author: MORTENSEN, Judge: HARRIS, Judge (dissenting):

text:
    Marietta BERGDORF, Memb Ventures LLC, and Modern Health Clinic for Advanced Medicine LLC, Appellants, v. SALMON ELECTRICAL CONTRACTORS INC., Appellee.
    No. 20171024-CA
    Court of Appeals of Utah.
    Filed July 26, 2019
    Opinion
   MORTENSEN, Judge:

¶1 Appellant Marietta Bergdorf appeals the district court's grant of summary judgment in favor of Salmon Electrical Contractors Inc. (Salmon) in which the court concluded that no reasonable jury could find the existence of a valid contractual relationship between Bergdorf and Salmon. We affirm.

BACKGROUND

¶2 Bergdorf is a healthcare professional who, in 2012, purchased a building for use as a medical clinic. Although the building was move-in ready, Bergdorf wanted to remodel some areas of the building to better suit her needs (Project). Bergdorf reached out to Randy Krantz and asked if he was able to help her with both the financing and the construction work associated with the Project. Krantz had been involved in many construction projects as a general contractor, and he expressed a willingness to become involved with the Project, even taking Bergdorf to look at two other medical clinics he had constructed in the past. Bergdorf eventually became "comfortable" with Krantz "doing the construction" on the Project.

¶3 Bergdorf's initial plan was to finance the Project through a loan (Loan) with U.S. Bank (Bank). To secure the Loan, the Bank required Bergdorf and Krantz to submit, among other things, a building permit (Permit)

and a contract outlining the work to be performed. But there was a problem: Krantz's contractor license was expired and he was therefore unable to obtain the Permit. So, Krantz arranged for Salmon-whom Krantz had worked with in the past, and who had a valid license-to be the general contractor.

¶4 Krantz thereafter acted as an intermediary between Bergdorf and Salmon, and he even visited the Project with Bergdorf and Salmon, but not with the two together, to discuss the budget and scope of the Project. Krantz testified that he "made a list of things that were going to be done in the contract ... that identified the costs for each of the items that [Bergdorf] wanted done and the amount of ... overhead that [Salmon] needed in the contract to do the job."

¶5 Krantz then prepared a proposed contract detailing Bergdorf's wishes for the property and the budget for each area of the remodel (Proposed Contract). The Proposed Contract recited that Bergdorf was the owner and that Salmon was the general contractor. Importantly, the parties never signed the Proposed Contract. Indeed, Bergdorf indicated at her deposition that she had never actually seen the Proposed Contract:

[Attorney]: Let me show you ... the proposed contract that was prepared by Randy Krantz. I think he indicated he prepared it and he submitted it to you and [Salmon], and I'm wondering whether or not you remember ever seeing this?
[Bergdorf]: I've never seen this. I don't need to look. I have never seen it.
[Attorney]: You have not seen it?
[Bergdorf]: No.

¶6 Krantz also set about obtaining and gathering the other documents necessary to secure the Loan. Krantz asked Salmon to prepare certain documents, including a builder's statement, a W-9 form, and a credit authorization, that Salmon had filled out and signed in July 2012. Later that month, Krantz submitted the documents and unsigned Proposed Contract to the Bank as part of the Loan application.

¶7 In September 2012, while the Loan application was pending, Salmon obtained the Permit from Bountiful City for the Project. The Permit listed Bergdorf as the owner and Salmon as the general contractor. When the Permit was issued, Salmon's secretary emailed Krantz a copy of the Permit. Bergdorf never saw the Permit or the Permit application, and understood that it had been procured under Salmon's name only because Krantz told her so. The Permit expressly stated, "This [P]ermit becomes null and void if work or construction authorized is not commenced within 180 days, or if construction or work is suspended or abandoned for a period of 180 days at any time after work is commenced."

¶8 Sometime in the fall of 2012, while the Loan application was still pending, Krantz hired a subcontractor to perform demolition work for the Project. The subcontractor removed some carpet from the building and demolished an interior wall. Importantly, Krantz did not inform Salmon or Bergdorf that he had arranged for this work to be completed. And when Krantz was asked at his deposition about Salmon's involvement with the demolition, he indicated that Salmon had none:

[Attorney]: Okay. Because that contract was not signed, you undertook to hire [a subcontractor] to perform that work ... ?
[Krantz]: Right. ...
[Attorney]: Okay. So Salmon, to your knowledge, had no involvement with hiring [the subcontractor]?
[Krantz]: No.
[Attorney]: Is that correct, [Salmon] didn't have any involvement?
[Krantz]: None.

Krantz also stated that Salmon's Permit was not used for this demolition work or any work that was done on the Project, at any time:

[Attorney]: Did [Salmon] hire any general contractors?
[Krantz]: I-I don't think so.
[Attorney]: Any subcontractors?
[Krantz]: There was never-the [P]ermit was never used. There was never any work done on this [Permit]. There was a contract-a building contract was drawn up that was-[Bergdorf] had a copy, the [B]ank had a copy that has never been signed. So if the-there was never anything done because the [P]ermit-or the [Loan] had never been closed.

Upon learning that the wall had been demolished, Bergdorf was unhappy with Krantz. Though she had spoken with Krantz about the possibility of removing the wall, she did not consider the plan finalized. After this episode, Bergdorf told Krantz to stop construction because funds were not yet available from the Loan.

¶9 After the demolition was performed in the fall of 2012, no additional work was completed on the Project for the next two years. Bergdorf testified that although the Loan was eventually approved, she "was very busy" and decided to "[give] up" on closing the Loan and starting work on the Project. Because construction did not commence on the Project, Salmon's Permit self-terminated.

¶10 In September 2013, about one year after the unauthorized demolition, Bergdorf contacted Bountiful City and, without Salmon's knowledge or consent, somehow "renewed" the Permit. Neither Bergdorf nor Bountiful City contacted or otherwise notified Salmon about the renewal.

¶11 With a renewed Permit in hand, Bergdorf independently obtained bids from several contractors, and because Krantz submitted the low bid, Bergdorf entered into a new contract with him to act as the general contractor. Salmon was not invited to bid, nor did Krantz or Bergdorf contact Salmon about serving as the general contractor. Indeed, Bergdorf testified that when the Project resumed in 2014, she had no general contractor in place:

[Attorney]: [L]et me ask you this: Who did you view as the general contractor for that work in 2014?
[Bergdorf]: I didn't have anyone.

Further, Bergdorf plainly stated that she never had any kind of contractual relationship with Salmon, at any time:

[Attorney]: And you, yourself, never entered into any contractual relationship with Salmon to do either any subcontract work or general contracting work?
[Bergdorf]: No.
[Attorney]: Is that correct?
[Bergdorf]: Yes. Correct.

Later in her deposition, Bergdorf was asked to explain why Krantz was not listed on the Permit when it was renewed. Bergdorf testified as follows:

[Bergdorf]: In the beginning as we restarted or rekindled that working relationship, I said don't you want to change [the Permit] with the City, because it was due for renewal. I said don't you want to change it under your name. [Krantz] said, no, it doesn't matter. We'll continue under [Salmon].
[Attorney]: In terms of who the [P]ermit would be under?
[Bergdorf]: Yes. As a general contractor.
[Attorney]: But all of your contractual relationships were directly with [Krantz]?
[Bergdorf]: Yes.
[Attorney]: Okay.
[Bergdorf]: I don't know contract. All my relationships were with [Krantz].

¶12 Bergdorf and Krantz entered into a contract under the newly submitted Krantz bid-which Krantz did not purport to be on behalf of Salmon-and resumed work on the Project in 2014. At this time, Bergdorf viewed Krantz, and only Krantz, as the general contractor. Accordingly, Krantz hired subcontractors, obtained materials, and performed labor. In turn, Bergdorf issued payments to Krantz and his company, Eastwind. Bergdorf testified that she believed use of Salmon's Permit was proper, despite the fact that she issued payments only to Krantz, because Krantz told her, "[Salmon] is [my] friend and partner and [I] work[ ] with [Salmon, so] it doesn't really matter." In January 2015, Bergdorf's lawyer wrote Krantz to terminate him from the Project.

