Amidon v. Amidon, No. 381-8-13 Wmcv (Wesley, J., July 23, 2014).

[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy of the text and the
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                                                    STATE OF VERMONT
SUPERIOR COURT                                                                                         CIVIL DIVISION
Windham Unit                                                                                Docket No. 381-8-13 Wmcv

Floyd Amidon,
       Plaintiff

           v.
                                                                                       DECISION ON MOTION
Rickey A. Amidon,
Tami M. Amidon,
       Defendants


                                 Decision Declining to Impose Setoff &
            Denying Plaintiff’s Request for Attorney’s Fees under the Prompt Payment Act

        Floyd Amidon sued Rickey and Tami Amidon for defamation and breach of contract.
After the case was set for jury trial, Plaintiff settled with Tami Amidon and dismissed his claims
against her for a then-undisclosed amount. At trial, after Plaintiff and Defendant, Rickey
Amidon, waived presenting the case to the jury, Plaintiff proved damages of $6,700 for breach
of contract against Rickey Amidon. As reflected by its oral findings on the record, the Court
awarded $6,700 in damages because Plaintiff paid $15,000 to Rickey Amidon to do renovations
to a residential building, but the reasonable value of the work performed by Defendant was no
more than $8,300 at the time Plaintiff justifiably terminated the contract for non-performance.

Setoff

      After making its oral findings and conclusions, the Court on its own motion questioned
whether it should setoff Plaintiff’s damages of $6,700 by the settlement of Tami Amidon. In
response to the Court’s inquiry, Plaintiff acknowledged that the amount paid by Tami Amidon
in complete settlement of all claims against her was $5,000. The Court deferred entering
judgment, giving the parties a further opportunity to address the issue of setoff through
submission of memoranda of law. Only Plaintiff has responded with further briefing.

       Plaintiff opposes setoff, arguing that his claims against Tami Amidon principally related
to defamation, while his claims against Rickey Amidon as established by the evidence at trial
were limited exclusively to the count in the complaint relating to breach of contract. Plaintiff
further argues Rickey Amidon did not plead setoff as an affirmative defense.

        In considering whether it should reduce Plaintiff’s damages against Rickey Amidon by
the settlement from Tami Amidon, the Court notes that is has broad discretion to reduce a
plaintiff’s damages by a settlement with another party. See Agency of Natural Res. v. Glens Falls
Ins. Co., 169 Vt. 426, 433 (1999), citing Jensvold v. Town & Country Motors, Inc., 162 Vt. 580,
584 (1994).
        In this case, however, setoff is not appropriate because it was not raised by Defendant,
and because it is likely that, had it been raised, Plaintiff would have been able to demonstrate
that setoff was unnecessary to preserve an equitable outcome. As Plaintiff argues, Rickey
Amidon did not seek to amend his answer to plead setoff prior to the trial, after he learned that
Plaintiff had settled with Tami Amidon and dismissed her as a defendant. See, V.R.C.P. 8(c) &
15(a). Setoff is an affirmative defense and a defendant must prove affirmative defenses. See
Wilk Paving, Inc. v. Southworth-Milton, Inc., 162 Vt. 552, 557 (1994). Notwithstanding Rickey
Amidon’s status as a self-represented litigant, it was his responsibility to raise the issue of a
possible setoff. Otherwise, as discussed below, Plaintiff was placed at an unfair disadvantage in
structuring his evidence in order to attempt to address the issues implicated by a claim for
setoff.

           Inasmuch as setoff was never plead as an affirmative defense, Plaintiff was not placed
on notice to further explicate his claim against Tami Amidon, including the considerations
involved in the agreement to release her as a defendant. In particular, Plaintiff had no reason
to foresee the need to present evidence showing that his claim against Tami Amidon was
primarily for defamation, as distinguished from his claim against Rickey Amidon which was
limited to breach of contract by the evidence presented at trial. 1 Nevertheless, Plaintiff’s
litigation strategy of only pursuing the breach of contract claim against Rickey Amidon at trial
suggests the damages recovered are separate from those that were likely involved by the
release granted to Tami Amidon in exchange for her payment of the $5,000 settlement. Under
all the circumstances, the Court concludes that setoff is not required to protect against a
double recovery in this case, or to otherwise assure an equitable judgment. See Glens Falls Ins.
Co., 169 Vt. at 433.

