217 N.C. App. 290
N.C. Ct. App.2011Background
- Plaintiff J.T. Russell and Sons, Inc. contracted to pave roads in Silver Birch Pond subdivision for about $148,000, subject to asphalt price variations.
- The work was performed April 18, 2008; core samples showed asphalt thickness below certain standards; base thickness testing followed later.
- Richards and Boyle initially certified compliance due to a mistaken understanding of base thickness requirements; certification later corrected after further testing.
- Subsequent core tests in 2009 showed several deficiencies in asphalt and base thickness; certification was withdrawn.
- Plaintiff sued for breach of contract; defendant defended and sought damages; the jury awarded defendant $370,765.82 against plaintiff.
- The trial court later granted a new trial on damages, holding the damages award lacked evidentiary support and proper measurement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Johnson’s (hearsay) testimony was properly admitted. | Plaintiff argues Johnson’s testimony about NCDOT conversations was inadmissible hearsay. | Defendant contends testimony is admissible as non-hearsay or waived objection. | Waived objection; testimony admissible on merits. |
| Whether the trial court properly denied a directed verdict for plaintiff. | Plaintiff contends cores show compliance with contract terms. | Stone base and asphalt thickness evidence show noncompliance. | No error; substantial evidence supported submitting breach to jury. |
| Whether damages were improperly awarded and require remittitur or new trial. | Plaintiff argues damages were supported by evidence. | Damages exceed what evidence supports and were not properly measured. | Remand for new trial on damages; damages award vacated due to measurement/amount issues. |
| How damages should be measured for breach (cost of repair vs. diminution in value) and offsets. | Court should use standard measuring damages as cost of repair or value difference. | Evidence supports repair costs and incidental/consequential damages. | Use cost of repair with offsets for contract price; lost-lot profits measured as net profits; remand for proper calculation. |
Key Cases Cited
- Venters v. Albritton, 184 N.C. App. 230 (N.C. App. 2007) (waiver when similar testimony is unobjected to earlier)
- Weeks v. Select Homes, Inc., 193 N.C. App. 725 (N.C. App. 2008) (directed verdict standard; de novo review)
- Hart v. Warren, 46 N.C. App. 672 (N.C. App. 1980) (consider competent and incompetent evidence in ruling on directed verdict)
- Pergerson v. Williams, 9 N.C. App. 512 (N.C. App. 1970) (grounds for directed verdict must be stated; appellate review limited)
- Kenney v. Medlin Constr. & Realty, 68 N.C. App. 339 (N.C. App. 1984) (two methods of measuring damages; cost of repair or diminution in value)
- Bowles Distributing Co. v. Pabst Brewing Co., 80 N.C. App. 588 (N.C. App. 1986) (lost profits typically net profits after costs)
- Olivetti Corp. v. Ames Bus. Sys., Inc., 319 N.C. 534 (N.C. 1987) (damages must be proven with reasonable certainty)
- Weyerhaeuser Co. v. Supply Co., 292 N.C. 557 (N.C. 1977) (damages measure and foreseeability standards)