¶13 Later, an allegedly unpaid subcontractor sued Bergdorf and sought to foreclose a mechanic's lien on the Project. In response, Bergdorf filed a third-party complaint against Krantz seeking damages for the $130,000 she had paid Krantz and for physical damage to the building that left the building unsafe and unusable. Only later did Bergdorf recall that Salmon was identified as the general contractor on the Permit obtained in 2012 in connection with the abandoned Loan. Based upon Salmon's name being on the Permit, Bergdorf sued Salmon.

¶14 Salmon filed a motion for summary judgment, arguing that it had never consummated a contractual relationship with Bergdorf, that Bergdorf's only true contractual relationship was with Krantz, and that Krantz was not Salmon's agent. Salmon also pointed to Bergdorf's deposition testimony that "all of [Bergdorf's] contractual relationships were directly with [Krantz]" and "[a]ll [Bergdorf's] relationships were with [Krantz]." After briefing and oral argument, the district court granted Salmon's motion.

¶15 Bergdorf appeals.

ISSUE AND STANDARD OF REVIEW

¶16 Bergdorf argues that the district court erred in granting summary judgment, because there is sufficient evidence that a contractual relationship between her and Salmon exists and therefore Salmon is not entitled to judgment as a matter of law. We review a "grant of summary judgment for correctness, granting no deference to the district court's legal conclusions." Salt Lake City Mission v. Salt Lake City , 2008 UT 31, ¶ 5, 184 P.3d 599.

ANALYSIS

¶17 Bergdorf argues that the evidence in this case is sufficient to show that a contractual relationship between her and Salmon exists either directly or through Krantz acting as Salmon's agent. We will first address the issue of agency and thereafter the existence, or nonexistence, of a contract.

I. Apparent Authority to Enter a Contract

¶18 Bergdorf does not contend that Krantz had "actual authority" to act on behalf of Salmon. See Grazer v. Jones , 2012 UT 58, ¶ 10, 289 P.3d 437 (discussing that a principal may provide an agent with "actual authority" to perform certain actions on its behalf). Bergdorf does argue, however, that Salmon cloaked Krantz with "apparent authority" to act as its agent. See id. ¶ 11 (discussing that a principal may create an agency relationship by taking actions that "support a third party's reasonable belief that the agent has the authority to act"). We conclude that Salmon did not undertake actions, or remain silent, in such a way that a jury could find that Bergdorf reasonably believed that Salmon had clothed Krantz with apparent authority to enter into a contract with her on Salmon's behalf.

¶19 Our supreme court has articulated a three-part test to determine whether an agent has apparent authority to perform certain acts on behalf of a principal:

(1) that the principal has manifested his or her consent to the exercise of such authority or has knowingly permitted the agent to assume the exercise of such authority;
(2) that the third person knew of the facts and, acting in good faith, had reason to believe, and did actually believe, that the agent possessed such authority; and
(3) that the third person, relying on such appearance of authority, has changed his or her position and will be injured or suffer loss if the act done or transaction executed by the agent does not bind the principal.

Burdick v. Horner Townsend & Kent, Inc. , 2015 UT 8, ¶ 23, 345 P.3d 531 (cleaned up).

¶20 "Where corporate liability is sought for acts of its agent under apparent authority, liability is premised upon the corporation's knowledge of and acquiescence in the conduct of its agent which has led third parties to rely upon the agent's actions." City Elec. v. Dean Evans Chrysler-Plymouth , 672 P.2d 89, 90 (Utah 1983) (cleaned up). "Nor is the authority of the agent apparent merely because it looks so to the person with whom he deals." Id. (cleaned up). "It follows that one who deals exclusively with an agent has the responsibility to ascertain that agent's authority despite the agent's representations."

Id. (cleaned up); see also Sutton v. Byer Excavating, Inc. , 2012 UT App 28, ¶ 12, 271 P.3d 169 ; Bodell Constr. Co. v. Stewart Title Guar. Co. , 945 P.2d 119, 124 (Utah Ct. App. 1997). Accordingly, apparent authority cannot be premised on the manifestations of the purported agent. City Elec. , 672 P.2d at 90 ; see also Zions First Nat'l Bank v. Clark Clinic Corp. , 762 P.2d 1090, 1095 (Utah 1988).

¶21 Here, Bergdorf did nothing to ascertain Krantz's authority, nor does she claim that she did. And now, on appeal, Bergdorf attempts to look at the totality of the circumstances to find apparent authority instead of focusing on Salmon's manifestations to her. Applying the facts of this case to the controlling law-particularly the analysis outlined in Burdick -leads to a conclusion that apparent authority cannot be found here. Under Burdick , all three factors must be shown. 2015 UT 8, ¶ 23, 345 P.3d 531 ; accord Luddington v. Bodenvest Ltd. , 855 P.2d 204, 209 (Utah 1993) ; 3 Am. Jur. 2d Agency § 80 (2019). We address each of the Burdick factors in turn.

A. Whether Salmon manifested its consent for Krantz to enter into a contract with Bergdorf on Salmon's behalf

¶22 The first Burdick factor is whether "the principal has manifested his or her consent to the exercise of such authority or has knowingly permitted the agent to assume the exercise of such authority." 2015 UT 8, ¶ 23, 345 P.3d 531 (cleaned up). To be clear, the law focuses not on just any manifestation, but only on manifestations of the principal (i.e., Salmon) to the third party (i.e., Bergdorf). See id. ¶ 22. There is simply no evidence in the record that Salmon manifested its consent to Krantz to contract with Bergdorf on Salmon's behalf. Bergdorf points to three facts she claims meets this factor: (1) Salmon's secretary signed and paid for the Permit for the Project, (2) Salmon filled out and allowed to be submitted a number of documents connected with the Loan application, and (3) Krantz had been telling Bergdorf all along that he was acting through Salmon. These facts do not constitute manifestations of consent to Krantz's exercise of authority. First, representations by Krantz are not manifestations of the principal-Salmon. Second, Bergdorf's two remaining alleged manifestations of consent go only to whether Salmon agreed to act as a general contractor in connection with the Loan that never closed. These were not manifestations endowing Krantz with apparent authority to bind Salmon to a contract. Thus, manifestations of "such authority"-in this case, the authority to enter into a contract-are simply missing as a matter of law.

B. Whether Bergdorf knew of the manifestations, had reason to believe, and did actually believe, that Krantz had authority to bind Salmon

¶23 The second Burdick factor is whether the "third person knew of the facts and , acting in good faith, had reason to believe, and did actually believe, that the agent possessed such authority." 2015 UT 8, ¶ 23, 345 P.3d 531 (emphasis added) (cleaned up). As stated above, all three Burdick factors must be shown to establish apparent authority. Id. Likewise, all three discrete components of the second Burdick factor must be shown. See id. Thus, to satisfy the second Burdick factor, Bergdorf must have (1) known of the "facts" (manifestations of authority), (2) had reason to believe, and (3) actually believed that Krantz had authority to bind Salmon contractually. See id. But because Bergdorf did not know of the facts now claimed in support of a finding of apparent authority, none of these assumed facts can establish a reasonable belief of apparent authority under the law.

¶24 Specifically, there is no evidence in the record that Bergdorf had any knowledge-at the relevant time-of Salmon applying for or paying for the Permit. The record actually establishes that Bergdorf first learned of Salmon's obtaining the Permit when the construction recommenced in 2014. Likewise, there is no evidence that Bergdorf was aware of any of the documents that Salmon allegedly filled out in connection with the Loan application. Whether others may have known of these facts is immaterial. To rely on a theory of apparent authority to bind Salmon, it is Bergdorf who must have known of these facts.

