R.G. Nelson, A.I.A. v. Steer

• Citation: 797 P.2d 117,118 Idaho 409
• Decision Date: 07 August 1990
• Docket Number: No. 16807,16807
• Parties: R.G. NELSON, A.I.A., Plaintiff-respondent, v. M.L. STEER and Gary Hebener, Defendants-appellants.
• Court: United States State Supreme Court of Idaho

Page 117

797 P.2d 117

118 Idaho 409

R.G. NELSON, A.I.A., Plaintiff-respondent, v. M.L. STEER and Gary Hebener, Defendants-appellants.

No. 16807.

Supreme Court of Idaho.

Aug. 7, 1990.

Samuel Eismann (argued), Eismann & Kosonen, Coeur d'Alene, for defendants-appellants.

Scott W. Reed, Coeur d'Alene, for plaintiff-respondent.

BAKES, Chief Justice.

In 1979, Gary Hebener, a Coeur d'Alene businessman, retained the services of R.G. Nelson, an architect, to design a restaurant to be situated in Riverwood, a real estate development owned by Hebener. The proposed restaurant was to be a "Chart House" restaurant, to be built by Hebener and leased back to Chart House. In March, 1982, Nelson accompanied Hebener to California to present preliminary plans to Chart House. By April, 1982, Hebener and his partner, Mr. Steer, owed Nelson $8264.90 for his services.

On May 5, 1982, Nelson wrote Hebener rejecting a telephone invitation to do more work because "There is no guarantee that I will ever be reimbursed for my services". The letter concluded, "Reluctantly, I'm in a position where I find it impossible to work on your projects any further."

Following this letter, and later during the same month, Nelson traveled to California with Duane Hagadone, another Coeur d'Alene businessman, to meet with Chart House officials to discuss the possibility of securing and locating a Chart House at Hagadone's resort hotel. Nothing came of that contract because Hagadone's concept of an in-house restaurant was contrary to the Chart House scheme of operation.

Early in 1983 Hebener persuaded Nelson to perform an additional 19 hours of work. All services for Hebener by Nelson ended by April 14, 1983, and Hebener retained the services of another architect, Gordon Longwell, to negotiate with Chart House.

Hebener refused to pay for any of the services rendered by Nelson which prompted the instant action wherein Nelson sought payment. Hebener filed a counterclaim alleging that Nelson had interfered with Hebener's prospective business advantage and had breached a fiduciary duty to Hebener. Partial summary judgment in favor of Nelson was granted dismissing the counterclaim. It is the dismissal of the counterclaim that is the subject of this appeal.

Upon a motion for summary judgment all facts and legitimate inferences arising therefrom are viewed most favorably from the position of the non-moving party. However, a party against whom a summary judgment is sought cannot merely rest on his pleadings but, when faced with affidavits or depositions supporting the motion, must come forward by way of affidavit, deposition, admissions or other documentation to establish the existence of material issues of fact which preclude the issuance of summary judgment. Zehm v. Associated Logging Contractors, 116 Idaho 349, 350, 775 P.2d 1191, 1192 (1988); Worthen v. State, 96 Idaho 175, 176, 525 P.2d 957, 958 (1974); Tri-State Nat. Bank v. Western Gateway Storage Co., 92 Idaho 543, 546, 447 P.2d 409, 412 (1968); I.R.C.P. 56(e). Additionally, "To withstand a motion for summary judgment, the [non-moving party's] case must be anchored in something more solid than speculation; a mere scintilla of evidence is not enough to create a genuine issue." Edwards v. Conchemco, Inc., 111 Idaho 851, 727 P.2d 1279 (Ct.App.1986). It is not the judge's function to weigh evidence, "but to determine whether there is a genuine issue for trial ... [T]here is no issue for trial unless there is sufficient evidence favoring the non-moving party for a jury to return a verdict for that party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202, 209 (1986). Summary judgment should be granted if the evidence in opposition to the motion "is merely colorable" or "is not significantly probative." Id.

In the instant case the uncontroverted facts indicate that Hebener had a longstanding relationship with Chart House. That relationship continued following the Hebener/Nelson meeting with Chart House and following the Hagadone/Nelson meeting with Chart House. There is no indication in the record that Nelson drew plans for any proposed restaurant to be built by Hagadone. Rather, the uncontroverted testimony of Chart House officials indicated that during the brief meeting between Hagadone, Nelson and the Chart House people, a series of photographs of the Hagadone facility were displayed. This meeting was brief because it became immediately apparent that Hagadone proposed a restaurant that would be part of his overall development, whereas Chart House envisioned a restaurant that would be a stand-alone structure. For this reason, Hagadone's proposal was never really considered by Chart House in their brief meeting.

