TODD GRAUS and HOLLY GRAUS, husband and wife, individually, and as parents of next friends of SG, a minor child, RG, a minor child, and GG, a minor child, Appellants (Plaintiffs),
OK INVESTMENTS, INC., a Wyoming corporation, d/b/a OK RENTALS & REAL ESTATE, JOSEPH GIOVANINI, GIOVANINI PROPERTIES, LORI KYLE, and MARY OBRINGER, Appellees (Defendants)
Appeal from the District Court of Teton County. The Honorable Marvin L. Tyler, Judge.HILL, Justice.
For Appellants: Gerard R. Bosch and M. Allison Floyd, Wilson, WY.
For Appellees: Katherine L. Mead of Mead & Mead, Jackson, WY.
Before BURKE, C.J., and HILL, KITE, DAVIS, and FOX, JJ.
[¶1] Todd and Holly Graus (Plaintiffs), individually and on behalf of their children, filed a complaint against OK Investments, Inc. and others (Defendants) alleging injury resulting from Plaintiffs' rental of a house containing black mold. Defendants made a W.R.C.P. 68 offer of settlement, which Plaintiffs did not accept. Following Plaintiffs' voluntary dismissal of certain claims and the district court's entry of judgment as a matter of law in favor of Defendants on the remaining claims, Defendants filed a certificate of costs through which Defendants sought an award of costs pursuant to W.R.C.P. 68 and W.R.C.P. 54(d). The district court awarded costs pursuant to both rules, and Plaintiffs appeal, contending that W.R.C.P. 68 did not authorize an award of costs and that the costs awarded exceeded those allowed under U.R.D.C. 501.
[¶2] We hold that W.R.C.P. 68 did not authorize an award of costs under these circumstances, and we affirm in part and reverse in part the district court's award of costs pursuant to W.R.C.P. 54(d) and U.R.D.C. 501.
[¶3] Plaintiffs state the issue on appeal as follows:
1. Did the District Court abuse its discretion in awarding costs for expert fees solely under W.R.C.P. Rule 68?
2. Did the District Court abuse its discretion in awarding costs for expert fees under W.R.C.P. Rule 68 and W.S. § 1-14-102(b)?
3. Did the District Court abuse its discretion in awarding costs under the Uniform Rules of District Court Rule 501 and Wyoming Statutes § 1-14-102 for a witness that did not testify?
4. Did the District Court abuse its discretion in awarding costs for depositions under Rule 68?
[¶4] In December 2010, Plaintiffs filed an amended complaint against Defendants alleging negligence, breach of contract, violation of the Wyoming Consumer Protection Act, fraud, and negligent misrepresentation. Plaintiffs' claims stemmed from their rental of a house that contained black mold. On July 11, 2011, Defendants served on Plaintiffs an Offer of Settlement Pursuant to Rule 68 W.R.C.P., by which Defendants offered to have judgment entered against them in the amount of $25,000.00. Plaintiffs did not accept the offer.
[¶5] Plaintiffs' claims were tried to a jury on September 23-25 and 27, 2013. At the close of Plaintiffs' case on September 27, 2013, Plaintiffs moved pursuant to W.R.C.P. 41 to voluntarily dismiss with prejudice their claim under the Wyoming Consumer Protection Act, their fraudulent misrepresentation claim, and their claim for punitive damages. The district court granted the motion and dismissed the claims with prejudice, subject to the condition that Defendants were the prevailing party on those claims. Also at the close of Plaintiffs' case, Defendants moved for judgment as a matter of law on Plaintiffs' remaining claims. On November 22, 2013, the district court granted Defendants' motion.
[¶6] On December 9, 2013, Defendants filed a certificate of costs by which they requested an order awarding costs of $2,874.56 " pursuant to W.S. § 1-14-102 et seq., Wyoming Rules of Civil Procedure Rule 54(d)(1), Rule 68 and Rule 501 of the Uniform Rules of District Court." Specifically, Defendants stated, in relevant part:
1. The case was tried to a twelve-person jury from September 23-September 30, 2013. The court entered a directed verdict order in favor [of] the Defendants on November 19, 2013.
