Weinstein v. Beach

340 P.3d 1013

2014 WY 167

Sonjia WEINSTEIN and Trey Warren, Appellants (Defendants)

v.Gary BEACH and Susan Beach, husband and wife, Appellees (Plaintiffs).

No. S–14–0070.

Supreme Court of Wyoming.

Dec. 22, 2014.

Representing Appellants: Jason A. Neville of Williams, Porter, Day & Neville, P.C., Casper, WY.

Representing Appellees: David B. Hooper of Hooper Law Offices, P.C., Riverton, WY.

Before BURKE, C.J., and HILL, KITE, DAVIS, and FOX, JJ.

Opinion

HILL, Justice.

[¶ 1] Gary and Susan Beach (Plaintiffs) filed a complaint against Sonjia Weinstein and Trey Warren (Defendants) alleging injuries from carbon monoxide poisoning caused by Defendants' failure to maintain a property they rented to Plaintiffs. Defendants made a W.R.C.P. 68 offer of settlement, which Plaintiffs did not accept. Following a jury verdict in Defendants' favor, Defendants filed a motion for costs in the amount of $45,410.62 pursuant to W.R.C.P. 68, W.R.C.P. 54(d), and U.R.D.C. 501. Applying U.R.D.C. 501, the district court entered an order awarding Defendants costs in the amount of $1,326.05. Defendants appeal, contending that the court erred in applying U.R.D.C. 501 to an award of costs under W.R.C.P. 68. We affirm.

ISSUE

[¶ 2] Defendants state the issue on appeal as follows:

I. Whether the district court abused its discretion by denying the majority of the costs requested by [Defendants] pursuant to Wyo. R. Civ. P. 68 ?

FACTS

[¶ 3] On August 11, 2011, Plaintiffs filed a complaint against Defendants alleging injuries from carbon monoxide poisoning caused by a gas stove on a property Plaintiffs were renting from Defendants. On August 8, 2012, Defendants made a $5,000 offer of settlement to Plaintiffs pursuant to W.R.C.P. 68. Plaintiffs did not accept the offer.

[¶ 4] The matter was tried to a jury on August 19–23, 2013, and the jury returned a verdict in favor of Defendants. On September 17, 2013, the district court issued a Judgment Upon Jury Verdict. In addition to entering judgment in favor of Defendants, the court ordered that “Defendants are entitled to costs pursuant to W.R.C.P. Rule 54 and U.R.D.C. Rule 501 and that the parties shall comply with such rules if costs are sought by Defendants.”

[¶ 5] On September 23, 2013, Defendants filed a motion and statement for costs pursuant to W.R.C.P. 54, W.R.C.P. 68, and U.R.D.C. 501. Through that motion, Defendants sought an award of costs in the amount of $45,410.62, which Defendants asserted were the total costs incurred subsequent to their August 8, 2012 Rule 68 offer of settlement. On October 7, 2013, Plaintiffs filed their objection to Defendants' statement of costs and contended that the allowable costs totaled only $1,326.05.

[¶ 6] On December 17, 2013, the district court entered an order awarding Defendants costs in the amount of $1,326.05. The court agreed that Plaintiffs' objection had accurately identified the only allowable costs, which were costs for three depositions and a portion of the court reporter's fees. The court explained, footnote omitted:

Pursuant to Rule 68 of the Wyoming Rules of Civil Procedure, the defendants are entitled to recover their costs subsequent to their offer as the jury found in defendants' favor. Rule 501 of the Uniform Rules for the District Court sets forth allowable costs. Without belaboring the point, the vast majority of the items detailed in the defendants' $45,410.62 claim are simply not allowable costs. A significant number are not costs at all, as that term is generally understood and utilized in Rule 501, but are personal expenses of counsel which are in no sense “costs” related to this litigation.

[¶ 7] On January 10, 2014, Defendants filed their notice of appeal from the district court's order awarding fees.

STANDARD OF REVIEW

[¶ 8] An award of costs is reviewed for an abuse of discretion. Beckwith v. Weber, 2012 WY 62, ¶ 32, 277 P.3d 713, 721 (Wyo.2012) (citing Wilson v. Tyrrell, 2011 WY 7, ¶ 58, 246 P.3d 265, 281 (Wyo.2011) ; Meyer v. Hatto, 2008 WY 153, ¶ 25, 198 P.3d 552, 557 (Wyo.2008) ). “Abuse of discretion occurs when a court exceeds the bounds of reason or commits an error of law.” Beckwith, ¶ 54, 277 P.3d at 725 (quoting Combs v. Sherry–Combs, 865 P.2d 50, 55 (Wyo.1993) ). “The burden is placed upon the party who is attacking the trial court's ruling to establish an abuse of discretion, and the ultimate issue is whether the court could reasonably conclude as it did.” Jones v. Artery, 2012 WY 63, ¶ 8, 275 P.3d 1244, 1247 (Wyo.2012) (quoting Nish v. Schaefer, 2006 WY 85, ¶ 6, 138 P.3d 1134, 1137 (Wyo.2006) ).

