CRAWFORD, J.
¶ 1. Plaintiff appeals the trial court's grant of judgment as a matter of law to defendants following a three-day jury trial in this negligence case. Plaintiff claims that the trial court erred in (1) excluding the testimony of plaintiff's expert witness on causation, (2) granting defendants' motion for judgment as a matter of law, (3) excluding an eyewitness's statements to police, (4) denying plaintiff's motion for a new trial, (5) awarding all deposition costs to defendants, and (6) refusing to disqualify counsel for defendant-landlord. We affirm the trial court's decision in all respects, with the exception of the award of deposition costs.
¶ 2. This case arose following a fire that destroyed a commercial building in Rutland, Vermont in April 2010. The following facts were introduced through plaintiff's witnesses at trial. Plaintiff Johnathan Lasek leased the northern half of the building and used the space as a workshop for his house-staining business. He stored staining products and other equipment and constructed a business office in the northeastern corner of the building. The southwestern corner of the building contained a fully enclosed room that was occupied by another commercial tenant, Vermont Vapor Inc. (VVI). The remainder of the building was used by landlord Downing Properties, LLC, as storage for ATVs, motorcycles, and snowmobiles.
¶ 3. VVI used its space as a laboratory for mixing the liquid filler for electronic cigarettes. The process involved diluting liquid nicotine with glycerin and other ingredients. VVI is owned by Adam Tredwell. Adam hired his father, Warren Tredwell, to alter the room to Adam's specifications. Warren added sheetrock and other materials to create a "clean room." He also installed an eight-inch fan
¶ 4. The fire was reported at around 5:00 a.m. on April 7, 2010. When firefighters arrived a few minutes later, the northwest corner of the building — plaintiff's corner — had a large hole in the roof and was heavily engulfed in flames. VVI's corner was not on fire at that time.
¶ 5. Plaintiff sued VVI for negligence and strict liability, alleging that VVI had caused the fire by mishandling liquid nicotine. He also sued landlord for breach of the implied warranty of suitability for commercial use, negligence, breach of the duty to warn, and unjust enrichment. After plaintiff's presentation of his case, the trial court granted defendants' motion for judgment as a matter of law. This appeal followed.
¶ 6. Prior to trial, defendants filed a joint motion to exclude the testimony of plaintiff's fire investigator about the cause of the fire. The court did not rule on the motion at that time. Instead, it conducted a mid-trial hearing on admissibility after defendants renewed their objection.
¶ 7. Under Rule 702, a qualified expert witness may testify if his or her testimony "will assist the trier of fact to understand the evidence or to determine a fact in issue" and "if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case." V.R.E. 702. Vermont Rule 702 is derived from Federal Rule 702, and the two provisions are substantively identical.
¶ 8. In Daubert, the U.S. Supreme Court held that Federal Rule 702 superseded the traditional test for admissibility of expert testimony set forth in Frye v. United States, 293 F. 1013, 1014 (D.C.Cir.1923). 509 U.S. at 586, 592-93, 113 S.Ct. 2786. The Daubert decision created "a flexible standard requiring only that expert testimony be both relevant and reliable to be admissible." 985 Assocs., Ltd. v. Daewoo Elecs. Am., Inc., 2008 VT 14, ¶ 6, 183 Vt. 208, 945 A.2d 381 (citing Daubert, 509 U.S. at 588-89, 113 S.Ct. 2786). Because our rules of evidence are "essentially identical" to the federal rules, we have adopted the standards set forth in Daubert and its progeny governing admissibility of expert testimony. Id. (quotation omitted).
¶ 9. "[W]e review trial court decisions on the admissibility of expert testimony only for abuse of discretion." Id. ¶ 9. However, we must "engage in a substantial and thorough analysis of the trial
¶ 10. The proffered opinion of plaintiff's fire investigator was that vapors from liquid nicotine in the lab came into contact with the pilot light of the overhead industrial space heater, causing a flash fire. During the Daubert hearing, he admitted that he was not a chemical engineer and did not know how much of any chemical was present in the VVI lab the night of the fire. He further admitted that he did not know the volume of air circulating through the lab because he did not know the size of the vent or the filter fabric that was used. When asked what methodology he used to determine how chemical vapors got out of the lab and reached the space heater overhead, he responded:
The court asked, "How do we know that?" The fire investigator responded that "if you look at the [material safety data] sheets ... some of those chemicals that were ... used in this process were lighter than air." Landlord's attorney then asked how the fire investigator had calculated that the concentration of these chemicals in the air was high enough to be ignited by the pilot light from the space heater. Plaintiff's fire investigator responded that he was not an engineer, but that this was the "commonsense" approach for this type of investigation. He opined that if there were containers without lids that contained solutions of the chemicals used by VVI in the lab, the lab likely would have been saturated with fumes, and the fumes would have escaped through a hole in the ceiling or through the door, and made their way up to the space heater where they ignited. On cross-examination, he agreed that nicotine is much heavier than air and that its vapors would have gone down, not up. He thought that mixing the nicotine with other chemicals, perhaps alcohol, created a flammable vapor that reached the pilot light:
¶ 11. The court excluded plaintiff's fire investigator's testimony pertaining to causation. The court explained that the fire investigator was not trained in chemistry, and did not know what chemicals were present, what their flammability or other characteristics were, or how they would interact with each other or flow through the air. The court noted that nicotine was present, but nicotine has a low flammability rating and is heavier than air. Even accepting that nicotine's properties could have been modified by a combination of other chemicals, there was no evidence of what the other chemicals were or how they would behave. The court concluded that the fire investigator could not offer his opinion regarding the cause of the fire because it did not meet the standards of Daubert and Rule 702.
