Tampa Bay Shipbuilding & Repair Co. v. Cedar Shipping Co.

United States Court of Appeals for the Eleventh Circuit · Evidence

EvidenceLay opinion testimonyFederal Rule of Evidence 701FRE 701FRE 702lay opinionbusiness officer testimonyparticularized knowledge

Facts

Tampa Bay repaired Cedar’s ship after grounding damage and later billed Cedar for the base contract amount, agreed extras, disputed condition reports, and lay days. Before trial, Cedar moved in limine to exclude testimony from Tampa Bay officers, employees, and a subcontractor about the reasonableness of Tampa Bay’s charges and repair time, arguing that such testimony was expert testimony requiring Rule 702 qualification and expert disclosure. The district court denied the motion and, during the bench trial, allowed the witnesses to testify based on their roles in supervising, estimating, pricing, and approving the repair work. Cedar challenged those evidentiary rulings on appeal under amended Federal Rule of Evidence 701.

Issue

Whether, after the 2000 amendment to Federal Rule of Evidence 701, the district court abused its discretion by admitting lay opinion testimony from Tampa Bay’s officers, employees, consultant, and subcontractor concerning the reasonableness of repair charges and timing without requiring expert qualification under Rule 702 and expert disclosure under Rule 26.

Rule

Under amended Rule 701, lay opinion testimony is admissible if it is rationally based on the witness’s perception, helpful to understanding the testimony or determining a fact in issue, and not based on scientific, technical, or other specialized knowledge within the scope of Rule 702. Testimony from business owners, officers, or similarly situated participants that rests on particularized knowledge gained by virtue of their positions in the business remains a prototypical form of lay opinion testimony and is not transformed into expert testimony merely because it concerns matters on which an expert could also testify or bears on an ultimate issue.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Granite Harbor Construction, a fictional contractor in Denver, sues a property developer in a federal bench trial for unpaid charges on a warehouse renovation. Nolan Price, Granite Harbor’s project manager, personally supervised the work, prepared internal estimates, approved change-order pricing, and observed the labor performed each day; Granite Harbor did not disclose him as an expert.

The developer objects when Nolan testifies that Granite Harbor’s charges were reasonable. How should the court most likely rule?

Explanation. Rule 701 permits lay opinion that is rationally based on the witness’s perception, helpful, and not based on scientific, technical, or other specialized knowledge within Rule 702. The majority treated business officers and employees with direct involvement in estimating, supervising, pricing, and observing the work as classic lay-opinion witnesses when they speak from particularized knowledge gained through their positions. That the subject could also be addressed by an expert, or bears on the ultimate issue, does not by itself make the testimony inadmissible.