Farm Credit Bank of Spokane v. Wissel

• Decision Date: 11 June 1992
• Docket Number: No. 19118,19118
• Citation: 122 Idaho 565,836 P.2d 511
• Parties: FARM CREDIT BANK OF SPOKANE, a corporation; and Terry L. Ketterling and Linda K. Ketterling, husband and wife, Plaintiffs-appellants, v. John WISSEL and Clinton Wissel, individuals; and W.W. Farms, Inc., a corporation, Defendants-respondents. Boise, February 1992 Term
• Court: Idaho Supreme Court

Page 511

836 P.2d 511

122 Idaho 565

FARM CREDIT BANK OF SPOKANE, a corporation; and Terry L. Ketterling and Linda K. Ketterling, husband and wife, Plaintiffs-appellants, v.John WISSEL and Clinton Wissel, individuals; and W.W. Farms, Inc., a corporation, Defendants-respondents.

No. 19118.

Supreme Court of Idaho,

Boise, February 1992 Term.

June 11, 1992.

Rehearing Denied Sept. 30, 1992.

Ellis, Brown & Sheils, Chartered, Boise, for plaintiffs-appellants.Stephen C. Brown, argued.

Ringert, Clark, Harrington, Reid, Christenson & Kaufman, Boise, for defendants-respondents.Andrew M. Harrington, argued.

BAKES, Chief Justice.

This is an appeal from the trial court's denial of plaintiffs' request for costs and attorney fees.

Prior to 1988, Farm Credit Bank of Spokane (FCB) took a first mortgage on a 1200 acre farm owned by Gem Mountain Farms, Inc. Gem Mountain had leased the farm to John and Clinton Wissel(Wissel), who farmed the land through their family corporation, W.W. Farms, Inc. Gem Mountain defaulted on its loan to FCB, and on December 28, 1988, delivered a deed to FCB in lieu of foreclosure.Gem Mountain also assigned its lessor's interest in the Wissel lease to FCB.On December 30, 1988, the Wissels, as lessees, signed a document entitled "Notice of Assignment and Declaration of Interest," in which they acknowledged the assignment of Gem Mountain's lessor's interest to FCB and certified that:

The lease is in full force and effect ..., [that] there have been no changes or modifications to the lease....The copy of the lease attached hereto is a true, correct and complete copy thereof, and except for said leasehold interest, which now expires November 30, 1989, Lessees disclaim any right, title or interest in and to all the real property described therein....The term of this lease expires on November 30, 1989, and that after such date, Lessees agree to vacate the premises and agree that there are no agreements to extend, renew, release or otherwise allow Lessees to remain in possession of the premises after November 30, 1989.(Emphasis added.)

Thereafter, in May, 1989, FCB sold the farm to Terry and Linda Ketterling(Ketterling).FCB's deed to the Ketterlings, dated September 13, 1989, warranted possession of the property as of December 1, 1989, the day following the expiration of the Wissel lease.However, despite the fact that the Wissels had certified in the notice of assignment that their lease expired on November 30, 1989; that there were no agreements to extend the lease; and that they had agreed to vacate the premises on November 30, 1989, the Wissels informed FCB and the Ketterlings in September, 1989, that they would not give up possession on November 30, 1989, nor would they allow the Ketterlings to do fall plowing as the lease provided, and that they intended to farm the property in 1990.

As a result, FCB and the Ketterlings filed a complaint and an application for preliminary injunction against the Wissels.In their complaint, the plaintiffs sought the following relief: (1) possession of the property at the expiration of the lease; (2) limited possession of the property prior to expiration of the lease in order to do fall work on the land; ¹(3) a temporary injunction preventing the Wissels from interfering with their right to possession of the farm to do fall work and their right to possession at the expiration of the lease; (4) a conditional claim for damages in the event that the property was unavailable for farming during the 1990 growing season, including any loss due to the inability to do fall work; and (5) costs and attorney fees.

Defendants counterclaimed against FCB, again declaring a right to retain possession after November 30, 1989, and seeking a dismissal of plaintiffs' complaint and damages if the plaintiffs prevailed in obtaining possession, costs and attorney fees.

On November 21, 1989, the trial court denied plaintiffs' application for preliminary injunction for possession.However, on February 7, 1990, the court granted plaintiffs' motion for partial summary judgment, granting them possession of the property.Subsequently, the parties stipulated to a dismissal of the plaintiffs' conditional damage claim and the defendants' counterclaim.Nothing in the stipulation referred to any party's entitlement to costs and attorney fees.

