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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Alaska Construction & Engineering, Inc. v Balzer Pacific Equipment Company (01/27/2006) sp-5981

Alaska Construction & Engineering, Inc. v Balzer Pacific Equipment Company (01/27/2006) sp-5981, 130 P3d 932

     Notice:   This opinion is subject to correction  before
     publication  in  the  Pacific  Reporter.   Readers  are
     requested to bring errors to the attention of the Clerk
     of  the  Appellate  Courts, 303  K  Street,  Anchorage,
     Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
     e-mail corrections@appellate.courts.state.ak.us.


            THE SUPREME COURT OF THE STATE OF ALASKA

ALASKA CONSTRUCTION & )
ENGINEERING, INC., )
) Supreme Court No. S- 11168/11225
Appellant/Cross-Appellee, )
) Superior Court No.
v. ) 3AN-01-12395 CI
)
BALZER PACIFIC EQUIPMENT )
COMPANY, ) O P I N I O N
)
Appellee/Cross-Appellant. ) [No. 5981 - January 27, 2006]
)
          Appeal  from the Superior Court of the  State
          of    Alaska,   Third   Judicial    District,
          Anchorage, Philip R. Volland, Judge.

          Appearances: Thomas S. Gingras  and  Erin  K.
          Egan,  Eide, Miller & Pate, P.C.,  Anchorage,
          for   Appellant/Cross-Appellee.    David   W.
          Pease,  Burr,  Pease & Kurtz, Anchorage,  for
          Appellee/Cross-Appellant.

          Before:   Bryner,  Chief  Justice,  Eastaugh,
          Fabe,  and  Carpeneti,  Justices.  [Matthews,
          Justice, not participating.]

          CARPENETI, Justice.

