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William J. Evans, Individually and D/B/A Wj Enterprises and Melony Evans v. Avista Corporation D/B/A Avista Utilities

September 19, 2012


The opinion of the court was delivered by: Honorable Ronald E. Bush U. S. Magistrate Judge


Currently pending before the Court are the following motions: (1) Third-Party Defendant Mid-Mountain Land & Timber, Inc.'s Motion for Summary Judgment (Docket No. 41); (2) Plaintiffs' Motion for Leave to Amend Complaint to Add Prayer for Punitive Damages Against Defendant Avista Corporation (Docket No. 53); (3) Plaintiffs' Motion for Sanctions Due to Spoliation Against Defendant Avista Corporation (Docket No. 58); and (4) Defendant Avista Corporation's Motion for Partial Summary Judgment Re: Plaintiffs' Claimed Damages (Docket No. 71). Having carefully reviewed the record, participated in oral argument, and otherwise being fully advised, the Court enters the following Memorandum Decision and Order:


This action involves a claim for property damage brought by Plaintiffs William J. Evans, d/b/a WJ Enterprises, and Melony Evans ("Plaintiffs") as a result of a January 2, 2009 fire in their commercial building (the "Building"), located within the Warren K. Industrial Park at 11888 N. Reed Road, Hayden, Idaho.

Third-Party Defendant Mid-Mountain Land & Timber, Inc. ("Mid-Mountain") designed, developed, and constructed the Building itself, while Defendant/Third-Party Plaintiff Avista Corporation, d/b/a Avista Utilities, Inc. ("Avista") supplied and installed the gas meter at the Building. The gas meter was located underneath the slope-side of the Building. A factual dispute exists as to whether Mid-Mountain or Avista determined the location of the Building's gas meter. Moreover, according to Plaintiffs, the Building's gas meter was not protected from snow and/or ice that may slide off the roof; Avista contends that the roof area above the Building's gas meter was equipped with a snow break (supplied and installed by Mid-Mountain), designed to prevent accumulated snow and ice from sliding off the roof.

During the winters of 2007-2008 and 2008-2009, there is no dispute that northern Idaho and eastern Washington experienced record snowfall accumulation. As a result, during these times, a number of gas meters at the Warren K. Industrial Park were damaged due to snow and/or ice sliding off of the buildings' roofs.*fn1 In fact, around January 2, 2009, accumulated snow and ice slid off of the Building's roof, damaged the Building's gas meter, and caused a gas leak. The gas leaking from the Building's damaged gas meter immediately ignited, resulting in a significant fire at the Building. According to Plaintiffs, this fire destroyed the Building and the majority of its contents.

Through this action, Plaintiffs argue that the January 2, 2009 fire would not have occurred but for Avista's negligent conduct. Indeed, Plaintiffs assert the following causes of action against Avista: (1) negligence, (2) negligence per se, (3) gross negligence, and (4) strict liability. Avista denies that it is responsible for the fire at the Building and related damage, while bringing a third-party claim against Mid-Mountain, asserting the following causes of action against Mid-Mountain: (1) contribution, and (2) indemnification.*fn2

The Court now has before it four interrelated, but independent, motions:

1. Mid-Mountain moves for summary judgment to dismiss Avista's (as well as Plaintiffs') claims against it, arguing that (1) there can be no indemnity relationship between Mid-Mountain and Avista because Avista cannot assert that it is without fault; (2) there is no basis for Avista to assert a contribution claim against Mid-Mountain because Avista has not and cannot plead that the two parties are joint tortfeasors; (3) there is no breach of an implied warranty of habitability because the doctrine applies only to residential properties; (4) Avista has a higher duty to its customers and the public as the provider of a utility; and (5) Avista undertook and voluntarily assumed an affirmative duty to protect the meter outside the Building.

2. Plaintiffs move to amend their Complaint to add a prayer for punitive damages against Avista. Plaintiffs note that, in the year before the at-issue fire, there were several incidents at the Warren K. Industrial Park where a gas meter was damaged by falling snow or ice. Despite such preceding events, Plaintiffs argue that Avista failed to ensure that its meter was sufficiently protected from similar damage and that such disregard warrants a claim for punitive damages.

3. Plaintiffs move for sanctions against Avista for discarding evidence, previously identified as being relevant in its Initial Disclosures and in response to Plaintiffs' discovery requests.

