Gravina Siding and Windows Company v. Paul A. Frederiksen

The summaries of the Colorado Court of Appeals published opinions
constitute no part of the opinion of the division but have been prepared by
the division for the convenience of the reader. The summaries may not be
cited or relied upon as they are not the official language of the division.
Any discrepancy between the language in the summary and in the opinion
should be resolved in favor of the language in the opinion.
SUMMARY
May 5, 2022
2022COA50
No. 20CA1465, Gravina v. Frederiksen — Contracts — Breach
of Contract; Restitution — Unjust Enrichment
A division of the court of appeals considers whether a party
who breaches a contract may nonetheless recover on an unjust
enrichment claim for any benefit bestowed on the other party to the
contract. Based largely on the Restatement (Third) of Restitution
and Unjust Enrichment and cases from other jurisdictions, the
division concludes that an unjust enrichment claim permits an
equitable remedy when the contract is silent regarding the
consequences of the particular breach. The division’s opinion also
addresses breach of contract, negligent supervision, exclusion of
expert evidence, and attorney fees issues.
COLORADO COURT OF APPEALS 2022COA50
Court of Appeals No. 20CA1465
Douglas County District Court No. 18CV31018
Honorable Jeffrey K. Holmes, Judge
Gravina Siding and Windows Company,
Plaintiff-Appellee and Cross-Appellant,
v.
Larry A. Gravina, Mike Gravina, and Jason Castro,
Third-Party Defendants-Appellees,
and
Paul A. Frederiksen and Brenda J. Frederiksen,
Defendants-Appellants and Cross-Appellees.
JUDGMENT AFFIRMED IN PART, REVERSED IN PART,
AND CASE REMANDED WITH DIRECTIONS
Division I
Opinion by JUDGE DAILEY
Fox and Schutz, JJ., concur
Announced May 5, 2022
Fischer & Fischer, P.C., Jennifer K. Fischer, Denver, Colorado, for Plaintiff-
Appellee and Cross-Appellant
Overturf McGath & Hull, P.C., Scott A. McGath, Steven W. Boatright, Denver,
Colorado, for Third-Party Defendants-Appellees
Frederiksen Law Office, Paul A. Frederiksen, Parker, Colorado, for Defendants-
Appellants and Cross-Appellees
¶1 Defendants and third-party plaintiffs Paul A. Frederiksen and
Brenda J. Frederiksen (the Frederiksens) appeal the trial court’s
entry of judgment in favor of plaintiff Gravina Siding and Windows,
Co., and third-party defendants Larry A. Gravina, Mike Gravina,
and Jason Castro (collectively, Gravina). Gravina cross-appeals
from an unfavorable part of the trial court’s judgment. We affirm in
part, reverse in part, and remand with directions.
I. Background
¶2 For some years, the Frederiksens had to repair their cedar
siding because woodpeckers damaged it by building nests and
boring holes into it. On November 29, 2017, the Frederiksens
entered into a contract with Gravina to replace the cedar siding of
their home with steel siding in exchange for payments totaling
$42,116.00. The Frederiksens put down $10,000 towards the
contract price.
¶3 Gravina (1) told the Frederiksens that it could start work
within ten to fourteen weeks of signing the contract and (2)
estimated that the job would take up to four weeks to complete.
The Frederiksens hoped to have the new siding put on the house
before the woodpeckers arrived in the spring.
1
¶4 Gravina’s subcontractors began work in late March 2018 and
were not finished four-and-a-half months later when, on August 7,
2018, the Frederiksens received a bill from Gravina requesting final
payment for the outstanding balance on the contract. Believing
Gravina had repeatedly breached their agreement, the Frederiksens’
terminated the contract and denied Gravina and its subcontractors
further access to their property.
¶5 Gravina filed the present action against the Frederiksens,
alleging, as pertinent here, breach of contract, breach of the
covenant of good faith and fair dealing, and unjust enrichment.
The Frederiksens filed an answer as well as counterclaims against
Gravina and third-party claims against Gravina’s owner (Larry
Gravina) and two employees (salesperson Mike Gravina and project
supervisor Jason Castro). On Gravina’s motion, the trial court
dismissed all but, as pertinent here, the Frederiksens’ (1) breach of
contract claim against Gravina and (2) negligent supervision claim
against the three individual third-party defendants.
¶6 After conducting a three-day bench trial, the court found that
Gravina had materially breached the contract and, that,
consequently, the Frederiksens had properly terminated it.
2
Nonetheless, the trial court ultimately (1) awarded Gravina a net
judgment of $19,000 on its unjust enrichment claim1 and (2)
rejected the Frederiksens’ negligent supervision claim and request
for attorney fees.
¶7 Both parties appeal.
¶8 On appeal, the Frederiksens contend that the trial court erred
by (1) ruling that they had been unjustly enriched as a result of
Gravina’s efforts; (2) failing to award them damages for Gravina’s
breach of contract; (3) rejecting their negligent supervision claim
against the individual third-party defendants; (4) excluding expert
testimony related to the existence of roof damage and related repair
costs; and (5) denying their request for attorney fees.
¶9 Gravina cross-appeals the trial court’s ruling that it breached
the contract, entitling the Frederiksens to terminate the contract
and recover damages.
¶ 10 We address each contention, but we start with the issue raised
in Gravina’s cross-appeal before later addressing the parties’
respective recoveries.
1Because the Frederiksens had already paid Gravina a $10,000
deposit, the court’s award required paying an additional $9,000.
3
II. Gravina’s Cross-Appeal
¶ 11 Gravina contends that the trial court erred when it found that
it materially breached the contract, allowing the Frederiksens to
terminate the contract and recover damages. We disagree.
