### IN THE COURT OF APPEALS OF TENNESSEE AT JACKSON Assigned O n Brief A

ugust 8, 2002
EDWARD KEITH GRAY

V 

### . JOHNSON MOBILE HOMES OF TENNESSEE, INC. A 

### / K 

### / A 

### JOHNSON HOMES AND 

### FLEETWOOD HOMES OF TENNESSEE, INC. AND 

### GREEN TREE FINANCIAL SERVICING CORPORATION

Appeal from the Chancery Court for Hardeman County No. 12298 Dewey C. Whitenton, Chancellor

No. W2001-01982-COA-R3-CV - Filed Marc h 26, 2003

This is a contract case. The buy er contracted to purchase a mobile home. A fter the home was delivered, the buy

er inspe cted it and found it t o be in unsat isfactory c ondition. The buyer complainedto the seller and then to the manufacturer, each of whom attempted to remedy the problems

. The buyer

found the repairs to be unacceptable a nd revoked

his accept

ance of the mobile home. The buyer sued the seller, the manuf

acture r, and the finance company . The buy

er settle d with the finance company . The sell er beca me insolve

nt and did not appea

r at the tr ial. Co ns eq ue nt ly, the buy er went t

o trial ag ainst the s eller and the manufactur er, with o nly

the manuf

acture r prese nt. The trial court found for the buyer a n d apportioned the damages between the seller and the manufacturer. On appeal, the buyer ar gues that the trial erred in apportioning the damage s between the seller and the ma

nufactu rer, and in awar

ding him insuffic ient dama ges. The manufacturer arg ues that the tr ial cour t erred in denying

its motion forinvoluntary dismissal, and in awarding damages against the manufacturer. We aff irm. Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed

H OLLY K IRB Y L ILLARD , J., deliver ed the opinion of the

court, in whic h W. F RANK C RAWFORD , P.J., W.S., and A LAN E. H IGHERS , J., joined.

Sc ot ti e O . W il ke s, Me mp hi s, Te nn es se e, fo r a pp el la nt , E dw ar d K ei th Gr ay. Evan Nahmias, Memphis, Tennessee, for appellee, F leetwood Homes of Tennessee, I nc.1 Rule 10 of the Rules of the C ourt of Ap peals of T ennessee states:

Th is Court, with t

he concurrence of all judges parti cipating in t he case, may affirm , revers e or m odify the action s of the trial court by memorandum opinion when a formal opinion would have no precedenti al value. W hen a c ase is deci ded by memorandum opinion i t shal l be desi gnated “MEMORANDU M OPINION”, shal l not be publ ish ed, an d shal l not be ci ted o r rel ied o n for any
reaso n in any un related case.
2 Secti on 47-2-608(1)(a) provides: “The buyer may revoke h is acc eptance o f a lot or comm ercial unit whose
nonc onfo rmity subst anti ally impairs its value to him if he has acc epted it on the re ason able a ssump tion that its nonconformity would be cured and it has not been seasonably cured.” Tenn. Code Ann. § 47-2-608 (1)(a) (2001).

3 Sec tio n 47-2- 714 provi des f or buy er’ s damag es af ter breach , an d sect

ion 47- 2-715 per mit s re covery of damages resul tin g from nonconf ormity of goods, incl uding i ncident al and c onse que ntial dam ages. See Tenn. Cod e Ann. §§ 47-2- 71 4 and -715 (20 01) . Buye r’s com plaint re que sted co nseq uential d ama ges, retu rn of the dow n paym ent, exp enses in curre d, and paym ent of co sts assoc iated w ith the laws uit.
-2- MEMORAN

DUM OP

INION 1

In January 1998, Edward K eith Gray ( “Gray ”) contracted with Johnson Homes, Inc. (“Johnson Homes”) to purchase a double-wide mobile home, a site for the home, and delivery of utilities for the site, for a total purchase price of $54,885.18. Gray

paid a down pay

ment of $2,725. The home was manufacture d b y Flee twood Homes of Tennessee, I nc. (“Fleetwood”). Financ ing was provided by Green Tree Financial Servicing Corpor ation (“Green Tree”). Gray did not obtain financing for the purchase until April 1998. I n May 1998, Johnson Homes delivered and assembled the mobile home.

