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Stevens v. Eyer

Supreme Court of Idaho

September 12, 2016

RUSSELL STEVENS and LAURA STEVENS, husband and wife, Plaintiffs,
v.
KENNETH EYER and SALLY EYER, husband and wife; TIMOTHY FARRELL and NANCY FARRELL, husband and wife, and JOHN DOES I-X, being persons and/or entities whose identities and liabilities are yet to be determined, Defendants. KENNETH EYER and SALLY EYER, husband and wife, Third Party Plaintiffs-Appellants,
v.
IDAHO FOREST GROUP, LLC, Third Party Defendant-Respondent.

         Appeal from the District Court of the First Judicial District of the State of Idaho, Bonner County. Hon. Barbara A. Buchanan, District Judge.

         The judgment of the district court is affirmed.

          Bistline Law, PLLC, Coeur d'Alene, for appellants. Arthur Bistline argued.

          Smith Malek PLLC, Coeur d'Alene, for respondent. Peter J. Smith argued.

          HORTON, Justice.

         Kenneth and Sally Eyer appeal from the district court's award of attorney fees to Idaho Forest Group, LLC (IFG). The Eyers and IFG entered into a Log Purchase Agreement in which IFG agreed to purchase timber harvested from the Eyers' land. Before logging, IFG sent an agent to the Eyers' property to assist them in locating property lines. When the logging occurred, the loggers mistakenly cut timber located on neighboring land. The neighbors sued the Eyers for timber trespass and the Eyers brought a third-party action against IFG for breach of an assumed duty to properly mark the property lines. A jury found in favor of IFG, finding that IFG had not assumed a duty to the Eyers. The district court then awarded IFG $95, 608 in attorney fees pursuant to Idaho Code section 12-120(3).

         On appeal, the Eyers contend the district court erred in awarding fees under Idaho Code section 12-120(3), arguing (1) the gravamen of the Eyers' complaint was not a commercial transaction and (2) the Eyers did not sell timber for a "commercial purpose" since they used the proceeds of the sale to pay medical bills. We affirm.

         I. FACTUAL AND PROCEDURAL BACKGROUND

         In 2009, the Eyers and IFG entered into a Log Purchase Agreement in which IFG agreed to purchase cut timber from the Eyers. An IFG representative, Jeff Berend, subsequently visited the Eyers' property. Berend walked the property with the Eyers' son-in-law, Tim Farrell, and contacted a forester to survey the west line of the property.[1] When the harvest took place, the loggers inadvertently took trees from Russell and Laura Stevens' property, located to the north of the Eyers' property line.

         The Stevens sued the Eyers for timber trespass in 2012, alleging that $1, 600 of timber was removed from their property and seeking treble damages under Idaho Code section 6-202. The Eyers subsequently filed a third-party complaint against IFG for indemnification and, alternatively, contribution. The district court dismissed the Eyers' claims against IFG on summary judgment but granted the Eyers leave to file an amended complaint that alleged a cause of action in negligence. In their amended complaint, the Eyers alleged that IFG assumed a duty to locate the property boundary between the Eyers' and Stevens' property. The jury found that IFG had not assumed this duty. The district court entered judgment in IFG's favor on April 29, 2015.

         Afterwards, IFG moved for an award of $95, 608 in attorney fees under Idaho Code section 12-120(3). On July 13, 2015, the district court issued its memorandum opinion on the motion and awarded IFG the full amount of their requested attorney fees. An amended judgment reflecting the award of attorney fees was entered on July 13, 2015. The Eyers moved to alter or amend the district court's award, arguing that there was no commercial transaction because the Eyers were going to pay medical bills with the proceeds of the timber sale.[2] The district court denied the Eyers' motion in a decision dated August 7, 2015. The Eyers timely appealed.

         II. STANDARD OF REVIEW

         "Whether an action is based on a commercial transaction is a question of law over which this Court exercises free review."[3] Idaho Transp. Dep't v. Ascorp, Inc., 159 Idaho 138, 140, 357 P.3d 863, 865 (2015).

         III. ANALYSIS

Idaho Code section 12-120(3) provides:
In any civil action to recover on an open account, account stated, note, bill, negotiable instrument, guaranty, or contract relating to the purchase or sale of goods, wares, merchandise, or services and in any commercial transaction unless otherwise provided by law, the prevailing party shall be allowed a reasonable attorney's fee to be set by the court, to be taxed and collected as costs.
The term "commercial transaction" is defined to mean all transactions except transactions for personal or household purposes.

         The Eyers contend that the district court erred in awarding fees under Idaho Code section 12-120(3), arguing (1) the gravamen of the Eyers' complaint was not a commercial transaction and (2) the Eyers did not sell timber for a commercial purpose since they used the proceeds of the sale to pay medical bills. These arguments are addressed in turn.

         A. The district court did not err when it determined the gravamen of the Eyers' lawsuit against IFG was a commercial transaction.

         "[W]hether a party can recover attorney fees under Idaho Code section 12-120(3) depends on whether the gravamen of a claim is a commercial transaction. Sims v. Jacobson, 157 Idaho 980, 985, 342 P.3d 907, 912 (2015). "A gravamen is 'the material or significant part of a grievance or complaint.' " Id. (quoting Merriam Webster's Collegiate Dictionary 509 (10th ed.1993)). "[C]ourts analyze the gravamen claim by claim." Id. "To determine whether the significant part of a claim is a commercial transaction, the court must analyze whether a commercial transaction (1) is integral to the claim and (2) constitutes the basis of the party's theory of recovery on that claim." Id.

         In both its initial decision regarding attorney fees and its subsequent decision denying the Eyers' motion to alter or amend, the district court concluded that a commercial transaction formed the gravamen of ...


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