Hebener's proposal was extensively considered by the Chart House officials, both before and after the Hagadone proposal. The deposition testimony of Patrick E. Goddard, the executive vice president of Chart House, is uncontroverted. Goddard testified that the ongoing negotiations between Hebener and Chart House continued for a considerable period of time, and culminated in a proposed lease being sent to corporate headquarters in Louisiana. However, two successive presidents of Chart House recommended that no Coeur d'Alene site be utilized. At the time of the present litigation Chart House had not located and had no future plans to locate in Coeur d'Alene.

Goddard's testimony described the ongoing negotiations between Hebener, Nelson and Chart House and, following the termination of the relationship with Nelson, the new architect hired by Hebener. It was the plans of the new architect which were submitted to, discussed by, and rejected by Chart House officials for reasons unrelated to the Hagadone visit.

The affidavit of Nelson and the deposition testimony of the Chart House CEO stand uncontradicted. Hebener did not respond with any evidence. The trial court had before it no facts indicating the establishment of a "fiduciary" relationship. Even assuming that such a relationship existed, there are no facts indicating a breach of such relationship or an interference with a prospective business advantage. Also, the requisite showing of causation resulting from such breach is missing. As the trial court aptly observed:

Just as the tort of negligence requires causation, so too, does the tort of interference with prospective advantage. In short, the Plaintiff's conduct in this case may arguably have been unethical ... or he may arguably have breached a fiduciary duty to the Defendant. But, it is beyond dispute that such conduct simply did not have anything to do with the Defendant's loss of prospective advantage. At least the Defendant has failed to come forward with any evidence which could establish a material issue of fact with respect to such an issue. The best that could be said is that the Defendant has raised a suspicion that foul play occurred which caused his lost contract. In the fact of unrefuted admissible evidence, mere suspicion is simply not enough. Rule 56(e) I.R.C.P.

In Johnson v. Jones, 103 Idaho 702, 707, 652 P.2d 650, 655 (1982), this Court unanimously stated:

In this case, the Johnson's have failed to introduce any evidence that would suggest that Nagel's failure to disclose the possible conflict of interest and obtain their consent before proceeding was a proximate cause of any of the damages alleged in their complaint.... Since there is nothing in the record that would support even an inference that Nagel's failure to disclose his possible conflict of interest proximately caused the damages alleged by the Johnsons, the district court's summary judgment is Affirmed.

(Emphasis in original.) The only facts before the trial court were the uncontroverted affidavit of Nelson, and the depositions of the Chart House officers. Based upon the uncontradicted evidence, the trial court did not err in granting summary judgment for respondent Nelson on Hebener's counterclaim.

Summary judgment is affirmed. Costs to respondent.

JOHNSON, BOYLE and McDEVITT, JJ., concur.

BISTLINE, Justice, dissenting.

This case has been interesting to follow as it coursed its way through this Court following Mr. Eismann's appeal from a decision of Judge Haman. Judge Haman's decision ruled that Mr. Hebener could not lay his evidence before a jury and was turned out of court on his claim against Mr. Nelson. For my part, this will be the third opinion which I have written.

The initial opinion for the Court was mine. It quickly commanded a majority comprised of Justice Huntley, Judge Towles, ¹ and myself. We concluded that a fiduciary relationship existed between Mr. Nelson and Mr. Hebener. ² The following is a reprint of excerpts of that opinion which brought us to the conclusion that Judge Haman's decision could not be sustained:

The fiduciary relationship is one which courts traditionally have guarded very closely. Sixty years ago, in an often quoted passage, Justice Cardozo depicted the unique bonds between fiduciaries:

Many forms of conduct permissible in a workaday world for those acting at arm's length, are forbidden to those bound by fiduciary ties. A trustee is held to something stricter than the morals of the market place. Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior. As to this there has developed a tradition that is unbending and inveterate. Uncompromising rigidity has been the attitude of courts of equity when petitioned to undermine the rule of undivided loyalty by the 'disintegrating erosion' of particular exceptions. Wendt v. Fischer, 243 N.Y. 439, 444, 154 N.E. 303 [1926]. Only thus has the level of conduct for fiduciaries been kept at a level higher than that trodden by the crowd.

Meinhard v. Salmon, 249 N.Y. 458, 164 N.E. 545, 546 (1928). In Idaho these principles have been applied to the relationship of principal and agent in Jensen v. Sidney Stevens Implement Co., 36 Idaho...