ROBERT W. DOWNS, Appellant (Defendant),
HOMAX OIL SALES, INC., a Wyoming corporation, Appellee (Plaintiff).
from the District Court of Natrona County The Honorable
Catherine E. Wilking, Judge
Representing Appellant: James R. Belcher, Darin B. Scheer and
Blake A. Klinkner of Crowley Fleck PLLP, Casper, Wyoming.
Argument by Mr. Belcher.
Representing Appellee: Frank R. Chapman and Patrick J.
Lewallen of Chapmen Valdez & Lansing, Casper Wyoming.
Argument by Mr. Chapman.
BURKE, C.J., and DAVIS, FOX, KAUTZ, JJ., and RUMPKE, DJ.
Appellee Homax Oil Sales, Inc. filed suit against Appellant
Robert W. Downs, claiming he and his daughter had improperly
interfered with Homax's business relationship with RKI
Exploration & Production. After a bench trial, the
district court granted judgment in favor of Homax.
On appeal, Mr. Downs claims the district court abused its
discretion by allowing Homax to present damages evidence that
was not properly disclosed during discovery and improperly
awarded damages to Homax. We conclude Homax violated its duty
under W.R.C.P. 26 to provide its computation of damages and
the documents supporting its damages claim to Mr. Downs, and
the district court abused its discretion by admitting
Homax's damages evidence at trial. We also conclude the
district court's finding on damages was clearly
erroneous. Consequently, we reverse the district court's
judgment in favor of Homax and direct that judgment be
entered in favor of Mr. Downs on Homax's claims.
Although the parties present several issues related to the
district court's damages award, the following issues are
1. Whether the district court abused its discretion by
admitting Homax's damages evidence at trial.
2. Whether the district court's damages award was
supported by the evidence.
Mr. Downs owns a ranch in Converse County, Wyoming, which is
the site of oil and gas development activities. Mr.
Downs' daughter, Amanda Horr, works on the ranch. RKI had
oil and gas operations on the Downs Ranch and entered into a
surface use agreement with Mr. Downs. RKI contracted with
landman, Adam Hughes, to act as its liaison with landowners,
including Mr. Downs.
Homax sells refined petroleum products such as gasoline,
diesel and lubricants. Prior to the events in question, Homax
delivered petroleum products to RKI's operations on the
Downs Ranch approximately three times per week. RKI and Homax
did not, however, have an agreement that required RKI to
continue to purchase petroleum products from Homax.
On March 23, 2015, a Homax fuel truck drove on a private road
within the Downs Ranch, without permission or other authority
to do so. Ms. Horr was in Casper, Wyoming, that day, so Mr.
Downs told her to go to Homax's office and give it a bill
for trespassing on Downs Ranch. Ms. Horr purchased an invoice
book, filled out a trespass bill for $1, 500, and went to
Homax's office to present the bill. Darin Homer, the
president of Homax, refused to pay the bill. According to Mr.
Homer, Ms. Horr stated that his refusal would affect
Homax's business with RKI.
After leaving Homax's office, Ms. Horr called Mr. Hughes
and told him that she had been treated rudely by Mr. Homer.
Mr. Hughes informed RKI representatives of Ms. Horr's
report. Later that day, RKI terminated its business
relationship with Homax.
Homax filed suit against Mr. Downs, claiming improper
interference with Homax's business relationship with RKI.
It sought damages for "lost business, punitive damages,
attorney's fees, and further relief as the Court deems
just and proper, including pre and post judgment interest
incurred in the prosecution of this action." Mr. Downs
counterclaimed for trespass. The district court's order
on the pretrial conference set out deadlines for witness and
During the discovery period, Homax produced to Mr. Downs a
one-page document purportedly setting out its damages. The
document was a simple two-line accounting spreadsheet showing
Homax's monthly gross revenue from RKI, with totals of
$2, 162, 542.31 for 2014 and $307, 615.21 for 2015.
