A judge in the Southern District of Florida was asked to hear a plaintiff’s motion in limine to exclude the opinion testimony of Defendant’s construction costs expert in a breach of contract case.
This case involved work Plaintiff performed at an apartment complex under two subcontracts with Defendant (“Projects”). Defendant entered into the contracts with Plaintiff for demolition and carpentry services. Defendant agreed to pay Plaintiff progress payments provided Plaintiff’s monthly payment applications provided detailed statements and percentages of completion it performed the prior month.
Plaintiff alleged that Defendant failed to provide any payment for work completed under three payment applications.
Defendant hired Mr. A as a replacement manager for the Projects. He toured the Projects to determine how much work had been performed and to update the completion percentages based on what he saw. When he realized that Plaintiff had misreported the amount of work completed, he assisted Defendant in issuing a credit that corrected the completion percentages and reduced the money due. Plaintiff alleges, however, that multiple entities, including Defendant, previously approved the applications and completion percentages and therefore Defendant shouldn’t have changed the figures.
Plaintiff served Defendant with a notice of default, filed its notice of termination, and expressed an intent to pursue an action against Defendant’s surety for breach of the payment bond. Defendant relied on Mr. A’s spreadsheets to create Plaintiff’s payments. The spreadsheets assisted Defendant in justifying a credit to for work that Mr. A determined was incomplete and overbilled. Defendant subsequently reduced the amounts it owed under the subcontracts.
Plaintiff’s motion in limine sought to exclude the opinion testimony and spreadsheets of Mr. A—who Plaintiff deposed—because Defendant failed to disclose him as an expert witness. Plaintiff claimed that the testimony and spreadsheets were inadmissible under Federal Rule of Evidence 701(c) because they relied on Mr. A’s technical and specialized construction skills to render conclusions.
Defendants asserted that he was only testifying to facts observed while working on the Projects and that his testimony didn’t amount to an improper expert opinion. Defendants said that the values on the spreadsheet were computed with a simple calculation of multiplying a value by the percentage of completion.
U.S. Magistrate Judge Edwin G. Torres considered whether the expert’s testimony and spreadsheets should be excluded as a violation of Rule 701.
Plaintiff argued that Mr. A, as a senior project manager, was tasked to review Plaintiff’s construction work. To complete this task, Plaintiff claimed he drafted spreadsheets by observing the projects and adjusting Plaintiff’s estimated percentages based on his subjective belief without any measurable data or methodology. Plaintiff alleged that he relied on his specialized construction knowledge to conclude that Plaintiff over billed and failed to complete the work required.
Plaintiff further argued that his compiled his spreadsheets required a specialized understanding of how construction work is quantified into percentages of completion.Plaintiff suggested that the spreadsheets and testimony went beyond the realm of a lay witness because the latter relied on specialized construction knowledge despite having personally observed Plaintiff’s work. The crux of Plaintiff’s argument was that verifying Plaintiff’s percentage of completion required a specialized understanding of extrinsic factors unknown to a layperson’s day to day observations—such as the costs of labor, the complexity of demolition, installation services, and external factors—and that Mr. A couldn’t testify in this case without the designation of an expert witness.
Defendants’ responded that Mr. A’s testimony fell squarely within Federal Rule of Evidence 701 because he merely reviewed the Projects and determined that not all the demolition work was completed. Defendants suggested that he only adjusted Plaintiff’s competition percentages based on what he observed and that he was simply testifying within the scope of his duties as a project manager. Because he was merely testifying within the scope of his duties as a project manager based on simple observations as he walked through the Projects, Defendants concluded that his testimony fit within the realm of a lay witness.
Judge Torres explained that Rule 702 provides that an expert witness may testify to his or her opinion if: (1) “the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;” (2) the testimony “is based on sufficient facts or data” and is the “product of reliable principles and methods;” and (3) “the expert has reliably applied the principles and methods to the facts of the case.”
On the other hand, Rule 701 states that “the hallmark of lay witness testimony” is when it is “(a) rationally based on the witness’s perception; (b) helpful to clearly understanding the witness’s testimony or to determining a fact in issue; and (c) not based on scientific, technical, or other specialized knowledge within the scope of Rule 702.”
Citing the advisory committee’s note to the 2000 amendment to Rule 701, Judge Torres explained that the requirement that a lay witness’s opinion be rationally related to his perception is satisfied where his perception is based on a review of relevant documents, both in and not in evidence. The witness’s opinion must be based on a rational perception of the reviewed information, and the witness must not “merely deliver[ ] a jury argument from the witness stand” based on inferences drawn from facts already in evidence.
The last requirement in Rule 702, the judge said, is intended “to eliminate the risk that the reliability requirements set forth in Rule 702 will be evaded through the simple expedient of proffering an expert in lay witness clothing” and “also ensures that a party will not evade the expert witness disclosure requirements set forth in [Federal Rule of Civil Procedure] 26 . . . by simply calling an expert witness in the guise of a layperson.”
However, Judge Torres noted that the Eleventh Circuit Court of Appeals concluded, “Rule 701 does not prohibit lay witnesses from testifying based on particularized knowledge gained from their own personal experiences.” Further, he added that the Advisory Committee Notes explain, “[t]he amendment does not distinguish between expert and lay witnesses, but rather between expert and lay testimony.” As such, the judge explained that this means that “credentials alone do not make the expert; the testimony based upon the credentials make the expert.”
And, as the Eleventh Circuit found, opinion testimony regarding the manner or method upon which accompany takes action, which is based on particularized knowledge gained by a witness’s employment, is properly treated as lay testimony.
The determination of whether testimony is properly admitted as a lay opinion is based upon the nature of the testimony, not whether the witness could have been qualified as an expert.
Judge Torres found that the computations in the spreadsheets weren’t as basic as Defendants suggested and Mr. A’s testimony supported that view. Defendants offered no explanation, and it wasn’t clear to the Court how his computations constituted lay witness testimony when he was “determining percentages based on the number of screws installed in a cabinet.” Rather, the judge found that Mr. A’s testimony showed that these percentages required a specialized understanding of labor, demolition, and installation costs.
The evidence suggested that Mr. A’s computations were beyond the realm of lay witness testimony because the collection of the data required specialized construction knowledge which, in turn, required a computer to determine the percentages of the work completed. This process was necessary so that individuals, other than himself, could read and understand the data collected.
Given Mr. A’s testimony and the computer method he used to compile his spreadsheets, the Court found that the data he collected didn’t “result from a process of reasoning familiar in every day life,” but instead “from a process of reasoning that can be mastered only by specialists in the field,” of construction. The judge held that Defendants should have designated him as an expert in this case because—although a lay person may opine on matters based upon his perception—he could not testify as to matters that require specialized knowledge.
Because Mr. A rendered an expert opinion based on his specialized knowledge of design and construction and Defendants failed to disclose him as an expert witness, Plaintiff’s motion in limine to exclude Mr. A’s spreadsheets and testimony related to the specific valuations of the construction work that Plaintiff completed was granted.
However, Judge Torres noted that this didn’t mean that all of Mr. A’s testimony should be excluded because “[i]t is possible for the same witness to provide both lay and expert testimony in a single case.” While the spreadsheets on the specific valuation of the work completed constituted expert testimony, his general observations were admissible as lay witness testimony because there was no specialized knowledge required to tour the Projects and observe the status of the construction work completed. In other words, the observation of whether Plaintiff completed the construction work that they were required to do may be the product of reasoning” familiar to the average person in everyday life.