¶ 12 Upon a material breach of a contract, the injured party is
“excuse[d from] further performance” and entitled to recover
damages. Morris v. Belfor USA Grp., Inc., 201 P.3d 1253, 1258
(Colo. App. 2008); see, e.g., Blood v. Qwest Servs. Corp., 224 P.3d
301, 324 (Colo. App. 2009) (recognizing a nonbreaching party may
terminate a contract following a material breach), aff’d, 252 P.3d
1071 (Colo. 2011).
¶ 13 “Whether there has been a material breach of contract turns
upon the importance or seriousness of the breach and the
likelihood that the injured party nonetheless received, or will
receive, substantial performance under the contract.” Interbank
Invs., L.L.C. v. Vail Valley Consol. Water Dist., 12 P.3d 1224, 1228
(Colo. App. 2000); see Lawry v. Palm, 192 P.3d 550, 567 (Colo. App.
2008) (“A material term goes to the root of the matter or essence of
the contract. Materiality must be assessed in the context of the
expectations of the parties at the time the contract was formed.”).
4
¶ 14 Whether a party has materially breached a contract is a
question of fact, Interbank Invs., L.L.C., 12 P.3d at 1229, and a
court’s determination of such a question may not be disturbed on
appeal unless it is so clearly erroneous as to find no support in the
record. See S. Ute Indian Tribe v. King Consol. Ditch Co., 250 P.3d
1226, 1232 (Colo. 2011) (reviewing factual findings by trial court).
¶ 15 The trial court determined that Gravina materially breached
the contract because “Gravina did not substantially perform the
terms of the contract and the Frederiksens did not receive what
they substantially contracted for.”
¶ 16 The court found that the Frederiksens wanted new steel siding
installed “to reduce maintenance on the house” and to eliminate
their woodpecker problems. Thus, the Frederiksens “wanted the
[new] siding installed prior to the arrival of the woodpeckers in the
spring.” The timeframes given by Gravina — starting work in
February or March 2018, and taking a month to complete — were,
the court found, “acceptable to the Frederiksens because [they]
allowed the work to be completed prior to the woodpeckers nesting.”
And “[a]ssuming the maximum four week[s] for completion, as
testified to by Brenda Frederiksen and Mike Gravina, the job should
5
have been finished by April 23[, 2018].” But the project was not
completed even as of August 7, 2018.
¶ 17 Further, Gravina hired three separate subcontractors, at
different times, to install the siding. The first one — a single person
operation — was on the job less than one week before he quit. And
the court found that (1) the second subcontractor’s crew did
“unsatisfactory work, . . . much of [which] had to be redone by [the
third subcontractor/crew]”; and (2) the third subcontractor’s crew,
which was “on the job for over two months,” neither completed the
job,2 nor complied with a product manual “regarding installation as
[Gravina] had agreed.”
¶ 18 The trial court’s findings are supported by the record.
¶ 19 Gravina asserts that the court erred in finding it materially
breached the contract by failing to timely complete the work. As
Gravina points out, there is no time specified in the written contract
for completing the work. Per the contract, the installation was to
begin ten to fourteen weeks from the November 29, 2017, contract
2Gravina’s expert witness, Ryan Phillips, testified that 1,300 of the
3,000 square feet of siding installation on the home was not
completed, not including “soffits and things of that nature.”
6
date — between February 7 and March 4, 2018 — but no
completion date or time estimate was mentioned.3
¶ 20 Nonetheless, the trial court correctly recognized that if a
contract contains no explicit provision concerning the time for a
party’s performance of obligations, the party must perform within a
“reasonable time” as determined by the circumstances of the case.
See Shull v. Sexton, 154 Colo. 311, 317, 390 P.2d 313, 316 (1964);
see also Ranta Constr. Inc. v. Anderson, 190 P.3d 835, 841 (Colo.
App. 2008) (“‘[I]n the absence of a specific time for performance in
the contract, the law implies a reasonable time,’ measured by the
circumstances of the case.” (quoting Adams v. City of Westminster,
140 P.3d 8, 11 (Colo. App. 2005))).
¶ 21 A reasonable time is “determined upon consideration of the
subject matter of the contract, what was contemplated at the time
the contact was made, and other surrounding circumstances.” Hall
v. Add-Ventures, Ltd., 695 P.2d 1081, 1089 (Alaska 1985) (citing
Shull, 154 Colo. at 316-17, 390 P.2d at 316).
3 The contract did include a “time of essence” clause, but the clause
favored Gravina.
7
¶ 22 The trial court heard evidence that (1) the parties entered a
contract in late November 2017 stating that the project was to start
as early as February 7, 2018, but no later than thirty days after
March 4, 2018; (2) Mike Gravina had estimated that the job would
take up to four weeks, a number confirmed as a reasonable
estimate by Jason Castro and expert witnesses hired by each party;
and (3) the Frederiksens hoped to finish the project in the spring.
¶ 23 Based on this evidence, we cannot disturb the court’s
conclusion that Gravina’s completion of the project within a
“reasonable time” of, say, a month (or, even by the end of spring)
was a “material” term of the contract.
¶ 24 Nor will we disturb the trial court’s conclusion that Gravina
breached this term, given evidence that (1) Gravina started the
project on March 23, 2018; (2) Gravina’s first subcontractor quit
within his first week on the job; (3) its second subcontractor started
work near the originally estimated completion date, worked for
another month, and only completed about thirty percent of the job,
much of which was “unacceptable”; and (4) its third subcontractor
began on June 4, 2018 — about two months after the originally
estimated completion date — and by August 7, two months later,
8
had completed siding only 1,700 of 3,000 square feet of the
Frederiksens’ home.4
¶ 25 Delays understandably happen in construction, but a
four-month extension on a one-month job — even then completing
only part of the work — is indicative of a project gone wrong. As the
trial court noted, the delays on the Frederiksens’ home were not
due to matters for which the contract made allowance, i.e., “strikes,
weather conditions, acts of God, or unavailability of materials at
prices acceptable to the parties.” Nor could it have been due to the
“unavailability of labor”: according to the evidence, Gravina’s
business model depends on hiring subcontractors to fulfill its
contracts; any difficulty finding subcontractors with adequate
experience and skills to satisfactorily complete its contracts does
not absolve it of the responsibility to do so in a reasonable time.