4. Avista moves for partial summary judgment, attacking Plaintiffs' ability to recover (1) damages allegedly incurred by Ryan Evans, (2) damages to vehicles not owned by Plaintiffs, and (3) purported losses of rental income. Avista also seeks an up-front determination from this Court that (1) certain expenses are not taxable costs and, therefore, are not recoverable under applicable law, and (2) the gravamen of this action is not a "commercial transaction" and, therefore, attorneys' fees are not recoverable under Idaho Code § 12-120(3).


A. Mid-Mountain's Motion for Summary Judgment (Docket No. 41) and Avista's Motion for Partial Summary Judgment (Docket No. 71)

1. Motion for Summary Judgment: Standard of Review

Summary judgment is used "to isolate and dispose of factually unsupported claims . . . ." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). It is "not a disfavored procedural shortcut," but rather is "the principal tool[ ] by which factually insufficient claims or defenses [can] be isolated and prevented from going to trial with the attendant unwarranted consumption of public and private resources." Id. at 327. "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).

However, the evidence, including all reasonable inferences which may be drawn therefrom, must be viewed in a light most favorable to the non-moving party (see id. at 255) and the Court must not make credibility findings. Id. Direct testimony of the non-movant must be believed, however implausible. Leslie v. Grupo ICA, 198 F.3d 1152, 1159 (9th Cir. 1999). On the other hand, the Court is not required to adopt unreasonable inferences from circumstantial evidence. McLaughlin v. Liu, 849 F.2d 1205, 1208 (9th Cir. 1988).

The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. Devereaux v. Abbey, 263 F.3d 1070, 1076 (9th Cir. 2001). To carry this burden, the moving party need not introduce any affirmative evidence (such as affidavits or deposition excerpts) but may simply point out the absence of evidence to support the nonmoving party's case. Fairbank v. Wunderman Cato Johnson, 212 F.3d 528, 532 (9th Cir. 2000).

This shifts the burden to the non-moving party to produce evidence sufficient to support a jury verdict in its favor. Anderson, 477 U.S. at 256-57. The non-moving party must go beyond the pleadings and show "by [its] affidavits, or by the depositions, answers to interrogatories, or admissions on file" that a genuine issue of material fact exists. Celotex, 477 U.S. at 324.

However, the Court is "not required to comb through the record to find some reason to deny a motion for summary judgment." Carmen v. San Francisco Unified Sch. Dist., 237 F.3d 1026, 1029 (9th Cir. 2001) (quoting Forsberg v. Pac. Northwest Bell Tel. Co., 840 F.2d 1409, 1418 (9th Cir. 1988)). Instead, the "party opposing summary judgment must direct [the Court's] attention to specific triable facts." Southern California Gas Co. v. City of Santa Ana, 336 F.3d 885, 889 (9th Cir. 2003). A statement in a brief, unsupported by the record, cannot be used to create an issue of fact. Barnes v. Independent Auto. Dealers, 64 F.3d 1389 n. 3 (9th Cir. 1995).

2. Mid-Mountain's Motion for Summary Judgment (Docket No. 41)

Through its Motion for Summary Judgment, Mid-Mountain seeks to dismiss Avista's (and Plaintiffs') claims for indemnity and contribution as well as Plaintiffs' claim for breach of the implied warranty of habitability.

a. Avista's (and Plaintiffs') Indemnity Claim against Mid-Mountain "The common law right of indemnity . . . refers to those situations where a person who without fault on his part is compelled to pay damages occasioned by the negligence of another." May Trucking Co. v. International Harvester Co., 543 P.2d 1159, 1161 (Idaho 1975). Applying this framework to the instant action, it would seem as though Avista, via its indemnity claim against Mid-Mountain, is arguing that, through no fault of its own, it is compelled to pay damages occasioned by Mid-Mountain's negligence. The problem with such a theory, however, is that the record is devoid of any allegation that Mid-Mountain breached any duty owing to either Avista or Plaintiffs and, therefore, is negligent. Absent Mid-Mountain's negligence, it cannot be responsible for indemnifying Avista under principles of common law indemnity.