¶25 Perhaps even more importantly, there is no evidence in the record that Bergdorf actually believed that Krantz was acting as Salmon's agent for the purpose of entering into a contract. Indeed, when deposed, Bergdorf testified that all of her contractual relationships were directly with Krantz. Granted, Bergdorf's testimony was inconsistent as to whom she thought was acting as the general contractor. But Bergdorf did not claim that she thought she had a contract with Salmon. Nor does Bergdorf's testimony establish that she believed Krantz was Salmon's agent. At most, a jury could reasonably infer only that Bergdorf believed Salmon had agreed to serve as the general contractor for the Project if the Loan closed-but it never did.

¶26 At oral argument on appeal, Bergdorf relied heavily on an email sent by the Bank confirming that Salmon was approved as the general contractor. This email confirmed only the understanding that Salmon agreed to act as the general contractor if the Loan was approved. But it does not support a finding that Bergdorf reasonably believed that Krantz had the authority to agree to the terms of a contract with Bergdorf on Salmon's behalf. Similarly, Salmon's silence at that time signifies little as to the apparent authority of Krantz to contract on Salmon's behalf. Since no contract had been entered into, and no funding had yet been obtained, Salmon had no reason to object to the Bank's email. It was true that should the Bank actually close the Loan, and should the parties agree on the terms of a contract, Salmon was agreeable to serving as the general contractor. But this email, which was not even copied to Krantz, did not manifest Salmon's intent that Krantz act as Salmon's agent.

C. Whether Bergdorf changed her position in reliance on Salmon's manifestations

¶27 The third Burdick factor is whether Bergdorf, "relying on such appearance of authority, has changed [her] position and will be injured or suffer loss if the act done or the transaction executed by [

Krantz] does not bind [Salmon]." See 2015 UT 8, ¶ 23, 345 P.3d 531 (cleaned up). In this case, the record reflects no change of position or injury suffered by Bergdorf flowing from any reliance on Krantz's apparent authority. Initially, this third factor must still be connected to the manifestations, or "the facts," identified in the first two factors. In this case, the record establishes that at no relevant time did Bergdorf even know of "the facts"-that the Loan documents signed by Salmon had been submitted to the Bank or that Salmon had submitted an application and paid for the Permit. In short, Bergdorf cannot rely on knowledge she did not have. See Luddington v. Bodenvest Ltd. , 855 P.2d 204, 210-11 (Utah 1993).

¶28 Further, Bergdorf cannot show a change of position or injury stemming from reliance on Krantz's alleged apparent authority in connection with the 2012 demolition work because Bergdorf did not authorize that work. The record exhibits that Krantz undertook-and paid for-the demolition without informing Salmon or Bergdorf. Indeed, "upon learning that the interior wall had been demolished, Bergdorf was unhappy, stating that she had only wanted the carpet to be removed at the time. Though she had spoken with Krantz about the possibility of removing the wall, she did not consider the plan finalized." One can hardly claim that Bergdorf acted in reliance on Salmon's alleged manifestation of Krantz's authority when she only found out about this activity after the fact, claimed to have not wanted it to happen, and did not consider the plans finalized.

¶29 The only thing Bergdorf apparently did-based upon Salmon's agreement to serve as the general contractor-was apply for the Loan, which never closed. Because the Loan never closed, no work was done pursuant to that financing. Further, Salmon did not engage any subcontractors to do anything. The fact that Krantz, unbeknownst to both Bergdorf and Salmon, hired a subcontractor to perform demolition work that was not approved by Bergdorf or Salmon, cannot be considered reliance by Bergdorf on Salmon's manifestations. In other words, the record does not support the assertion that Bergdorf initiated any work based upon the belief that she had a contract with Salmon to be her general contractor.

¶30 When work recommenced in 2014, Bergdorf testified that she viewed Krantz, not Salmon, as her general contractor-and Bergdorf viewed Krantz as such for the remainder of 2014. Accordingly, neither the work in 2012 (the demolition that Bergdorf was unaware of) nor the work in 2014 (where Bergdorf believed Krantz was the general contractor) meets the requirement of reliance.

¶31 Under these facts, reasonable minds could not differ in concluding that apparent authority did not exist. Penunuri v. Sundance Partners, Ltd. , 2017 UT 54, ¶ 33, 423 P.3d 1150 (holding that summary judgment should be granted when reasonable minds could not differ). Accordingly, to the extent the district court's ruling depends on the existence of apparent authority, it was correct in granting summary judgment.

II. Contract

¶32 Because Bergdorf cannot show that Salmon cloaked Krantz with apparent authority, it follows that a jury could not find that Krantz entered into a contractual relationship with Bergdorf on Salmon's behalf. If anything, the only agreement between Salmon and Bergdorf (via Krantz) was for Salmon to act as a general contractor for the Project funded by a Loan from the Bank. Since the Loan never closed, no contractual obligations attached to Salmon. Indeed, it would likely come as a shock to many contractors that a preliminary agreement to act as a general contractor contractually obligates them to be answerable in damages for any work done on that project when they never agreed to terms, did not oversee the work, and were not paid for doing the job. Thus, we agree with the district court's conclusion that there was never mutual assent sufficient to form a contract.

¶33 On summary judgment, Bergdorf is entitled to have factual inferences construed in her favor. Heslop v. Bear River Mutual Ins. Co., 2017 UT 5, ¶ 15, 390 P.3d 314. However, the court is not required to draw every possible inference of fact, no matter how remote or improbable, in her favor. See id. ¶ 21. Rather, Bergdorf is only entitled to reasonable inferences. See id. ("[T]o be reasonable, the inference must present something more than pure speculation.").

¶34 Bergdorf concedes that there was neither a signed offer nor an acceptance as between Bergdorf and Salmon. Nevertheless, Bergdorf urges us to hold that issues of fact exist whereupon a jury could conclude that the parties mutually assented through conduct. Again, Bergdorf focuses on the representations of Krantz and thus is dependent on apparent authority and the specific representation of Krantz that Salmon was his friend and partner. In our view, this contorts the evidence beyond any reasonable inference. As previously pointed out, the conversation about Salmon being Krantz's "partner" took place in 2014, after the Permit had expired and after Bergdorf had abandoned the Loan. At best, Krantz was representing-without Salmon's knowledge-that he could use his "partner's" contractor's license to renew the Permit.

¶35 Bergdorf places great significance on the fact that Salmon agreed to act as a general contractor if and when Bergdorf's Project moved forward with Bank financing. But that Loan never closed. The record in this case demonstrates that Bergdorf did not think she had a contract with Salmon. At most, there was an agreement to act as a general contractor on a remodeling project that was not defined or funded. A preliminary agreement to act as a general contractor on an undefined project, contingent on financing, neither establishes a basis for finding that a contract exists or otherwise concluding that an implied contract resulted. Similarly, while Bergdorf argues that Salmon's silence in response to a single email from the Bank-approving Salmon as a general contractor-ratified something, we are hard pressed to see how that silence ratified anything other than the same agreement to serve as a general contractor if the Project proceeded and if the Project was funded.

¶36 Further, as highlighted by the district court, it is undisputed that the Permit obtained by Salmon self-terminated when work was not commenced within, or ceased for a period of, 180 days. The demolition work was not completed by Salmon or at the direction of Salmon. And except for the demolition, no work was done for more than 180 days after the Permit was issued. Therefore, the Permit expired. Although the Permit was renewed, it is undisputed that it was renewed without the consent or knowledge of Salmon. And similarly, in 2014, when work was performed under the Permit, Salmon was not notified.