¶ 26 Nonetheless, Gravina asserts that if it had to complete the
project within a “reasonable time,” it was at least entitled to a notice
4 In their opening brief, the Frederiksens use these numbers to
calculate the job being 57% completed. At trial, Gravina’s expert
witness called such assertion “misleading” because it did not
include other work such as soffits, wraps, and other perimeter
component installation that precedes the installation of siding.
9
of deadline before being considered in breach of the contract.
Because, however, Gravina did not argue or otherwise raise this
matter in the trial court, we decline to address it. Brown v. Am.
Standard Ins. Co., 2019 COA 11, ¶ 21 (“[I]ssues not raised in or
decided by the trial court generally will not be addressed for the
first time on appeal.”).5
¶ 27 Additionally, the trial court’s findings and the evidence in the
record reflect that Gravina’s breach of contract was not limited to
failing to complete the project within a reasonable time. The court
also found that the third subcontractor did not always follow the
siding manufacturer’s installation instructions (after the meeting in
which Gravina agreed to do so), and that the work before that
subcontractor’s arrival was “unsatisfactory.”6
5 Gravina claims otherwise, citing us to three places in the record
where it says it preserved the issue of requiring a notice of deadline.
The closest we can find to such an argument, however, is a
statement during Gravina’s closing remarks simply that the
Frederiksens’ termination of the contract was “improper.” See
United States v. Dunkel, 927 F.2d 955, 956 (7th Cir.1991) (“A
skeletal ‘argument,’ really nothing more than an assertion, does not
preserve a claim [for appeal].”) (citation omitted).
6Additionally, the evidence was in conflict as to whether the final
work, though largely incomplete, was acceptable. Gravina’s expert
Ryan Phillips testified that the “work overall was quality,” “a lot of
10
¶ 28 Accordingly, we perceive no error in the court’s determination
that, by failing to complete the work in a timely and satisfactory
manner, Gravina breached material terms of the contract and that,
consequently, the Frederiksens were entitled to terminate the
agreement and recover actual damages. See Kaiser v. Mkt. Square
Disc. Liquors, Inc., 992 P.2d 636, 641 (Colo. App. 1999).
III. The Frederiksens’ Appeal
¶ 29 Although it concluded that Gravina had breached its contract
with the Frederiksens, the trial court nonetheless determined that
Gravina was “due some restitution for the work that it did” in
partially completing the installation of siding on the home.
A. Gravina’s Unjust Enrichment Claim
¶ 30 The Frederiksens contend that the trial court erred in
concluding that Gravina could recover under an unjust enrichment
theory. More specifically, they assert that (1) unjust enrichment is
not an appropriate remedy where a contract exists; (2) Gravina
the work is simply incomplete as opposed to defective,” and much of
the work complied with the installation instructions. Conversely,
the Frederiksens’ expert Phillip Blankenship testified that the
quality of the work “seemed to vary around different areas of the
house,” and their other expert, Jeff Whitmore, described the work
as “poor” and recommended re-installing the entire job.
11
acted with “unclean hands”; and (3) Gravina bestowed no benefit
upon them. We disagree, in all three instances.
¶ 31 Initially, we reject Gravina’s assertion that, by not arguing
these points at trial, the Frederiksens forfeited the right to raise
them on appeal. In its first amended complaint, Gravina had
alleged a claim of unjust enrichment “[i]n the event that [the trial
court] determines . . . that the contract between the parties is not a
valid and binding [one].” But outside a couple of other pre-trial
filings mentioning the pleadings, neither party referenced the words
“unjust enrichment,” much less presented any argument on the
subject in the trial court. Consequently, the trial court essentially
entered a sua sponte ruling on the claim. In that circumstance,
“the merits of [the court’s] ruling are subject to review on appeal,
whether timely objections were made or not.” Rinker v. Colina-Lee,
2019 COA 45, ¶ 26; see also In re Estate of Ramstetter, 2016 COA
81, ¶ 71 n.7 (referencing “the rule that where a trial court addresses
an argument, whether that argument was preserved is moot”).
¶ 32 Turning to the merits of the Frederiksens’ arguments, “[u]nder
contract law, a party to a contract cannot claim its benefit where he
is the first to violate its terms.” Coors v. Sec. Life of Denver Ins. Co.,
12
112 P.3d 59, 64 (Colo. 2005). Consequently, per the preceding
section, Gravina was not entitled to recover under the contract.
¶ 33 However, “[g]enerally speaking, ‘a person who is unjustly
enriched at the expense of another is subject to liability in
restitution.’” Scott v. Scott, 2018 COA 25, ¶ 47 (quoting
Restatement (Third) of Restitution and Unjust Enrichment § 1 (Am.
Law Inst. 2011) (hereinafter Restatement)).
¶ 34 “To prevail on an unjust enrichment claim, a party ‘must prove
that (1) the defendant received a benefit (2) at the plaintiff’s expense
(3) under circumstances that would make it unjust for the
defendant to retain the benefit without commensurate
compensation.’” Pulte Home Corp. v. Countryside Cmty. Ass’n, 2016
CO 64, ¶ 63 (quoting Lewis v. Lewis, 189 P.3d 1134, 1141 (Colo.