¶ 13. Plaintiff argues that in his motion for a new trial he provided the court with data showing that the density of liquid nicotine equals that of air at sixty-eight degrees Fahrenheit, so it was not "junk science" to conclude that vapor from liquid nicotine could reach the space heater. The fact remains, however, that plaintiff's fire investigator was unqualified to explain this information to the jury. He was also unable to say what amount of liquid nicotine had to be present in the open in order for the vapors to escape the lab in a sufficient concentration to ignite, or whether that concentration of vapors was present on the night of the fire. The trial court therefore did not abuse its discretion in excluding his testimony.
¶ 14. After plaintiff rested his case, the trial court granted judgment as a matter of law to defendants on all of plaintiff's claims pursuant to Vermont Rule of Civil Procedure 50. Rule 50(a)(1) permits the court to grant judgment as a matter of law against a party that has been fully heard on an issue where "there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue." In evaluating the trial court's grant of judgment as a matter of law to defendants, we "consider the evidence in the light most favorable to the nonmoving party, excluding the effect of modifying evidence." Foti Fuels, Inc. v. Kurrle Corp., 2013 VT 111, ¶ 10, ___ Vt. ___, 90 A.3d 885 (quotation omitted). "If evidence exists that may fairly and reasonably support all elements of the nonmoving party's claim, judgment as a matter of law is improper." Brueckner v. Norwich Univ., 169 Vt. 118, 122, 730 A.2d 1086, 1090 (1999).
¶ 15. The trial court properly granted judgment as a matter of law in favor of defendants on plaintiff's claims of negligence against VVI and landlord. Without expert testimony on the issue of causation, plaintiff was unable to prove that VVI's use of liquid nicotine in its laboratory caused the fire. Without establishing that VVI caused the fire, plaintiff also could not prove that landlord was negligent in leasing the space to VVI or in maintaining VVI's leased space.
Id. at 235-36, 485 A.2d at 1268.
¶ 17. The doctrine of res ipsa loquitur allows an inference of negligence in certain cases, not causation. Established causation is a prerequisite to the application of the doctrine. As discussed above, plaintiff's expert was unable to present reliable testimony linking VVI's activities in the lab to the fire. Furthermore, plaintiff failed to show that a fire in a commercial warehouse is the sort of accident that ordinarily does not occur without negligence. See Metro. Prop. & Cas. v. Harper, 168 Or.App. 358, 7 P.3d 541, 551 (2000) ("[R]es ipsa loquitur is not commonly applied to fires, because the cause of a fire is generally unknown [and] fires commonly occur where due care has been exercised as well as where due care was wanting." (quotation omitted)). The cause and origin of this fire were genuinely disputed. It was therefore appropriate for the court to decline to apply res ipsa loquitur in this case.
¶ 18. Plaintiff also argues that the trial court erred in granting judgment as a matter of law to landlord on plaintiff's claim of unjust enrichment. "Under the doctrine of unjust enrichment, a party who receives a benefit must return the benefit if retention would be inequitable. Unjust enrichment applies if in light of the totality of the circumstances, equity and good conscience demand that the benefitted party return that which was given." Kellogg v. Shushereba, 2013 VT 76, ¶ 22, 194 Vt. ___, 82 A.3d 1121 (quotations and alteration omitted). Plaintiff claims that he spent over $40,000 improving his portion of the warehouse. Because landlord's insurance proceeds covered the total loss of the building, he seeks some share of the payment. Assuming without deciding that Vermont law recognizes an unjust enrichment claim by a tenant against a landlord to recover the value of improvements made by the tenant, plaintiff's claim fails because he did not show that landlord received a benefit from his improvements.
