 14 As the District Court recognized, Carlisle undoubtedly needed the tax records before it could have determined whether a tax expert would be necessary at trial. Although the tax returns supported Carlisle's theory that B Bar J was not a consumer, they could have also disproved that theory. It was only after reviewing the returns that Carlisle knew for sure that it needed a tax expert to testify at trial. B Bar J argues, however, that it was Carlisle's own fault that it did not receive the tax records in a timely fashion. Our review of the record reveals otherwise. Carlisle first sought production of the tax records in October of 2010. At that time, B Bar J refused to produce the records and claimed that they were irrelevant. The next time Carlisle requested the records was in a letter that it sent to B Bar J's counsel on November 18, 2010. In that letter, sent nearly a month before the deadline to disclose experts, Carlisle's counsel explained that the tax records were directly relevant to its MCPA claim defense. But B Bar J again refused to produce the records and continued to insist that they were irrelevant. Carlisle was consequently forced to seek the District Court's assistance, which it received on January 27, 2011, when the court compelled production of the tax returns. That order came well after the deadline to disclose expert witnesses.

¶ 15 B Bar J now asks us to penalize...