Here, Avista does not assert a negligence claim against Mid-Mountain - only indemnity and contribution causes of action. Indeed, during oral argument, Avista's counsel candidly acknowledged that Avista did not have a right to allege a negligence claim against Mid- Mountain because Avista suffered no harm.*fn3 Likewise, despite Avista's counsel's expected arguments to the contrary, Plaintiffs also do not assert a negligence claim against Mid-Mountain. To be sure, Plaintiffs' First Amended Complaint (amended only after Avista brought its third-party claims against Mid-Mountain) seems to premise its "liability" claim against Mid-Mountain upon the mistaken notion that Avista's Third-Party Complaint and affirmative defenses allege that Mid-Mountain was negligent. See First Am. Compl., p. 8 (Docket No. 30, Att. 1). Further, at oral argument, Plaintiffs' counsel stated in no uncertain terms that Plaintiffs themselves do not have an independent negligence claim against Mid-Mountain.*fn4 In other words, and borrowing an iconic line from the movie Cool Hand Luke, "what we've got here is a failure to communicate" between Avista and Plaintiffs -- each party pointing at the other as the source of any semblance of a negligence claim against Mid-Mountain. Perhaps owing to the contorted state of the pleadings thus far, there is simply no such claim.

Without an identified, underlying duty owed by Mid-Mountain to either Avista or Plaintiffs, or a corresponding allegation that such duty was ever breached, there can be no viable claim against Mid-Mountain for common law indemnity. See, e.g., Knudson v. Spicer, 601 P.2d 1089, 1090, n.1 (1979) ("In this Court, both parties continue to argue negligence . . . . Here, Sun Valley and Spicer seek to pass on their liability, or some of it, to Boise Cascade. As above stated . . . , the Knudsons have not named Boise Cascade as a defendant, and have not charged it with any negligence in the construction or design of the condominium. Nor . . . has Spicer or Sun Valley charged either with any negligence in that regard."). To hold otherwise would essentially force Mid-Mountain to defend itself against a non-existent claim, saying nothing of who (as between Plaintiffs and Avista) would even have the burden of proving such a non-existent claim. The Court is not prepared to require such a confused and awkward outcome. In this respect, Mid-Mountain's Motion for Summary Judgment is granted; Avista's (and Plaintiffs') common law indemnity claims against Mid-Mountain are dismissed.*fn5 *fn6

b. Avista's (and Plaintiffs') Contribution Claim against Mid-Mountain In Idaho, "[t]he right of contribution exists among joint tortfeasors, but a joint tortfeasor is not entitled to a money judgment for contribution until he has by payment discharged the common liability or has paid more than his pro rata share thereof." I.C. § 6-803(1). A joint tortfeasor "means one . . . of two . . . or more persons jointly or severally liable in tort for the same injury to person or property, whether or not judgment has been recovered against all or some of them." I.C. § 6-803(4). A party is jointly and severally liable for the fault of another person where they were acting in concert. I.C. § 6-803(5). Acting in concert "means pursuing a common plan or design which results in the commission of an intentional or reckless tortious act." Id.

Here, there are no allegations of -- or examples in the record -- indicating that Avista and Mid-Mountain are joint tortfeasors. Similarly, there is no evidence suggesting that Avista and Mid-Mountain acted in concert with one another or otherwise pursued a common plan or design resulting in an intentional or reckless tortious act. Without these predicate parts, there can be no claim for contribution. In this respect, Mid-Mountain's Motion for Summary Judgment is granted; Avista's (and Plaintiffs') contribution claims against Mid-Mountain are dismissed.

c. Plaintiffs' Breach of Implied Warranty of Habitability Claim Against Mid-Mountain

Idaho common law recognizes an implied duty of habitability, described in the leading case in this manner: "[m]ajor defects which render the house unfit for habitation, and which are not readily remediable, entitle the buyer to [relief]." Tusch Enter. v. Coffin, 740 P.2d 1022, 1033 (1987) (quoting Bethlahmy v. Bechtel, 415 P.2d 698, 711 (1966)). Plaintiffs seek to invoke such a warranty in regard to their industrial building. However, their Building is not a residence that is understood to enjoy the protection of the warranty; the Building is actually a commercial building. See Ela Decl. at ¶ 8 (Docket No. 41, Att. 3); see also Ex. 1 to Ela Decl. (Docket No. 41, Att. 3) (Certificate of Occupancy issued by City of Hayden Department of Building Inspection, identifying Building's use as "Light Industrial Office/Shop"). Plaintiffs seek to expand the warranty's protection beyond dwellings and into commercial buildings. The Court concludes that Idaho law does not support such an application to these facts.

As Plaintiffs' admit, "[t]he law in Idaho regarding the . . . warranty . . . is admittedly scant." See Pls.' Resp. to Mid-Mountain's Mot. for Summ. J., p. 4 (Docket No. 48). Still, any application of the warranty to commercial buildings, while not specifically addressed by Idaho's case law, is, simply put, a stretch -- one that the undersigned believes is not something the Idaho Supreme Court would endorse if ...

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