In June 1998, Gray inspected the mobile home a nd found it unacceptable. Gray f ound that the hom e had da

maged s iding, un

level flo ors, def

ective p aneling , broken

pipes, and that it leake d water. Gr ay complained about t he defe cts to Johnso n Homes, w ho attemp ted unsuc cessfully to remedy them. Gray then c omplained about the defects to Fleet wood, who also attempted unsuccessfully to fix the problems. Gray remained unsatisfied.

In December

1998, Gray r

evoked his acceptance of the mobile home, pursuant to section 47- 2-608(1)(a) of the Tennessee Code Annotated. 2 Gray then sued Johnson Homes, Fleetwood, and Green Tree under sections 47-2-714 a nd 47-2-715 of the Tennessee Code Annotated. 3

On July 13, 2001, Green Tree and Gray entered into a consent order permitting Green Tree to repossess the mobile home. As part of the agree ment, Green Tree and Gr ay dismissed with prejudice all claims they

had against one another.

On February

27, 2001, the bench trial wa s held. B y th at time, John son Homes had bec ome insolventand did no t appear at the tri al. While on

ly Fleetwood was present, Gray proceeded

to trial against both Johnson Homes and Fleetwood.-3-

At the trial, Gray

testified that his monthly pay ments on the new mobile home were to be $482.17. Gray

mo ved out of his previous home in January 1998, expecting to move into the ne w mobile home that mo nth. After Gray ’s financing was resolved, Johnson Homes delivered and assembled the mobile home in May 1998. Gray did not inspect

the home until the third week of June 1998. At that time he found no sh eetrock on the walls, a buckled floor, wrinkled carpet, a hole in the c eiling, leaking gables, and inco mpletesidi ng insta

llation. G

ray contact ed both Johns on Homes a nd Flee twood to c omplain about the defects. Both worked on the home “quite a few times” between May

and December 1998, butnei therresolve d Gray ’s conce rns. Consequently , in Dece mber 1998 , Gray

revoked his acceptance of the mobile home. The evide nce showed that Gray

made pay

ments toGreen T

ree in June 1998, December

1998, January 1999, and Fe bruary 1999in an aggreg ate amount of $1,764.04. After Gray moved out of

his previous home in Janu ary 1998, he a

pparent ly mo ved intohis motherin-law’ s home fo r a period of time, and then rented a home for $375 a month from March 1998 throu gh February

2000. Gray a

lso testified that he incurred lost wages as a result of dealing with the problems with the mobile home, totaling between $1,000 and $1,200. Overall, Gray sought damages totaling $13,564.04.

The trial court al so heard th e testimon

y of a carpe nter who saw that s ome floor s in the mob ile homewere buckled and that there was a leak in a bedroom. I n addition, Gray prof

fered the testim onyof an expertwitness who had visited the mobile home. He testified that the floor was buckledin the kitchen, that water had pooled around the back door, and that there was mildew on the ceiling where water ha d apparently le aked into the structure. During the hearing, the trial judge aske d Gray’ s attorney to separ ate the claim for damages betweenJohnson Homes and Fleetwood. Gray ’s attorney a ckno wledged t o the trial judge that he understood what he was requesting, but ga ve no further response to the trial court’s directive.

At the conclusion of the hearing, the trial court found for Gray

and ordered Johnson Homes to pay Gra

y $6,507 and Fleetwood to pay Gra y $1,882, for a

total damage award of $8,389. Gra y moved for

a new tri al, which

the trial court de nied. Fr om this orde

r, Gray now appe als.

In his appea

l, Gray argue s that the t

rial cou rt erre d in appor

tio ning fa ultbetween Johnson Homes and Fleetwood, and erred in awa rding damages in an amount less than those claimed by Gr ay. Fleetw ood arg

ues that th

e trial c ourt err

ed in dec li ning to g rant its motion for involuntary dismissal, and in calculating the damages awa rded against Fleetwood.

