2004-240, WILLIAM C. JACKSON & a. v. CHARLES W. MORSE, JR. & a.

Jacksons funds they had received in settlement of a lawsuit. Morse later Morse were long - time friends. In early 2000, Mor se offered to invest for the fiduciary duties. They alleged, in part, the following facts. The Jacksons and action for promissory estoppel, negligent misrepresentation and breach of The plaintiffs comme nced this action in April 2003, asserting causes of

attorney’s fees. We affirm in part, vacate in part and remand. Ameritrade Holding Corp. They also appeal a post - trial order denying them estoppel against defendant Charles W. Morse, Jr. and trustee - defendant jury verdict in Superior Court (Smukler, J.) on the ir claim for promissory NADEAU, J. The plaintiffs, William C. and Donna Jackson, appeal the

Guldbrandsen on the brief, and Ms. Guldbrandsen orally), for the defendants. Orr & Reno P.A., of Concord (James P. Bassett and Melissa C.

the brief, and Mr. Quarles orally), for the plaintiffs. Devine, Millimet & Branch, P.A., of Manchester (Thomas Quarles & a. on

No. 2004 - 240 Belknap

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. O pinions are available on the Internet by 9:00 Errors may be reported by E - mail at the following address: errors in order that corrections may be made before the opinion goes to press. Hampshire, One Noble Drive, Concord, New Hampshire 03301, of any editorial Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as 2

determining which of the two measures of damages to apply.” of law in that the court properly permitted the jury to exercise its discretion in argues that the trial “court’s jury instructio ns were not erroneous as a matter objected at trial to giving the jury the choice of damage measures, Morse now appropriate award under a promissory estoppel theory. W hile both parties this and oth er States supports the view that reliance damages are the relied upon his promise. On appeal, Morse continues to assert that the law of would put the Jacksons in the position they would have been in if they had not reliance measure of damages, in other words, the amount of damages that performed as he promised. Morse, on the other hand, argued a t trial for a would put them in the position they would have been in if Morse had case is their expectation interest, in other words, the amount of damages that now argue on appeal, that the only appropriate measure of damages in this parties’ respective positions on damages. The Jacksons contended at trial, and Turning to the merits of the Jacksons’ argument, we first note the

damages. Accordingly, the issue is properly before us on appeal. by objecting to the court’s failure to give their proposed instruction on apparently confused and misled the jury. The Jacksons preserved this issue trial court’s instruction on the measure of damages was legally erroneous and The Jacksons’ challenge of the jur y’s verdict is based upon a claim that the We find Morse’s argument unpersuasive because we reject its premise.

because they failed to file a motion for additur. too small, and that the Jacksons failed to preserve that issue for appeal asserts that the true basis of the Jacksons’ appeal is tha t the jury’s verdict was that the Jacksons failed to preserve this issue for appeal. Specifically, Morse Before reaching this argument, however, we must address Morse’s contention the jury that damages could be limited to the extent of the Jacksons’ reliance. On appeal, the Jacksons argue that the trial court erred in instructing

Jacksons in the amount of $ p. 2 29,064.64. promissory estoppel claim went to trial. The jury returned a verdict for the prompted the instant lawsuit. The record reflec ts that only the Jacksons’ 31, 2001, and Morse’s failure to restore the account to a value of $62,000 The value of the account dropped to approximately $8,000 by December

over the investment account. make them whole, the Jacksons accepted his offer and gave him total control representations of past success in securities investment and his promise to management of, the investment account. In reliance upon Morse’s but only if they gave him complete control over, and did not interfere with his investment account was less than $6 p. 2 2,000, he would make up the shortfall, promised the Jacksons that if by December p. 3 31, 2001, the value of their 3

the court.” Id. (citations omitted); accord Truesdale v. Straw, 58 N.H. 207, 215 choice of the proper measure of damages is a question of law to be decided by to be awarded in a particular case is essentially a fact question. However, the McGraw, 15 S.W. p. 3 3d 819, 827 (Tenn. Ct. App. 1998). “[T]he amount of damages The award of damages is a “factually driven” determination. Beaty v.

omitted). the jury “into basing its verdict on a misperception of the law.” Id. (quotation will find reversible error if an erroneous civil jury instruction could have misled the law applicable to the case. Peterson v. Gray, 1 p. 3 37 N.H. 374, 377 (1993). We Thus, the trial court has a duty to instruct the jury completely and correctly on resolve them.” Carignan v. N.H. Int’l Speedway, 151 N.H. 409, 418 (2004). and to inf orm the jury of the appropriate standards of law by which it is to “The purpose of jury instructions is to identify issues of material fact,

damages. and equity – based on the evidence – to your determination of plaintiffs’ reliance. You are permitted to apply notions of fairness defendant claims that any damages should be determined by the by the defendant’s legal fault should be based on the promise. The measure of damages. The plaintiffs claim that the damages caused promise, you should consider the parties’ different positions on the promissory estoppel – in other words, breach o f a legally binding If you find that the plaintiffs have proved the elements of