2008)).7
7 The Frederiksens contend that, under DCB Construction Co. v.
Central City Development, Co., 965 P.2d 115, 123 (Colo. 1998), a
party must satisfy an additional element for an unjust enrichment
recovery, that is, that the benefitted party engaged in “improper,
deceitful, or misleading conduct.” See id. at 122-23 (holding that
for a tenant’s contractor to recover from the landlord on an unjust
enrichment claim, the contractor must show some malfeasance by
the landlord). Our supreme court, however, has rejected the
Frederiksens’ contention, limiting DCB to the landlord-tenant
contract context as a “particularized analysis” that “did not extend
13
¶ 35 But,
[a] party generally cannot recover for unjust
enrichment . . . where there is an express
contract addressing the subject of the alleged
obligation to pay. Colorado appellate courts
have recognized only two exceptions to this
rule — a party may still recover for unjust
enrichment when (1) the express contract fails
or is rescinded, or (2) the claim covers matters
that are outside of or arose after the contract.
Id. at ¶ 64 (citations omitted).
¶ 36 There was a contract here, obligating the Frederiksens to pay
upon completion of the project. Applying the general rule, Gravina
would appear to be barred from recovering anything under the
rubric of unjust enrichment.
¶ 37 But maybe not: it depends on whether one of the exceptions to
the general rule applies here.
¶ 38 The phrase “when the contract fails” certainly encompasses
contracts that are unenforceable for some reason, but it also
appears to encompass other situations as well. See Pulte Home
Corp., ¶ 64 (citing Dudding v. Norton Frickey & Assocs., 11 P.3d
441, 445 (Colo. 2000), as an example of a “fail[ed]” or rescinded
to all unjust enrichment claims.” Lewis v. Lewis, 189 P.3d 1134,
1142 (Colo. 2008).
14
contract); Dudding, 11 P.3d at 442 (client terminated attorney’s
services rendered pursuant to a contingency fee agreement).
¶ 39 In Interbank Investments, LLC v. Eagle River Water &
Sanitation District, 77 P.3d 814 (Colo. App. 2003), a division of our
court, in considering a contract dispute, cited, with approval, the
analysis in United Coastal Industries, Inc. v. Clearheart Construction
Co., 802 A.2d 901 (Conn. Ct. App. 2002), where the court allowed a
subcontractor who breached its contract with the general
contractor, and therefore had no remedy under that contract, to
recover on the basis that the general contractor had been unjustly
enriched by the subcontractor’s partial performance. The court
explained that unjust enrichment “applies when no remedy is
available based on the contract.” Interbank Inv., LLC, 77 P.3d at
818 (quoting United Coastal Indus., 802 A.2d at 906).
¶ 40 The Restatement also recognizes that a party who breaches a
contract may nonetheless be entitled to recover under a theory of
unjust enrichment:
(1) A performing party whose material breach
prevents a recovery on the contract has a
claim in restitution against the recipient of
performance, as necessary to prevent unjust
enrichment.
15
(2) Enrichment from receipt of an incomplete
or defective contractual performance is
measured by comparison to the recipient’s
position had the contract been fully performed.
The claimant has the burden of establishing
the fact and amount of any net benefit
conferred.
(3) A claim under this section may be
displaced by a valid agreement of the parties
establishing their rights and remedies in the
event of default.
(4) If the claimant’s default involves fraud or
other inequitable conduct, restitution may on
that account be denied.
Restatement § 36; see, e.g., New Windsor Volunteer Ambulance
Corps, Inc. v. Meyers, 442 F.3d 101, 118 (2d Cir. 2006) (“[W]here a
valid agreement exists between the parties, an action in quantum
meruit to prevent unjust enrichment ordinarily is not available.
However, a plaintiff whose breach was not willful and deliberate
may, in some instances, recover [on an unjust enrichment theory]
so much as his efforts have actually benefited the non-breaching
party.”) (citation omitted); In re Palmdale Hills Prop., LLC, 577 B.R.
858, 861 (Bankr. C.D. Cal. 2017) (“California law allows a breaching
party to recover under an unjust enrichment theory for the benefit
conferred upon the non-breaching party minus damages to the
16
non-breaching party.”); David M. Somers & Assocs., P.C. v. Busch,
927 A.2d 832, 841 (Conn. 2007) (“When a contracting party has
unjustifiably breached a contract, the breaching party cannot
recover restitution damages unless” the breaching party has made a
claim for unjust enrichment.); Am. Nat’l Bank & Tr. Co. v. St. Joseph
Valley Bank, 391 N.E.2d 685, 687 (Ind. Ct. App. 1979) (“A
breaching party may recover, apart from the contract, in quantum
meruit.”); ARC LifeMed, Inc. v. AMC-Tenn., Inc., 183 S.W.3d 1, 25
(Tenn. Ct. App. 2005) (“A party who has materially breached a
contract cannot recover on the contract. Nevertheless, under
proper conditions . . . he may recover in quantum meruit. The rule
is: ‘Even though a contract be entire, the party who breaches the
same may recover of the other party, as on a quantum merit, the
value of benefits conferred on such other party by partial
performance — these benefits being accepted and retained. Any
damage, of course, which the party not in default suffered by the
breach [is] also to be taken into account.’” (quoting Nat’l Life &
Accident Ins. Co. v. Hamilton, 98 S.W.2d 107, 108 (Tenn. 1936))).
¶ 41 Persuaded by these authorities, we conclude that where a
contract exists, absent a provision explicitly addressing remedies
17
with respect to the default at issue, a party that breaches the
contract may nonetheless recover for the other party’s unjust
enrichment.
¶ 42 But, the Frederiksens assert, there is a provision in the
contract explicitly addressing remedies in the event of Gravina’s
breach. In this regard, they point to the line in the contract stating
“cash to be paid on completion.” They argue the provision requires
them to pay “only when” the project is complete. When read in
context, however, the provision addresses only payment of the
balance owed under the contract upon completion of the project. It
does not address what happens in the event that the contract is
terminated before the project is completed.