I.   INTRODUCTION
          Alaska  Construction & Engineering, Inc.  (ACE)  leased
various pieces of equipment from Balzer Pacific Equipment Company
(Balzer).   When ACE stopped making rental payments, Balzer  sued
for  breach  of contract and sought prejudgment delivery  of  the
equipment.   Balzer was allowed to retrieve its  equipment  after
putting up a bond.  The jury returned a verdict for Balzer on its
breach  of  contract claims, rejected ACEs affirmative  defenses,
and awarded ACE $10,000 on one of its counterclaims.  Post-trial,
the  superior  court  ruled that: (1) Balzer was  the  prevailing
party;  (2)  the attorneys fees provisions in the lease  did  not
apply  to  Balzers attorneys fees at trial; and  (3)  Balzer  was
entitled  to prejudgment interest at the statutory rate of  three
and  three-quarters percent, as opposed to the  eighteen  percent
rate  listed  on  Balzers  invoices  to  ACE.   ACE  appeals  the
prevailing party decision; Balzer appeals the decisions regarding
the attorneys fees provisions and the prejudgment interest rate.
          Because ACE won on relatively minor claims while Balzer
won  on its main claim, we affirm the superior courts designation
of  Balzer  as  the prevailing party. Because the lease  and  the
option  to  purchase are separate agreements, we  hold  that  the
attorneys  fees  provisions in the option  to  purchase  and  the
repossession section of the lease are inapplicable to this  case.
Because Balzer did not offer sufficient record evidence regarding
the invoice interest rate, we reject the argument that ACE agreed
to  pay  eighteen percent prejudgment interest.  Thus, we  affirm
the superior court in all respects.
II.  FACTS AND PROCEEDINGS
          ACE, an Alaska corporation, contracted with Balzer,  an
Oregon  corporation,  to lease various pieces  of  rock  crushing
equipment  with  the  option to purchase.   Two  agreements  were
involved:  a  December  15,  2000  agreement  for  conveyers  and
accessories at $8,980 per month, and a January 11, 2001 agreement
for  a  screen plant at $7,000 per month.  The agreements,  which
were  drafted  by Balzer, are identical except as  to  the  items
leased and their value.
          By  July 2001 ACE had defaulted on its rental payments.
Balzer  sued for back rent in Oregon in August 2001.  In November
2001 Balzer filed a complaint for breach of contract against  ACE
in  Alaska.   Balzer claimed that ACE breached  the  contract  by
ceasing to make monthly rental payments and failing to return the
equipment.  The complaint prayed for the return of the equipment,
attorneys   fees,   and  other  relief  appropriate   under   the
circumstances.  Balzer also moved for prejudgment delivery of the
equipment pursuant to Alaska Civil Rule 88, and submitted a  bond
for  $228,000, representing the combined contract  price  of  the
leased  equipment.  ACE answered the complaint  and  opposed  the
motion for prejudgment delivery.  ACE offered various affirmative
defenses  (including that Balzer materially breached by providing
defective   equipment),  and  counterclaimed  for  unfair   trade
practices,  breaches of contract and the duty of good  faith  and
fair  dealing,  and  intentional and negligent misrepresentation.
ACE sought damages of just over $1 million.
          A  hearing on prejudgment delivery was held on December
11,  2001.  ACE opposed the motion on the grounds that it had  an
ownership interest in the equipment stemming from the rent it had
already paid.  ACE also argued that Balzers bond of $228,000  was
insufficient under AS 09.40.270,1 which governs undertakings.  At
the hearing, the superior court ordered Balzer to post a bond  of
$489,560,  about twice the value of the equipment as set  out  in
the lease agreements.  ACE then agreed to turn over the equipment
          to Balzer.  In January 2002 Balzer picked up the equipment at
ACEs  Anchorage  storage yard and eventually  transported  it  to
Oregon.
          A  jury trial was held in February 2003 before Superior
Court Judge Philip R. Volland.  At trial Balzer sought $20,000 in
transportation  costs  for  returning the  equipment  to  Oregon,
$52,000  in  repair  costs, and $40,000 in  back  rent  for  ACEs
alleged running of a second shift in violation of the contracts.2
In  its  counterclaim, ACE alleged that it incurred  losses  from
defects in the equipment and loss of profits resulting from those
defects;  it sought damages totaling $359,000.3  The  jury  found
that  ACE breached the contract and violated the implied covenant
of  good  faith  and fair dealing.  Therefore, it awarded  Balzer
approximately $50,500 in damages.  The jury rejected all of  ACEs
affirmative   defenses.    It  also  rejected   three   of   ACEs
counterclaims: that Balzer had breached the contract, contravened
the  implied  covenant of good faith and fair dealing,  and  made
intentional misrepresentations.  The jury found that  Balzer  had
made  negligent misrepresentations and awarded ACE  approximately
$10,000 in damages.
          Following the verdict, Judge Volland considered whether
to  award attorneys fees.  The court made three rulings regarding
attorneys  fees.  First, Judge Volland held that Balzer  was  the
prevailing  party for the purposes of Alaska Civil Rules  82  and
79.   He  also  held that, although Balzer was entitled  to  full
attorneys  fees for the period before it recovered its  equipment
on  January 10, 2002, none of the lease agreements attorneys fees
provisions  applied  to fees incurred at trial.   Finally,  Judge
Volland  rejected Balzers argument that prejudgment  interest  be
calculated  at  eighteen percent, as provided in invoices  Balzer
sent to ACE, and instead applied the statutory rate of three  and
three-quarters percent.
          This  appeal  concerns only Judge  Vollands  post-trial
attorneys  fees  decisions.   ACE  appeals  the  superior  courts
designation  of  Balzer as the prevailing party.   Balzer  cross-
appeals,   seeking  full  attorneys  fees  and   calculation   of
prejudgment interest at eighteen percent.
III. STANDARD OF REVIEW
          We  review a trial courts decision regarding prevailing
party status as well as the award of costs and attorneys fees for
abuse  of  discretion.4  An abuse of discretion  exists  when  an
award  is  arbitrary,  capricious,  manifestly  unreasonable,  or
improperly motivated.5
          Interpretation of a contract is a question  of  law  to
which  we  apply  our independent judgment.6  We also  apply  our
independent judgment in interpreting the Alaska Civil Rules.7  In
exercising our independent judgment we adopt the rule of law most
persuasive in light of precedent, reason, and policy.8
IV.  DISCUSSION
     A.   The  Superior  Court Did Not Abuse  Its  Discretion  in
          Ruling that Balzer Was the Prevailing Party.
          ACE  makes two challenges to the superior courts ruling
that  Balzer was the prevailing party for the purpose of awarding
attorneys  fees.  First, ACE argues that both it and Balzer  were
          prevailing parties, and that the superior court erred by not
awarding  attorneys fees to both parties under Alaska Civil  Rule
82 and costs under Alaska Civil Rule 79.  Second, ACE contends in
the alternative that neither party was entitled to attorneys fees
and costs.
          Alaska  Civil  Rule 82(a) provides that the  prevailing
party  in a civil case shall be awarded attorneys fees calculated
under this rule.  Similarly, Alaska Civil Rule 79(a) states  that
the prevailing party is entitled to recover costs allowable under
Civil Rule 79(f).  We have previously held that a party does  not
have  to prevail on all the issues in the case to be a prevailing
party  for purposes of attorneys fees and costs.9  But the  party
must  be successful with regard to the main issues in the action,
though it need not prevail on every subsidiary issue.10
          The  superior court held that Balzer was the prevailing
party  because Balzer prevailed on the main issue  in  the  case,
which  the court defined as recovery of money owed from [Balzers]
lease  contracts  with Alaska Construction and Engineering.   The
superior court correctly observed that the jury had rejected  all
of  ACEs defenses and all but one of ACEs counterclaims, and that
the amount awarded to ACE was nominal.
          ACE argues that since both of the parties prevailed  on
some  significant  claims and were awarded damages  .  .  .  both
parties  should be considered to be prevailing parties.  Even  if
ACE  is correct that it prevailed on some significant claims,  we
are  not  persuaded that the superior court abused its discretion
by   finding   that   Balzer  was  the  only  prevailing   party.
Determination   of  who  the  prevailing  party   is   does   not
automatically  follow  if  the  party  receives  an   affirmative
recovery, but rather is grounded on which party prevails  on  the
main  issues.11   We have held that a litigant  who  successfully
defeats  a  claim  of  great  potential  liability  may  be   the
prevailing  party even if the other side receives an  affirmative
recovery.12   Here,  it  was Balzer, and not  ACE,  that  escaped
significant  liability   ACE requested $359,000  in  damages  but
Balzer was only found liable for $10,000.  But it was also Balzer
that  had  the  larger monetary award, succeeding on  significant
portions  of  its  own claims, including its breach  of  contract
claims,  and  securing  a judgment nearly identical  to  what  it
sought.   In  contrast, ACE received only  a  partial  award  and
succeeded on its least significant claim.  In light of the  jurys
findings  that  ACE had breached the contract  and  violated  the
implied  covenant of good faith and fair dealing, and  the  jurys
rejections  of all but ACEs least significant claim,  we  do  not
find  the superior court abused its discretion in concluding that
Balzer  prevailed on the main issue of the case and that  it  was
entitled to costs and attorneys fees.13
     B.   The  Attorneys Fee Provision in the Option To  Purchase
          Is Inapplicable.
          Balzer  argues  that  it  is  entitled  to  its  actual
attorneys  fees for all legal costs and fees incurred  to  obtain
repossession  of the equipment because both contracts  contain  a
separately  executed,  identical attorneys  fees  provision  that
required  ACE  to pay Balzers reasonable attorneys  fees  if  ACE
          defaulted on any of its contractual obligations.  ACE responds
that  the  attorneys fees provision is inapplicable to this  case
because the parties intended for the fees provision to apply only
if ACE exercised its option to purchase the leased equipment, and
ACE  never exercised its option.  The relevant paragraphs of  the
option to purchase provide:
          At any time during the term of this
                    lease,   provided  Lessee
                    has   made  all  payments
                    when   due  and  is   not
                    otherwise  in default  in
                    this    or   any    other
                    agreement  with   Lessor,
                    Lessee  may purchase  the
                    equipment  described   in
                    the  lease  contract   by
                    paying cash to Lessor the
                    amount  of [the value  of
                    the  equipment] less 100%
                    of    rentals   paid   if
                    purchased within 90 days,
                    or   less  90%   of   the
                    rentals paid if purchased
                    after 90 days.
                    