The legal fault claimed by the plaintiffs is promissory estoppel. . . .

defendant.” The court responded, in part: During deliberations, the jury asked the judg e to define “legal fault of the

reliance, rather than by the terms of the promise. limited to damages measured by the extent of the plaintiffs’ In a promissory estoppel claim, relief may sometimes be would have been in had t he defendant not been legally at fault. plaintiffs because of the defendant’s legal fault to the position they not been legally at fault. You should compare the position of the in the same position they would have been in if the defendant had The purpose of any damages award ed is to put the plaintiffs . . . . caused by the legal fault of the defendant. . . . adequately compensate them for such damages as you find were the amount of money that will reasonably, fairly, fully, and If your verdict is fo r the plaintiffs, then you must determine

Specifically, the court instructed the jury, in part: p. 4 4

officials.” Id. We noted, however, that under different facts, namely “conduct public fisc in response to mere carelessness on the part of low level government that “[t]o permit the recovery of greater damages in such cases could drain the in the competitive bidding process, i.e., its bid preparation costs.” We reasoned limited to the e xpenses incurred by the low bidder in its fruitless participation the lowest responsible bidder . . . . Hence, damages ordinarily should be justifiable reliance upon the municipality’s promise to award the contract to be limited to the damages the plaintiff “sustained directly by reason of its award a municipal contract to the lowest responsible bidder should o rdinarily 63 p. 4 4 (1993), we held that the damages recoverable for the wrongful failure to case at hand. Thus, in Marbucco Corp. v. City of Manchester, 137 N.H. 629, Rather, the appropriate measure will vary with the facts and equities of the measure of damages is not applicable to every promissory estoppel case. We agree with this section, and with the trial court, that a single

Restatement (Second) of Contracts § 90 comment d.

reliance rather than by the te rms of the promise. damages or specific relief measured by the extent of the promisee’s particular, relief may sometimes be limited to restitution or to granted also bear on the character and extent of the remedy. In the same factors which bear on w hether any relief should be scale enforcement by normal remedies is often appropriate. But A promise binding under this section is a contract, and full -

Contracts § 90 (1981). Comment d to that section explains: granted for breach may be limited as justice requires.” Restatement (Second) of reasonably induces action or forbearance and provides that “[t]he remedy (Second) of Contracts, which sets forth the rule for enforcing a promise that The trial cou rt premised its instruction on section 90 of the Restatement

reliance or expectation. appear to reflect a determination of the measure of damages based upon either misled the jury is evidenced by the amount of the verdict, which does not determinatio n of choosing a measure of damages. That this error apparently The trial court in this case erroneously allowed the jury to make the legal

10 p. 4 49, 10 p. 5 51 (Ill. App. Ct. 1997). underlying factual issue. Cf. Arch of Ill. v. S.K. George Painting, 681 N.E.2d instruct the jury to apply only one measure depending upon how it resolves the alternative measures are submitted to the jury, care should be taken to App. Ct. 1993), appeal denied, 631 N.E.2d 708 (Ill. 1994). In those cases, when jury. See Hills of Palos Condo. Ass’n v. I - Del, Inc., 626 N.E.2d 1311, 1327 (Ill. damages is dependent upon a factual determination that must be made by the (1877). In some instances, the choice between alternative measures of 5

measure of damages turns on the resolution of a dispute of fact, the court may would be more equitable. In addition, if the trial court’s decision on the proper may choose a different measure if, under the particular facts of this case, it presumptive measure of damages in this case is expectation damages, but it for a new trial on damages on ly. We instruct the trial court that the a complete record on appeal. Thus we vacate the damages award and remand of damages is a fact - driven determination, and we have not been provided with measure of damages on remand. Rather, as noted above, the proper measure law, we decline to instruct the trial court that it must use the expectation damages. Nevertheless, although the proper measure of damages is a matter of remediable by an award of the value of the promise, in other words, expectation date certain, was a definite promise, the breach of w hich is presumptively for any shortfall in the value of their investment account below $62,000, as of a Turning to the facts of this case, the promise to reimburse the Jacksons

