Nelson v. Newman

583 P.2d 601, 1978 Utah LEXIS 1370
CourtUtah Supreme Court
DecidedJuly 27, 1978
Docket15182
StatusPublished
Cited by13 cases

This text of 583 P.2d 601 (Nelson v. Newman) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nelson v. Newman, 583 P.2d 601, 1978 Utah LEXIS 1370 (Utah 1978).

Opinions

WILKINS, Justice:

Plaintiffs brought action against defendant in the District Court of Salt Lake County, sitting with a jury, on nine separate claims, praying, inter alia, for declaratory judgment with respect to the validity of a written contract for the purchase of business assets; for modification of said contract to include oral covenants made during negotiations; for damages for breach of said contract; and for damages for breach of subsequent oral contracts. Defendant counterclaimed, praying, inter alia, for judgment accelerating payments under said written contract on the basis of the default of the buyer, Plaintiff Nelson. From judgment entered by the District Court for Salt Lake County partially in favor of Plaintiff Nelson and partially in favor of defendant, these two parties appeal.

All references to Rules are to Utah Rules of Civil Procedure.

The parties entered into a written contract whereby Plaintiff Nelson agreed to purchase, and Defendant Newman agreed to sell the assets of defendant’s metal salvage business. All parties agree that Plaintiff Smith was a guarantor of the payments to be made by Nelson under the contract. Concurrently with the execution of the written contract Nelson also executed 57 promissory notes in the amount of $150 each, payable to defendant. Smith is not a guarantor on these notes, which represent monthly payments under the contract. Each note has a due date one month later than the preceding one.

At the close of plaintiffs’ evidence defendant moved for a directed verdict in his favor, and at that time the Court reviewed the evidence with respect to each of the claims and found or noted, as applicable: (1) That the written contract was by its terms the integrated agreement of the parties, and could not be modified by parol evidence concerning warranties and representations made prior to the execution of the contract, nor was that parol evidence [603]*603admissible on the grounds of fraud for the reason that plaintiffs had failed to plead fraud with the particularity required by Rule 9(b); (2) Two of plaintiffs’ counts and five of the counts in defendant’s counterclaim were dismissed upon stipulation of counsel; (3) With respect to the alleged subsequent oral contracts, there was either insufficient evidence to show that there had been a meeting of the minds, or no evidence of any consideration to support such agreements; and (4) That there was no dispute with respect to any facts which would require submission of the case to the jury, These facts included those regarding breaches of the contract by defendant, the amount of damages sustained by Plaintiff Nelson as a result of such breaches (which were stipulated to by defendant), and the number of promissory notes which had not been paid by Plaintiff Nelson since the commencement of the action.

All of the Court’s determinations and findings as above stated are supported by the evidence and are affirmed. The parties’ arguments on appeal with respect to claimed error therein are without merit.

The Court further determined on plaintiffs’ prayer for declaratory judgment that the parties intended the plaintiffs’ obligations under the contract to be superseded by Nelson’s execution of the promissory notes; that plaintiff was obligated to pay the notes only as they came due; and that as Plaintiff Smith was not a guarantor on the notes, he had no further obligation to defendant.

The Court then granted defendant’s motion for a directed verdict on the remaining issues and entered judgment as follows: (a) in favor of Plaintiff Nelson in the amount of $200 damages pursuant to stipulation; (b) in favor of defendant on his counterclaim, for $1,347.50, the amount due on the notes which had accrued and remained unpaid since commencement of the action, together with attorneys’ fees in the amount of $1,935 and costs of $302.45; and (c) against defendant on his counterclaim to accelerate payments under the contract.

Defendant, in his appeal, contends that the Court erred in finding that the plaintiffs’ obligations under the contract were superseded by the promissory notes. Each of the notes contains the notation: “This is note No. _of a series of 57 notes which represent the payments set forth in that certain Conditional Sales Contract . . . ” The reasonable interpretation of that notation is that the parties intended the notes to pay and extinguish the obligations under the contract, and we do not find that the Court erred in so finding, nor in finding that the acceleration clause of the contract and Plaintiff Smith’s obligations as a guarantor under the contract were likewise extinguished.

Plaintiff, in his appeal, contends that the Court erred in not submitting to the jury the question of whether the admitted breaches of contract on the part of defendant were material and substantial so as to justify non-performance by plaintiff. Plaintiff, however, prayed for judgment that the subject contract was valid and enforceable, and did not pray for rescission of the contract. As plaintiff did not raise this issue of rescission below he cannot raise it for the first time on appeal.

As noted ante, the Court granted to defendant attorneys’ fees in the amount of $1,935, and costs of $302.45, which included $242.25 as the costs of depositions taken by defendant. Plaintiff objects to these amounts as being excessive and not substantiated by the evidence.

The promissory notes contained a clause whereby Plaintiff Nelson agreed to pay “all costs of collection including reasonable attorney’s fees” if the notes were placed with an attorney for collection. Defendant’s counsel, whose reasonable hourly rate was $35, testified that he had expended in excess of 56 hours in defense of plaintiffs’ claims and prosecution of defendant’s counterclaims, and the Court found that $1,935 was a reasonable fee under the circumstances of this case. Defendant’s counsel testified that he had expended these hours on the entire case, and “had no idea” what portion of that time was attributable to the [604]*604collection of the notes. We have previously held that the contractual liability for payment of attorney’s fees extends only to the amount necessary for the enforcement of the contract1 (here the collection of the notes).

In this case, however, the Court awarded costs, including attorneys’ fees, by virtue of the provisions of Rule 68(b), which provides:

At any time more than ten days before the trial begins, a party defending against a claim may serve upon the adverse party an offer to allow judgment to be taken against him for the money or property or to the effect specified in his offer, with costs then accrued. . An offer not accepted shall be deemed withdrawn and evidence thereof is not admissible except in a proceeding to determine costs. If the judgment finally obtained by the offeree is not more favorable than the offer, the offeree must pay the costs incurred after the making of the offer.

Defendant filed such an offer to have judgment taken against him more than 10 days before the trial, which offer was more favorable to plaintiff than the judgment obtained by plaintiff, and which offer was not accepted by him. Rule 68(b), however, applies to taxable costs only. Attorney’s fees are not taxable as costs, but may be awarded against an opposing party only if there is contractual or statutory liability therefor.2

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Nelson v. Newman
583 P.2d 601 (Utah Supreme Court, 1978)

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Bluebook (online)
583 P.2d 601, 1978 Utah LEXIS 1370, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nelson-v-newman-utah-1978.