M.G. Dyess v. MarkWest Liberty Midstream & Resources

Colorado Court of Appeals·Decided September 15, 2022·No. 20CA1742·Published

Opinion

The summaries of the Colorado Court of Appeals published opinions constitute no part of the opinion of the division but have been prepared by the division for the convenience of the reader. The summaries may not be cited or relied upon as they are not the official language of the division. Any discrepancy between the language in the summary and in the opinion should be resolved in favor of the language in the opinion.

SUMMARY

September 15, 2022

2022COA108

No. 20CA1742, M.G. Dyess, Inc. v. MarkWest Liberty Midstream & Resources, L.L.C. — Civil Procedure — Right to Trial by Jury — Trial by Jury or By the Court — Findings by the Court — Advisory Jury and Trial by Consent; Contracts — Quantum Meruit

As a matter of first impression, a division of the court of appeals considers whether quantum meruit claims are legal or equitable for purposes of determining whether a party has a right to a jury trial on such a claim. The division concludes that, where the claimant has requested monetary damages, the quantum meruit claim is legal, and the claimant is entitled to a jury trial under C.R.C.P. 38(a).

The division further considers whether, pursuant to C.R.C.P.

52, a trial court may unilaterally reduce the amount of damages awarded in a binding jury verdict. It concludes that C.R.C.P. 52 does not provide that authority. Because the trial court did so here, it erred. Accordingly, the division reverses the judgment insofar as the trial court reduced the damages, but it affirms the judgment insofar as the court accepted the jury’s verdict on liability.

The division also rejects the appellant’s contention that the trial court erred by denying its motion for judgment notwithstanding the verdict on the appellee’s counterclaim, concluding there was evidence upon which a verdict against the appellant could be sustained.

It remands the case for entry of an amended judgment and an award of pre- and post-judgment interest to both parties.

COLORADO COURT OF APPEALS 2022COA108

Court of Appeals No. 20CA1742 City and County of Denver District Court No. 18CV34745 Honorable Michael J. Vallejos, Judge

M.G. Dyess, Inc., a Mississippi corporation, Plaintiff-Appellant, v.

MarkWest Liberty Midstream & Resources, L.L.C., a Delaware limited liability corporation,

Defendant-Appellee.

JUDGMENT AFFIRMED IN PART, REVERSED IN PART, AND CASE REMANDED WITH DIRECTIONS

Division IV

Opinion by JUDGE RICHMAN

Pawar and Brown, JJ., concur

Announced September 15, 2022

Wheeler Trigg O’Donnell LLP, Edward C. Stewart, Frederick R. Yarger, Denver, Colorado; Moore Williams PLLC, Marie E. Williams, Golden, Colorado; Kilpatrick Townsend & Stockton LLP, Adam H. Charnes, Dallas, Texas, for Plaintiff-Appellant

Snell & Willmer L.L.P., Michael E. Lindsay, James Kilroy, Ellie Lockwood, Denver, Colorado; Snell & Willmer L.L.P., Kelly H. Dove, Las Vegas, Nevada for Defendant-Appellee

¶1 In this construction contract dispute, plaintiff, M.G. Dyess, Inc. (Dyess), appeals post-trial orders reducing the amount of damages awarded on its quantum meruit claim and denying its motion for judgment notwithstanding the verdict (JNOV) on defendant’s counterclaim. Defendant, MarkWest Liberty Midstream & Resources, L.L.C. (MarkWest), and Dyess both appeal the trial court’s denial of their motions for pre- and post-judgment interest. We affirm in part, reverse in part, and remand this case with directions.

I. Background

¶2 MarkWest, a corporation that processes and transports natural gas, entered into three contracts with Dyess, a pipeline construction company, to install thousands of feet of pipeline. Each of the three contracts concerned a particular length of pipeline, called a “spread,” and each spread was assigned a lump sum payment amount and a “mechanical completion date” after which liquidated damages would accrue if the spread remained incomplete.

¶3 According to Dyess, MarkWest materially hindered its work, increasing the costs and duration of the project. Dyess sued

MarkWest, asserting claims for breach of contract, negligent misrepresentation, fraudulent nondisclosure, fraud, promissory estoppel, and quantum meruit. MarkWest countered that it had not hindered Dyess’s work, and Dyess failed to achieve mechanical completion by the contractual deadlines. MarkWest brought counterclaims for liquidated damages under the contract and declaratory judgment. Per jury demands by both parties, the case was set for a jury trial, which began on February 3, 2020.

¶4 During the trial, however, MarkWest asserted that Dyess’s promissory estoppel and quantum meruit claims were not triable to the jury because they are equitable claims. Dyess argued that its claims were legal and contended that, in any case, MarkWest had waived any objection to a jury trial.

¶5 The trial court concluded that Dyess had brought “a mix of legal and equitable claims,” but the court did not specify which claims were equitable. It stated an intention to submit all the claims to the jury under C.R.C.P. 39(c), which permits courts to “try any issue with an advisory jury” in “all actions not triable by a jury.” The court also noted that, if the jury returned a verdict

awarding relief on an “arguably equitable claim,” it could permit further briefing.

¶6 The jury rejected all of Dyess’s claims except its quantum meruit claim, for which it awarded $26,039,641 in damages. It also awarded MarkWest $4,500,000 in liquidated damages based on its breach of contract counterclaim. When the verdict was read, MarkWest immediately made an oral motion to treat the jury’s quantum meruit verdict as advisory, asking the court to “decide this issue.” The court ordered additional briefing.

¶7 In response, MarkWest filed a motion, captioned as a motion under C.R.C.P. 52, asking the court to make findings of fact and conclusions of law regarding the quantum meruit claim. It urged the court to conclude that MarkWest was not liable to Dyess for the quantum meruit claim, and in the alternative, that Dyess could only recover $934,436, the approximate amount Dyess claimed for the items listed in Instruction 60 (the quantum meruit jury instruction). Dyess countered that its expert had testified to overall losses equal to or greater than the amount awarded and, therefore, the $26,039,641 verdict was supported by evidence.

¶8 The trial court concluded, in a written order titled “Order Regarding Defendant’s Brief in Support of Motion Pursuant to C.R.C.P. 52,” that (1) MarkWest did not waive its objection to a jury trial; and (2) quantum meruit is “an equitable theory of recovery . . . triable by the court and not by a jury, subject to the right of the court to impanel an advisory jury under C.R.C.P. 39(c).” It accepted the jury’s “advisory verdict” insofar as the jury found that MarkWest was liable under a quantum meruit theory, but the court concluded that the amount awarded was not supported by the evidence. It reduced the amount of damages to $934,436. On the same day, it entered judgment on the jury verdict as modified by its C.R.C.P. 52 order.

¶9 Dyess subsequently filed a motion for JNOV on MarkWest’s breach of contract counterclaim, asserting that it had achieved mechanical completion before the final mechanical completion dates, which it claimed MarkWest had extended. The trial court did not rule on the motion, and it was therefore deemed denied by rule. See C.R.C.P. 59(j).

¶ 10 Dyess did not file any other post-trial motions challenging the jury’s verdict, although the jury had denied Dyess’s other claims.

MarkWest did not seek post-trial relief on any claim. However, both parties filed C.R.C.P. 59(c)(4) motions to amend the judgment to include pre- and post-judgment interest. These motions were also deemed denied. See C.R.C.P. 59(j).

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