A05-25

Allen H. Aaron, et al.,

Respondents,

vs.

David Gregory Crooks,

Appellant.

Filed January 17, 2006

Affirmed

Hudson, Judge

Scott County District Court

File No. 03-20579

Jerome B. Simon, Jason A. Lien, Morgan L. Holcomb, Maslon Edelman Borman & Brand, LLP, 3300 Wells Fargo Center, 90 South Seventh Street, Minneapolis, Minnesota 55402-4140 (for respondents)

Stephen L. Smith, The Law Firm of Stephen L. Smith, PLLC, 700 Lumber Exchange Building, 10 South Fifth Street, Minneapolis, Minnesota 55402 (for appellant)

Considered and decided by Lansing, Presiding Judge; Willis, Judge; and Hudson, Judge.

U N P U B L I S H E D O P I N I O N

HUDSON, Judge

In this appeal from the district court order denying appellant’s motion for judgment notwithstanding the verdict (JNOV) or for a new trial, appellant argues that the district court abused its discretion by excluding the testimony of one witness and allowing two other witnesses to testify as experts. Appellant further argues that (1) the district court erred because the verdict was contrary to law and manifestly inconsistent with the facts, and (2) the evidence was insufficient to prove that respondents obtained appellant’s enrollment in the Mdewakanton Sioux Community. Because the district court did not abuse its discretion in its evidentiary rulings, nor was appellant prejudiced by the rulings, and because there was sufficient evidence from which a jury could base its decision that respondent attorneys obtained appellant’s enrollment in the Community, we affirm.

FACTS

In 1994, appellant David Crooks attempted to enroll as a member of the Shakopee Mdewakanton Sioux Community (hereinafter the “Community”). Among other things, enrollment in the Community entitles members to share in the Community’s profits from the operation of the Mystic Lake Casino. In addition to possessing the requisite lineage, the Community’s enrollment procedures require the prospective member to submit an application that is subject to approval by the “Enrollment Committee.” The enrollment officer posts the approved applications for challenges by members of the Community. The Enrollment Committee then upholds or overrules the challenge before submitting the entire record to the “General Council,” consisting of all members of the Community, for a vote on membership. It is undisputed that the General Council is the governing body of the Community and that it ultimately determines whether an individual is qualified for membership.

Although appellant had the required lineage for enrollment, he filed a lawsuit in tribal court in order to leverage the Enrollment Committee. The Enrollment Committee approved appellant and placed his application on the General Council’s agenda. Appellant then voluntarily dismissed the lawsuit prior to his appearance before the General Council. The General Council did not enroll him.

In 1998, appellant signed a contingency retainer agreement with Richard Meshbesher to represent appellant in his second attempt to enroll in the Community. Respondent Allen Aaron later associated with Meshbesher and began working on the case. In 2000, appellant filed his second lawsuit against the Community. Aaron brought respondent Larry Leventhal & Associates in to assist with the trial. In 2002, the Community Trial Court dismissed appellant’s lawsuit. Following the dismissal, Aaron and appellant executed a separate contingent-fee agreement to pursue an appeal with the Community Court of Appeals. That agreement read in part:

It is understood that Allen H. Aaron will prosecute this matter to conclusion by way of settlement, adjustment or trial, including services to be rendered in taking an appeal. . . .

It is agreed that as compensation for his services Allen H. Aaron will receive as attorney fees, 40 percent of any and all sums obtained on my behalf, whether by way of settlement, adjustment, hearing or trial. If the result amounts to a monthly distribution from Tribal profits the percentage fee shall be limited to a period of five years of payments distributed to Mr. David Crooks.

(Emphasis added.) The agreement also indicated that the contingent fee payable to Aaron included all fees payable to Larry Leventhal & Associates.

Respondents worked with appellant on a two-pronged strategy; first, pursuing the lawsuit, and second, making valuable connections within the Community in an effort to lobby for enrollment. During the appeals process, appellant was scheduled to appear before the General Council. Leventhal & Associates informed the Community’s counsel, Andrew Small, that appellant wanted to postpone oral arguments on the appeal until after the General Council’s vote. Leventhal told Small that appellant would dismiss his appeal if the General Council enrolled him. Small agreed to postpone the oral argument.