Both parties then moved for an award of costs and attorney fees, and both objected to an award against them.The trial court denied both parties' requests, finding that under I.R.C.P. 54(d)(1)(B) there was no prevailing party.²The trial court stated:

The relief initially sought by plaintiffs was the immediate possession of the farmland....Defendant prevailed on plaintiffs' attempt to obtain possession by a preliminary injunction.A counter-claim and third party complaint were then filed seeking relief on various claims.Plaintiffs then presented the question of possession to the Court on summary judgment motion, and plaintiffs then prevailed in obtaining a partial summary judgment on the issue of possession.Subsequently, the parties all entered a stipulation whereby defendants prevailed on the claims for damages by each of the plaintiffs and the plaintiffs prevailed on the claims for damages by the defendants.

It is therefore my conclusion that each of the parties hereto prevailed in part and did not prevail in part.Also, it would be fair and equitable for them to each pay their own costs and attorney fees.

Plaintiffs FCB and Ketterlings have appealed, arguing that the trial court erred in finding that they were not the prevailing party and in not granting costs and attorney fees based upon the terms of the lease.

The scope of the trial court's discretion in determining who is the prevailing party, for the purpose of assessing costs under I.R.C.P. 54(d)(1), was reviewed recently in Stewart v. Rice, 120 Idaho 504, 817 P.2d 170(1991).In Stewart, a ski instructor brought an action against another skier for injuries sustained in a collision which allegedly resulted in a broken scapula and epileptic seizures.At trial, the plaintiff presented evidence of more than $21,000 in medical expenses and requested $500,000 in general damages.However, the jury only returned a verdict of approximately $4,500.Nevertheless, the plaintiff argued that she was the prevailing party and entitled to costs under I.R.C.P. 54(d)(1).The trial court found that most of the trial was taken up with plaintiffs' claim for damages for the epileptic episodes, and because the jury did not award any damages based on the epileptic episodes but only for the broken scapula, the defendant prevailed upon that issue and therefore the plaintiff was not the prevailing party in the case for the purpose of the award of costs under I.R.C.P. 54(d)(1).On appeal we upheld the trial court's denial of costs under I.R.C.P. 54(d)(1) based on the trial court's finding that there was no prevailing party, stating that "I.R.C.P. 54(d)(1)(B) specifically directs the trial court, in exercising its discretion, to consider the result in relation to the relief sought in determining who the prevailing party is."120 Idaho at 510, 817 P.2d at 176(emphasis added).

In this case, the plaintiffs filed an application for a preliminary injunction on September 9, 1989, to prevent the defendants from interfering with their right to possession to do fall work and to obtain total possession of the premises when the lease expired on November 30, 1989.The plaintiffs' complaint also sought damages.The trial court denied the preliminary injunction on November 21, 1989.After the lease expired on November 30, 1989, the plaintiffs brought a motion for summary judgment on the issue of possession, which the trial court granted on February 7, 1990.Plaintiffs subsequently stipulated to a dismissal of their remaining claim for damages in return for a dismissal of defendants' counterclaim.Based upon this record, the trial court concluded that "each of the parties hereto prevailed in part and did not prevail in part."

The determination of who is the prevailing party, if anyone, is within the trial court's discretion, and this Court will not disturb the trial court's decision unless there is an abuse of discretion.Stewart v. Rice, supra;Gilbert v. City of Caldwell, 112 Idaho 386, 732 P.2d 355(Ct.App.1987).Our analysis of whether or not a trial court has abused its discretion includes: (1) whether the trial court correctly perceived the issue as one of discretion; (2) whether the trial court acted within the outer boundaries of this discretion and consistently with the legal standards applicable to the specific choices available to it; and (3) whether the trial court reached its decision by an exercise of reason.Sun Valley Shopping Center, Inc. v. Idaho Power, 119 Idaho 87, 803 P.2d 993(1991).We conclude that the trial court did not abuse its discretion in determining that, for the purpose of awarding costs under I.R.C.P. 54(d)(1)(B), neither party prevailed in this litigation.

The plaintiffs' complaint also requested attorney fees and costs under the terms of the farm lease.³The farm lease executed by the Wissels provided:

In the event that the Lessor does find it necessary to bring suit or action under the terms of this lease, then the Lessee hereby agrees to pay the Lessor's reasonable attorney fees and costs of suit incurred in said suit or action.

Paragraph 12 of plaintiffs' complaint alleged that, "Under the Farm Lease, plaintiffs are entitled to their costs and reasonable attorney fees incurred in this action."Plaintiffs' prayer for relief requested possession, damages in the amount of $10,000, and for "plaintiffs' attorney fees as provided in paragraph 12 above."

Nothing in the language of Paragraph 12 of the lease requires that the lessor, in order to obtain attorney fees and costs, be a "prevailing party," as defined in I.R.C.P. 54(d)(1).Cf.Burnham v. Bray, 104 Idaho 550, 661 P.2d...