          Time is of the essence of this contract.   If
          Lessee fails to make all payments when due or
          defaults  on any obligation, term of  notice,
          Lessor  shall  there  upon  be  entitled   to
          immediate possession of all equipment, and in
          the event of the commencement of any suit  or
          action   involving  this  contract   or   the
          disbursements   provided  by   law,   Lessors
          reasonable costs in recovering said equipment
          and  such  additional sum as  the  court  may
          adjudge reasonable as attorneys fees in  such
          suit or action or upon any appeal there from.
          Balzer  maintains that because the option  to  purchase
allowed  ACE to apply past rent payments towards the purchase  of
the equipment, the attorneys fees provision was triggered not  by
failure  to  make  payments on the purchased  equipment,  but  by
failure  to make lease payments that could be credited towards  a
later purchase.
          When  interpreting a contract, we strive to give effect
and reasonable meaning to all provisions of the instrument,14 and
we  interpret contract terms so as to avoid interpretations  that
cause conflicts among the provisions.15
          In   light  of  these  principles,  we  reject  Balzers
interpretation.  Some factors, including the fact that the  lease
and option to purchase were signed contemporaneously and the fact
that  the  lease  and the option to purchase are paginated  as  a
single  document, support Balzers interpretation  that  attorneys
fees  provisions contained in the option to purchase  applied  in
case  of  any  failure to make lease payments.   However,   other
          factors, such as the placement of the lease and the option to
purchase  under separate subheadings, the fact that each  section
is  signed  separately, and the fact that Balzers  interpretation
would  render redundant paragraph 9(c) of the lease, which allows
for  attorneys fees and costs associated with repossession of the
equipment,  lead us to read the lease and the option to  purchase
as separate agreements.  Thus, the attorneys fee provision in the
option  to purchase only applies to fees associated with securing
payment for purchased items.
     C.   The  Lease  Agreement Does Not Entitle Balzer  to  Full
          Attorneys Fees and Costs for Its Efforts After  January
          10, 2002.
          Following  trial, Balzer moved for full attorneys  fees
and  costs  based  on  the  lease contracts.   According  to  the
attorneys  fees provision in the section of the contract  dealing
with repossession, ACE was bound:
          (9) To return the equipment at the end of the
          rental.   If  Lessee  has  not,  at  its  own
          expense, loaded and returned the equipment at
          the  Lessors  written demand to  do  so,  the
          Lessee further covenants and agrees:
          