¶37 In any event, an implied contract based on mutual assent does not obtain under these facts. Bergdorf looks to Ellsworth v. American Arbitration Ass'n , 2006 UT 77, 148 P.3d 983, for the proposition that mutual assent can be evidenced by things other than a signed contract. This is a correct but incomplete statement of the law. First, the ultimate holding in Ellsworth was that a person's name appearing on an unsigned contract as a party-as is the case here-is not direct evidence of assent. Id. ¶ 18. This is especially true here, where there is no evidence that Salmon (or Bergdorf) participated in any way in negotiating or drafting Krantz's Proposed Contract. Second, when mutual assent is based on conduct or performance, the law requires that words or actions of a party must be reasonably " 'interpretable as indicating an intention to make a bargain with certain terms or terms which reasonably may be made certain .' " Heideman v. Washington City , 2007 UT App 11, ¶ 25, 155 P.3d 900 (emphasis added) (quoting Rapp v. Salt Lake City , 527 P.2d 651, 654 (Utah 1974) ). In Heideman , this court affirmed a grant of summary judgment and concluded that no mutual assent could be shown as a matter of law even though one of the parties had accepted payment. Id. ¶¶ 24, 27. The plaintiff in Heideman , a developer, argued that because Washington City accepted payment for sixty-six water impact fees at a lower rate, even though the rate had been raised effective the day the plaintiff paid, a contract had been formed and the higher rate could no longer be sought. Id. ¶¶ 2, 3, 9. This court determined that a contract could not be found because there was "no communication that would indicate any type of meeting of the minds." Id. ¶ 25. In short, the acceptance of payment without other terms was insufficient.

¶38 The same can be said here. There was simply no communication between Bergdorf and Salmon that exhibits a meeting of the minds on any certain terms. Indeed, it is undisputed that Bergdorf never saw, much less signed, the Proposed Contract. Bergdorf never met Salmon. Bergdorf and Salmon never agreed on a definite price. And Bergdorf testified that there was not a definite plan when Krantz ordered the demolition work to be completed in 2012. Likewise, there is no evidence Salmon agreed to perform any certain scope of the work for the Project. Therefore, we conclude that Salmon's agreement to be listed as a general contractor and apply for the Permit in 2012, without more, did not indicate assent to a contract with certain terms sufficient to be binding. See id. (" 'The application for an issuance of a building permit does not constitute a voluntary agreement between the parties to enter into binding contract.' " (quoting Trevino & Gonzalez Co. v. R.F. Muller Co. , 949 S.W.2d 39, 42 (Tex. Ct. App. 1997) )).

¶39 Bergdorf, as in her agency analysis, grounds her position on the activities of Salmon in supplying documents for the Loan. Again, the most that Salmon thereby assented to was to act as the general contractor if and when the Loan closed. It is an undisputed fact in this case that the Loan never closed. It is also undisputed that Bergdorf abandoned the Loan. The record is devoid of any evidence that Salmon agreed to do any work for any price to be paid directly by Bergdorf. Therefore, an implied contract simply does not exist.

¶40 Bergdorf also places weight on payments made during the Project. However, these payments were not made to Salmon; instead they were made to Krantz or entities owned by Krantz. Indeed, at any time that Bergdorf made payments related to the Project, she unequivocally testified that she thought Krantz, not Salmon, was her general contractor. These payments are therefore only possibly evidence of performance if Krantz is considered the agent of Salmon. Because we conclude that apparent authority cannot be found here, these payments are evidence that Bergdorf's contract, if it existed, was with Krantz and not Salmon.

¶41 Bergdorf also places significance upon the fact that, until December 2014, Salmon did not take any steps to remove its name from the Permit. But since the Permit had expired by its own terms and the Loan had never closed, there was no reason for Salmon to anticipate that Krantz would-without Salmon's knowledge-renew its expired Permit. Bergdorf and Krantz's unauthorized renewal of the Permit cannot constitute assent by Salmon.

¶42 For these reasons, we conclude that no contract between Bergdorf and Salmon was formed as a matter of law and that the district court therefore properly granted summary judgment in favor of Salmon.

CONCLUSION

¶43 Bergdorf's position rests primarily on her reliance on Krantz's apparent authority to contract with Bergdorf on Salmon's behalf-with which we do not agree. Independently, the record does not support a conclusion that the parties entered into a contract as a matter of law. Because reasonable minds could not differ that the parties did not mutually assent, and no contract was formed as a matter of law, Salmon was entitled to summary judgment.

¶44 Affirmed.

HARRIS, Judge (dissenting):

¶45 I would not characterize Bergdorf's claim against Salmon as a strong one. Odds are, she would not prevail at a trial on the merits against Salmon if she were ever afforded one. But our task in reviewing this appeal is not to assess who has the better claim, or predict who is most likely to prevail at trial. Rather, our task is to determine if "a reasonable jury" could find in favor of Bergdorf on her claim against Salmon, see Helf v. Chevron U.S.A. Inc. , 2015 UT 81, ¶ 4, 361 P.3d 63, and in making this determination, we must view the record evidence "in the light most favorable" to Bergdorf, the party who is resisting summary judgment, see Raab v. Utah Ry. , 2009 UT 61, ¶ 3, 221 P.3d 219.

¶46 The majority correctly recites this standard, see supra note 1, but I disagree that it has appropriately applied it. In my view, the majority emphasizes the (ample) evidence supporting Salmon's position, while minimizing some of the (less copious) evidence supporting Bergdorf's position. Certainly, the question about whether "a reasonable jury" could possibly find in favor of a party on a specific claim is the type of inquiry upon which reasonable minds might reasonably differ, and on the record presented here I respectfully disagree with the majority's general conclusion that no reasonable jury could possibly find for Bergdorf.

¶47 Chiefly, I disagree with the majority's conclusion that no reasonable jury could find that Krantz had apparent authority to act as Salmon's agent. The majority correctly recites the elements of apparent authority: (1) that the principal has either "manifested" consent to the agent's exercise of authority or at least "knowingly permitted the agent" to exercise authority; (2) that the third person, based on actions of the principal, reasonably believed that the agent had apparent authority; and (3) that the third person has relied to her detriment on the appearance of authority. See Burdick v. Horner Townsend & Kent, Inc. , 2015 UT 8, ¶ 23, 345 P.3d 531 (quotation simplified). But I disagree with the majority's application of those elements to the facts of this case.

¶48 The first Burdick factor is satisfied simply by the principal's manifestation of consent to the agent's exercise of authority, or even by the principal's knowing decision to "permit[ ] the agent to assume the exercise of such authority." Id. (quotation simplified). And in this case there exists ample evidence to support a finding that Salmon took actions intended to clothe Krantz with authority to act as its agent on Bergdorf's Project. At trial, the jury would have learned, by way of background, that Salmon and Krantz had worked together on over a hundred construction projects, and that they were business partners in a commercial development project. Indeed, Krantz was familiar enough to Salmon's employees that he had the power to tell them to carry out tasks-like apply for and pay for the Permit-and they would follow Krantz's orders. On this particular Project, Salmon agreed-at Krantz's request-to act as the general contractor on Bergdorf's Project, and Salmon provided information to Krantz to assist him in drafting the written (but ultimately unsigned) Contract that listed Salmon as the contractor and Bergdorf as the client/owner. Salmon filled out a set of documents-including a W-9 form, a credit authorization, and a "builders statement" that listed Salmon as the "contractor" on the Project-for submission to the Bank in connection with the Loan, and then Krantz submitted those documents to the Bank. And according to Salmon's principal Chad Salmon, Krantz walked into Salmon's offices and asked the secretary there to submit an application for the Permit on Bergdorf's Project that listed Salmon as the general contractor on the Project, and the secretary complied, including paying the four-figure permit fee out of Salmon's funds. Moreover, in later communications, Krantz listed himself as "Randy Krantz, Project Manager, Salmon Electrical Contractors." In my view, there is no question that sufficient evidence exists, viewed in the light most favorable to Bergdorf, to satisfy the first Burdick factor.

¶49 Salmon's best argument lies with the second Burdick factor, which is where Bergdorf's knowledge of these events becomes relevant. See id. (describing the second factor as whether "the third person knew of the facts and, acting in good faith, had reason to believe, and did actually believe, that the agent possessed such authority" (quotation simplified)). I acknowledge that this is the closest question presented, and that the evidence of Bergdorf's knowledge is thinner than the evidence of Salmon's assent to Krantz's agency or of Bergdorf's reliance. But even here, I think there is enough to support a finding by a reasonable jury that Bergdorf reasonably believed that Krantz was acting as Salmon's agent.