Since this case

was tried by a trial court sitting without a jury, we review the trial court’s factual finding s de novo ac co mp an ie d b y a presumption of correctness, unless the preponderanc e of the evidence is otherwise. Campbell v. Florida Steel Corp. , 919 S.W.2d 26, 35 (Tenn. 1996); Tenn. R. App. P. 13(d). “The amount of damages aw arded by the [t]rial [c]ourt is a question of fact,” and therefore is subject to a presumption of correctness, unless the evidence preponderates against the award.” Hall v. City of Gatlinbur g , No. E2001-01470-COA-R3-CV, 2002 Tenn. App. LEXI S 104,-4-

at *13 (Tenn. Ct. App. Feb. 6, 2002). Regar ding witn ess cre dibility , “trial j udges, unlike ap pellate judges, have an opportunity to o bserve the manner and demeanor of the witness while they are testifying.” Mitchell v. Archibald , 971 S.W. 2d 25, 29 (Te nn. C t. App . 1998 ) (cit ing Bowman v. Bowman , 836 S.W.2d 563, 566 (Tenn. Ct. App. 19 91)) Thu s, becau se the tri al court is best situated to ma ke cr ed ib il it y determ inations, these are afforded gr eat deference on appea

l. Id. (citations omitted)

. The trial court’s legal conclusions are r eviewed de novo with no presumpt ion o f correctness. Campbell , 919 S.W.2d at 35. Gray first argues that the trial court erred in apportioning fault between Johnson Homes and Fleetwood. Gray notes tha tJohnson Home s and Fleetwood f ailed to plead the affirma tive def ense of comparative fault, an d argues from this that the trial court’s awar d should have been joint and
severa l. This is inapplicable, however, bec ause Gray ’s claimsdid not sound in tort bu t rather in contract. Moreover, during the hearing , the trial court asked Gray ’s counsel t o apportio n his claim for damages between Johnson Homes and Fleetwood, a nd Gray’ s attorne

y a cknowle dged the reque st butmade no objection to the app ortionmen t o f damag es. Afte

r the judg ment of the

trial cou rt, however, Gray’ s counsel movedfor a new trial on the grounds, inter alia, that the trial cour t limited Gray’ s case by

requiring him to apportion fault between Johnson Homes and Fleetwood. The trial court denied the motion.
Here, Gray sue d two parties, and offered no testimony regarding which of

the two parties was responsi ble for the p

roblems w ith the mobi le home. Du ring the trial, Gr ay made no ob

jection to apportionment

of the da mages. After the trial, h

e cited n o authority to

the trial court to s upport his argument t h at the tri al court

should not h ave app ortioned damage s, and he

cites no s uch autho

rity to this Court on appeal. Considering all of the circumstances, we c anno t conclude t hat Gray ha s demonstratedon appea

l that the t

r ial court erred in apportioning the damages betwe en Johnson Homes and Fleetwood. Gray argues next that the trial court erred in failing to award him the full amount of damages he sought. Gray

claimed damages of $7,875 for rent a nd storage at $375 per month for th e time period from Mar

ch 13, 199 8 to February

1, 2000. In total Gray

sought $13,564.04 in damages. The evidenc e, howev er, show ed that, b ecause of the delay c ausedby G ray ’s financing and the dela y in inspecting the mobile

home, the

earlie st Gray

could have moved into the mobile home was May 1998. Gray

revoked acceptance of the mobile home in approximately December 1998. Moreover, Gray’ s testimonyindicated that he expected to pay $482.17 per month for living accommodations had the mobile home not been defective. Under all of these ci rcumstan ces, we must conclude that the evidence does not preponderate ag ainst the t ri al court ’s decis ion not to a ward Gr ay the full amount of

damage s he soug

ht.

Fleetwood

argues on appeal that the trial court e rred in f ail ing to grant its motion for involuntary

dismissal pursuantto Rule 41.02 of the Tennessee Rules of Civil Procedure. Fleetwood argues that Gra

y’ s failure

to insp ect t

he home after delivery

and assembly pre

vents him from establishing his prima faci e case against Fleetwood, that is, t hat the defects were Fleetwood’ s4 Fleet wood relies on Paskell v. Nobilit y Hom es, I

