Lead Opinion
Plaintiffs filed this action for damages, asserting that defendants’ negligence caused the foundation of their home to shift during its construction. Defendant Benton Construction Company, doing business as Great Lakes Superior Walls (Great Lakes), appeals by right the judgment entered after a jury verdict finding it 60 percent negligent and defendants Pristine Home Builders (Pristine) and Daniel J. Bonawitt (Bonawitt) 40 percent negligent. Great Lakes also appeals the trial court’s order granting partial remittitur of the $272,500 jury award in plaintiffs’ favor to $195,000, as the amount the evidence showed that plaintiffs’ home diminished in value. Great Lakes contends it should have been granted judgment as a matter of law, but if not, the jury’s verdict should have been reduced to $77,500, the cost of repairing the damage to plaintiffs’ home. Plaintiffs cross-appeal the trial court’s order granting remittitur and the trial court’s determination of a reasonable attorney fee for case evaluation sanctions. We affirm, but also reverse the trial court’s order granting remittitur and remand for entry of judgment for plaintiffs consistent with the jury’s verdict.
Plaintiffs Gerald T. Heaton and Jonna Heaton entered a contract with defendant Pristine, operated by defendant Bonawitt, a licensed builder, to build their retirement home at Scenic Lake in Shiawassee County Bonawitt subcontracted with defendant Great Lakes
Defendant first argues that the trial court erred by not granting one of its dispositive motions for judgment as a matter of law. Specifically, the trial court denied defendant’s motion for summary disposition under MCR 2.116(C)(10), denied defendant’s motions for a directed verdict after opening statement and at the close of plaintiffs’ proofs, and denied defendant’s motion for judgment notwithstanding the verdict (JNOY). Our review of the trial court’s decision regarding each of these motions is de novo. Diamond v Witherspoon,
Defendant’s motion under MCR 2.116(C)(10) tested the factual sufficiency of plaintiffs’ claim. Maiden v Rozwood,
When reviewing a trial court’s decision on a motion for a directed verdict, this Court must view the evidence presented up to the point of the motion and all legitimate inferences from the evidence in the light most favorable to the nonmoving party to determine whether a fact question existed. Zantel Marketing Agency v Whitesell Corp,
Defendant argues that it was entitled to judgment as a matter of law because, although plaintiffs couched their complaint in terms of negligence, the case was actually a products liability claim for failure to warn. Defendant contends that the undisputed facts establish that it furnished a “product,” precast concrete foundation walls. See Fenton Area Pub Schools v Sorensen-Gross Constr Co,
The statutes pertinent to this issue provide:
(g) “Product” includes any and all component parts to a product.
(h) “Product liability action” means an action based on a legal or equitable theory of liability brought for the death of a person or for injury to a person or damage to property caused by or resulting from the production of a product.
(i) “Production” means manufacture, construction, design, formulation, development of standards, preparation, processing, assembly, inspection, testing, listing, certifying, warning, instructing, marketing, selling, advertising, packaging, or labeling.
(j) “Sophisticated user” means a person or entity that, by virtue of training, experience, a profession, or legal obligations, is or is generally expected to be knowledgeable*534 about a product’s properties, including a potential hazard or adverse effect. An employee who does not have actual knowledge of the product’s potential hazard or adverse effect that caused the injury is not a sophisticated user. [MCL 600.2945(g), (h), (i), and (j).]
(4) Except to the extent a state or federal statute or regulation requires a manufacturer to warn, a manufacturer or seller is not liable in a product liability action for failure to provide an adequate warning if the product is provided for use by a sophisticated user. [MCL 600.2947(4).]