¶ 43 Even so, the Frederiksens assert that Gravina could not
recover for unjust enrichment because it was guilty of “inequitable
conduct.” See Wilson v. Prentiss, 140 P.3d 288, 293 (Colo. App.
2006) (“Under the doctrine of unclean hands, a court considering
equitable claims may exercise its discretion to deny the remedy
sought.”). According to them, Gravina acted with “unclean hands”
in breaching the contract. But the concept of “unclean hands”
must encompass something more than simply engaging in an act or
18
omission that breaches a contract. It requires “improper ” conduct.
See Salzman v. Bachrach, 996 P.2d 1263, 1269 (Colo. 2000) (“Many
different forms of improper conduct may bar a plaintiff's equitable
claim, and the conduct need not be illegal. Generally, courts apply
this doctrine only when a plaintiff's improper conduct relates in
some significant way to the claim he now asserts.”). No intentional
misconduct on Gravina’s part, however, is even suggested in the
record. See Int’l Network, Inc. v. Woodard, 2017 COA 44, ¶¶ 38-39
(Unclean hands doctrine applied where “seller admitted that he had
intentionally breached the referral provision and agreed that his
purpose in concealing his negotiations was to deprive broker of its
commission.”).
¶ 44 Finally, we reject the Frederiksens’ assertion that they received
no benefit from Gravina’s efforts. The court found that, while “the
amount of work that remained to be done or needed to be redone
was in conflict,” the Frederiksens received a benefit “in the form of
installation of siding on a portion of their home . . . done at
[Gravina’s] expense.” This finding is supported by the evidence,
including that of the Frederiksens’ expert, who opined that the
Frederiksens benefitted despite Gravina’s failure to strictly adhere
19
to the procedures provided in a product manual for installing the
siding.8
¶ 45 Consequently, we perceive no error in the court’s conclusion
that Gravina was entitled to pursue a claim of unjust enrichment.
B. Negligent Supervision
¶ 46 The Frederiksens contend that the trial court erred by not
applying the doctrine of res ipsa loquitur to the Frederiksens’ claim
of negligent supervision against the individual third-party
defendants. We disagree.
¶ 47 The court did not directly address the res ipsa loquitur issue
in its order, finding only that the Frederiksens “failed to prove” their
claim.
¶ 48 “Whether res ipsa loquitur is applicable is a question of law for
the trial court.” Minto v. Sprague, 124 P.3d 881, 886 (Colo. App.
2005). On appeal, we review the trial court’s determination de
novo. Boulders at Escalante LLC v. Otten Johnson Robinson Neff &
Ragonetti PC, 2015 COA 85, ¶ 19.
8 On this particular point, Gravina’s expert testified that many of
the Frederiksens’ examples of failing to follow the manual were
misinterpretations of its content, and that failing to strictly follow
the manual to the letter would not necessarily void any warranty.
20
For res ipsa loquitur to apply, the plaintiff
must establish that it is more probable than
not that: “(1) the event is of the kind that
ordinarily does not occur in the absence of
negligence; (2) responsible causes other than
the defendant’s negligence are sufficiently
eliminated; and (3) the presumed negligence is
within the scope of the defendant’s duty to the
plaintiff.”
Chapman v. Harner, 2014 CO 78, ¶ 5 (quoting Kendrick v. Pippen,
252 P.3d 1052, 1061 (Colo. 2011)).
¶ 49 According to the Frederiksens, (1) “it is undisputed that the
[individual] third-party defendants . . . had a duty to the
Frederiksens to see that the job was properly done”; (2) the
individual third-party defendants “were the only people responsible
for supervising the project”; and (3) other explanations for the
failure of the individual third-party defendants to produce their end
of the contract “have been eliminated.” Consequently, they assert,
the elements of res ipsa loquitur regarding their claim of negligent
supervision were met.9
9There is some question whether a claim of negligent supervision
can be pursued against individuals or entities that hire independent
contractors. The proper tort claim in that situation may well be for
negligent selection, rather than negligent supervision, of the
contractors. See W. Stock Ctr., Inc. v. Sevit, Inc., 195 Colo. 372,
375-78, 578 P.2d 1045, 1048-49 (1978). We need not resolve that
21
¶ 50 Not quite.
¶ 51 To establish a claim of negligent supervision, a plaintiff must
prove (1) the defendant owed the plaintiff a legal duty to supervise
others; (2) the defendant breached that duty; and (3) the breach of
the duty caused the harm that resulted in damages to the plaintiff.
Settle v. Basinger, 2013 COA 18, ¶ 23 (citing Keller v. Koca, 111
P.3d 445, 447 (Colo. 2005)).
¶ 52 “The duty to supervise an agent or employee arises when the
principal or employer ‘has reason to know’ that the agent or
employee ‘is likely to harm others’ because of ‘his [or her] qualities’
and ‘the work or instrumentalities entrusted to him [or her].’” Id. at
¶ 26 (emphasis added) (quoting Destefano v. Grabrian, 763 P.2d
275, 287 (Colo. 1988)).
Thus, there is no liability for breach of the
duty to supervise unless the principal or
employer both knows the agent or employee is
. . . ‘incompetent, vicious, or careless,’ and
does not take ‘the care which a prudent
issue in this case, though. For purpose of appeal, we assume,
without deciding, that the Frederiksens could assert a negligent
supervision claim here.
22
[person] would take in selecting the person for
the business in hand.’”10
Id. (quoting Destefano, 763 P.2d at 287).
¶ 53 So far as we can discern, nothing in the record suggests that
the individual third-party defendants had any reason to know that
any of the subcontractors were likely to harm others “because of
their personal qualities” and “the work or instrumentalities
entrusted to them.” Id. at ¶ 29. Consequently, regardless of
whether the subcontractors’ negligence caused the Frederiksens’
injuries, the individual third-party defendants did not owe the
Frederiksens a legal duty to supervise them.
