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Hudgens v. Prosper, Inc. - 2010 UT 68, 243 P.3d 1275 (Sup.Ct.)

Rule:

An appellate court reviews the grant of a motion to dismiss for correctness, granting no deference to the decision of the district court. A motion to dismiss should be granted only if, assuming the truth of the allegations in the complaint and drawing all reasonable inferences therefrom in the light most favorable to the plaintiff, it is clear that the plaintiff is not entitled to relief. An appellate court will affirm the dismissal of a complaint only where it clearly appears that the plaintiff would not be entitled to relief under the facts alleged or under any state of facts they could prove to support their claim.

Facts:

Plaintiff Chad Hudgens was an employee of defendant Prosper, Inc. and under the direct supervision of defendant Joshua Christopherson. In 2007, Christopherson asked for volunteers for a new motivational exercise, where Hudgens volunteered to prove his loyalty and determination. During the motivational exercise, Christopherson ordered Hudgens to lie down, and slowly poured water from a gallon jug over Hudgen’s mouth and nose so that the latter could not breathe. After concluding the exercise, Christopherson instructed his team members that they should work as hard at making sales as Hudgens had worked at trying to breathe. Hudgens quit working for Prosper as a result of the anxiety and other injuries caused by the incident. Several months after, Hudgens filed a complaint in Utah state court against Prosper and Christopherson asserting four causes of action. First, Hudgens alleged common law assault and battery, intentional infliction of emotional distress and wrongful termination against both Prosper and Christopherson; he alleged that that Christopherson had intentionally interfered with his contractual relationship with Prosper. Prosper filed a motion to dismiss the complaint and argued that Hudgens had failed to allege sufficient facts to demonstrate any claim for relief. Prosper argued that the claims of common law assault, battery, and intentional infliction of emotional distress were barred by the exclusivity provision of the Utah Workers Compensation Act. The district court dismissed Hudgen's complaint without prejudice, holding that the complaint failed to state a claim for common law assault, battery, or intentional infliction of emotional distress because the purpose of Christopherson's exercise was to motivate his team members, not to injure Hudgens. The district court also denied Hudgens leave to amend his complaint, holding that Hudgens had failed to properly move the court for leave to amend because, rather than filing a motion for leave to amend, he incorporated his request for leave to amend into his Memorandum in Opposition to Prosper's Motion to Dismiss. The court indicated that the claims were to be dismissed without prejudice and instructed Prosper to draft an order reflecting its ruling. Prosper did so and the district court later signed the draft order. Before the draft order was signed, however, Hudgens filed a motion for leave to amend his complaint; the amended complaint included additional facts and allegations intended to cure the original complaint's deficiencies as identified by the district court. After signing the draft order, Prosper moved the district court to amend the order so that the claims would be dismissed with prejudice. The district court denied Hudgens' motion for leave to amend and granted Prosper's motion to dismiss with prejudice. Hudgens appealed.

Issue:

Did the trial court abuse its discretion when it refused to grant Hudgens leave to amend his complaint?

Answer:

Yes.

Conclusion:

The state supreme court reversed the district court's order and remanded to the district court with instructions to grant leave to amend. The court held that the district court abused its discretion under Utah R. Civ. P. 15(a) in denying leave to amend because the order lacked sufficient detail to permit meaningful appellate review and the district court's reasoning was not apparent from the record. Moreover, because no responsive pleading had been served, the court concluded that Hudgens was entitled to amend as a matter of course.

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