Wing v. Amalgamated Sugar Co.

• Decision Date: 31 May 1984
• Docket Number: No. 14142,14142
• Citation: 106 Idaho 905,684 P.2d 307
• Parties: Elwood WING and Naomi Wing, husband and wife, Plaintiffs, Counter-defendants, Respondents, v. AMALGAMATED SUGAR COMPANY, a Utah Corporation, Defendant, Cross-defendant, Respondent, and Jay Hulet and Gertrude Hulet, husband and wife, Intervenors, Defendants, Counter-claimants, Cross-claimants, Appellants.
• Court: Idaho Court of Appeals

Page 307

684 P.2d 307

106 Idaho 905

Elwood WING and Naomi Wing, husband and wife, Plaintiffs, Counter-defendants, Respondents, v. AMALGAMATED SUGAR COMPANY, a Utah Corporation, Defendant, Cross-defendant, Respondent, and Jay Hulet and Gertrude Hulet, husband and wife, Intervenors, Defendants, Counter-claimants, Cross-claimants, Appellants.

No. 14142.

Court of Appeals of Idaho.

May 31, 1984.

Philip A. Peterson (Yost, White, Ahrens & Peterson, P.A.), Nampa, for intervenors, defendants, counter-claimants, cross-claimants, appellants. G. Lance Salladay (Risch, Goss, Insinger & Salladay), Boise, for plaintiffs, counter-defendants, respondents.

Burnett, Judge. Walters, C.J., and Swanstrom, J., concur.

This case presents three issues: (1) Under what circumstances should a lawsuit be allowed to proceed when there is another, similar suit pending between the same parties in a different court? (2) When a farm lessee sells a crop grown under a cropshare lease, is the landowner entitled to insist that part of the sale proceeds be paid to him directly by the crop purchaser? (3) If the crop purchaser writes jointly payable checks to the landowner and lessee, does the owner's refusal to negotiate the checks -- and his subsequent intervention in a suit by the lessee against the purchaser to compel issuance of separate checks -- constitute unreasonable conduct, justifying an award of attorney fees to the lessee under I.C. 12-121?

These issues are framed by a dispute between a farm owner (Hulet) and a lessee-grower (Wing) over the proceeds of a sugar beet crop. This dispute has spawned two lawsuits. The first, filed in Owyhee County by the lessee against the owner, deals broadly with a dispute over various expenses and losses related to farm operations. The Owyhee County suit is fully examined in Wing v. Hulet, 105 Idaho 912, 684 P.2d 314 (Ct.App.1984), a companion to the instant case.

The second lawsuit, resulting in the appeal now before us, was filed in Ada County while the first suit was still pending in Owyhee County. In the Ada County suit, the lessee sought judgment against the crop purchaser, Amalgamated Sugar, for the lessee's alleged share of the crop proceeds. The object of the suit was to compel the crop purchaser to pay the lessee a share of the proceeds by separate check rather than to pay the full amount by joint checks naming the landowner as an additional payee. The landowner intervened, asserting that the separate payment requested by the lessee did not correspond to his actual entitlement which -- in the landowner's view -- depended upon the outcome of the claims pending in Owyhee County. The crop purchaser -- apparently maintaining a position of neutrality -- filed no responsive pleading, and was content to pay as ultimately directed by the district court in Ada County. The court entered judgment as prayed by the lessee and awarded attorney fees against the

intervening owner. For reasons explained below, we affirm the judgment but reverse the attorney fee award.

I

The threshold issue is whether the Ada County court should have allowed this case to proceed while the Owyhee County suit was pending. The landowner contends that the instant case should have been dismissed or stayed because there was "another action pending between the same parties for the same cause," within the meaning of I.R.C.P. 12(b). We disagree.

Initially, we note that the owner's reliance upon Rule 12(b), as a substantive ground for dismissal or for a stay, is misplaced. The rule is procedural, not substantive. It specifies the time and manner in which certain defenses must be presented. It does not, of itself, establish the validity of those defenses in particular cases; nor does it prescribe the action to be taken by the court if a defense mentioned in the rule is properly asserted. The tests of whether a lawsuit should proceed in the face of a similar suit elsewhere, involving the same parties, are found in case law. The first test is whether the other pending case has gone to judgment. In that event, the doctrines of claim preclusion and issue preclusion may bar additional litigation. See Aldape v. Akins, 105 Idaho 254, 668 P.2d 130 (Ct.App.1983); cf. Roberts v. Hollandsworth, 101 Idaho 522, 616 P.2d 1058 (1980) (holding state court action precluded by federal court judgment). Here, the Owyhee County case had not gone to judgment when the instant case was filed and decided. Therefore, the Ada County court was not precluded from deciding any claim or issue presented to it.