          . . . .
                                        
          (c)  That  Lessee  will pay  Lessor  for  all
          costs, including attorneys fees, if any,  and
          Sheriffs  costs  and  fees,  and  all   other
          expenses  incurred by Lessor in  effectuating
          repossession.
          
          The superior court agreed that Balzer was contractually
entitled  to  full  attorneys  fees  and  costs  it  incurred  in
effectuating repossession.  Citing Brown v. Baker,16 however, the
court observed that repossession is complete when a party resumes
possession  of  its  property.  The court  then  determined  that
Balzer  had  effectuated repossession when it obtained possession
of  the  equipment on January 10, 2002 and was only  entitled  to
full  fees  and costs through that date.  The court  specifically
rejected Balzers argument that, since it was required to  post  a
bond  in  order to obtain prejudgment delivery of the  equipment,
repossession was not completed until the bond was returned  after
trial.   The superior court analyzed Balzers arguments by looking
to   AS   09.40.270,   which  specifies  the   requirements   for
undertakings:
          A   peace   officer  may  not  take  personal
          property  into  custody until  the  plaintiff
          delivers  to the peace officer the  affidavit
          and undertaking of sufficient sureties to the
          effect  that  they are bound  in  double  the
          value of the property for the prosecution  of
          the action and the return of the property  to
          the defendant, if return be adjudged, and for
          the  payment to the defendant of any sum that
          may be recovered against the plaintiff.
          