In March 2003, appellant appeared before the General Council, who enrolled him as a member. He then dismissed his appeal. Appellant hosted a celebration dinner and thanked respondents for their efforts, telling them “I couldn’t have done it without you guys.” But appellant later refused to pay respondents, claiming that (1) it was his own efforts that resulted in his enrollment, and (2) because his attorneys did not secure his enrollment “by way of settlement, adjustment, hearing or trial,” he was not contractually bound by the contingent-fee agreement. As a result, respondents brought this suit against appellant for breach of the contingency-fee contract/agreement.

To avoid involvement of the Community in the fee dispute, Small, as counsel for the Community, asserted sovereign immunity on behalf of the Community. In turn, respondents moved to exclude any tribal official or tribal attorneys from testifying at trial, arguing that any such testimony would constitute a selective use of sovereign immunity by the Community. Appellant had intended to call Small as a witness to contradict Leventhal’s expected testimony that, in his conversations with Small regarding the postponement of the oral argument, Leventhal had reached an informal settlement agreement with the Community. The district court granted respondents’ motion to exclude Small and other tribal members as witnesses based on the Community’s assertion of sovereign immunity.

Over appellant’s objection, the district court allowed the expert testimony of Mary Jo Hunter—a professor of law and a judge on numerous tribal courts—who testified that appellant’s enrollment litigation was meritorious, and William Sieben—an experienced plaintiff’s attorney—who testified generally about retainer agreements and his opinion that the contingent fee in this case was reasonable.

After hearing all of the testimony, a jury found that respondents had obtained appellant’s enrollment in the Community “by way of settlement, adjustment, trial or hearing.” The district court then entered judgment against appellant and subsequently denied appellant’s motion for JNOV or, in the alternative, a new trial. This appeal follows.

D E C I S I O N

“[E]videntiary rulings, including a decision to exclude expert testimony, lie within the sound discretion of the trial court.” Benson v. N. Gopher Enters., 445 N.W.2d 444, 445 (Minn. 1990). A trial judge is given wide latitude in determining whether there is sufficient foundation upon which an expert may state an opinion. Id. at 446. “Even if this court would have reached a different conclusion as to the sufficiency of the foundation, the decision of the trial judge will not be reversed absent clear abuse of discretion.” Id.

The decision to grant—or not to grant—a new trial also rests in the discretion of the district court, and the district court’s decision will be reversed only for a clear abuse of discretion. Boschee v. Duevel, 530 N.W.2d 834, 840 (Minn. App. 1995), review denied (Minn. Apr. 25, 1995). Courts may grant a new trial when errors of law occurred during the trial, or when a jury verdict is either not justified by the evidence, or is contrary to law. Minn. R. Civ. P. 59.01(f), (g). Yet, an appellate court “will not set aside a jury verdict on an appeal from a district court’s denial of a motion for a new trial unless it is manifestly and palpably contrary to the evidence as a whole and in the light most favorable to the verdict.” Navarre v. S. Washington County Schs., 652 N.W.2d 9, 21 (Minn. 2002) (quotation omitted). Further, an entitlement to a new trial on the grounds of an improper evidentiary ruling rests upon the complaining party’s ability to demonstrate prejudicial error. Kroning v. State Farm Auto. Ins. Co., 567 N.W.2d 42, 46 (Minn. 1997).

First, appellant argues that the district court abused its discretion by excluding the proposed testimony of Andrew Small. Both parties agree that sovereign immunity applies to attorneys when they are acting as representatives of the Tribe and within the scope of their authority. See Diver v. Peterson, 524 N.W.2d 288 (Minn. App. 1994) (examining the scope of tribal sovereign immunity), review denied (Minn. Feb. 14, 1995). But the parties disagree on whether the district court properly ruled that the Community’s invocation of sovereign immunity also prohibited Small’s testimony. Appellant argues that Small was outside counsel, not a tribal official and, thus, he was acting as an independent contractor and should have been permitted to testify. But as respondents correctly assert, appellant’s “independent contractor” argument was never presented to the district court. Accordingly, we will not consider it for the first time here on appeal. See Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988) (stating that appellate courts generally will not review issues that were not presented to and considered by the district court).

