Herrick v. Leuzinger, 20361

CourtCourt of Appeals of Idaho
Writing for the CourtLANSING; WALTERS, C.J., and PERRY
Citation900 P.2d 201,127 Idaho 293
Parties, 27 UCC Rep.Serv.2d 1152 Gerald D. HERRICK and Kathryn S. Herrick, husband and wife, Plaintiffs-Appellants-Cross Respondents, v. Doyle LEUZINGER and Judi Leuzinger, husband and wife, Defendants-Respondents-Cross Appellants.
Docket NumberNo. 20361,20361
Decision Date09 June 1995

Ringert, Clark, Chtd., Boise, for appellants. Patrick D. Furey argued.

Marcus, Merrick & Montgomery, Boise, for respondents. Craig Marcus argued.

LANSING, Judge.

The plaintiffs, Gerald and Kathryn Herrick, filed suit alleging that Doyle and Judi Leuzinger had converted the Herricks' cattle to their own use and committed fraud. The Leuzingers asserted in defense that the Herricks' predecessors in interest had gifted the cattle herd to the Leuzingers. At the close of evidence the Herricks moved for a directed verdict, which was denied. The jury found in favor of the Leuzingers. The Herricks now appeal, asserting error in the denial of their motion for a directed verdict and numerous errors in the exclusion of evidence by the district court. We affirm the district court's denial of a directed verdict, but because we find that evidence was erroneously excluded by the district court to the Herricks' detriment, we reverse and remand the case for a new trial.

I. FACTS

Prior to 1973 Mildred and Lewis Carlisle acquired land in Custer County known as the Broken Wing Ranch. The Carlisles obtained a registered brand certificate for use of an "ML" cattle brand. They also held a United States Forest Service permit entitling them to graze 150 head of cattle on Forest Service land.

In 1973 the Carlisles purchased forty-five head of cattle with the proceeds of a five-year bank loan. The bill of sale states that the cattle were sold to Lewis, and Mildred's name does not appear on the document. The Carlisles did not operate the ranch themselves or manage the cattle herd. Rather, neighboring ranchers and close friends, Doyle and Judi Leuzinger, leased the ranch from the Carlisles and managed their herd. All parties agree that from 1973 until 1975, the Leuzingers were managing the Carlisle herd in exchange for one-half of the profits from the yearly calf crop. During this period, if any of the calves were retained by the Carlisles to replace a cow or to expand the herd size, the Carlisles paid the Leuzingers half the value of that calf.

In 1982 Lewis Carlisle died, leaving all of his interest in the ranch to Mildred. In 1988 Mildred passed away. She bequeathed the ranch to a trust administered by First Interstate Bank. The beneficiaries of the trust were various relatives of Mildred. For convenience, the trust and beneficiaries are hereinafter referred to collectively as Mildred's heirs.

At various points in 1988 and 1989, the heirs, while visiting the ranch, asked the Leuzingers about the ownership of cattle that were being grazed on the ranch. The Leuzingers stated that none of the cattle belonged to the Carlisles. Mildred's heirs eventually sold their interest in the ranch to Gerald and Kathryn Herrick, the plaintiffs in the current action. The sale included a transfer of any rights the heirs possessed in the herd of cattle. When the Herricks began investigating to determine what cattle were encompassed within their purchase, the Leuzingers again asserted that all of the cattle on the Broken Wing Ranch belonged to them.

On November 19, 1991, the Herricks brought suit against the Leuzingers for an accounting, alleging that the Leuzingers, as the Carlisles' managers, owed an accounting for assets. In January 1992, the Leuzingers answered and filed a counterclaim asserting that the Herricks had breached the Leuzingers' lease of the Broken Wing Ranch. Eventually, through discovery, the Herricks learned it was the Leuzingers' contention that in 1975 Lewis Carlisle had transferred the entire herd to the Leuzingers as a gift. Thereafter the Herricks amended their complaint to allege that the Leuzingers had converted the herd to their own use and had committed fraud.

The trial court bifurcated the trial, separating out the Leuzingers' counterclaim for breach of lease from the issues raised by the Herricks' complaint. A court trial on the breach of lease case was held in April 1992, and the court found for the Leuzingers.