(Emphasis added.)
          Referring to the emphasized portion of the statute, the
superior  court  stated that at the prejudgment delivery  hearing
ACE  agreed to release the property once Balzer posted a bond for
twice  the  amount  of  the  value of  the  equipment,  and  that
therefore the bond did not substitute for the property.   Rather,
the  bond  acted  to  secure payment to ACE on its  counterclaims
against  Balzer.  The court also rejected Balzers  argument  that
prejudgment delivery in this case had not resolved the  issue  of
possession,  noting  that neither party  disputed  possession  at
trial  and that the jury was not asked to decide which party  was
entitled to possession.
          On appeal, Balzer argues that because Alaska Civil Rule
8817  is a prejudgment remedy and because the bond stood  in  the
place of the equipment, it did not complete repossession until it
received  a  judgment at trial.  Balzer notes that  according  to
Rule  88(l)  the  order for seizure lapses if a judgment  is  not
obtained within six months, and argues that therefore it did  not
repossess  the  equipment  until it received  a  final  judgment.
Balzer also maintains that the trial falls under the repossession
sections  attorneys fee provision because Balzer had  to  proceed
through   trial  to  get  transport  costs  stemming   from   the
repossession.
          ACE responds that Balzer effectuated repossession under
the  lease  agreement when it reclaimed the  equipment  from  ACE
since  physical  possession of the equipment  was  all  that  was
required.   ACE  further  argues that Balzers  interpretation  of
Alaska  Civil  Rule  88 is only correct where  possession  is  in
dispute,  but  that in this case, because ACE voluntarily  turned
over  the  equipment  in  exchange for a bond  that  secured  its
counterclaims,  no  one contested possession  of  the  equipment.
Thus,  ACE  argues  that Balzer effectuated repossession  of  the
equipment  when  it took physical possession  of  it.   ACE  also
adopts  the  superior  courts position  regarding  Balzers  bond,
arguing  that  ACE  voluntarily relinquished its  claims  to  the
equipment once Balzer retook possession, and only sought the bond
to guarantee its counterclaims against Balzer.
          We  agree with the superior courts analysis.  As  noted
previously,  ACE  in  its  opposition  to  Balzers   motion   for
prejudgment  delivery  initially claimed a  compensable  property
interest  in  the  equipment.  However, after Balzer  posted  the
replevin  bond and retook possession in January 2002, ACE  waived
any ownership claims to the equipment.  Although Balzer correctly
observes  that  a  Civil  Rule 88 bond stands  in  the  place  of
personal  property, Balzers further assertion  that  repossession
cannot be completed or effectuated until a Rule 88 bond has  been
returned  is undermined by the facts of this case.  The  superior
court  did not issue, nor did Balzer request, a Civil Rule  88(e)
seizure  order.18   After  Balzer repossessed  the  equipment  in
January  2002, there was no question of returning it to ACE,  nor
did  ACE  persist in asserting that its previous  lease  payments
created  an  ownership  interest under  the  option  to  purchase
agreement.   Balzer  filed its first amended complaint  in  March
2002.  In its answer and counterclaims, filed in April 2002,  ACE
omitted any claim to the equipment, and claimed only damages  for
          unfair trade practices, breach of contract and of the duty of
good   faith   and   fair  dealing,  negligent  and   intentional
misrepresentation, and fraud.
          The replevin bond has two purposes.  It guarantees both
the  return  of  the  property to the  defendant,  if  return  be
adjudged, and . . . the payment to the defendant of any sum  that
may  be recovered against.19  In this case, the bond served  only
the  second  of  its two purposes (guarantee of  payment  to  the
defendant),  since  the  parties  agreed  on  ownership  of   the
equipment  before  trial and Judge Volland did not  instruct  the
jury to decide this issue.
          Balzer   is  incorrect  in  stating  that  repossession
requires final judgment simply because the possessory rights  are
premised  on  continued pursuit of the replevin  action.   Balzer
offers  several  cases for the proposition that replevin  actions
are temporary in nature and that possession is final only after a
final  judgment is rendered.20  Balzer relies primarly on Eastman
Kodak  Co.  v.  Thomas  Gordon  and  Associates,  Inc.  for  this
proposition.21  In that case, Eastman Kodak secured return of its
equipment through a prejudgment bond, but both parties  then  let
their claims and counterclaims languish for eight years, and  the
suit  was dismissed for lack of prosecution.  The court held that
Thomas   Gordon   was  the  prevailing  party  because   replevin
plaintiffs  are  under an obligation to pursue  their   claims.22
Balzer  maintains that Eastman Kodak supports its  position  that
repossession  requires  a final judgment because  its  possessory
rights   were   similarly  temporary.   But  Eastman   Kodak   is
distinguishable from the present case.  While in both cases there
was  no  final  judgment  on  the propriety  of  the  prejudgment
seizure,  in  Eastman Kodak this was because the parties  allowed
the  case to languish.  By contrast, in the present case,  Balzer
and ACE agreed during the replevin hearing that Balzer would take
possession of the equipment, following which the parties actively
litigated  the  issues remaining between them.   Nor  did  Balzer
offer  any  evidence that the delayed payments and the  costs  of
securing  the  bond  undermined Balzers  use  of  the  equipment.
Balzer was able to make repairs, sell some of the equipment,  and
prepare  the rest for re-rental.  Similarly, there is no evidence
that  the  costs  of  securing  the  bond  and  delayed  payments
undermined  Balzers  ability to use the equipment.   And  as  the
prevailing party, Balzer can pass costs associated with the  bond
to  ACE, while any delays in payment due to the trial are  offset
by  the  award  of prejudgment interest.  Thus,  Balzer  did  not
suffer  any  detriment that prevented it from exercising  control
over the property sufficient to have effected repossession.
          Balzer also argues that transportation costs are a part
of the repossession and that [it] did not effectuate repossession
until  it recovered its transportation costs at the trial,  which
required  that  it  defeat ACEs counterclaims.  Put  differently,
Balzer  asserts  that  because it did not receive  the  transport
costs  ACE  was  obligated to pay until Balzer received  a  final
judgment  at  trial, the attorneys fees associated with  securing
those  transport  costs are covered by the repossession  sections
attorneys  fees  provision.  We reject this argument  because  it
          fails to distinguish between Balzers attorneys fees associated
with  securing its transport costs and those fees associated with
defending against ACEs counterclaims or those related to securing
its repair costs.  In this combined action, sizeable portions  of
Balzers  trial attorneys fees were clearly associated  with  non-
transport  costs.   Balzer  successfully  defended  against  ACEs
numerous  counterclaims,  and  the  repair  damages  amounted  to
$30,000   of  Balzers  $50,500  judgment.   In  light   of   this
commingling of issues and effort, we reject Balzers argument that
it  can collect full attorneys fees for trial services under  the
repossession  section fee provision simply because it  needed  to
proceed  through trial to secure transport costs.  To  adopt  the
broad interpretation suggested by Balzer would allow it attorneys
fees  for  claims  and defenses not covered by  the  repossession
sections  attorneys fees provision.  Consequently, we reject  the
argument  that Balzer is entitled to full attorneys fees  because
it had to proceed through trial to secure its transport costs.23
     D.   The  Superior  Court  Properly  Calculated  Prejudgment
          Interest at the Statutory Rate.
          Balzer   also   cross-appeals   the   superior   courts
application of AS 09.30.070s
three and three-quarters percent prejudgment interest rate.   The
lease contract specifies that ACE must either make repairs to the
leased  equipment or pay Balzer for any repairs according to  the
prevailing price for such work. The relevant provision states:
          Lessee   further  covenants  and  agrees   as
          follows:
          . . . .
          (10)  To  make all necessary repairs  if  the
          equipment becomes damaged in operation or  in
          transit at Lessees own expense and cost,  and
          to  hold Lessor harmless for any loss,  costs
          or  expenses  on account of or  arising  from
          repairs  or  maintenance or claims therefore,
          or failing to do so, Lessee authorized Lessor
          to  make  such  repairs for  maintenance  and
          agrees  to  pay  the same at  the  prevailing
          price for such work.
          A  statement that eighteen percent interest is  charged
on  outstanding balances is printed on the repair invoice  Balzer
sent  ACE  soon  after Balzer repossessed the equipment.   Balzer
asserts  that the lease incorporates these invoices.   The  lease
provides:
          Lessee  agrees to pay on invoice  apportioned
          charges  for tire wear, manganese wear,  wear
          plate or liner wear, conveyor belting, screen
          cloths,  and  any  apportioned  wear   costs,
          lessor  will be the sole judge of  amount  of
          wear charges.
          Thus,  Balzer argues that ACE agreed to accept invoices
bearing  the prevailing price for repairs, and that the  interest
rate  is  part of this prevailing price.  As Balzer sees it,  ACE
accepted the eighteen percent interest rate (or should be  deemed
to  have  done so) in the course of its contractually  authorized
          dealings with Balzer.
          Alaska Statute 45.12.207(a) governs interpretations  of
leases.  That statute provides:
          If   a   lease  contract  involves   repeated
          occasions  for  performance by  either  party
          with   knowledge  of  the   nature   of   the
          performance and opportunity for objection  to
          it  by  the  other, any course of performance
          accepted  or acquiesced in without  objection
          is  relevant to determine the meaning of  the
          lease agreement.
          