¶50 Certainly, there is evidence that Krantz told Bergdorf that he and Salmon were "partners" and that Salmon would be the general contractor for the Project. But the majority correctly notes that Bergdorf's reasonable belief needs to be based, at least in part, on some action of the principal; an agent's representations are not enough. See supra ¶ 20. However, a principal's action endorsing the act of the agent can occur even after the agent's act has taken place, if the principal acts to ratify the previous act of the agent. See Bradshaw v. McBride , 649 P.2d 74, 78 (Utah 1982). Ratification "need not be express," and "silence with full knowledge of the facts may manifest affirmance and thus operate as a ratification." Id. (quotation simplified). A principal may not "escape ratification" through being "wilfully ignorant, nor may he purposely shut his eyes to means of information within his possession and control." Id. (quotation simplified).

¶51 In this case, Salmon filled out the Loan application paperwork, and allowed Krantz to submit it to the Bank; that documentation listed Salmon as the general contractor on Bergdorf's Project. While there is no evidence that Bergdorf knew about the loan documentation when it was submitted, she certainly learned later-when the Bank sent a confirmation email, copied to both Bergdorf and Chad Salmon, notifying them that Salmon "has been accepted as the General Contractor" on the Project-that Salmon had submitted some form of application to the Bank seeking to be treated as the contractor on her Project. After receiving this email, Salmon took no action to disabuse anyone, including Bergdorf, of the notion that it was the general contractor on the Project. A reasonable jury could conclude that this email-and Salmon's decision not to contradict it-confirmed, in Bergdorf's mind, all of the things Krantz had been telling her about his relationship with Salmon, and could infer from this evidence that Bergdorf reasonably believed, based in part on Salmon's actions, that Salmon had authorized Krantz to act as its agent.

¶52 The majority believes that, because the Loan never closed, the documents related to the Loan-including the email-somehow lose their relevance. I simply disagree. Whether the Loan ever closed does not necessarily have anything to do with whether Salmon agreed to act as the general contractor on the Project or with whether Salmon agreed to allow Krantz to act as its agent. Bergdorf correctly points out that a contract to build a structure, and the financing for that contract, are entirely different conceptually, and that "the fact that [Bergdorf's] construction loan was not approved means she needed to get funding elsewhere, not that she needed a new construction contract." I therefore disagree with the majority's contention that "a jury could reasonably infer only that Bergdorf believed Salmon had agreed to serve as the general contractor for the Project if the Loan closed." See supra ¶ 25. Contractors generally do not care where the money that pays them comes from, as long as they get paid. There is a reasonable inference to be drawn-certainly "more than pure speculation," Heslop v. Bear River Mutual Ins. Co. , 2017 UT 5, ¶ 21, 390 P.3d 314 -that Salmon's agreement to act as the general contractor on Bergdorf's Project was not conditional on the Loan closing, but instead was only conditional on it getting paid from some source.

¶53 I acknowledge that some of Bergdorf's own deposition statements are harmful to her cause regarding the second Burdick factor. As the majority notes, at one point during her deposition Bergdorf stated that she did not believe she had entered into any contractual relationship with Salmon. See supra ¶ 11. But at other points in Bergdorf's deposition, she testified that she believed that Salmon was the general contractor on the Project, and that Salmon and Krantz were "partners" on the Project. And she clarified that, while she believed that "all [her] relationships were with" Krantz, she does not understand the legal niceties of contractual relationships. Bergdorf's seemingly contradictory deposition testimony is admittedly confusing, and would require some explanation at trial, but in my view a reasonable jury could view that testimony as consistent with the notion that, while all of her person-to-person relationships were with Krantz, he was acting as Salmon's agent.

¶54 Moving now to the third Burdick factor, in my view there exists sufficient evidence that Bergdorf took action in reliance on her belief that Krantz was acting as Salmon's agent. See Burdick , 2015 UT 8, ¶ 23, 345 P.3d 531. Bergdorf submitted a Loan application to the Bank seeking financing for the Project on which Salmon was to be the general contractor. Bergdorf knew that Krantz did not have a valid contractor's license at the time, and Krantz told her that his "partner" Salmon was going to be acting as the general contractor on the Project. Bergdorf hired Krantz to perform work on the Project, and Krantz-with or without her knowledge-hired a demolition subcontractor who removed one of the building's interior walls, an act that Bergdorf alleges led to damages. Moreover, Bergdorf began the building process pursuant to the Permit listing Salmon as her general contractor, thereby believing that she had a licensed general contractor on her Project.

¶55 In short, I think there is enough evidence on all three of the Burdick factors to permit a reasonable jury to conclude that-at least during the 2012 part of the Project's timeframe-Krantz had apparent authority to act as Salmon's agent. And once that conclusion is drawn, it necessarily follows that a jury could also reasonably find in Bergdorf's favor on the question of whether a valid contract ever existed between her and Salmon. It is undisputed that Bergdorf asked Krantz to work on her Project, and that Krantz did so. To the extent that Krantz was taking those actions in the capacity as Salmon's agent, Salmon and Bergdorf had a contractual relationship.

¶56 As noted, merely because I believe that summary judgment was improvidently granted here does not mean that I believe that Bergdorf has a fantastic case against Salmon. In the end, the factfinder might find this evidence unpersuasive, or at least less persuasive than the evidence that unquestionably exists on the other side of the ledger. But that should be the jury's choice to make, and I cannot say that a determination in favor of Bergdorf on the contractual question would be unreasonable. For these reasons, I would reverse and remand for further proceedings.

      When reviewing a district court's grant of summary judgment, we view the facts in the light most favorable to Bergdorf, the non-moving party. See Raab v. Utah Ry. Co. , 2009 UT 61, ¶ 3, 221 P.3d 219.

      In ruling on the summary judgment motion, the district court expressly determined that the Permit expired and that certain steps were required to renew it. The court ruled, "These steps were not taken and, therefore, as a matter of law, the [P]ermit could not be extended." Bergdorf has not challenged this determination.

      Bergdorf notes that in July 2013, Krantz sent some documents to Salmon to review. Among those documents was an assignment document that references a contract. There is no evidence in the record that Bergdorf ever knew of the assignment document, nor is there any evidence that Salmon signed the assignment.

      In addition to the three facts identified by Bergdorf, the dissent relies on additional facts to find support for Bergdorf's position that Salmon clothed Krantz with authority to enter into a contract on Salmon's behalf. Infra ¶ 48. First, the dissent argues that Salmon conferred authority on Krantz because Salmon had worked with Krantz on over one hundred construction projects and they were business partners on another. These facts do not demonstrate a manifestation of Salmon's consent to Krantz entering into a contract on its behalf. As an initial matter, there is no indication in the record that Bergdorf was ever aware of these facts, let alone during the relevant time period (2012-2014). Further, the fact alone that Krantz and Salmon had worked together in the past does not show or even imply that Krantz was authorized to enter into contracts for Salmon.
      Second, the dissent relies on the fact that Krantz listed himself as a project manager for Salmon in a 2013 email concerning renewal of the Permit. Infra ¶ 48. This email, however, is the manifestation of Krantz, not Salmon-and was sent in an effort to renew Salmon's Permit without Salmon knowing. Further, Krantz sent this email in May 2013 after the Permit had self-terminated and after Bergdorf had solicited new bids for the Project. In other words, Salmon was no longer involved in the Project at the time this email was sent. Thus, this 2013 email cannot lend support to the dissent's conclusion that a reasonable jury could find apparent authority "at least during the 2012 part of the project's timeframe." Infra ¶ 55.