Appellant also argues that even if Small had reached a settlement with respondents, he would have been acting outside the scope of his authority and, therefore, sovereign immunity would be inapplicable. We are not persuaded by appellant’s argument. According to appellant, Small would have testified that he did not reach a settlement with respondents, thus Small did not exceed his authority. Further, it is undisputed that Small did not have the authority in any event to admit Crooks; only a vote of the General Council could do that. Finally, respondents never claimed that they reached a settlement with Small. To the contrary, at trial both parties conceded that the General Council made the ultimate decision to enroll appellant, and there is no question that the General Council was protected by sovereign immunity. As a result, neither the district court nor the jury had any way of knowing whether Leventhal’s offer to dismiss the appeal if Crooks was enrolled influenced the General Council’s decision.

Appellant has failed to demonstrate that the Community’s invocation of sovereign immunity did not also attach to Small. Likewise, appellant has failed to show that he was prejudiced by the district court’s decision to exclude Small’s testimony, or that Small’s testimony would have changed the jury’s verdict. Accordingly, we conclude that the district court did not abuse its discretion by excluding Small’s proposed testimony.

Next, appellant challenges the district court’s decision to allow the expert testimony of Professor Mary Jo Hunter and William Sieben, arguing that their testimony impeded the jury’s understanding of the issues.

Hunter is a professor of Native American law at Hamline University School of Law and serves as a justice on numerous tribal courts. Hunter testified generally regarding the tribal justice system, that she had experience with enrollment claims, and that in her opinion the claims made in appellant’s lawsuit against the Community had merit. Appellant’s principal argument was that his enrollment was merely fortuitous and not related to respondents’ efforts. Hunter’s testimony tended to show that appellant’s appeal might have influenced the General Council’s decision to enroll him in exchange for his dismissal of the appeal.

Sieben is a plaintiff’s lawyer who handled virtually all of his business under contingent-fee agreements. The district court allowed Sieben to testify as to the purpose and common use of contingent-fee agreements. Sieben opined that the fee agreement between Crooks and Aaron was reasonable, and that a settlement is a give-and-take agreement. Sieben’s testimony was relevant to the jurors’ understanding of the fee agreement and whether appellant’s promise to dismiss his appeal against the Community if the General Council enrolled him into the Community was a “settlement.”

Appellant’s argument that the testimony of both Hunter and Sieben created “potential for confusion of the issues” is conclusory and does not meet his burden on appeal of showing that the district court’s decision allowing Hunter and Sieben to testify—and not allowing Small to testify—would likely have changed the jury’s verdict. On this record, we conclude that the district court did not abuse its discretion in allowing the expert testimony of Hunter and Sieben.

It is proper for the district court to enter JNOV when, viewing the evidence in the light most favorable to the verdict, it finds the verdict is contrary to law or manifestly inconsistent with the evidence. Navarre v. S. Washington County Schs., 652 N.W.2d 9, 21 (Minn. 2002). Because the denial of JNOV is a question of law, we review it de novo. Obst v. Microtron, Inc., 614 N.W.2d 196, 199 (Minn. 2000). On appeal, where JNOV has been denied by the district court, the denial “must be affirmed, if, in the record, there is any competent evidence reasonably tending to sustain the verdict. Unless the evidence is practically conclusive against the verdict, [this court] will not set the verdict aside.” Pouliot v. Fitzsimmons, 582 N.W.2d 221, 224 (Minn. 1998) (quotation omitted).

The construction and effect of a contract are questions of law for the court. Turner v. Alpha Phi Sorority House, 276 N.W.2d 63, 66 (Minn. 1979). But “the interpretation of an ambiguous contract is a question of fact for the jury.” Denelsbeck v. Wells Fargo & Co., 666 N.W.2d 339, 346 (Minn. 2003). “A contract is ambiguous if, based upon its language alone, it is reasonably susceptible of more than one interpretation.” Art Goebel, Inc. v. N. Suburban Agencies, Inc., 567 N.W.2d 511, 515 (Minn. 1997).