The trial court denied defendants motion for two reasons: (1) plaintiffs’ claim was not one of products liability but rather one for ordinary negligence, and (2) under the facts of the case, Bonawitt was not a “sophisticated user” as contemplated by the statute. “This Court reviews de novo the interpretation and application of statutes as questions of law.” Gilliam v Hi-Temp Products Inc,
First, we accept defendant’s argument that its precast concrete foundation walls were a “product” within the meaning of the products liability statutes. Second, for purposes of our analysis of this issue, we accept defendant’s assertion that even though plaintiffs’ claim was one of ordinary negligence, it still could come within the broad definitions of “product liability action” and “production” in MCL 600.2945(h) and (i). Splicing these two definitions together, they would read, pertinent to this case: “ ‘Product liability action’ means an action based on a legal.. . theory of liability brought
Nevertheless, we conclude that the trial did not err by ruling on the basis of the facts of this case that Bonawitt was not a sophisticated user as contemplated by the statute. A “sophisticated user” is one who “by virtue of training, experience, [or] a profession,... is or is generally expected to be knowledgeable about a product’s properties, including a potential hazard or adverse effect.” MCL 600.2945(j). Here, although Bonawitt was a licensed builder engaging in home construction since 1997, he testified that he had built only 12 houses under his license and had never used the type of foundation that Great Lakes provided. In Bonawitt’s words, he “built like one and a half houses a year, adequate to support my family.” Further, Bonawitt testified that he relied on various subcontractors and engineers for their expertise regarding various aspects of construction. He also testified that he relied on a “Builder Guideline Booklet,” which is subtitled “Site Preparation and Framing Attachment Requirements,” that Great Lakes provided him. Specifically, Bonawitt read page 36 of this booklet that addressed shear walls as stating that with respect to plaintiffs’ home, shear walls were not necessary because no continuous span of the foundation was greater than 42 feet. This page of
Moreover, MCL 600.2947(4) only limits products liability with respect to a duty to provide an “adequate warning” to sophisticated users where not otherwise required by state or federal statute or regulation. Plaintiffs’ theory of liability was much broader than simply the failure to provide an adequate warning. It included a claim for breach of a duty to provide adequate instructions regarding the need for shear walls, and for defendant’s active participation with Bonawitt in devising the shear walls that subsequently failed to adequately support the foundation walls. Plaintiffs’ theory of the case, supported by the evidence, is best characterized as an “application of the basic rule of the common law, which imposes on every person engaged in the prosecution of any undertaking an obligation to use due care, or to so govern his actions as not to unreasonably endanger the person or property of others.” Clark v Dalman,
Next, defendant argues that the trial court erred by failing to instruct the jury regarding its claim to a sophisticated user defense. This Court reviews de novo claims of instructional error. Lewis v LeGrow,
Both parties appeal the trial court’s partial grant of remittitur. Defendant contends the trial court abused its discretion by only reducing the jury verdict in plaintiffs’ favor from $272,500 to $195,000. Defendant
When a jury awards damages that appear excessive because of the influence of passion or prejudice, or the jury award is clearly or grossly excessive, a court may grant a new trial. MCR 2.611(A)(l)(c)-(d). Alternatively, a trial court may offer the prevailing party an opportunity to consent to judgment in the highest amount the court finds is supported by the evidence. MCR 2.611(E)(1). This Court reviews a trial court’s decision regarding a motion for remittitur or a new trial for an abuse of discretion. Palenkas v Beaumont Hosp,
Analysis of this issue must start with the principle that the adequacy of the amount of the damages is generally a matter for the jury to decide. Kelly v Builders Square, Inc,
Both parties cite Baranowski v Strating,
As to damages, the trial court instructed the jury consistent with M Civ JI 51.05:
In this case the Plaintiffs claim damages to their home. If you decide that Plaintiff [sic] is entitled to such damages, the amount should be measured by the lesser of the reasonable expense of necessary repairs to the property which was damaged or the difference between the fair market value of the property immediately before the occurrence and its fair market value immediately after the occurrence.
As noted above, the evidence adduced at trial would have permitted the jury to find that the damage to the home caused by the second foundation shift was essentially irreparable. Engineer Scott Walkowicz testified regarding the dilemma plaintiffs faced:
When we were approached by Mr. Heaton he was at that point, already having problems with his house. His primary interest was whether or not the house could reasonably be saved or repaired and brought back to a condition that you would expect for a newly constructed house. So we went through, did field work, and as we were going through there some of the observations that we made — I’m not sure if I should state those — but ultimately it came down to the opinion that it would be a very, very difficult thing[,] if not impossible[,] to repair the house to the condition that it should’ve been prior to having moved, and that was due to a number of reasons; that there was lesser or kind of partial repairs whereby we can stabilize it and have reasonable confidence that it wouldn’t move again or move further. Those were our two ultimate opinions.