However,  AS  45.12.207(a) does not apply to this  case,  because
Balzer  did not introduce record evidence that ACE had  knowledge
of  the eighteen percent provision or a reasonable opportunity to
reject  it  before  both parties ceased all  performance  of  the
contract.24
          Balzer cites only invoices for repairs which it sent to
ACE  after Balzer took possession of the equipment, by which time
ACE  had long ceased payments.  Additionally, insofar as ACE  had
an  opportunity to object to the eighteen percent provision after
Balzer brought suit, we agree with ACE that in litigating Balzers
claim  for  repairs,  ACE objected to the repair  invoices  as  a
whole.   Additionally,  in  its  order  on  attorneys  fees,  the
superior  court  found  that the parties  contract  contained  no
provisions for enhanced interest.  After re-examining this matter
on  Balzers  motion, the superior court again  reached  the  same
conclusion in its order on correction of the judgment.   Our  own
search  of  the record reveals no earlier invoices.  Further,  at
oral  argument Balzers counsel was unable to point to any invoice
that included the eighteen percent rate before Balzer repossessed
the  equipment.  We are unable to conclude on the facts presented
that   ACE   acquiesced  to  the  eighteen   percent   provision.
Therefore,  we  hold that the statutory three and  three-quarters
percent interest rate for prejudgment interest is appropriate  in
this case.
V.   CONCLUSION
          Because  Balzer  succeeded on  the  primary  issues  at
trial, the superior court did not abuse its discretion in deeming
Balzer to be the prevailing party and awarding it attorneys  fees
and costs under Alaska Civil Rules 82 and 79.
          Because   the   lease  and  the  option  are   separate
agreements,  we  reject Balzers argument that the attorneys  fees
provision of the option to purchase is applicable to this case.
          Further,  because the parties did not dispute ownership
after Balzer repossessed the equipment, Balzer cannot collect its
trial  costs under the repossession section of the lease.   While
Balzer  did  have to undergo trial after repossession  to  secure
repossession-related transport costs, it cannot recover attorneys
fees  for  that effort because its trial costs include  fees  for
claims  and  defenses not incurred while securing  the  transport
costs.  Awarding it full fees would overcompensate Balzer.
          Because  ACE  did  not  agree to the  eighteen  percent
interest  rate  listed on Balzers repair invoices,  the  superior
          court correctly set prejudgment interest at the statutory rate.
          In sum, we AFFIRM the decision of the superior court in
all respects.
_______________________________
     1    Alaska Statute 09.40.270 states in relevant part:

          A   peace   officer  may  not  take  personal
          property  into  custody until  the  plaintiff
          delivers  to the peace officer the  affidavit
          and undertaking of sufficient sureties to the
          effect  that  they are bound  in  double  the
          value of the property for the prosecution  of
          the action and the return of the property  to
          the defendant, if return be adjudged, and for
          the  payment to the defendant of any sum that
          may be recovered against the plaintiff.
          
     2     The  lease  agreements required ACE to pay  Balzer  an
additional  $7,990 per month if it ran the leased equipment  more
than  eighty  hours per week.  The second shift was  the  alleged
additional use, and Balzer argued that ACE had run a second shift
for five months.

     3     ACEs  original complaint requested over $1 million  in
damages.  However, ACE dropped its treble damages claim over  the
course  of litigation and claimed $359,000 in damages at  closing
arguments.

     4    Fernandes v. Portwine, 56 P.3d 1, 4-5 (Alaska 2002).

     5    Id. at 5.

     6    Peterson v. Ek, 93 P.3d 458, 463 (Alaska 2004).

     7    Airoulofski v. State, 922 P.2d 889, 892 (Alaska 1996).

     8     Casey  v. Semco Energy, Inc., 92 P.3d 379, 382 (Alaska
2004).

     9     Hickel v. Southeast Conference, 868 P.2d 919, 925  n.7
(Alaska 1994) (internal citation omitted).

     10    Id.

     11    Contl Ins. Co. v. U.S. Fid. & Guar. Co., 552 P.2d 1122,
1125 (Alaska 1976).

     12     Buoy  v.  Era Helicopters, Inc., 771  P.2d  439,  448
(Alaska 1989).

     13     ACE  also cites Andrus v. Lena, 975 P.2d  54  (Alaska
1999),  for the proposition that a party may prevail even  though
it  did  not secure all of the relief sought, and Blumenshine  v.
Baptiste, 869 P.2d 470 (Alaska 1994), for the idea that  a  party
should not be penalized for a small recovery.  In Andrus we  held
that the plaintiff was the prevailing party because it won on its
key  claims even though it lost on some claims; the size  of  the
monetary  award  was less important than the fact that  plaintiff
succeeded on the claims central to its suit.  Andrus, 975 P.2d at
58.   Andrus does not help ACE because ACE lost on the breach  of
contract and intentional misrepresentation claims that would have
shielded  it from liability and allowed it to collect significant
damages.   Neither  does Blumenshine support ACEs  argument.   In
that case we awarded prevailing party status to the plaintiff  in
an automobile accident case, notwithstanding his recovery of past
medical  expenses,  and only about $16,000 for  past  and  future
physical  impairment and pain and suffering although  he  claimed
$700,000.  Blumenshine, 869 P.2d at 474.  We held that the  total
award,  while  small  in  relation to  what  was  claimed,  still
constituted  a significant damage award on the main issues.   Id.
at  474.   This characterization supports the award of prevailing
party  status to Balzer even though it did not win on its second-
shift claims, but is inapplicable to ACE given its failure to win
on its affirmative defenses or its primary counterclaims.