nc. , 871 S.W .2d 481 (T enn. 1994), and W inter v. S m ith , 914 S.W.2d 527 (Tenn. Ct. App. 1995), forthe proposi ti on th at “ it is the Plai nti ff ’s burden to s how when a breach occurred and tha t ea ch par ty shoul d be res ponsi ble f or it s own br each, ” and al so t hat if Flee twood breache d its warranty, t he breach occurred upon delivery o f th e home. The Pa skell case ci tes s tatu tory l aw stat ing t hat a bre ach occurs when delivery is made; however, the cas e it self focuses on when a plain tiff’s cause of action accrues, not on liabil ity when a buyer fail s to ti mely inspect mercha ndise af ter delive ry. Similar ly, Winter , a l engt hy ca se i nvol vin g cont ract or indemnificati on, offers o nly the ge neral sta teme nt that eac h par ty should be r esponsibl e for i ts own wr ongdoing. Neither case supp orts Fleetwoo d’s argume nt that Gray failed to me et his prima facie burden.

5 Section 4 7-2-715 of the Ten nessee Co de An notated states: (1) Inc ide nt al dama ges resulting fro m the se ller’s bre ach inc lude e xpe nses re ason ably inc urred in inspection, receipt, t

ransportation and care and custod y of goo ds righ tfully rejecte d, any c omm ercially
reaso nab le charges, exp ens es or commiss ions i n connecti on with eff ecti ng cover and an y other
reaso nab le exp ense inc ident to the de lay or o ther br each

. (2) C onse que ntial dam ages re sulting from the seller’s b reach includ e:

(a) any loss resul tin g from gene ral or parti cular require ments an d needs of whi ch the s elle r at the ti me of c ontr acti ng had reas on to kno w and which c ould not reas onably be pre vented by cove r or ot

herwi se; and
(b) inju ry to pe rson o r pro perty p roxim ately resu lting from any br each of warr anty.

Te nn. Co de A nn. § 4 7-2-7 15 ( 200 1).

6 It is undisp uted th at Joh nson Ho mes a nd no t Fleetw ood would be liab le for the dow n paym ent. -5- re sp on si bi li ty. 4 First, the recor d does not r

eflect t hat Flee twood move d for invo luntary dism i ssal. Second, there was ample evidence from which the trial court could hav e conclu ded that a t least som

e of the defects in the mobile home were caused by the manufacturer. Under these circ umstances, we find no error in the trial court’s decision not to dismiss Gray ’s claims against Fleetwood.

Fleetwood

argues next that Gray

failed to proffer evidence of incide ntal and consequential damages as permit

t ed in section 47-2-715 of the Tennessee Code Annotated. 5 In the case at ba r, Gray sought a total of $1 3,564.04 in damag es. Gra y te stified th at he pai d $2,725 in down pay

ment, $7,875 in rent a

nd storag e fees, $1,764.04 in mortg age pa

yme nts, and that he lost $1,000 to $1,200 in wageswhile dea

ling with the probl ems with the mobile home. Fleetwood argues that Gray sought damages for a time period bey ond that for which Fleetw ood should be liable , and that

Gray should notbe permitted to recover for rent pay ments when he would have been pay ing mort gage pay ments for the mobile home had it not been defective. At the conclusion of the tri al, Gray wa s awarded a total of $8,389 in damages, $1,882 of which was allocated to Fleetwood. The trial court, however, didnot indicate that any portion of the damage award was f

or incidental or consequential damages
or the time period for the damages; rather , the trial court simply allocated liability for the damages betweenthe defendants. Apart from the d

own pay ment, 6 the remaining damages ca n be attributed to mortga ge pay ments, stor

age fees, and lo st wage s. For the releva nt time peri od, the award of $1,882 against Fleetwood is supported by sufficient evidence.-6-

Fi na ll y, Fleetwood

argues that Gray

cannot recover for

incidental or consequential damages because the contract Gray

signed includes a disclaimer of such damages. Fleetwood, however, does notpoint to the portion of the record that demonstrates tha t such a di sclaimer was part of Gray ’s contract. Because the disclaimer was appa rently not made part of the record, it cannot be consider ed on appeal. Therefore, the awa rd of damages aga

inst Fleetwood must be affirmed.

The decision of

the trial court

is affir med. Costs a

re taxed equally

to appell ant, Edwa

rd Keith Gr ay, and his sur

ety , and toappellee, Fleetwood Homes of Tennessee, I

nc., for which execution may is su e, if ne ce ss ar y.

___________________________________ HOLL Y KIRBY L

IL LARD, JUDGE