¶ 19. The trial court granted judgment as a matter of law on plaintiff's strict liability claim against VVI on the grounds that there was no ultrahazardous activity being conducted. It dismissed plaintiff's breach-of-warranty-of-suitability claim against landlord on the ground that no such action has been recognized in Vermont. Finally, it dismissed plaintiff's duty-to-warn claim against landlord on the ground that landlord did not owe a duty to warn plaintiff about VVI's activities. Plaintiff's brief does not challenge the court's rulings on these counts, and we will not disturb them. See Catlin v. Town of Hartland, 138 Vt. 1, 2, 409 A.2d 596, 597 (1979) (declining to disturb trial court's ruling where appellant failed to challenge it in appellate brief).
¶ 20. Plaintiff argues that the trial court erred in excluding two statements that Warren Tredwell made to police the morning of the fire and a few days later. He argues that the statements were admissible nonhearsay evidence pursuant to Vermont Rule of Evidence 801(d)(2)(D). That rule provides that a statement offered against a party is not hearsay if it is "a statement by his agent or servant concerning a matter within the scope of his agency or employment, made during the existence of the relationship." V.R.E. 801(d)(2)(D).
¶ 21. The first statement was contained in the report written by a state police investigator who interviewed Warren the morning of the fire:
The second statement was contained in the report written by the investigator hired by landlord's insurer. Warren told the investigator that he was the last person in the warehouse the night of the fire, that he left at 2:00 a.m. "after completing an order of electronic cigarettes to be shipped out the next day," and that he worked for his son.
¶ 22. The court agreed with plaintiff that Warren was an agent of VVI, but
¶ 23. The trial court based its ruling on this Court's decision in Westinghouse Electric Supply Co. v. B.L. Allen, Inc., 138 Vt. 84, 94, 413 A.2d 122, 129 (1980), in which we stated that it is "`only when an agent is acting within the scope of his authority and his admission relates to an act or negotiation connected therewith that it is admissible against his principal.'" Id. (quoting Jones v. Gay's Express, Inc., 110 Vt. 531, 534, 9 A.2d 121, 123 (1939)). The rule stated in Westinghouse has since been modified by Rule 801(d)(2)(D). See Reporter's Notes, V.R.E. 801(d)(2)(D) (explaining that in contrast to "traditional view" expressed in Westinghouse and other cases, "[t]he present rule adopts the broader view allowing statements about matters within the scope of employment in order to prevent loss of valuable evidence"); see also Contractor's Crane Serv., Inc. v. Vt. Whey Abatement Auth., 147 Vt. 441, 451, 519 A.2d 1166, 1173 (1986) (explaining that "[s]tatements made by an [agent] concerning a matter within his employment may be admissible against the party retaining the [agent]" (quotation omitted)). It was therefore error to require plaintiff to show that Adam Tredwell authorized Warren Tredwell to make his statements to the police and the investigator. Under Rule 801(d)(2)(D) and our case law, an agent's statements are not hearsay if they concern a matter within the scope of the agent's agency or employment. Contractor's Crane Serv., 147 Vt. at 451, 519 A.2d at 1173. Warren's employment in the lab provided a sufficient foundation for the admission of his statement.
¶ 24. However, the court's error was harmless because plaintiff has not shown that admission of the testimony would have changed the outcome of the case.
¶ 25. Plaintiff argues that the court should have granted his motion for a new trial because its dismissal of the case was based on incorrect scientific reasoning.
¶ 26. The trial court acted within its discretion in denying plaintiff's motion for a new trial. The court's decision to grant judgment as a matter of law in favor of defendants was not based on its own scientific conclusions. Rather, it was based on plaintiff's failure to provide reliable evidence at trial to prove that VVI's activities caused the fire. The information plaintiff offered in his motion was available to him prior to the judgment and could have been offered through a qualified expert witness at trial. His failure to provide admissible evidence in support of causation led to the Rule 50 motion being granted. Plaintiff has failed to demonstrate that the court's denial of his motion for a new trial was an abuse of discretion. See Gardner v. Town of Ludlow, 135 Vt. 87, 91, 369 A.2d 1382, 1385 (1977) (explaining that Rule 59 is directed at preventing a "miscarriage of justice" and is not a device for putting "merely dilatory" evidence before the court).
¶ 27. Vermont Rule of Civil Procedure 54(g) allows the court to award "costs in the taking of depositions" to the prevailing party in its discretion. The depositions must have been "reasonably necessary," whether or not they were actually used at trial. V.R.C.P. 54(g). The rule provides that deposition-related costs "may include the cost of service of subpoena upon the deponent, the reasonable fee of the officer before whom the deposition is taken, the stenographer's reasonable fee for attendance, and the cost of the original transcript of the testimony or such part thereof as the court may fix." Id.
¶ 28. Plaintiff argues that the trial court improperly awarded defendants the costs of obtaining copies of transcripts of depositions that they did not take themselves.