[¶ 9] While the award of costs itself is reviewed for an abuse of discretion, the question of whether a particular cost provision applies requires construction of a court rule, which is a question of law that we review de novo. Stewart Title Guar. Co. v. Tilden, 2008 WY 46, ¶ 7, 181 P.3d 94, 98 (Wyo.2008) ; see also Marx v. General Revenue Corp., 668 F.3d 1174, 1178 (10th Cir.2011) (citations omitted) (“We review an award of costs for an abuse of discretion. Whether costs provisions even apply is a legal question reviewed de novo.”).

DISCUSSION

[¶ 10] Defendants challenge the district court's award of costs on two grounds. First, Defendants contend that U.R.D.C. 501 does not apply to a Rule 68 award of costs and the court therefore erred in limiting Defendants' costs to those allowed by Rule 501. Second, Defendants argue that if U.R.D.C. 501 does apply to a Rule 68 award of costs, the court abused its discretion in the manner in which it limited the award of costs to Defendants.

[¶ 11] In our recent decision in Graus v. OK Investments, 2014 WY 166, 342 P.3d 365 (Wyo.2014), this Court held that where a party who makes an offer pursuant to W.R.C.P. 68 prevails on that claim, that party is not entitled to costs pursuant to Rule 68 and costs are instead governed by W.R.C.P. 54(d). That holding resolves Defendants' first argument because Defendants' costs should have been awarded pursuant to W.R.C.P. 54(d), rather than pursuant to W.R.C.P. 68. Nonetheless, because the question of the applicability of U.R.D.C. 501 to a W.R.C.P. 68 award of costs is a question directly presented by this appeal and one that is likely to recur, we choose to address the issue before turning to a review of the district court's exercise of discretion pursuant to U.R.D.C. 501. See State v. Mares, 2014 WY 126, ¶ 30, 335 P.3d 487, 499 (Wyo.2014).

A. Applicability of U.R.D.C. 501 to W.R.C.P. 68 Award of Costs

[¶ 12] Defendants contend that when costs are awarded pursuant to W.R.C.P. 68, that award of costs is mandatory and U.R.D.C. 501 therefore does not apply. We find no support for this argument in the plain language of W.R.C.P. 68, in F.R.C.P. 68 precedent, or in our own Rule 68 precedent.

[¶ 13] W.R.C.P. 68 provides in relevant part that “[i]f 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. As used herein, ‘costs' does not include attorney's fees.” Defendants first argue that because Rule 68 uses mandatory language, does not specifically define costs, and places only one limitation on costs—that they do not include attorney's fees—all other post-Rule 68 offer costs must be paid. We disagree.

[¶ 14] First, W.R.C.P. 68 is not unique in not internally defining the term “costs.” W.R.C.P. 54(d) similarly does not define the term, providing only that “costs other than attorney's fees shall be allowed as of course to the prevailing party unless the court otherwise directs.” Nonetheless, it is clear that U.R.D.C. 501 applies to a Rule 54(d) award of costs. See Jones, ¶ 10, 275 P.3d at 1247–48 (review of Rule 54(d) award of costs and noting that Rule 501(a) details taxable costs and requirements for certified bill of costs).

[¶ 15] Additionally, while this Court has observed that Rule 68 “is mandatory in that it provides that the offeree ‘must’ pay costs incurred after making the offer,” we have at the same time recognized that a district court retains its discretion to decide which post-offer costs should be awarded. Duffy v. Brown, 708 P.2d 433, 440 (Wyo.1985). For example, in Duffy, we reviewed the district court's denial of an award of costs under Rule 68 and remanded for the court's determination of whether the deposition costs allowed were reasonably necessary for the preparation of the case for trial, noting that “uses of the deposition in connection with the trial proceedings such as motions for summary judgment might serve to persuade the district court that the depositions were reasonably necessary, but it would not be required to so conclude.” Duffy, 708 P.2d at 441. This Court also in Duffy rejected the cost of preparing enlarged exhibits for trial, explaining, “We have found no authority in this state, nor have we been cited to any, for the proposition that the expense of preparing enlarged exhibits for trial is a taxable cost.” Duffy, 708 P.2d at 441 ; see also Crawford v. Amadio, 932 P.2d 1288, 1294–95 (Wyo.1997) (reviewing Rule 68 award of costs for abuse of discretion under U.R.D.C. 501).

[¶ 16] Our conclusion that U.R.D.C. 501 applies to a Rule 68 award of costs is further supported by federal precedent. Wyoming's Rule 68 is similar in all material respects to its federal counterpart, F.R.C.P. 68, and this Court has long held that we will look to federal authority interpreting a particular rule as an aid in applying the comparable Wyoming rule. Bratton v. Blenkinsop (In re Bratton ), 2014 WY 87, ¶ 24, 330 P.3d 248, 253, n. 6 (Wyo.2014) ; see also Lamar Outdoor Adver. v. Farmers Co–Op Oil Co., 2009 WY 112, ¶ 12, 215 P.3d 296, 301 (Wyo.2009). Federal precedent is clear that “[t]he costs included in Rule 68 are no more extensive than the costs authorized under Rule 54(d), and in each instance the cost award should be based on 28 U.S.C.A. § 1920.” 12 Charles Alan Wright, Arthur R. Miller, and Richard L. Marcus, Federal Practice and Procedure § 3006 n. 15 (2d ed. supp....