A jury trial was then held on the Herricks' claims in October 1993. At this trial Doyle Leuzinger testified that in 1975 Lewis Carlisle had given the entire herd to the Leuzingers. He stated that out of gratitude for this gift, and to enable the Carlisles to obtain certain tax advantages from their ownership of the Broken Wing Ranch, even after the cattle were given to them the Leuzingers continued to split the yearly calf crop with the Carlisles. This sharing of the calf crop after 1975 was, according to the Leuzingers, a return gift to the Carlisles. In 1975 when Lewis allegedly gave the cattle to the Leuzingers, he executed a bill of sale which recited that Lewis Carlisle sold to Doyle Leuzinger seventy-eight head of cattle bearing the Carlisles' "ML" brand. Doyle Leuzinger testified at one point that this bill of sale was to transfer title and thereby effectuate the gift. At another point he testified that the bill of sale was executed because the Leuzingers were running their own cattle on United States Forest Service land for which the Carlisles' held a grazing permit. In order to graze their cattle on the land, he said, the Leuzingers had branded their own cattle with the Carlisles' ML brand in addition to the Leuzingers' brand. Doyle Leuzinger stated that he therefore asked Lewis Carlisle to execute the bill of sale in order to show that these cattle, though falsely branded with the ML brand, belonged to the Leuzingers.

From 1975 until Mildred's death in 1988, the Leuzingers continued to split with the Carlisles (and after Lewis' death, with Mildred) the yearly calf crop from those cows branded solely with the ML brand. During this period, the Carlisles continued to pay Leuzinger one-half the value of any calves retained and not sold at the yearly auction. In 1983, at Doyle Leuzinger's request, Mildred executed a bill of sale to the Leuzingers for seventy-four head of cattle. Doyle Leuzinger testified that this bill of sale was executed to again protect his title to his own cattle that were being grazed under the Carlisle grazing permit and were falsely branded with the ML brand.

In April 1988, after Mildred's death, Leuzinger presented the 1983 bill of sale to a state brand inspector who authorized Leuzinger to re-brand with his own brand 66 head of cattle bearing the ML brand.

At the close of the evidence in the October 1993 trial on the conversion and fraud claims, the Herricks moved for a directed verdict, arguing that the Leuzingers had failed to carry their burden of proof regarding the alleged gift. The trial court denied the motion, and the jury later returned a verdict for the Leuzingers. On appeal the Herricks contend that the district court erred in excluding certain evidence, giving an improper jury instruction, and denying the motion for directed verdict. The Leuzingers cross-appeal from the denial of a motion for summary judgment they had filed and the denial of their request for attorney fees in the breach of lease case which was tried to the court in April 1992.

II. MOTION FOR DIRECTED VERDICT

We first address the Herricks' argument that they are entitled to a directed verdict on the Leuzingers' affirmative defense of gift. They contend that the trial evidence was insufficient to support a finding by the jury that the Carlisles gave the herd to the Leuzingers. The Herricks point out that under Idaho law, proof of an enforceable gift must include a showing that the transferor had a present donative intent and that the gift was delivered to the donee with the donor immediately relinquishing all dominion over the object given. See Christiansen v. Rumsey, 91 Idaho 684, 429 P.2d 416 (1967); Claunch v. Whyte, 73 Idaho 243, 249 P.2d 915 (1952). Because it is undisputed that the Carlisles continued to receive income from the calf crops until Mildred's death, the Herricks argue there was no complete relinquishment of dominion over the cattle herd and that an essential element for the claim of gift was therefore missing.

When reviewing the disposition of a motion for a directed verdict under I.R.C.P. 50(a), we utilize the same standard that governs the trial court's decision. That is, we must determine whether, admitting the truth of the adverse evidence and drawing every legitimate inference most favorably to the opposing party, there exists substantial evidence to justify submitting the case to the jury. Quick v. Crane, 111 Idaho 759, 727 P.2d 1187 (1986); Stephens v. Stearns, 106 Idaho 249, 678 P.2d 41 (1984); Smith v. Great Basin Grain Co., 98 Idaho 266, 561 P.2d 1299 (1977).

Applying this standard, we conclude that the district court correctly denied the Herricks' motion. The Leuzingers presented evidence that Lewis Carlisle expressed an intent to completely transfer all control over the cattle to the Leuzingers and that because the cattle were already on the ranch which they leased from the Carlisles, delivery was complete at the inception of the alleged gift. They also presented testimony from two of Lewis's friends who said Lewis had told them that he gave the cattle to the Leuzingers. As explanation for the fact that the Carlisles continued to receive half the income from the calf crops, the Leuzingers testified that this income was a gift back from them to the Carlisles, not a retention of control or limitation on the gift imposed by Lewis Carlisle. Although the Herricks presented evidence that called into question the credibility of this explanation from the Leuzingers, we cannot say that the evidence of gift was insufficient to submit the question to the jury. Accordingly, the district court's denial of the motion...

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