Homax's witness list designated Mr. Homer, Darla Homer,
and Peggy Bagner as witnesses on damages, but Homax called
only Mr. Homer to testify at trial about its damages.
Homax's witness designation provided the following
information about Mr. Homer's proposed testimony on
Mr. Homer has been the President/CEO of Homax Oil Sales, Inc.
for 13 years and is involved in all aspects and knowledge of
the company. Mr. Homer will testify concerning all facts and
allegations made in the Complaint, and all facts concerning
the damages Homax Oil Sales has incurred as a result of the
actions of Defendant in this matter. . . .
. . . Mr. Homer will testify that Homax has had no business
dealings with RKI after RKI terminated its business with
Mr. Homer will testify to the damages in the loss of 2.15
million dollars in revenue in 2014, $306 [t]housand dollars
in revenue in early 2015, the [sic] resulting in 2014 Gross
Profit damages of $345, 279 [and] 2015 Gross Profit damages
of $83, 573.00 at the time of termination. Mr. Homer shall
testify to the computations, the accounting systems, and all
associated computations of damages, including the future.
Mr. Homer shall testify to all the aspects of the attempts to
mitigate the damage to Homax Oil Sales, Inc., along with the
damage to RKI's successor Devon Energy and their
unwillingness to allow Homax Oil Sales to provide fuel to
locations on Down[s'] property, as before.
Mr. Downs filed two motions challenging Homax's damages
evidence-a motion for summary judgment based, in part, upon
lack of evidence of lost profit damages and a motion in
limine for exclusion of damages evidence because Homax failed
to comply with the disclosure requirements of Rule 26. After
a hearing, the district court denied Mr. Downs' motions.
A bench trial was set to begin January 3, 2017. The week
before trial, Homax's counsel filed its third amended
exhibit list, indicating that Plaintiff's Exhibit 4 was
the same one-page document showing its 2014 and 2015 revenue
from sales to RKI that had previously been disclosed. Homax
provided copies of its exhibits on a CD, and the copy of
Exhibit 4 on the CD only contained the previously disclosed
single page. On the first day of the scheduled trial, January
3, 2017, Homax's attorney gave Mr. Downs' attorney a
folder with its trial exhibits and asked her to stipulate to
their admission. In the paper copy, Exhibit 4 contained three
pages, although Homax did not amend its exhibit list to
reflect the added pages. Apparently without knowing about the
additional pages in Exhibit 4, Mr. Downs' attorney
stipulated to the admission of Homax's exhibits contained
in the folder, including the expanded Exhibit 4. Because Mr.
Hughes did not appear pursuant to his subpoena, the trial
proceedings were continued until February 14, 2017.
During Mr. Homer's testimony at trial, defense counsel
realized that Plaintiff's Exhibit 4 contained three
pages. The first page was the same revenue information for
2014 and 2015 previously provided by Homax. The two
additional pages, one for 2014 and one for 2015, were each
titled "Customer Inquiry" and listed RKI as the
customer. The pages contained tables showing, for each month,
"Sales," "Costs of Sales," "Profit
%," "Profit $," "Cash Recvd," and
Plaintiff's counsel claimed that he told defense counsel
that he had "added a couple in there for foundation on
damages." Defense counsel "vehemently" denied
that Homax's counsel had informed her that he had added
pages to the stipulated exhibits.
[¶14] Mr. Downs' attorney objected to admission of
the extra pages and Mr. Homer's testimony about the
information contained in those pages. The district court
allowed Mr. Homer to testify about all three pages in Exhibit
4 because defense counsel had stipulated to the exhibit,
although she was apparently unaware of the additional pages.
Mr. Homer testified that Exhibit 4 showed "gross
revenue" and "gross profit" from RKI for each
month in 2014 and 2015. Homax's counsel then questioned
Mr. Homer about Homax's net losses:
Q. So have you calculated your losses, financial losses, from
the time you were run off of RKI till [sic] today?
A. Yes, I have.
Q. And what is that amount?
A. It's $330, 000 of net ...