Eagle River Mobile Home Park, Ltd. v. District Court In and For Eagle County

• Decision Date: 28 June 1982
• Docket Number: No. 82SA126,82SA126
• Parties: EAGLE RIVER MOBILE HOME PARK, LTD. a Colorado limited partnership, Petitioner, v. The DISTRICT COURT In and For the COUNTY OF EAGLE and the Honorable William L. Jones, one of the Judges thereof; Lifetime Fiberglass Tank Co., a Colorado corporation; and John Phillips, Respondents.
• Court: Colorado Supreme Court

Page 660

647 P.2d 660

EAGLE RIVER MOBILE HOME PARK, LTD. a Colorado limited partnership, Petitioner, v. The DISTRICT COURT In and For the COUNTY OF EAGLE and the

Honorable William L. Jones, one of the Judges

thereof; Lifetime Fiberglass Tank Co., a

Colorado corporation; and John

Phillips, Respondents.

No. 82SA126.

Supreme Court of Colorado, En Banc.

June 28, 1982.

Criswell, Patterson, McNamara, Myles & Bell, John A. Criswell, Englewood, for petitioner.

DeMoulin, Anderson, Campbell & Laugesen, P. C., Richard W. Laugesen, Denver, for respondent Phillips.

William L. Jones, pro se.

Buchanan, Thomas & Johnson, Don R. Teasley, Lakewood, for Lifetime Fiberglass Tank Co. LOHR, Justice.

In this original proceeding under C.A.R. 21 the petitioner, Eagle River Mobile Home Park, Ltd. (Eagle River), seeks reversal of an order of the Eagle County District Court denying Eagle River's motion to file a supplemental and amended complaint in its action for damages based on the structural failure of certain water tanks. We issued a rule to show cause and now make that rule absolute.

In the spring of 1980 Eagle River contracted with defendant John Phillips (Phillips) to obtain and install upon Eagle River's mobile home park property two underground water tanks manufactured by defendant Lifetime Fiberglass Tank Co. (Lifetime). After the tanks were installed and paid for, they collapsed. In December 1980 Eagle River filed a complaint against Phillips and Lifetime, seeking damages to recover the $40,000 purchase price of the tanks plus costs, expert witness fees, and interest. In June of 1981 the parties filed pre-trial statements with the court, and the case was set for jury trial to commence April 13, 1982.

During the summer of 1981 Eagle River lost shrubs and plants having a value of $30,000 as a result of lack of irrigation water at its mobile home park. The water was to have been made available through storage in the tanks supplied by Phillips and Lifetime. In November of 1981 one of Eagle River's buildings burned, resulting in a $250,000 loss. Fire protection was to have been provided by use of water stored in the tanks. ¹

On or about February 23, 1982, Eagle River filed a motion to amend its complaint, and tendered an amended complaint, to supplement the damages requested to include the $30,000 vegetation loss and the $250,000 building destruction. The new pleading also asserted several additional theories of liability. A hearing was held on the motion on March 12, 1982, a month before the scheduled trial date. After first indicating an inclination to grant the motion, the trial court heard argument by counsel for the defendants. Counsel for Phillips urged that the newly asserted elements of damages were so substantial, the additional theories of recovery so significant, and the delay in assertion of the supplemental damage claims so great that the motion to amend should be denied. If the motion were to be granted, he argued, Phillips would need additional time for discovery. ² Counsel for Lifetime objected to the requested amendment of the complaint on the same grounds asserted by Phillips. Additionally and independently, counsel for Lifetime orally moved for a continuance because the plaintiff did not make his expert witness available for deposition until November 26, 1981, although required by the pre-trial order to do so by October 15, 1981. The pre-trial order provided that Phillips and Lifetime would have 60 days after that deposition was taken to decide whether to employ an expert witness. If they elected to utilize an expert witness, that witness would then be made available for deposition examination by Eagle River.

Without hearing argument from counsel for Eagle River and without making any findings, the court denied the motion for a continuance and the motion to amend the complaint, "with the specific ruling that it will not prejudice plaintiff's rights to file a separate action on the (claims for supplemental damages first alleged) in the amended complaint." Eagle River attempted to make an additional record but the court did not permit it. The court's ruling was based on its conclusion that the damages accruing subsequent to the filing of the complaint could be asserted in a different action and reflects an overriding concern with maintaining the scheduled trial dates beginning April 13.