Attorney’s Fees Under the Prompt Payment Act

        In addition to his opposition to setoff, by his post-trial memorandum Plaintiff sought
attorney’s fees under the Prompt Payment Act. Neither Plaintiff nor Rickey Amidon invoked the
Prompt Payment Act in the pleadings, or during the trial. As determined by the oral findings,
Plaintiff did not withhold money from Rickey Amidon. Rather, Plaintiff’s complaint was to
recover funds paid in excess of the value of the work performed. Similarly, Rickey Amidon never
alleged that he had performed work valued in excess of the original payment of $15,000.
Rather, his only counterclaim was for back rent –rejected by the Court as unproved – which was
a separate claim unrelated to the dispute arising from the construction contract.

         By statute, “the substantially prevailing party in any proceeding to recover any payment
within the scope of this chapter shall be awarded reasonable attorneys' fees…” 9 V.S.A. §
4007(c). The statue does not define the meaning of “within the scope of this chapter.” The
Vermont Supreme Court has noted: “PPA claims typically arise in construction disputes in which
one party seeks to be paid for its work and the other party seeks to avoid paying on the ground
that the work was deficient.” Nystrom v. Hafford, 2012 VT 60, ¶ 21, 192 Vt. 300. Additionally,
“‘[t]he purpose of the prompt payment act is to provide protection against nonpayment to


1
 The Court notes that it denied Plaintiff’s request for pre-judgment attachment based on its conclusion that
Plaintiff had failed to show that it was likely to prevail in its breach of contract claim against Tami Amidon, since
there was no written contract which included her as a party, and scant evidence from which any obligation on her
part could be implied with respect to the renovations contemplated by Plaintiff’s payment of $15,000 to Rickey
Amidon.
contractors and subcontractors.’” Birchwood Land Co., Inc. v. Ormond Bushey & Sons, Inc., 2013
VT 60, ¶ 21 (quoting Elc. Man, Inc. v. Charos, 2006 VT 16, ¶ 12, 129 Vt. 351.).

        The Prompt Payment Act does not apply to this case. The purpose of the statute is to
ensure payment when a landowner withholds money from a contractor. See id. Here, Plaintiff
paid Rickey Amidon in excess of the value of the work actually performed, and Defendant never
claimed Plaintiff withheld money owed for the contracting job. The case is thus different from
the typical case arising under the Prompt Payment Act, and the Court concludes that the
dispute here lies outside of the purpose of the statute. See id.; Nystrom, 2012 VT 60, ¶ 21.
“[W]ithin the scope of this chapter” only encompasses actions in which an owner is alleged to
have improperly withheld money from a contractor. See 9 V.S.A. § 4007(c); Birchwood, 2013 VT
60, ¶ 21. The Court acknowledges that an owner who prevails against such a claim by proving
that the contractor failed to perform is entitled to recover attorney’s fees. Nevertheless, the
Court is not persuaded that the Legislature intended that every breach of contract claim against
a contractor, in the absence of any opposing claim for nonpayment of an invoice, see 9 V.S.A. §
4002, falls under the Prompt Payment Act’s provision for the award of attorney’s fees. Rather,
except as specifically contemplated by the PPA, the American rule applies making each party
responsible for his own attorney’s fees. In re Gadhue, 149 Vt. 322 (1987).

WHEREFORE, it is hereby ORDERED :

       The Court REJECTS its own suggestion as to setoff, and none will be applied. The Court
DENIES Plaintiff’s request for attorney’s fees under the Prompt Payment Act. The Court enters
judgment in favor of Plaintiff against Rickey Amidon in the amount of $6,700, together with
prejudgment interest at 12% from the date of breach, July 1, 2013, as well as costs recoverable
pursuant to V.R.C.P.54(d). Plaintiff shall within 5 days submit a proposed judgment order
consistent with this entry.

Electronically signed on July 23, 2014 at 02:01 PM pursuant to V.R.E.F. 7(d).


______________________________________
John P. Wesley
Superior Court Judge
