Building Concepts, Ltd. v. Pickering

• Citation: 114 Idaho 640,759 P.2d 931
• Decision Date: 26 July 1988
• Docket Number: No. 16831,16831
• Parties: BUILDING CONCEPTS, LTD., an Oklahoma corporation, Plaintiff-Respondent-Cross Appellant, v. Brad PICKERING, Joanne Pickering, Jerry Smith, and Dorothy Smith d/b/a Sunkiss Enterprises and Sunkiss Towing and Body Repair, Defendants-Appellants-Cross Respondents.
• Court: Court of Appeals of Idaho

Page 931

759 P.2d 931

114 Idaho 640

BUILDING CONCEPTS, LTD., an Oklahoma corporation, Plaintiff-Respondent-Cross Appellant, v. Brad PICKERING, Joanne Pickering, Jerry Smith, and Dorothy Smith d/b/a Sunkiss Enterprises and Sunkiss Towing and Body Repair, Defendants-Appellants-Cross Respondents.

No. 16831.

Court of Appeals of Idaho.

July 26, 1988.

[114 Idaho 641] Spencer E. Daw, Idaho Falls, for defendants-appellants-crossrespondents.

Teresa L. Sturm of Hopkins, French, Crockett, Springer & Hoopes, Idaho Falls, for plaintiff-respondent-crossappellant.

SWANSTROM, Judge.

Building Concepts brought a claim and delivery action to regain possession of a fabricated steel building it had manufactured and shipped to Brad and Joanne Pickering and Jerry and Dorothy Smith, partners doing business as Sunkiss Enterprises (hereinafter Pickering). After the parties settled the underlying controversy concerning payment for the building, the district court awarded costs and attorney fees to Building Concepts.

Pickering appeals, raising the issue whether Building Concepts is a prevailing party and whether attorney fees are awardable under former I.C. § 12-120 in a claim and delivery action. A cross-appeal by Building Concepts asserts that the court erred by disallowing some of its claimed expenses, costs and attorney fees. We uphold Building Concepts' entitlement to costs and fees but we vacate the judgment and remand the case for the court to reconsider the claimed expenses, costs and fees.

In April 1985, Pickering became a dealer for Rigid Steel Structures of Cottonwood Falls, Kansas. The dealership agreement required a deposit by the dealer which could be applied to the purchase of a Rigid Steel building. Pickering ordered a building at a total cost of $11,340. Pickering was credited with payments totaling $2,268, leaving a balance of $9,072 which--according to the purchase order signed by Pickering--was to be "paid on delivery by cashier's check." Rigid Steel Structures filled this order by having Building Concepts, Ltd., an Oklahoma corporation, manufacture and deliver the prefabricated building to Pickering in Bonneville County, Idaho, in September 1985. The record indicates, and this is not disputed, that Building Concepts had been assigned proceeds due under the sales contract between Pickering and Rigid Steel Structures and had been given authority to receive payment of the $9,072 balance. When the shipment arrived, the driver for Building Concepts contacted Pickering and requested payment pursuant to the C.O.D. terms of the bill of lading.

The affidavit of Brad Pickering and the driver's affidavit conflict somewhat, but the following statements of the driver are undisputed. He was led to believe by Pickering that, because of the lateness of the day, a cashier's check could not be obtained until the following morning. He was told that the truck and its cargo could be safely left at Sunkiss Enterprises for the night and that it would be unloaded the next day. A Sunkiss employee took the driver to Idaho Falls where the driver spent the night. During the night Pickering unloaded the truck and took possession of the cargo. The next day Pickering refused to pay the $9,072. Demand was made to Pickering by the driver, and later by Building Concepts, for payment or return of the shipment but the demand was refused. Brad Pickering's affidavit states that he believed he was entitled to have all of the dealer's deposit refunded or applied immediately by Rigid Steel toward the balance due on the building.

Building Concepts immediately filed suit against Pickering, seeking a return of the shipped merchandise and damages for breach of the sales contract. A writ of possession was issued and served. Building Concepts then repossessed the merchandise. Negotiations between the parties resulted in a partial settlement whereby Pickering paid the $9,072 balance due Building Concepts next filed a notice of intent to take default. This notice contained affidavits listing the costs and expenses incurred to date. These included court costs, attorney fees and the expenses of repossession. The total approximated $3,350. The district court granted a default judgment against Pickering but later set it aside on Pickering's motion alleging mistake or excusable neglect under I.R.C.P. 60(b).

[114 Idaho 642] for the building. The issues regarding alleged conversion and unlawful possession of the shipment were thus resolved. The sole remaining issue was whether Pickering should pay Building Concept's costs, expenses and attorney fees.