¶ 54 We perceive no error in the court’s failure to apply a negligence
doctrine to a situation in which no duty of care for supervising
others was shown to exist.
10The court in Settle v. Basinger, 2013 COA 18, added a “not” that
did not appear in Destefano v. Grabrian, 763 P.2d 275 (Colo. 1988).
The ellipsis in our use of the quote represents removal of the errant
word.
23
C. Exclusion of Expert Evidence
¶ 55 The Frederiksens contend that the trial court erred by
excluding expert witness evidence related to the repair costs of roof
damage allegedly caused by Gravina. We disagree.
1. Facts
¶ 56 The trial in this case was held, after two continuances, on July
13-15, 2020. On August 22, 2019 — during Gravina’s inspection of
the property — Gravina and the Frederiksens discovered damage to
the Frederiksens’ fireproof metal roof allegedly caused by Gravina.
¶ 57 The trial court ordered the Frederiksens to identify all expert
witnesses by March 6 and to disclose all expert witness reports by
March 16. The Frederiksens timely disclosed expert witness Eli
Grasmick and a report he had written. The report did not, however,
include a roofing repair estimate.
¶ 58 On June 3, 2020, the Frederiksens received another report
from Grasmick, in which he estimated the cost of repairing the roof
at $41,872.47.
¶ 59 Gravina deposed Grasmick on June 9, 2020. The
Frederiksens had not, however, disclosed Grasmick’s second report
to Gravina before Gravina deposed him. Instead, they disclosed
24
Grasmick’s roof repair estimate to Gravina on June 16, 2020. On
that same day, the Frederiksens also disclosed to Gravina a second
roof repair estimate of $78,539.32 from an individual (i.e., Byron
Franks) who had not been endorsed as an expert witness under
C.R.C.P. 26(a)(2)(B).
¶ 60 On June 19, the Frederiksens filed an exhibit list containing
Grasmick’s and Franks’s estimates for repairing the roof and
Gravina filed a motion in limine to exclude the roof-related
evidence. The trial court granted Gravina’s motion in part,
excluding evidence of the roof repair estimates.
¶ 61 At trial, the Frederiksens questioned their expert, Phillip
Blankenship, about damage to the home. When Blankenship began
to discuss the roof, Gravina objected, citing the court’s pre-trial
order, and the court sustained the objection.
2. Standard of Review and Applicable Law
¶ 62 A party must disclose the identity of any person who may
present expert testimony at trial, as well as written reports from,
and summaries of testimony of, experts. C.R.C.P. 26(a)(2). And
parties must supplement their required disclosures. C.R.C.P. 26(e).
25
¶ 63 C.R.C.P. 37(c)(1) provides “[a] party that without substantial
justification fails to disclose information required by C.R.C.P. 26(a)
or 26(e) shall not be permitted to present any evidence not so
disclosed at trial . . . , unless such failure has not caused and will
not cause significant harm, or such preclusion is disproportionate
to that harm.”
¶ 64 Rule 37(c)(1) allows the “preclusion of testimony from an
expert witness where the fact that the witness would be testifying
was not timely disclosed.” Trattler v. Citron, 182 P.3d 674, 681
(Colo. 2008).
¶ 65 The burden is on the nondisclosing party to establish that its
failure to disclose was substantially justified or harmless, or that
excluding the evidence would be disproportionate to the harm
caused by the nondisclosure. See Todd v. Bear Valley Vill.
Apartments, 980 P.2d 973, 978 (Colo. 1999).11
11 The Todd case dealt with the prior version of the rule, which,
before 2015, explicitly “provide[d] for the exclusion of non-disclosed
evidence unless the failure to disclose is either substantially
justified or harmless to the opposing party.” Todd v. Bear Valley
Vill. Apartments, 980 P.2d 973, 977 (Colo. 1999). Following the rule
change, the supreme court said that “the harm and proportionality
analysis under Colorado Rule of Civil Procedure 37(c)(1) remains
the proper framework for determining sanctions for discovery
26
¶ 66 “We review a trial court’s decision to exclude expert testimony
for an abuse of discretion and will not overturn the court’s ruling
unless it is ‘manifestly erroneous.’” Black v. Black, 2018 COA 7,
¶ 111 (quoting People v. Williams, 790 P.2d 796, 797-98 (Colo.
1990)).
3. Analysis
¶ 67 The Frederiksens do not make much of an argument on
appeal. Other than general legal standards, they cite no authority
in support of their “argument,” which consists merely of pointing
out that (1) Gravina knew that the Frederiksens claimed the roof
had been damaged; (2) Gravina’s expert had an opportunity to view
the roof damage on May 20, 2020; (3) the experts’ estimates were
provided to Gravina “as soon as they were available”; and (4) the
trial court’s “exclusion of the roof damage evidence was unfair and
substantially influenced the possible damages in this case.”
¶ 68 The record, however, shows that the Frederiksens did not
disclose Franks’ identity as an expert or the estimates as soon as
violations.” Cath. Health Initiatives Colo. v. Earl Swensson Assocs.,
Inc., 2017 CO 94, ¶ 15 (citing Todd, 980 P.2d at 978).
27
they were available. Grasmick’s estimate, at least, was available as
early as June 3, 2020 — nearly a week before he was deposed —
but not disclosed to Gravina until June 16, 2020 — a week after
Grasmick had been deposed.12
¶ 69 In Todd, the supreme court noted a number of factors relevant
in determining whether a party’s failure to disclose information as
required was justified or harmless: the importance of a witness’s
testimony, the explanation of the party’s failure to comply with
required disclosure, potential prejudice to the party against whom
the testimony is offered if the testimony were admitted, the
availability of continuance to cure, and the nondisclosing party’s
bad faith or willfulness. 980 P.2d at 978-79.
