Martz v. Day Development Company, L.C.

In September 2003, Day Development Company, L.C. (Day) (defendant) hired Byron Martz (plaintiff) to obtain certain approvals relating to a condominium development and perform other services. The contract stated that once Martz obtained the requested approvals, “compensation as set forth below shall be due and payable by [Day] unto Martz.” In the section below, the contract provided for two alternate methods for calculating this compensation. One, if Martz obtained the approvals and Day then sold the property, Martz’s compensation would be 50 percent of Day’s net profits from the sale. Alternatively, if Martz obtained the approvals and Day elected to build the condominium project, Martz’s compensation would be 50 percent of the project’s appraised value. The section went on to state that Martz would receive this compensation on the earliest of either (1) the sale of the condominium parcel, (2) Day obtaining a building permit to construct any units on the parcel, or (3) January 1, 2015. Martz obtained the required approvals. On January 1, 2015, Day had neither sold the parcel nor obtained any building permits for it, allegedly because it was waiting for the city to complete a road extension before doing either. Martz requested payment, but Day refused, claiming that a condition precedent to any payment was that the condominium parcel be either sold or developed. Martz sued Day in federal district court, alleging breach of contract. The district court ruled that Day had breached the contract by not paying Martz on January 1, 2015. The district court awarded Martz approximately $1.9 million, which was 50 percent of the difference between the parcel’s value before his services and its value after his services. Day appealed.