Building Concepts then filed a motion for summary judgment seeking its costs, expenses and attorney fees incurred in the claim and delivery action. A hearing was held and, based on the settlement of the underlying controversy, Building Concepts was determined to be the prevailing party. The court awarded $1,250 for attorney fees and $112 for costs. The court's memorandum decision did not mention or allow the other expenses and costs claimed by Building Concepts. This appeal and cross-appeal followed.

THE APPEAL

Pickering contends that an award of attorney fees under former I.C. § 12-120(2) was improper. The action, it is argued, was one for claim and delivery under I.C. § 8-301 and not for any of the types of actions enumerated in former I.C. § 12-120(2) allowing attorney fees. At the time I.C. § 12-120(2) stated:

In any civil action to recover on an open account, account stated, note, bill, negotiable instrument, or contract relating to the purchase or sale of goods, wares, or merchandise, unless otherwise provided by law, the prevailing party shall be allowed a reasonable attorney fee to be set by the court, to be taxed and collected as costs.[ ¹

Pickering also cites the case of National Motor Service Co. v. Walters, 85 Idaho 349, 379 P.2d 643 (1963), where the Supreme Court stated:

This Court has consistently held, however, that attorney's fees are not recoverable unless provided for by statute or by contract of the parties. [Citations omitted.] Attorneys' fees are not a proper element of damages in a replevin action, [citations omitted] and are not recoverable in the statutory claim and delivery action, [citations omitted].

Id. at 361, 379 P.2d at 651. However, National Motor Service is of no value in determining whether the present action comes within the provisions of I.C. § 12-120 because the statute was enacted since National Motor Service was decided.

In any event, Building Concepts asserts that its action was one for breach of a contract and not solely for claim and delivery. It argues that the conduct of Pickering was in breach of the C.O.D. agreement and of statutory duties imposed by the Uniform Commercial Code on buyers of goods. The action for claim and delivery was merely a means for enforcing the right to the property arising from the contract agreement and to obtain immediate recovery of the property after the breach.

On the issue of whether an action qualifies for attorney fees under I.C. § 12-120(2), this Court in Chenery v. Agri-Lines Corp., 106 Idaho 687, 690, 682 P.2d 640, 643 (Ct.App.1984), stated:

For attorney fees to be recoverable under I.C. § 12-120(2) the action must be one "to recover on ... [a] contract relating to the purchase or sale of goods, wares or merchandise." It is not enough that the transaction between the parties relate to the purchase or sale of goods. The action itself must be one "to recover ... on [the] contract." [Emphasis original.]

We went on to discuss what is meant by the terms "recovery on the contract" in light of determining whether a claim is founded in tort or contract. We said this determination was to be made

"... from the pleadings, and by an examination and consideration of the essential allegations of the complaint rather than the form adopted by the pleader, ... the question must be determined by reference to the complaint as a whole, and not by particular words or allegations considered apart from the context...."

Id. at 690, 682 P.2d at 640 (quoting Yeager v. Dunnavan, 174 P.2d 755, 757 (Wash.1946)). This test for whether an action is founded in contract is also applicable here.

The complaint sets out the elements necessary to establish an action for claim and delivery: the existence of a contract, delivery of the property in question, possession of the property by a second party, failure to pay for the property, and a demand for its return. The complaint alleges:

That despite repeated demand, defendants have failed, refused and neglected to pay to plaintiff, its agents or representatives the balance due and owing for said building in breach of defendants' contract agreement regarding the same, all to the detriment of plaintiff.

Following these allegations the complaint goes on to characterize the claim and delivery proceeding as necessary to recover possession of the property because Pickering had taken possession without remitting payment.

Under the interpretation given to the scope of I.C. § 12-120(2) in Chenery, and in the cases it cites, an action is grounded in contract when the act complained of is a breach of specific terms of the contract, Chenery, supra at 690, 682 P.2d at 643 (quoting Yeager v. Dunnavan, supra ) or is a breach of duty arising out of the contract. Gearin v. Marion County, 110 Or. 390, 223 P. 929 (1924).

The acts of Pickering in taking possession of the merchandise without paying for it were clearly in breach of the sales contract. The written agreement between Rigid Steel Structures and Pickering obligated Pickering to pay the $9,072 balance in full upon delivery. Because the contract related to a sale of goods, its language was given further meaning by the Uniform Commercial Code. Under the Code, the C.O.D. terms of the bill of lading required payment to be made on delivery. See I.C. §§ 28-2-310; 28-2-507. Clearly, Building Concepts' possession of the bill of lading, coupled with its delivery of the...