      The dissent argues that a jury could reasonably infer such belief from Bergdorf's statement, "I don't know contract." We disagree. On summary judgment all reasonable inferences are made in the non-moving party's favor, Heslop v. Bear River Mutual Ins. Co. , 2017 UT 5, ¶ 21, 390 P.3d 314, but the non-moving party is not entitled to unreasonable inferences, id. ("[T]o be reasonable, the inference must present something more than pure speculation."). Here, Bergdorf's testimony can be construed as a representation either that she did not hold such a belief or that she had no belief one way or the other. To construe Bergdorf's statements as expressing an actual belief that Krantz had authority to bind Salmon stretches the permissible inference beyond reasonableness to speculation. Under oath, Bergdorf testified that she did not enter into a contract with Salmon. And later in her deposition when she stated, "I don't know contract," she then broadly testified, "All my relationships were with [Krantz]." The only reasonable inference-in context-is that Bergdorf's actual belief was that all of her relationships-contractual or otherwise-were with Krantz.

      Indeed, this testimony is consistent with Bergdorf's third-party complaint which alleges: "Krantz, before approval to proceed with work and approval of plans and the scope of work, entered the Property and removed carpet, demolished walls, and removed other property leaving the Property in an unsafe and unusable state resulting in more expense for [Bergdorf]." We find no support in the record, and indeed Bergdorf did not allege below, that she authorized Krantz to begin work on the Project as stated in the dissent. See infra ¶ 54.

      The payments Bergdorf made all occurred in 2014 or later when Bergdorf considered Krantz to be the general contractor and when Bergdorf and Krantz had completely bypassed Salmon and engaged subcontractors on their own. Accordingly, such payments cannot constitute reliance on apparent authority.

      Bergdorf also notes that Krantz told her that Salmon was his "partner" and was going to act as the general contractor. See infra ¶¶ 53-54. But this testimony from Bergdorf was referring to a conversation in 2014, after Bergdorf had solicited new bids for the Project, and when Krantz was explaining how they (Bergdorf and Krantz) could renew the building Permit using Salmon's name. However, even at that time, Bergdorf testified that she believed Krantz, not Salmon, to be the general contractor under the newly accepted bid. And in any event, the representations of Krantz are not manifestations of Salmon.

      We note that the theory of ratification by silence was not argued to the district court.

      Bergdorf also suggests that a walkthrough of the Project is evidence of assent. A walkthrough of a remodel project is part and parcel of any bid process and is hardly indicative of assent to contractual terms. Instead, a walkthrough is simply pre-contract due diligence.

      Having a licensed general contractor on a project is important for several reasons, not the least of which is that licensed general contractors are required to have liability insurance. See Utah Admin. Code R156-55a-302d.


source: Caselaw Access Project

author: POHLMAN, Judge:

license: Public Domain

text:
    BRIDGE BLOQ NAC LLC, Appellant, v. Zdenek SORF, CNC Machine and Design Inc., and FRS Leasing LLC, Appellees.
    No. 20171043-CA
    Court of Appeals of Utah.
    Filed August 1, 2019
    Leslie Van Frank, Stephen T. Hester, Salt Lake City, and Bradley M. Strassberg, Attorneys for Appellant
    Paul M. Belnap and Alan R. Houston, Salt Lake City, Attorneys for Appellees
    Judge Jill M. Pohlman authored this Opinion, in which Judges Gregory K. Orme and Kate Appleby concurred.
    Opinion
   POHLMAN, Judge:

¶1 This dispute involves whether Appellees Zdenek Sorf (Mr. Sorf), CNC Machine and Design Inc., and FRS Leasing LLC (collectively, Sorf) have an implied easement over property belonging to Bridge BLOQ NAC LLC. The trial court ruled that an easement existed. Bridge appeals, and we affirm.

BACKGROUND

¶2 Bridge and Sorf own adjoining properties separated by a paved alley. Bridge owns the east property and Sorf owns the west property. The alley, which is the subject of this dispute, is on Bridge's property.

¶3 On each property sits a building-the east building and the west building. The west building is approximately one foot from the boundary line between the two properties. The east building is approximately thirty feet to the east of the same boundary line.

¶4 Both properties were once owned by Sorf's predecessor, a company formed by Mr. Sorf and a business partner (Partner). In 2001, the east property was conveyed to Partner, while Sorf retained the west property. After the properties were severed, Sorf continued to use the alley in the same manner it was used before severance. Specifically, Sorf used the alley for ingress and egress, received deliveries to the west building through the alley, and parked in the alley. In addition, before and after severance, a tenant of the west building (Tenant) was given exclusive use of two parking spaces in the southernmost part of the alley. Tenant testified at trial that without those spots, it would "probably have to move" out of the west building.

¶5 Six years after severance, a dispute developed between Sorf and Partner regarding rights to the alley. Sorf filed a Notice of Easement, stating that "[a]n easement ... in the alley is claimed for pedestrian and vehicle access for the entire length of the alley, for all parking stalls located therein, for garbage receptacles and for storage of raw materials, storage of metal bars and ingots, pallets, and machinery." The Notice of Easement further claimed that Sorf and its predecessors had used the alley "continuously for fifty-one (51) years."

¶6 Through a series of conveyances, the east property-including the alley-came to belong to Bridge, which subsequently brought suit to quiet title. Sorf counterclaimed, requesting (as relevant here) a declaratory judgment upholding the existence of an implied easement.

¶7 As the litigation proceeded, Mr. Sorf was deposed. He testified that when he severed the properties in 2001, he intended to split "everything 50/50" and that he would have "never agree[d]" to someone else owning the alley. He also testified that "from day one, [he] ke[pt] using that property as [his] property ... for [the] next six years" until he found out he did not own it. "That's when I start[ed] fighting back," explained Mr. Sorf, "because this was not the agreement."

¶8 Mr. Sorf expressed similar sentiments in two declarations. In the first, he stated,

[Partner] and I agreed to dissolve our business relationship in the year 2001 and at that time we agreed that the alley would be split 50-50, just as we had discussed previously, and that the alley would continue to be used as in the past.
I did not know the alley was part of the property deeded to [Partner] when we ended our relationship, and I believed that we had divided the alley equally.

In his second declaration, he confirmed,

I NEVER would have agreed to conveyance of the east property to [Partner] if I had known that the alley was located on the east property because the alley is critical to the operation of [the west property].

¶9 Based partly on these statements, Bridge moved for summary judgment on Sorf's sole remaining counterclaim for an implied easement. It argued that there was "no basis to imply" the intent necessary for an implied easement, because "Sorf has made his intent clear by virtue of his ... sworn testimony in this case." Bridge reasoned that "Sorf intended to own half of the alley, not have permission to use it." (Emphasis added.) Because Mr. Sorf stated that he never would have conveyed the east property and alley to Partner in 2001, Bridge asserted that Sorf's claim for an implied easement failed as a matter of law.

¶10 The trial court denied the summary judgment motion. It determined, relying on Adamson v. Brockbank , 112 Utah 52, 185 P.2d 264 (1947), that in the context of implied easements "we're striving [for] an intent that the parties would have had if they'd thought of it." Thus, while Mr. Sorf's "recollection of his subjective intent" was "probative" for the court, it was "not dispositive." The court concluded that the issue was "entitled to be tried" rather than resolved as a matter of law.

¶11 A jury trial followed. After presentation of the evidence, Bridge moved for a directed verdict. The motion repeated, in part, what had been argued in the motion for summary judgment. That is, Bridge argued (1) that because of Mr. Sorf's sworn testimony there was no evidence "that the intent of the parties was to create an implied easement at the time of severance" and (2) that Sorf "made clear in this case that what [it] seeks is not an easement, but ownership," especially with respect to parking in the alley. Bridge asserted that an easement is a limited, "non-possessory interest in land" and that Sorf "intends to occupy all of the parking spaces" in the alley, "necessarily to the exclusion of [Bridge]." (Cleaned up.)

¶12 The trial court denied the motion for a directed verdict. It again determined that the parties had presented a jury question as to intent. And as to parking, the court concluded that Utah and other states "recognize parking easements." In other words, the court concluded that the law does not foreclose an easement for parking and that there was "evidence for which a jury might conclude that there was a reasonable necessity for parking" at the time of severance.