Plaintiffs chose to stabilize, but not repair the foundation, and partially repair other damage to the struc
Counsel: And I want to make sure that we understand whether that one hundred and ninety-five thousand dollar loss includes any of the costs that the homeowner would incur to partially cure or stabilize the problem with the foundation.
Vertalka: It does not.
Counsel: So any costs the homeowner incurred to stabilize or partially cure would be in addition to this loss in value?
Vertalka: That’s correct.
On the basis of this evidence and Baranowski, supra at 563, we conclude that defendant’s argument that the jury award should have been reduced to $77,500 is without merit. Consequently, defendant’s final argument that the trial court erroneously awarded case evaluations sanctions must also fail.
Further, we agree with plaintiffs that because the evidence supported the jury’s award, the trial court abused its discretion by granting remittitur. Palenkas, supra at 531; McManamon, supra at 138; MCR 2.611(E)(1). In general, a defendant found negligent is liable for all injuries resulting directly from his or her wrongful act, whether foreseeable or not, if the damages were the legal and natural consequences of the defendant’s conduct and might reasonably have been anticipated. Ensink v Mecosta Co Gen Hosp,
The final issue on appeal is plaintiffs’ claim that the trial court abused its discretion when awarding case evaluation sanctions by determining that a reasonable hourly attorney fee rate was $185 and $70 an hour was reasonable for paralegal services. We disagree.
When case evaluation sanctions are appropriate, the actual costs to be charged are the costs taxable in any civil action plus a reasonable attorney fee. MCR 2.403(O)(6); Dessart v Burak,
We affirm, but also reverse the trial court’s order granting remittitur and remand for entry of judgment for plaintiffs consistent with the jury’s verdict. We do not retain jurisdiction. Because plaintiffs have prevailed regarding the issues on which defendant appealed, they may tax costs pursuant to MCR 7.219.
Concurrence Opinion
(concurring in part and dissenting in part). I concur in the majority’s opinion that this is a products liability case, but respectfully disagree with its conclusion that Daniel J. Bonawitt was not a sophisticated user. In my view, Bonawitt was a sophisticated user, and, as a result, the trial court should have granted defendant Great Lakes Superior Walls’ motion for summary disposition, and dismissed plaintiffs’ claim to the extent that it was premised on a failure to warn.
Although the parties argue over whether plaintiffs’ claim was actually one in negligence or products liabil
The statutory definition of “sophisticated user” is:
“Sophisticated user” means a person or entity that, by virtue of training, experience, a profession, or legal obligations, is or is generally expected to be knowledgeable about a product’s properties, including a potential hazard or adverse effect. An employee who does not have actual knowledge of the product’s potential hazard or adverse effect that caused the injury is not a sophisticated user. [MCL 600.29450')]
I would hold that there was no genuine issue of material fact that Bonawitt was a sophisticated user. It is undisputed that Bonawitt had been a professional home-builder for the past 12 years, and that this was his exclusive line of business. The evidence is also undisputed that Bonawitt had built approximately 19 homes during his 12 years of business, and it is clear that when he contracted with plaintiffs to build their home, he
In light of this conclusion, I would reverse the trial court’s order in part, and remand for dismissal of plaintiffs’ failure to warn theory. Such a dismissal would not necessitate dismissal of the entire judgment, because plaintiffs also posited a failure to instruct theory, which is different from a failure to warn. See MCL 600.2945(i) (defining “production” as both “instructing” and “warning”) and Talcott v Midland,
Notes
I am assuming, because it is not addressed by the parties, that the “sophisticated user” defense applies to plaintiffs’ cause of action even though the transaction was between defendant and Bonawitt, and this discussion is over whether Bonawitt, rather than plaintiffs, was a “sophisticated user.”