¶ 30. Plaintiff argues that he should not have to pay for the costs of the deposition of Lieutenant Cruise, who did not testify at trial. The trial court did not address whether Lieutenant Cruise's deposition was "reasonably necessary." V.R.C.P. 54(g). We accordingly remand so that the trial court may make that determination in the first instance.
¶ 31. Contrary to plaintiff's claim, landlord's insurer is not precluded from recovering its deposition-related costs because it defended the suit instead of landlord. "Ordinarily, an insurer who defends and indemnifies on behalf of its insured will be subrogated to the rights of its insured." Jefferson Ins. Co. v. Travelers Ins. Co., 159 Vt. 46, 49, 614 A.2d 385, 387 (1992). As a prevailing party in this common-law action, landlord's insurer — acting on landlord's behalf — was entitled to recover litigation costs related to the defense, including deposition costs. V.R.C.P. 54; Murphy v. Sentry Ins., 2014 VT 25, ¶ 53, ___ Vt. ___, ___ A.3d ___, 2014 WL 942114.
¶ 32. Prior to the commencement of this suit, in October 2010, plaintiff placed a lien on the property involved in the fire that was owned by landlord. Plaintiff's attorney Kaveh Shahi advised the court in December 2011 that plaintiff was withdrawing the lien. In May 2012, landlord's attorney Harry Ryan wrote a letter to Attorney Shahi stating that his client "went into some sort of shock and required medical attention" after discovering that plaintiff's lien was still in the land records. The letter stated "[y]ou are now on notice that [landlord] may suffer additional significant personal injury if you do not take appropriate action to make sure that the lien is removed," and requested that plaintiff's attorney write to the town clerk's office and ask them to remove the lien.
¶ 33. Following receipt of the letter, plaintiff sought to disqualify Attorney Ryan and his firm, Ryan Smith & Carbine, Ltd. (RSC), from defending landlord in this case. At the time that Attorney Ryan wrote the letter to Attorney Shahi, RSC was retained as counsel by the malpractice insurer for Attorney Shahi's firm, Cleary
¶ 34. Following a hearing, the trial court denied plaintiff's motion for disqualification. We review the trial court's ruling for abuse of discretion. See Stowell v. Bennett, 169 Vt. 630, 631, 739 A.2d 1210, 1211 (1999) (mem.) ("A motion to disqualify counsel is a matter that rests within the sound discretion of the trial court, and its ruling will not be disturbed absent an abuse of discretion.").
¶ 35. We affirm the trial court's decision for two reasons. First, plaintiff has not produced a transcript of the hearing below, which would allow us to determine whether the trial court had an appropriate factual basis for making its ruling. See Cody v. Cody, 2005 VT 116, ¶ 16, 179 Vt. 90, 889 A.2d 733 (holding that evidentiary hearing was necessary to resolve motion to disqualify attorney where material facts were in dispute).
¶ 36. Second, plaintiff has failed to show that disqualification was warranted. Rule 1.7 of the Vermont Rules of Professional Conduct prohibits an attorney from representing a client:
V.R.Pr.C. 1.7(a). RSC's representation of landlord was not directly adverse to CSA. Representation is directly adverse where a lawyer "act[s] as an advocate in one matter against a person the lawyer represents in some other matter, even when the matters are wholly unrelated." V.R.Pr.C. 1.7 cmt. 6. RSC was not acting as an advocate against Attorney Shahi or his firm, but rather against one of Attorney Shahi's clients. Attorney Ryan's letter cannot reasonably be interpreted as threatening a claim of litigation against Attorney Shahi personally. The letter simply asked Attorney Shahi to do what he had already claimed to have done: remove plaintiff's lien from the land records.
¶ 37. As we have noted in the past, "disqualification of counsel is only one of several avenues available to a court ... and it is a drastic measure which courts should hesitate to impose except when absolutely necessary." Cody, 2005 VT 116, ¶ 23, 179 Vt. 90, 889 A.2d 733 (quotation omitted). The trial court could have reasonably concluded that any potential for conflict in this situation was outweighed by landlord's right to choose its own counsel. Stowell, 169 Vt. at 632, 739 A.2d at 1212 (explaining that in considering whether to disqualify attorney, court must be "solicitous of a client's right freely to choose his
The case is affirmed in all respects except for the award of deposition costs, which is reversed and remanded for recalculation consistent with this decision.
Landlord requested the costs of original and electronic copies of the depositions of Mr. Lasek, the Tredwells, and the Downings, as well as Ray Weed (plaintiff's expert on damages), James Cruise and Timothy Austin (defendants' fire expert), as well as half the costs of obtaining the original and a copy of the transcript of the deposition of Mr. May, and half the cost of the videorecording Mr. May's deposition. Landlord also requested the costs of videorecording the depositions of Mr. Lasek, Mr. Austin, and Mr. Cruise.