Summary 2007 WY 148

Summary of Decision issued September 18, 2007

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Case Name: Schmid v. Schmid

Citation: 2007 WY 148

Docket Number: 06-268 and 06-270

Appeal from the District Court of Sweetwater County, the Honorable Jere A. Ryckman, Judge

Representing Appellant (Defendant): Clark D. Stith, Rock Springs, Wyoming.

Representing Appellee (Plaintiff): P. Richard Meyer and Robert N. Williams, of Meyer and Williams, Jackson, Wyoming. Argument by Mr. Meyer.

Issues: Whether the district court abused its discretion in excluding the evidence corroborating Mike’s theory of the case. Whether the district court abused its discretion in refusing to allow Mike’s counsel to cross-examine Pat concerning deposition and trial testimony that supported Mike’s theory of the case. Whether the district court violated Mike’s due process rights under article I, section 6 of the Wyoming Constitution. Whether the district court violated Mike’s due process rights under the Fourteenth Amendment to the United States Constitution. Whether the district court erred by denying Mike’s pretrial motion for summary judgment and motion for directed verdict at trial, both made on the grounds of the statute of frauds and the lack of any fiduciary duty from Mike to Pat. Whether the district court abused its discretion in denying Mike’s motion for a new trial.

Facts/Discussion: Mike appealed the judgment entered in favor of his brother Pat.

Standard of Review: The Court reviews a trial court’s evidentiary decisions for abuse of discretion. Even when a trial court errs in an evidentiary ruling, the Court will reverse only if the error was prejudicial.
The Court reviewed the record of the pretrial conference where Pat’s motion in limine was considered prior to the start of trial. The trial court ruled the evidence should be excluded explaining that each agreement has to stand on its own. On the morning before trial started, Mike followed up with a written offer of proof which was excluded as well.
It is important to note that the parties were attempting to establish the terms of their oral agreement. There was no written contract with definite and unambiguous terms. Where the language of a contract is indefinite or ambiguous, all the surrounding circumstances must be considered in order to ascertain its terms. To establish the terms of an oral agreement, a broad range of evidence may be taken into consideration. As a general proposition, all relevant evidence is admissible. Evidence is relevant if it has any tendency to make the existence of a fact of consequence more or less probable than it would be without the evidence. Mike was prepared to testify that the agreements he had with is brother and the two witnesses he sought to bring as evidence were identical. With that connection, the evidence is relevant. The Court concluded that to establish the terms of an oral agreement, evidence about the terms of other, identical agreements is relevant, probative, and generally admissible.
The issue of whether the evidence was unfairly prejudicial was not discussed at the pretrial stage. After trial began, Mike’s counsel renewed his request. The trial court concluded that it would be unfairly prejudicial to change its ruling and admit the evidence because opening arguments had been made, and testimony taken, based on the trial court’s earlier decision to exclude the evidence. The Court stated the relatively simple testimony seemed to present little danger of unfair prejudice, confusion, or misleading the jury. Testimony from two witnesses supporting Mike’s version of the agreement would have had considerable probative value, not outweighed by other consideration.
Mike’s offers of proof were tested against the requirements of the Wyoming Rules of Evidence. The Court found they adequately informed the trial court about the nature of the proposed evidence and provided adequate information for meaningful appellate review.

The Court concluded that the trial court erred in excluding the evidence. They were also persuaded the error was prejudicial. Neither witness was a party to the suit. They were both prepared to testify contrary to their own interest that Mike owed them no bonus according to their understanding of the agreement.

In addition, the Court has indicated that a litigant is usually entitled to a remand and a new trial if he was unfairly restricted in developing and presenting his theory of the case.
Finding no legitimate basis for the trial court’s exclusion of the evidence, the Court was compelled to rule it an abuse of discretion.
Remaining Issues: The Court’s resolution of the first issue resolved most of the remaining issues except for the fifth issue asserting the district court erred in denying his pretrial motion for summary judgment and his motion for directed verdict. The Court left the claim for the trial court to consider in the context of the new trial.
The Court noted the denial of a summary judgment is not an appealable order. However, the trial court’s denial of Mike’s motion for judgment as a matter of law made at the close of trial is an appealable order. The trial court’s legal conclusions are reviewed de novo. Mike relied on the statute of frauds making the agreement void and unenforceable. The trial court rejected that argument ruling that Pat had substantially performed his part of the oral agreement. With the testimony being taken in the light most favorable to Pat, the trial court properly denied Mike’s motion for judgment as a matter of law. The trial court properly applied the substantial performance exception to the statute of frauds in this instance where the agreement was not an employment contract.

Holding: The Court held that the district court abused its discretion in excluding Mike’s evidence concerning other agreements that he asserted were identical to his oral agreement with Pat. With regard to Mike’s motion for judgment as a matter of law, the Court upheld the district court’s denial on the statute of frauds issue. The Court reversed the judgment on the evidentiary issue and remanded the case to the district court for a new trial.

Reversed and remanded.

J. Burke delivered the decision.

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