2. On July 11, 2011, Defendants presented Plaintiffs with an offer of settlement pursuant to Rule 68. Plaintiffs did not respond and the offer, pursuant to the terms of Rule 68, was deemed withdrawn. * * * Defendants are entitled to their costs incurred after July 11, 2011.
3. The attached Certificate of Costs (Exhibit " A" ) includes costs that are allowable pursuant to Rule 54(d)(1) of the Wyoming Rules of Civil Procedure, W.S. § 1-14-102(b) and Rule 501 of the Uniform Rules of District Court and which were reasonably necessary in the preparation and defense of Defendants' case from the time the Offer of Settlement was deemed denied.
[¶7] On December 26, 2013, Plaintiffs filed objections to Defendants' certificate of costs. Plaintiffs asserted that the requested award of costs was not authorized because: 1) Rule 68 does not apply if the opponent of a claim makes an offer of judgment that is not accepted and then the offeror wins the case; and 2) Defendants failed to meet their burden of proving that the costs requested were reasonably necessary for the preparation of the case for trial.
[¶8] On January 8, 2014, the district court entered an order awarding costs in the amount of $2,607.88. The court ordered:
The Defendants, * * *, having moved pursuant to W.S. § 1-14-102 et. seq., Wyoming Rules of Civil Procedure Rule 54(d)(1), Rule 68 and Rule 501 of the Uniform Rules of District Court for costs in the above captioned matter in the total amount of $2,607.88, and the Court being otherwise fully advised in the premises;
IT IS HEREBY ORDERED that costs are so awarded to the Defendants in the amount of $2,607.88.
[¶9] On February 6, 2014, Plaintiffs filed their Notice of Appeal to this Court.
STANDARD OF REVIEW
[¶10] An award of costs is reviewed for an abuse of discretion. Beckwith v. Weber, 2012 WY 62, ¶ 32, 277 P.3d 713, 721
(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)).
[¶11] While the award of costs itself is reviewed for an abuse of discretion, the question whether a particular costs 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." ).
[¶12] On appeal, Plaintiffs present essentially two arguments. First, Plaintiffs argue that the district court committed an error of law in awarding costs pursuant to W.R.C.P. 68 because Rule 68 does not apply when the party making the settlement offer is declared the prevailing party. Second, Plaintiffs argue that the court abused its discretion in awarding the requested costs because they were not costs authorized by U.R.D.C. 501 or Wyo. Stat. Ann. § 1-14-102(b). We will separately address each argument.
A. Applicability of W.R.C.P. 68
[¶13] In arguing that W.R.C.P. 68 does not allow an award of costs in this case, Plaintiffs urge this Court to adopt the ruling in Delta Air Lines, Inc. v. August, 450 U.S. 346, 352, 101 S.Ct. 1146, 1150, 67 L.Ed.2d 287 (1981), wherein the United States Supreme Court held that federal Rule 68 is not a basis for an award of costs to a prevailing party. We agree that the Delta holding should apply to Wyoming's Rule 68, and we therefore hold that it is W.R.C.P. 54(d), not W.R.C.P. 68, that governs an award of costs to a prevailing party.
[¶14] In determining which rule of civil procedure governs an award of costs in a case where a Rule 68 offer is made, we are concerned with the interplay between Rule 54(d) and Rule 68. " Because of the similarities between federal and Wyoming rules of civil procedure, we look to federal authority interpreting a particular rule as an aid in applying the comparable Wyoming rule." Bratton v. Blenkinsop ( In re Guardianship of 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) (" Because the Wyoming Rules of Civil Procedure are patterned after the Federal Rules of Civil Procedure, federal court interpretations of their rules are highly persuasive in our interpretation of the corresponding Wyoming rules." ). We therefore begin our consideration with a comparison of Wyoming's Rules 54 and 68 with their federal counterparts.
[¶15] Wyoming's Rule 54(d)(1) specifies that " [e]xcept when express provision therefor is made either in a statute or in these rules, costs other than attorney's fees shall be allowed as of course to the prevailing party unless the court otherwise directs." W.R.C.P. ...