E. M. Holmes, Corbin o n Contracts § 8.8, at 26, 33 (rev. ed. 1996). Developers, LLC, 29 S.W.3d 767, 770 (Ark. Ct. App. 2000), or restitution, see 3 remedy may be specific performance, see, e.g., Taylor v. Eagle Ridge expressed above. Finally, we note that in some instances, the appropriate 800 (Neb. 1990); however, we reject that view in favor of the on e we have promissory estoppel cases, see, e.g., Rosnick v. Dinsmore, 4 p. 5 57 N.W.2d 793, the view that reliance damages constitute the usual measure of damages in 1220, 1223 n.5 (Or. Ct. App. 2000). We note that some courts apparently take Co., Inc., 378 F.3d 698, 703 (7th Cir. 2004); see also Staley v. Taylor, 994 P.2d reasonable reliance on the vague promise.” Garwood Packaging, Inc. v. Allen & indefinite or unclear promise “will be limited to expenses incurred in awarded when the promise is clear or definite, damages in the case of an have explained, for instance, that while expectation damages are usually Reliance damages may be appropriate in certain instances. Some courts

only if awarding so mu ch would be inequitable.” the presumptive measure of damages for promissory estoppel, to be rejected ICM Realty, 788 F.2d 4 p. 5 56, 464 (7th Cir. 1986), that “the value of the promise is of Contracts § 90 comment d. Thus, we agree with the court in Goldstick v. enforcement by normal remedies is often appropriate.” Restatement (Second) “[a] promise binding under [section 90] is a contract, and full - scale 270, 290 (1992). That accords with the Restatement drafters’ comment that underlying promise.” Great Lakes Aircraf t Co. v. City of Claremont, 135 N.H. promissory estoppel “serves to impute contractual stature based upon an case, some guidance can be gleaned from case law. First, we have stated that Alth ough the appropriate measure of damages will differ from case to

damages would be lost profits. Id. of the awarding authority tantamount to bad faith,” the appropriate measure of p. 6 6

request entries for time spent on issues other than the one the court identified by not awarding attorney’s fees after the Jacksons failed to cull from their We cannot say that the trial court exercised its di scretion unsustainably

unsustainable exercise of discretion standard). (1994); cf. State v. Lambert, 147 N.H. 295, 29 p. 6 6 (2001) (explaining exercise of discretion. See Town of Littleton v. Taylor, 138 N.H. 419, 424 court’s decision and we will not overturn that decision absent an u nsustainable certain fees. We review a denial of attorney’s fees with deference to the trial award of attorney’s fees after initially ruling that the Jacksons were entitled to The Jacksons argue that the trial court erred in refusing to quantify an

awarded.” the Jacksons’ motion “once again fails to break out those fees that could be filed a motion for reconsideration, which was also denied. The court noted that denied the motion for the reasons stat ed in Morse’s objection. The Jacksons threatened litigation against Attorney Quarles or his law firm.” The court Jacksons’ exhibit did not contain “a single time entry that clearly relates to any attorneys’ time record s. Morse objected, claiming, among other things, that the Jacksons filed a motion to quantify the award, along with an exhibit of their Treating the court’s statements as an award of attorney’s fees, the

either was raised or could have been raised in this case.” preparation or costs incurred to do something on a n issue that legitimately however, that he was “not inclined to award attorney’s fees with respect to threats to the attorney and the law firm.” The trial judge further stated, “[i]f attorney’s fees wer e appropriate at all, they would be to respond to the At the hearing on the Jacksons’ request for fees, the court indicated that

documents. finding that Morse assisted his wife to some extent in preparing these evid entiary hearing on the Jacksons’ request for attorney’s fees supports a by the Court, with or without the assent of the [Jacksons].” The record of the federal court. She stated she would “do so unless the attachment is quashed to assert her rights in the joint account by suing the Jacksons’ attorney in that she was co - owner of the investment account and that it was her intention Jacksons’ attorney with a document purporting to notify the court and parties Holding Corp. Morse’s wife responded by, among other things, serving the including his investment acc ount with the trustee defendant, Ameritrade an ex parte attachment in the amount of $53,000 on all of Morse’s property, attorney’s fees. Just prior to commencing this action, the Jacksons obtained The Jacksons also contend that the trial court erred in refusing to award

apply only one measure depending upon how it resolves the factual dispute. submit alternative measures to the jury, taking care to instruct the jury to p. 7 7

DALIANIS, DUGGAN and GALWAY, JJ., concurred.

Dodge, Inc., p. 7 739 So. 2d 720, 724 (Fla. Dist. Ct. App. 1999) (citations omitted). the nonrecoverable fees, [they] failed in [their] burden.” Mangel v. Bob Dance entitled to recover. By failing to separate or apportion the recoverable fees from “had the burden of showing the amount of fees and/or costs [they were] agree with the court in Mangel v. Bob Dance Dodge, Inc. that the Jacksons pre - date Morse’s wife’s threat of litigation against the Jacksons’ attorneys. We as subject to a fee award. For instance, the time records include entries that