Eagle River asserts that, in view of the fact that all elements of damage are based on the same alleged wrongs, the trial court abused its discretion in declining to grant the motion to amend the complaint so that all of those damages could be resolved in one trial. Under the circumstances here, we agree. ³

In Varner v. District Court, Colo., 618 P.2d 1388 (1980), we stated the criterion by which we have been guided in determining whether to reverse a trial court's pre-trial procedural ruling when challenged in an original proceeding:

Although original proceedings are not designed as a substitute for appeal (citations omitted), we have exercised our original jurisdiction under C.A.R. 21 when a procedural ruling will have significant effect on a party's ability to litigate the merits of the controversy.

(Citations omitted.)

618 P.2d at 1390.

In Varner, we went on to relate that criterion to a motion to amend a complaint, stating:

C.R.C.P. 15(a) provides that once a responsive pleading has been filed, a party may amend his complaint "only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." The rule prescribes a liberal policy of amendment and encourages the courts to look favorably on requests to amend. See generally, 3 J. Moore, Federal Practice § 15.08(2) (2d ed. 1980); 6 C. Wright & A. Miller, Federal Practice and Procedure, § 1484 (1971). Although leave to amend is not to be granted automatically, the court should not impose arbitrary restrictions on the application of the rule or exercise its discretion in a manner that undercuts its basic policy. Pleadings are not sacrosanct, Brown v. Schumann, 40 Colo.App. 336, 339, 575 P.2d 443, 445 (1978), and amendments thereto should be granted in accordance with the overriding purposes of our rules of civil procedure-"to secure the just, speedy, and inexpensive determination of every action." C.R.C.P. 1(a).

618 P.2d at 1390. ⁴

We then outlined the primary considerations governing the trial court's resolution of a request to amend the pleadings. Quoting from the United States Supreme Court's decision in Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222, 226 (1962), we stated 'If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits. In the absence of any apparent or declared reason-such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.-the leave should, as the rules require, be "freely given." '

618 P.2d at 1390.

In the present case, the trial court did not base its ruling on any of the justifications for denial of an amendatory complaint listed in Foman. While the defendants contend that Eagle River was guilty of undue delay in asserting its supplemental damages, the trial court did not make a finding on this question. Indeed, when counsel for Eagle River attempted to make a record on the exact length of and reasons for the delay between the November fire and filing of the plaintiff's motion to amend, the court cut off counsel by statements reflecting that the date on which the Eagle River fire occurred was irrelevant to its decision. ⁵ In any case, "(d)elay alone, without any specifically resulting prejudice or any obvious design to harass," generally is not a sufficient basis for precluding a party from amending its complaint. Spiker v. Hoogeboom, Colo.App., 628 P.2d 177, 179 (1981). Accord, e.g., Davis v. Piper Aircraft Corp., 615 F.2d 606 (4th Cir. 1980), cert. dismissed, 448 U.S. 911, 101 S.Ct. 25, 65 L.Ed.2d 1141 (1980); United States v. International Business Machines Corp., 66 F.R.D. 223 (S.D.N.Y.1975); see generally 6 C. Wright & A. Miller, Federal Practice and Procedure, § 1488 at 438 (1971).

It is apparent from a reading of the record that the single overriding consideration which prompted the trial court to deny the motion to amend was the court's desire to maintain the scheduled trial date. While this is an appropriate factor for consideration, see Varner v. District Court, supra; Bobrick v. Sanderson, 164 Colo. 46, 432 P.2d 242 (1967), "the mere fact that an amendment is offered late in the case is not enough to bar it if the other party is not prejudiced." 3 J. Moore, Federal Practice § 15.08(4) at 15-102 (2d ed. 1982). Thus, we have previously approved a trial court's order permitting amendment of a complaint four days prior to trial, Palmer Park Gardens, Inc. v. Potter, 162 Colo. 178, 425 P.2d 268 (1967), and a trial court's decision to allow amendment of a complaint during trial for the purpose of asserting a new theory of recovery, Continental...