The second test is whether the Ada County court--although not barred from deciding the case--nevertheless should have refrained from deciding it. A court may refrain from deciding a case when there is parallel litigation elsewhere. See Farmer v. Boyd, 89 Idaho 269, 404 P.2d 353 (1965); Stevens v. Home Federal Savings & Loan Ass'n, 5 Idaho 741, 51 P. 779 (1898). In the cases cited, the power to refrain from decision has been discussed with reference to an appellate review standard of "error," as though there had been only a single, permissible course of action in each case. However, we believe a right-or-wrong analysis is too simplistic. The determination of whether to proceed with a case, despite another action pending, is similar to a decision to consolidate cases involving common questions of law or fact, under I.R.C.P. 42(a), or to order separate trials of multiple claims or issues in the same case, under I.R.C.P. 42(b). These decisions are committed to the trial court's sound discretion. See Rueth v. State, 103 Idaho 74, 644 P.2d 1333 (1982); Branom v. Smith Frozen Foods of Idaho, Inc., 83 Idaho 502, 365 P.2d 958 (1961). Analogous discretion inheres in a determination of whether a court represents a forum non conveniens for a claim or issue that better could be adjudicated elsewhere. E.g., St. Louis-San Francisco Railway Co. v. Superior Court, 290 P.2d 118 (Okl.1955).

Accordingly, we hold that the determination of whether to proceed with a case, when a similar case is pending elsewhere and has not gone to judgment, is discretionary. This determination will not be overturned unless discretion has been abused. In exercising such discretion, a trial court should evaluate the identity of the real parties in interest and the degree to which the claims or issues are similar. The court also may consider the occasionally competing objectives of judicial economy, minimizing costs and delay to the litigants, obtaining prompt and orderly disposition of each claim or issue, and avoiding potentially inconsistent judgments.

Here, the parties and claims in the two lawsuits overlapped, but were not precisely identical. In Owyhee County the parties were the landowner and lessee; in Ada County, the crop purchaser also was a named defendant. Although the purchaser filed no adversary pleading, it remained vitally interested in the outcome of the case. Its potential liability to each of the other parties, and the manner in which it should disburse the crop sale proceeds, were at issue. Moreover, the claims asserted in the two lawsuits were not entirely coextensive. In Owyhee County, the owner and lessee made claims against each other to recover expenses and losses related to farm operations. In Ada County, the lessee simply sued for separate disbursement of crop sale funds to him by the crop purchaser. He did not seek an adjudication of any amount owed him by the owner in connection with farm operations; nor did he seek an adjudication of the owner's claim against him. Although the owner, upon intervening in the Ada County case, sought a determination of these conflicting claims, the court correctly declined to reach them. An intervenor takes a case as he finds it. He is not entitled to raise new claims outside the scope of the original parties' pleadings. See Anderson v. Ferguson, 56 Idaho 554, 57 P.2d 325 (1936).

After the landowner intervened, the lessee asked the court to determine that the owner wrongfully had refused to endorse the joint checks. The lessee subsequently made the same claim in Owyhee County; but he did not do so until the Ada County court had decided the instant case. Under these circumstances, we conclude that the Ada County court did not abuse its discretion by proceeding in this case to determine rights pertaining to disbursement of crop sale proceeds, but avoiding claims relating to farm operations, while the Owyhee County case was pending.

II

We next turn to whether the court correctly decided the Ada County case on its merits. The court entered summary judgment, directing the crop purchaser to issue separate checks to the lessee and owner for percentage shares recited in the lessee's contract with the purchaser. Under that contract, the lessee-grower sold the entire crop, but the contract further provided:

If the Grower is a tenant, his check in payment for beets may be made jointly to the landlord and tenant, unless previously thereto the landlord has made proper release in writing to the [purchaser].

The contract contained a handwritten notation that the lessee's share was 75%. When the court entered summary judgment, Amalgamated tendered 75% of the crop sale proceeds to the lessee, and 25% to the owner.

On appeal, the owner contends that there were genuine issues of material fact as to whether the 75/25 ratio corresponded to the parties' actual entitlements to the proceeds. He urges that this ratio was only the starting point for computing entitlements, and was subject to adjustment for various crop production expenses or losses. The owner further argues that the contract between the lessee and purchaser did not authorize a separate disbursement to the lessee without a release from the owner. We will examine these contentions in turn.

A

It is, of course, axiomatic that summary judgment is improper when genuine issues of material fact exist. I.R.C.P. 56(c). However, not every factual issue, albeit genuine, is "material" to the...