Todd v. Sullivan Construction LLC

191 P.3d 196, 146 Idaho 118, 2008 Ida. LEXIS 140
CourtIdaho Supreme Court
DecidedJuly 17, 2008
Docket33954
StatusPublished
Cited by32 cases

This text of 191 P.3d 196 (Todd v. Sullivan Construction LLC) is published on Counsel Stack Legal Research, covering Idaho Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Todd v. Sullivan Construction LLC, 191 P.3d 196, 146 Idaho 118, 2008 Ida. LEXIS 140 (Idaho 2008).

Opinion

EISMANN, Chief Justice.

In this case a member and an employee of a limited liability company conspired to divert construction jobs from the company for their own benefit, performing those jobs with company employees and equipment and retaining the profits. Although the jury found that the member and employee had committed the tort of tortious interference with prospective economic advantage, the company obtained only $100 in damages. We vacate the damage award because the district court had wrongfully prevented the company from offering any evidence of its lost profits. We also vacate the court’s grant of a directed verdict on other claims and remand this case for a new trial on those claims and on damages.

*120 I. FACTS AND PROCEDURAL HISTORY

In January 2004, David Todd and Brett Sullivan formed Sullivan Todd Construction, LLC. Sullivan was responsible for the masonry division of the company, and Todd was responsible for the concrete division. In mid-April 2004, the company hired Jason Petersen as part of the concrete division’s management team. Petersen’s duties included soliciting new customers, including Petra, Inc., in Boise.

In December 2004, Todd and Petersen told a customer of Sullivan Todd Construction that they were going to form their own company. Sullivan did not learn of this conversation until later. In March 2005, Todd demanded that Sullivan purchase his interest in the company pursuant to the terms of their buy-sell agreement.

In April 2005, Sullivan noticed that Petersen and some employees were missing from a jobsite in Ketchum, and he began an investigation to find out where they were. In mid-April, he drove to Boise and discovered that Petersen and four other employees of Sullivan Todd Construction were using company equipment to do concrete work at a job site for Petra, Inc. From April 5 to 22, Petersen performed several jobs for Petra, Inc., using employees and equipment of Sullivan Todd Construction. On April 13, Sullivan demanded that Todd purchase his interest in the company.

On April 22, Petersen resigned from the company, and on April 29, Todd and Sullivan executed an agreement under which Sullivan purchased Todd’s interest in the company. Sullivan changed the name of the company to Sullivan Construction LLC. On May 4, 2005, Todd and Petersen formed their own concrete construction company. Petersen billed Petra, Inc., for the concrete work done during the period from April 5 to 22, and the payments for that work were deposited into the account of the company formed by Todd and Petersen.

On July 14, 2005, Todd filed this action against Sullivan Construction seeking to recover unpaid wages, treble damages, and interest. Sullivan Construction answered denying Todd’s claim and asserting counterclaims against him. On May 9, 2006, it also filed an action against Petersen, which was consolidated with this case for the purposes of discovery and trial.

On November 7, 2006, Sullivan Construction sought to amend its pleadings to assert a claim for punitive damages against both Todd and Petersen. After oral argument on that motion, the district court denied it on the grounds that the damages sought by Sullivan Construction included damages recoverable as punitive damages and the type of claims asserted were not within the category for which punitive damages could be awarded.

On November 27, 2006, Todd and Petersen filed a motion in limine to prevent Sullivan Construction from offering any evidence of lost profits on the ground that it had not identified anyone who would present expert testimony on that issue. After oral argument on that motion, the district court agreed and precluded Sullivan Construction from offering any evidence of lost profits.

Sullivan Construction asserted three claims at the trial: fraud in the inducement against Todd with respect to the sale of his membership interest, willful misconduct by Todd as a member of Sullivan Construction, and tortious interference with a prospective economic advantage against both Todd and Petersen. The willful misconduct claim alleged that Todd had breached his fiduciary duty by soliciting business away from Sullivan Construction and by usurping business opportunities of the company to his own benefit. After Sullivan Construction had presented its evidence, Todd and Petersen moved for a directed verdict dismissing all three counterclaims. The district court dismissed the counterclaims against Todd for fraud and for willful misconduct. It held that there was sufficient evidence to present the tortious interference claim to the jury.

After both sides had completed their presentations of evidence, Sullivan Construction moved under Rule 15(b) of the Idaho Rules of Civil Procedure to amend the pleadings to conform to the evidence to allow damages against Petersen for either disgorgement or restitution of the money he had received *121 from Petra, Inc., for the jobs done during the period from April 5 through 22, 2005. By doing so, it sought to recover about $15,500 that the evidence showed was paid by Petra to Petersen. The district court denied the motion based upon the assertion of Petersen’s counsel that he would have tried the case differently had he known that Sullivan Construction would be entitled to seek the gross profit on the Petra jobs rather than the net profit.

The jury returned a special verdict finding that Todd was not entitled to recover on his claims against Sullivan Construction. It also found that Sullivan Construction had proved its claim of tortious interference with a prospective business opportunity against both Todd and Petersen. It awarded no damages against Todd and $100 in damages against Petersen. Because the jury found that Todd and Petersen had acted in concert in committing that tort, judgment in the sum of $100 was entered against them jointly and severally-

Sullivan Construction sought an award of court costs, including a reasonable attorney fee. The district court found that there was no prevailing party and denied that request. Sullivan Construction then timely appealed.

II. ISSUES ON APPEAL

1. Did the district court abuse its discretion in granting the motion in limine prohibiting Sullivan Construction from presenting any evidence of its lost profits?

2. Did the district court abuse its discretion in denying Sullivan Construction’s motion to amend its pleadings to add claims for punitive damages?

3. Did the district court err in dismissing Sullivan Construction’s counterclaim labeled “Willful Misconduct”?

4. Did the district court abuse its discretion in denying Sullivan Construction’s motion to amend the pleadings under Rule 15(b) to add a claim against Petersen for either disgorgement or restitution of the money he had received from Petra, Inc.?

5. Did the district court abuse its discretion in finding that Sullivan Construction was not the prevailing party?

6.Are Todd and Petersen entitled to an award of attorney fees on appeal pursuant to Idaho Code § 12-121?

III. ANALYSIS

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Heit v. Livingston
D. Idaho, 2025
Steiner v. Gray
Idaho Court of Appeals, 2025
Scofield v. Guillard
D. Idaho, 2024
Western Community Ins v. Burks Tractor
428 P.3d 793 (Idaho Supreme Court, 2018)
American Semiconductor, Inc. v. Sage Silicon Solutions, LLC
395 P.3d 338 (Idaho Supreme Court, 2017)
Robert A. Kantor v. Sondra Louise Kantor
379 P.3d 1080 (Idaho Supreme Court, 2016)
Parks v. Safeco Ins Co of Illinois
376 P.3d 760 (Idaho Supreme Court, 2016)
State v. Felicity Kathleen Haynes
355 P.3d 1266 (Idaho Supreme Court, 2015)
Christina J. Greenfield v. Eric J. Wurmlinger
349 P.3d 1182 (Idaho Supreme Court, 2015)

Cite This Page — Counsel Stack

Bluebook (online)
191 P.3d 196, 146 Idaho 118, 2008 Ida. LEXIS 140, Counsel Stack Legal Research, https://law.counselstack.com/opinion/todd-v-sullivan-construction-llc-idaho-2008.