¶ 70 In their briefs, the Frederiksens offer no justification for (1)
why they couldn’t have identified Franks as an expert or obtained
Grasmick’s estimate any earlier than a month and a half before
12Gravina proceeded with the deposition expecting that Grasmick
was an expert witness in the matter of the siding only. Gravina
specifically asked Grasmick in the deposition what Paul Frederiksen
had asked him to do for this case, and Grasmick replied “[h]e asked
me to take a look at the siding and see if I seen [sic] anything that
was wrong with it.”
28
trial, and (2) not providing Grasmick’s estimates to Gravina before
Grasmick was deposed.13
¶ 71 Moreover, the Frederiksens don’t mention — much less
attempt to apply — the remaining Todd factors. “[I]t is not this
court’s function to speculate as to what a party’s argument might
be.” People v. Palacios, 2018 COA 6M, ¶ 29 (quoting Beall Transp.
Equip. Co. v. S. Pac. Transp., 64 P.3d 1193, 1196 n.2 (Or. Ct. App.
2003)). “Nor is it our proper function to make or develop a party’s
argument when that party has not endeavored to do so itself.” Beall
Transp., 64 P.3d at 1196 n.2.
¶ 72 On this record, under these facts, and based on the
arguments made by the Frederiksens, we perceive no abuse of
discretion on the part of the trial court in excluding the belatedly
13 In their opening brief, the Frederiksens assert that “this delay
was explained in detail in the Frederiksens’s response to the motion
in limine, CF 922-935, as well as in their response re discovery,
previously filed. CF 731-736.” This attempt to incorporate by
reference arguments made in the trial court improperly “attempts to
shift — from the litigants to the appellate court — the task of
locating and synthesizing the relevant facts and arguments” and
“‘makes a mockery’ of the rules that govern the length of briefs.”
Castillo v. Koppes-Conway, 148 P.3d 289, 291 (Colo. App. 2006)
(citation omitted); accord People v. Gutierrez-Vite, 2014 COA 159,
¶ 28.
29
disclosed expert evidence. See Redden v. Clear Creek Skiing Corp.,
2020 COA 176, ¶ 21 (“If [the party] wanted a weightier resolution of
the issue, it should have mounted a weightier contention. Gravitas
begets gravitas.” (quoting CSX Transp., Inc. v. Miller, 858 A.2d 1025,
1083 (Md. Ct. Spec. App. 2004))).
D. The Court’s Remedy
¶ 73 The Frederiksens contend that the trial court should have
awarded them damages rather than awarding restitution to
Gravina. We conclude that a remand is necessary.
¶ 74 As noted supra Part II, the Frederiksens were entitled to
recover damages for Gravina’s breach of contract.
¶ 75 But, as noted supra Part III.A, the Frederiksens were not
entitled to be unjustly enriched at Gravina’s expense.
¶ 76 Consequently, Gravina could recover the reasonable value of
the benefit conferred upon the Frederiksens minus the damages the
Frederiksens incurred as a result of Gravina’s breach of contract.
See In re Palmdale Hills Prop., LLC, 577 B.R. at 861; ARC LifeMed,
Inc., 183 S.W.3d at 25. 14
14If, however, this calculation resulted in a negative number, the
Frederiksens would recover the difference from Gravina.
30
¶ 77 The trial court purported to apply this rule. Contrary to the
Frederiksens’ assertion, the court awarded damages to the
Frederiksens. That it did so is apparent from its statement that it
took the Frederiksens’ damages into account in determining that
Gravina was entitled to a restitutionary award of $19,000.
¶ 78 We review a trial court’s determinations about the amount of
damages or restitution under an abuse of discretion standard. See
Zeke Coffee, Inc. v. Pappas-Alstad P’ship, 2015 COA 104, ¶ 11
(restitution); McDonald’s Corp. v. Brentwood Ctr., Ltd., 942 P.2d
1308, 1311 (Colo. App. 1997) (damages).
¶ 79 But a trial court’s order must contain findings of fact and
conclusions of law sufficient to give an appellate court a clear
understanding of the basis of its decision. E.g., In re Marriage of
Gedgaudas, 978 P.2d 677, 682 (Colo. App. 1999); In re Marriage of
Rozzi, 190 P.3d 815, 822 (Colo. App. 2008) (noting the purpose of
including findings of fact and conclusions of law in an order is to
enable the appellate court to determine the grounds upon which the
trial court rendered its decision). “In the absence of such findings,
an appellate court cannot adequately assess the propriety of the
trial court’s award.” Fed. Ins. Co. v. Ferrellgas, Inc., 961 P.2d 511,
31
515 (Colo. App. 1997); see Miller v. Hancock, 2017 COA 141, ¶ 49
(“Because the trial court failed to make findings sufficient to
disclose the basis for its decision to award some costs while denying
others, we cannot adequately assess the propriety of the award.”).
¶ 80 In our view, the trial court’s findings are not sufficient to give
us a clear understanding of the basis for its decision. The court
cited testimony from both parties’ experts, including opinions on
the quality of the completed work and detailed cost estimates to
complete (or replace) the job. It explained, to some degree, where it
rejected the reasoning of the experts. However, it did not explain
how it determined an award of $19,000 to Gravina was appropriate.
It never identified how much damages Gravina’s breach caused or,
for that matter, how much the Frederiksens benefitted as a result of
Gravina’s efforts. All the court did was repeat certain numbers
from the parties’ dueling experts’ testimony and conclude that when
the Frederiksens’ damages were subtracted from the benefits they
had received, Gravina was entitled to recover $19,000.
¶ 81 We have not been able to ascertain from these figures how the
court arrived at a figure of $19,000 due to Gravina. Because we are
unable to establish how the court arrived at its determination, we
32
conclude that a reversal and remand for further findings are
necessary.