     14    Modern Constr., Inc. v. Barce, Inc., 556 P.2d 528, 530
(Alaska  1976)  (quoting  4  Samuel Williston  &  Walter  Jaeger,
Williston on Contracts  619, at 731 (3d ed. 1961)).

     15     Wessells v. State, Dept of Highways, 562  P.2d  1042,
1049  n.23 (Alaska 1977) (quoting McBain v. Pratt, 514 P.2d  823,
828 (Alaska 1973)).

     16    688 P.2d 943, 950 (Alaska 1984).

     17    Alaska Civil Rule 88 states in relevant part:

          (a) Prejudgment Delivery of Personal Property
          to   Plaintiff;   Availability.    When   the
          plaintiff  has  commenced a civil  action  to
          recover possession of personal property,  the
          plaintiff  may make application to the  court
          to   have  the  property  delivered  to   the
          plaintiff.   The   court   may   order    the
          prejudgment   seizure  of  the  property   in
          accordance with the provisions of this rule.
          
          . . . .
          
          (l)  Duration  and  Vacation  of  Prejudgment
          Seizure Orders Issued Pursuant to Hearing.  A
          prejudgment seizure order issued pursuant  to
          a hearing provided for in section (c) of this
          rule   shall   unless  sooner   released   or
          discharged,  cease  to be  of  any  force  or
          effect  and  the  property  seized  shall  be
          released  from the operation of the order  at
          the  expiration  of six (6) months  from  the
          date  of the issuance of the order, unless  a
          notice of readiness for trial is filed  or  a
          judgment is entered against the defendant  in
          the action in which the order was issued,  in
          which case the order shall continue in effect
          until  released or vacated after judgment  as
          provided in these rules.
          
     18    Alaska Civil Rule 88(e) provides:

          If  at  the hearing the court finds that  the
          plaintiff has met the burden of proof as  set
          forth  in  paragraph (d) of  this  rule,  the
          court  shall  issue an order prescribing  the
          written    undertaking,    with    sufficient
          sureties, to be provided by the plaintiff and
          directing a peace officer to seize  and  take
          into  custody the property described  in  the
          affidavit   upon   the  furnishing   of   the
          undertaking by the plaintiff.
          
     19    AS 09.40.270.

     20    E.g., Burroughs v. U.S. Fid. & Guar., 397 P.2d 10 (N.M.
1964)  overruled by Quintana v. Knowles, 827 P.2d 97 (N.M.  1992)
(describing trial court proceedings where plaintiff who recovered
possession  of  tractor and trailer after posting replevin  bond,
then  litigated ownership at trial was thus adjudged to be  owner
of tractor and trailer and entitled to possession); America Rents
v.  Crawley, 603 N.E.2d 1079 (Ohio 1991) (after default  judgment
in  creditors favor, creditor sought to repossess consumer  goods
from  debtor  who defaulted on promissory note, but  trial  court
merely confirmed creditors ownership and awarded money damages to
creditor  since replevin is prejudgment rather than  postjudgment
remedy).

     21    789 So. 2d 360, 361-62 (Fla. Dist. App. 2001).

     22    Id. at 364.

     23    As Balzer is entitled to fees associated with securing
its   transport   costs,   it  arguably  could   have   requested
apportionment  of  its  attorneys fees,  gaining  full  fees  for
transport-cost related efforts and normal Civil Rule 82 fees  for
its defense against ACEs counterclaims and its securing of repair
costs.   However,  since Balzer did not request apportionment  in
the superior court, we need not reach this argument.

     24     Compare A & G Constr. Co., Inc. v. Reid Bros. Logging
Co.,  Inc.,  547  P.2d  1207 (Alaska  1976).   In  that  case,  a
materials supplier and a highway construction contractor  entered
a  contract for the sale of highway construction materials.   The
supplier sent a letter to the contractor notifying the contractor
that  it would increase the price of the materials.  Because  the
contractor   continued  to  receive  and  accept  the   materials
thereafter without objecting in writing to the price increase (as
required for sales contracts of $500 or more, under AS 45.02.201,
formerly numbered 45.05.020), the contractor was obligated to pay
the  increased  rate for materials received after notice  of  the
increased  price.  Id. at 1215-17.  According to AS 45.02.201(c),
[a] contract which does not satisfy [the writing requirement] but
which  is  valid in other respects is enforceable . . . (3)  with
respect  to  goods . . . which have been received  and  accepted.
(Emphasis added.)

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