¶13 The jury was tasked with deciding whether the factual elements of an implied easement were met, and it found each element was satisfied. Specifically, the jury found, by clear and convincing evidence, that Sorf's claimed easement was "apparent, obvious, and visible" at the time of severance in 2001; that the claimed easement was "reasonably necessary" to Sorf's use of the west property; that Sorf's use of the claimed easement was "continuous rather than sporadic"; and, finally, that Sorf and Partner at the time of severance "intended, or, having formed no conscious intent, probably would have intended, to create an easement" in favor of the west property.

¶14 After trial, but before the court entered final judgment in the case, Bridge moved for judgment notwithstanding the verdict (JNOV) based primarily on this court's intervening decision in Judd v. Bowen , 2017 UT App 56, 397 P.3d 686, cert. dismissed as improvidently granted , 2018 UT 47, 428 P.3d 1032. There, this court held that the doctrine of prescriptive easements could not grant a parking right that totally excluded the owner from his property. Id. ¶¶ 55, 68. Bridge argued that under Judd , "no easement for parking [in the alley could] be established, as a matter of law."

¶15 The trial court denied the JNOV motion and distinguished Judd . First, it concluded that Judd was a prescriptive easement case-not an implied easement case. It reasoned that parties can expressly "contract away their rights to exclusive use" and that the jury found that is what impliedly happened here. The court stated, "This is not a matter of determining whether a prescriptive right can arise through non-exclusive use versus a possessory right that can be obtained only through exclusive use. This is a right that is implied by the circumstances and the parties' actual or probable intent." Second, the court concluded that Judd was factually distinguishable. According to the court, Judd concerned a narrow, one-lane driveway with limited parking and the Judd court "repeatedly emphasized the peculiar facts in that case." By way of contrast, the trial court found in this case that there were a total of around eight parking spaces in the alley and that there was "very little evidence" concerning the extent of Sorf's interference with Bridge's parking rights.

¶16 The trial court then entered final judgment, concluding that "an implied easement over the alley was created in favor of the west property" in 2001 and that the easement covered ingress and egress, deliveries to the west building, and parking. As it relates to parking, the court determined that Sorf has an exclusive easement for daily parking across the two southernmost parking spaces in the alley and a nonexclusive easement for the remaining parking spaces. Accordingly, the court granted Sorf's request for a declaratory judgment and dismissed Bridge's quiet title claim.

¶17 Bridge appeals.

ISSUES AND STANDARDS OF REVIEW

¶18 Bridge first contends that the trial court erred when it denied its motion for summary judgment on the nonexistence of an implied easement. "Summary judgment is appropriate when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law, viewing the facts and all reasonable inferences drawn therefrom in a light most favorable to the nonmoving party." Stephenson v. Elison , 2017 UT App 149, ¶ 20, 405 P.3d 733 (cleaned up). We review the trial court's "ultimate grant or denial of summary judgment for correctness." Id. (cleaned up).

¶19 Bridge next contends that the trial court erred when it denied its motion for a directed verdict. "A trial court is justified in granting a directed verdict only if, examining all evidence in a light most favorable to the non-moving party, there is no competent evidence that would support a verdict in the nonmoving party's favor." Merino v. Albertsons, Inc. , 1999 UT 14, ¶ 3, 975 P.2d 467. "A motion for directed verdict can be granted only when the moving party is entitled to judgment as a matter of law." Id. (cleaned up).

¶20 Bridge next contends that the trial court erred when it denied its JNOV motion. In addressing a JNOV motion, "a trial court must look at the evidence and all reasonable inferences in a light most favorable to the nonmoving party, granting the ... motion only if this examination demonstrates that there is insufficient evidence to uphold the verdict." Franklin v. Stevenson , 1999 UT 61, ¶ 6, 987 P.2d 22. We review the trial court's ruling on a JNOV motion for correctness. ASC Utah, Inc. v. Wolf Mountain Resorts, LC , 2013 UT 24, ¶ 18, 309 P.3d 201.

¶21 Bridge finally contends that the trial court erred when it determined that Sorf was entitled under the easement to parking privileges, including two parking spots for Sorf's exclusive use. "Determining the scope of an easement is a question of law." Conatser v. Johnson , 2008 UT 48, ¶ 10, 194 P.3d 897, superseded by statute on other grounds as stated in Utah Stream Access Coal. v. Orange St. Dev. , 2017 UT 82, 416 P.3d 553. We accordingly review for correctness the trial court's determination on the scope of any easement. Id.

ANALYSIS

¶22 Bridge's four contentions on appeal break down into two basic inquiries: (I) does Sorf have an implied easement in the alley? and (II) if so, what is the scope of that implied easement?

I. Sorf has an implied easement in the alley.

¶23 The answer to the first question-whether Sorf has an implied easement in the alley-disposes of Bridge's first three contentions. That is, if there is an easement, the trial court did not err in denying the motion for summary judgment, the motion for a directed verdict, or the JNOV motion.

¶24 To imply an easement from prior use, the fact-finder must find evidence of four elements: "(1) that unity of title was followed by severance; (2) that the servitude was apparent, obvious, and visible at the time of severance; (3) that the easement was reasonably necessary to the enjoyment of the dominant estate; and (4) that the use of the easement was continuous rather than sporadic." Butler v. Lee , 774 P.2d 1150, 1152 (Utah Ct. App. 1989) ; accord Morris v. Blunt , 49 Utah 243, 161 P. 1127, 1132 (1916).

¶25 There is not much dispute in this case about these factual elements being met. The first element was undisputed, and the jury found clear and convincing evidence for the remaining three. The jury's factual determinations are not challenged. Sorf, along with Partner, owned both the east and west properties and, in 2001, severed them (element one). At that time, the alley was apparently, obviously, and visibly used by both the properties (element two). Also at that time, the alley was reasonably necessary to the west property's operations (element three). Finally, Sorf used the alley continuously, rather than sporadically, at the time of the conveyance (element four).

¶26 But for Bridge's argument about intent, our analysis would be finished. Bridge contends that, elements aside, "intent is the key inquiry in deciding whether to imply an easement." In Butler , we stated that "whether an easement arises by implication ... depends on the intent of the parties, which must clearly appear in order to sustain an easement by implication." 774 P.2d at 1153 n.1 (emphasis added) (cleaned up); see also Oak Lane Homeowners Ass'n v. Griffin , 2009 UT App 248, ¶ 18, 219 P.3d 64 ("Courts are willing to imply an easement because they are convinced that the parties intended to create an easement based on the circumstances accompanying a conveyance of property." (cleaned up)), aff'd , 2011 UT 25, 255 P.3d 677. And Bridge argues from these precedents that Sorf cannot have an implied easement because Mr. Sorf never intended to have an easement; he wanted to own the alley "50/50."

¶27 The trial court correctly rejected this argument. In Adamson v. Brockbank , 112 Utah 52, 185 P.2d 264 (1947), our supreme court described the intent necessary to imply an easement:

The inference drawn represents an attempt to ascribe an intention to parties who had not thought or had not bothered to put the intention into words, or perhaps more often, to parties who actually had formed no intention conscious to themselves. In the latter aspect, the implication approaches in fact, if not in theory, crediting the parties with an intention which they did not have, but which they probably would have had had they actually foreseen what they might have foreseen from information available at the time of the conveyance.

Id. at 270 (cleaned up). Later, in Butler , we held that Adamson applied even when the deed between the property owners specifically disavowed "any other agreements, including [one for] the disputed easement." 774 P.2d at 1153. Instead of relying on the disavowal in the deed, we looked to the circumstances attending the transaction to discern the parties' probable intent. Id.