E. Attorney Fees
¶ 82 The Frederiksens contend that the trial court erred by denying
their request for attorney fees, either under section 13-17-102,
C.R.S. 2021, or C.R.C.P. 11. We disagree.
¶ 83 “Whether to award attorney fees under § 13-17-102 or as a
sanction under C.R.C.P. 11 is a decision committed to the
discretion of the trial court, whose ruling will not be disturbed on
appeal absent an abuse of discretion.” E-470 Pub. Highway Auth. v.
Jagow, 30 P.3d 798, 805 (Colo. App. 2001), aff’d, 49 P.3d 1151(Colo. 2002).
1. C.R.C.P. 11
¶ 84 Under Rule 11, an attorney filing a complaint has an
“obligation to have determined it was well grounded in fact and
warranted by existing law.” Belinda A. Begley & Robert K. Hirsch
Revocable Tr. v. Ireson, 2020 COA 157, ¶ 49.
¶ 85 In the trial court, the Frederiksens linked their request for
Rule 11 fees to Gravina’s motions to exclude expert testimony and
roofing repair estimates. On appeal, however, they attempt to
33
connect it to a different subject, i.e., Gravina’s president’s
acknowledgment that he knew some work could not be completed
in a day. Because they did not present this argument to the trial
court, we do not consider it. See In re Estate of Colby, 2021 COA
31, ¶ 35 (“Arguments never presented to, considered or ruled upon
by a trial court may not be raised for the first time on appeal.”
(quoting Est. of Stevenson v. Hollywood Bar & Cafe, Inc., 832 P.2d
718, 721 n.5 (Colo. 1992))).
2. Section 13-17-102
¶ 86 Under section 13-17-102(2), reasonable attorney fees shall be
awarded “against any attorney or party who has brought or
defended a civil action, either in whole or in part, that the court
determines lacked substantial justification.” (Emphasis added.) As
pertinent here, “lack[s] substantial justification” means
“substantially groundless.” § 13-17-102(4).
¶ 87 “A claim is substantially groundless if the allegations in the
complaint, while sufficient to survive a motion to dismiss for failure
to state a claim, are not supported by any credible evidence at
trial.” City of Aurora ex rel. Util. Enter. v. Colo. State Eng’r, 105 P.3d
595, 618 (Colo. 2005).
34
¶ 88 For purposes of section 13-17-102, “something can be
‘credible’ without the necessity of its ultimately being “believed” or
accepted by the trier of fact.” In re Estate of Shimizu, 2016 COA
163, ¶ 21. Indeed, in this context, the term “‘credible’ relates ‘not to
some quantum measure of evidence nor to a fact-finder’s subjective
weighing of the quality (credit-worthiness) of evidence . . . but to an
objective recognition of the matter offered as being evidence capable
of being believed and capable of supporting a fact-finding.’” Id.(quoting Hlad v. State, 565 So. 2d 762, 777 (Fla. Dist. Ct. App.
1990) (Cowart, J., dissenting)).15
¶ 89 Here, although unsuccessful, Gravina presented “credible”
evidence to support its breach of contract and breach of covenant of
good faith claims. In support of its position that it had
“substantially completed the work,” Gravina could point to evidence
showing that the siding was about 57% finished, that much other
15 In In re Estate of Shimizu, the division took pains to emphasize
that “Judge Cowart went on to note that the word ‘credible’ is
‘intended to exclude only evidence that is inherently incredible,
such as asserted facts or events that are contrary to commonly
known and generally accepted scientific or mathematical principles,
geographic facts, natural laws or common sense.’” 2016 COA 163,
¶ 21 n.1 (quoting Hlad v. State, 565 So. 2d 762, 777 (Fla. Dist. Ct.
App. 1990) (Cowart, J., dissenting)).
35
time-consuming work (such as installation of wrap and perimeter
components) had been completed before installing that siding, and
that the project could have been finished in about another week’s
time. Similarly, in support of its position that the Frederiksens
interfered with Gravina’s performance under the contract, Gravina
could point to evidence that the Frederiksens had (1) “kicked” its
second subcontractor’s workers off the job site (due to mistakes
they had made on the job) and (2) posted “No Trespassing” signs
and threatened to contact law enforcement if the third
subcontractor or anyone from Gravina tried to re-enter the
property.
¶ 90 Finally, we reject the Frederiksens’ assertion that they were
entitled to attorney fees with respect to Gravina’s lien forfeiture
claim. The Frederiksens did not file a motion for attorney fees
following the court’s dismissal of this claim, and the district court
did not otherwise address it. Because they did not present this
argument to the trial court, we do not consider it.
¶ 91 Consequently, we conclude the court did not abuse its
discretion when it denied the Frederiksens’ fee request under
section 13-17-102.
36
IV. Attorney Fees and Costs Incurred on Appeal
¶ 92 The Frederiksens and Gravina request awards of attorney fees
and costs incurred on appeal. We conclude that neither party is
entitled to such an award.
¶ 93 The Frederiksens request their award under section 13-17-
102, C.R.C.P. 11, and C.A.R. 38 because Gravina’s “action has been
groundless from its inception.” But, given the manner in which
we’ve resolved the issues, this could not be the case.
¶ 94 Gravina requests its award of fees under the fee-shifting
provision of the contract, which provides that, “[i]n the event of any
breach of this Agreement by Buyer, including but not limited to
Buyer’s failure to make any payment when due, Seller shall be
entitled to recover any loss sustained, including costs incurred by
it, and reasonable attorneys’ fees.” Because the Frederiksens were
not found to have breached the agreement, however, no recovery of
fees under this provision is warranted.
V. Disposition
¶ 95 The judgment is affirmed in part, reversed in part, and the
case is remanded to the trial court for further proceedings
consistent with the views expressed in Part III.D of this opinion.
37
JUDGE FOX and JUDGE SCHUTZ concur.
38