Here, the district court noted that because the parties had different interpretations of the “plain and ordinary meaning” of the written contract terms, it follows that the contract was ambiguous. The contingent-fee agreement provided, in pertinent part: “[I]t is agreed that as compensation for his services Allen H. Aaron will receive as attorney fees, 40 percent of any and all sums obtained on my behalf, whether by way of settlement, adjustment, hearing or trial.” (Emphasis added.) Aaron testified that he did not consider appellant’s enrollment to be obtained by way of “hearing” or “trial.” Thus, the record reflects that the words “obtained,” “settlement,” and “adjustment” are the relevant ambiguous terms of this contract. By way of a special verdict form, the trial court asked the jury to determine only one question: “Did [respondents] obtain [appellant’s] enrollment in the Shakopee Mdewakanton Sioux Community by way of settlement, adjustment, trial, or hearing?” After hearing all of the evidence, the jury answered that question “Yes.”

On review, we will not set aside a jury’s answer to a special verdict question unless it is “perverse and palpably contrary to the evidence, or where the evidence is so clear as to leave no room for differences among reasonable persons.” Kelly v. City of Minneapolis, 598 N.W.2d 657, 662 (Minn. 1999) (quotation omitted). “The evidence must be viewed in a light most favorable to the jury verdict. If the jury’s special verdict finding can be reconciled on any theory, the verdict will not be disturbed.” Hanks v. Hubbard Broad., Inc., 493 N.W.2d 302, 309 (Minn. App. 1992) (citation omitted), review denied (Minn. Feb. 12, 1993).

Appellant argues that his enrollment was nothing more that fortuity and was not a direct result of respondents’ labor. Appellant further argues that because there was no written settlement agreement between respondents and the Community, and no direct proof that the General Council’s decision was influenced by the pending appeal, respondents did not provide any evidence to the jury that they obtained his enrollment through a settlement or adjustment.

Whether the jury found respondents’ actions to have “obtained” appellant’s enrollment through a “settlement” or an “adjustment”—or some combination of the two—is unknown. But on review, our focus is on whether there was any competent evidence tending to sustain their verdict. Pouliot, 582 N.W.2d at 224. At trial, respondents provided undisputed evidence that appellant retained respondents, and that respondents provided years of litigation and consulting services to appellant. The record indicates that the parties worked on a two-pronged strategy for obtaining appellant’s enrollment in the Community. The first prong was to leverage appellant’s enrollment using the lawsuit and subsequent appeal. The lawsuit included claims for retroactive per capita payments and injunctive relief to change the Community’s enrollment procedures. The second prong involved assisting appellant with making contacts within the Community who could influence the General Council’s decision if appellant went before them for another vote on his enrollment. Further, the record shows that appellant coordinated with respondents on both efforts.

The record also shows that Small, the Community’s attorney, knew that respondents purposefully postponed oral argument on the appeal and that appellant would voluntarily dismiss the appeal if the General Council enrolled him. Because the Community invoked sovereign immunity, it is unclear whether the General Council’s decision to enroll appellant into the Community was influenced by respondents’ legal strategy. But a jury is not prohibited from making assumptions or inferences based on the evidence presented. See 4 Minnesota Practice, CIVJIG 12.10 (1999) (allowing a fact to be proved by circumstantial evidence when that fact can be inferred from other facts proved in the case). Lastly, the record shows that appellant called respondents after the General Council approved his enrollment to tell them the good news. Then appellant held a celebration dinner where he thanked respondents for their support and told them “I couldn’t have done it without you guys.” Viewing the totality of the evidence in the light most favorable to the verdict, there was sufficient evidence in the record from which reasonable persons could find that respondents did “obtain” appellant’s enrollment as contracted. Because appellant failed to prove that the verdict was contrary to law or manifestly inconsistent with the evidence, the district court did not err in denying appellant’s motion for a JNOV.

Affirmed.