¶28 Here, Mr. Sorf testified many years after the severance in 2001 that he intended to own the alley equally with Partner. He "did not know the alley was part of" the east property and instead believed that they "had divided the alley equally." And he stated that he "NEVER" would have sold the alley because it was "critical to the operation" of the west property. But our precedent makes clear that these statements are not to be considered in a vacuum. Part of the attendant circumstances of the severance of the east and west properties was Partner's unknown ownership of the alley. And because Sorf was unaware of the actual legal boundary between the two properties at the time of the severance, it was appropriate for the court to allow the jury to credit Sorf with an unexpressed intention that Sorf "probably would have had had [it] actually foreseen what [it] might have foreseen." See Adamson , 185 P.2d at 270 (cleaned up). In fact, when viewed in context, Mr. Sorf's statements help confirm the existence of an implied easement. Far from establishing that Sorf was single-mindedly committed to ownership or nothing, his testimony demonstrates the primary importance of the alley to the west property's use and continued enjoyment.

¶29 Because it was possible for the jury to conclude that Sorf and Partner intended, or probably would have intended, to create an easement if Sorf had known that Partner inadvertently acquired ownership of the alley, the trial court did not err in denying Bridge's motion for summary judgment, motion for a directed verdict, or JNOV motion. See id. ; Butler , 774 P.2d at 1153.

II. The implied easement's scope includes parking.

¶30 Now we must decide the easement's scope, specifically whether the implied easement grants Sorf the right to park in the alley.

¶31 Utah has not yet adopted a test for defining the scope of an implied easement. The trial court determined the easement's scope based on "the parties' intent and necessity existing at the time of severance." And a number of other jurisdictions determine the scope of an implied easement based on the parties' probable expectations at the time of severance. See, e.g. , Tobias v. Dailey , 196 Ariz. 418, 998 P.2d 1091, 1095 (App. 2000) ; Thorstrom v. Thorstrom , 196 Cal.App.4th 1406, 127 Cal. Rptr. 3d 526, 539 (2011) ; McCoy v. Barr , 47 Kan.App.2d 285, 275 P.3d 914, 921 (2012) ; Tungsten Holdings, Inc. v. Kimberlin , 2000 MT 24, ¶ 27, 298 Mont. 176, 994 P.2d 1114, overruled on other grounds by Shammel v. Canyon Res. Corp. , 2003 MT 372, 319 Mont. 132, 82 P.3d 912 ; Barbour v. Pate , 229 N.C.App. 1, 748 S.E.2d 14, 18 (2013) ; see also Restatement (First) of Property § 484 cmt. b (Am. Law Inst. 1944) (explaining that the extent of an easement by implication "is to be measured ... by such uses as the parties might reasonably have expected from future uses of the dominant tenement"). This approach is an "inherently factual" one, McCoy , 275 P.3d at 921, with the parties' reasonable expectations being "ascertained from the circumstances existing at the time of the conveyance," Thorstrom , 127 Cal. Rptr. 3d at 539 (cleaned up); see also Restatement (First) of Property § 484 cmt. b.

¶32 We agree with this approach. The trial court found that at the time of severance "it was the parties' intent that Mr. Sorf be able to continue operating the business [out of the west building] in the same way that it had been operated before the separation, which necessarily included leasing a portion of the west property to [Tenant], along with the two parking spaces guaranteed in that lease, and allowing [Sorf's] employees to use the other parking spaces" in the alley. (Cleaned up.) It further found that from 2001, the time of severance, to 2006, the time of the parties' first disagreement, Partner "never restricted or attempted to restrict Sorf or its employees or tenants from parking" in the alley. Bridge does not dispute these findings. Instead, Bridge directs its challenges to the evidence of the parties' subjective intent. We have already rejected Bridge's attempt to undermine the probable intention of the parties based on subjective intent and see no error in the trial court's conclusion that the parties intended that Sorf and Tenant be able to park in the alley after severance. Thus, based on the court's factual findings, we conclude that the parties reasonably expected parking rights in favor of the west property.

¶33 We also conclude that Judd v. Bowen , 2017 UT App 56, 397 P.3d 686, cert. dismissed as improvidently granted , 2018 UT 47, 428 P.3d 1032, does not, as Bridge contends, compel a different result. First, Judd never held, or even suggested, that parking easements are categorically impermissible. See id. ¶ 36. It held only that "[u]nder the circumstances of [that] case," a prescriptive easement could not totally exclude the titled owner from its property. Id. ¶¶ 55, 68. The case concerned a "narrow, one-car-wide driveway" that allowed for only limited parking. Id. ¶¶ 36, 47-48. In contrast, the alley here provided for a total of approximately eight parking spots, and the trial court found that there was "very little evidence" concerning the extent of Sorf's interference with Bridge's parking rights. Further, the parties used the alley for years, both before and after severance, with no problems.

¶34 Second, Judd limited its discussion to prescriptive easements. E.g. , id. ¶¶ 36, 54, 68. It began by contrasting the ownership rights one can receive through adverse possession with the easement rights one can receive by prescription. Id. ¶¶ 37-46. And the Judd court concluded that the ability to exclude owners from their property more closely resembles the ownership rights one can acquire only through adverse possession. Id. ¶ 49. Here, this distinction is not legally relevant. As the trial court reasoned, parties can expressly grant a parking right (even an exclusive one), and whether parties impliedly grant a parking right (including an exclusive one) depends on the parties' probable expectations. See supra ¶¶ 31-32. So if the parties, as here, reasonably expected exclusive use of parking spots after severance, then exclusive use is what the implied easement grants. Cf. Papanikolas Bros. Enters. v. Sugarhouse Shopping Center Assocs. , 535 P.2d 1256, 1261 (Utah 1975) (enforcing an agreement providing for a parking easement).

CONCLUSION

¶35 We conclude that an implied easement in favor of the west property exists in the alley. The trial court therefore did not err in denying Bridge's motions for summary judgment, a directed verdict, or JNOV. We further conclude that the implied easement in favor of the west property grants parking rights in the alley, including two exclusive parking spots. Accordingly, the trial court's judgment is affirmed.

      We acknowledge that, at times, our use of Sorf to collectively refer to all three appellees is over-inclusive. However, because the parties and the district court regularly referred to the appellees and their interests collectively, we do the same here.

      This appeal was originally taken by Sixth South Properties LLC, which owned the subject property before Bridge. Before oral argument, Sixth South moved under rule 38(c) of the Utah Rules of Appellate Procedure to substitute Bridge as the appellant because Sixth South had conveyed the property to Bridge by special warranty deed. No objection was raised to the substitution, and we granted the motion. We therefore treat Bridge as the plaintiff and appellant throughout this opinion and attribute Sixth South's actions and arguments, both below and on appeal, to Bridge.

      Sorf asserted other counterclaims, including a request for reformation of the 2001 deed severing the east and west properties. This counterclaim was eventually dismissed as barred by the applicable statute of limitations.

      "The ultimate determination of whether an easement exists is a conclusion of law," but "the existence of an easement is also a highly fact-dependent question." Carrier v. Lindquist , 2001 UT 105, ¶ 11, 37 P.3d 1112. Thus, the jury found the factual elements of an implied easement, but the trial court ultimately granted the easement.

      The trial court ruled as a matter "of first impression" that because implied easements " 'deprive an individual of an interest in real property,' " they must be established by clear and convincing evidence. (Quoting Essential Botanical Farms, LC v. Kay , 2011 UT 71, ¶ 22, 270 P.3d 430.) The parties appear to accept the clear and convincing evidence standard. We therefore assume without deciding that that standard applies.

      The court found that when the properties were severed in 2001, "it was the parties' intent that Mr. Sorf be able to continue operating the business in the same way that it had been operated before the separation, which necessarily included leasing [the two parking spaces to Tenant]."

      There is no dispute that, if an easement exists, it would cover ingress, egress, and deliveries.

      After accepting the jury's determination that the factual elements for an implied easement were satisfied in this case, including that the easement is for, among other things, parking, the trial court determined the scope of the easement and supported its determination with additional factual findings.

      Indeed, our supreme court recognized as much when it dismissed its grant of certiorari as having been improvidently granted. See Judd v. Bowen , 2018 UT 47, ¶ 17, 428 P.3d 1032. It stated that "since the court of appeals did not make a categorical determination concerning the viability of prescriptive parking easements," it would not be appropriate to address the issue. Id.