Title: Cook's Pest Control, Inc. v. Robert Rebar and Margo Rebar
Citation: N/A
Docket Number: 1050029
State: Alabama
Issuer: Alabama Supreme Court
Date: February 20, 2009

Rel 02/20/2009 Cooks
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter.  Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2008-2009
____________________
1050029
____________________
Cook's Pest Control, Inc.
v.
Robert Rebar and Margo Rebar
____________________
1050128
____________________
Robert Rebar and Margo Rebar
v.
Cook's Pest Control, Inc.
Appeals from Jefferson Circuit Court 
(CV-01-5380)
PER CURIAM.
1050029, 1050128
Aycock, McClusky, and Pinckard were dismissed as
1
defendants on April 4, 2005.
The complaint also alleged wantonness and breach of
2
warranty.  However, those claims were not submitted to the
jury.
2
On August 30, 2001, Robert Rebar and his wife Margo Rebar
sued Cook's Pest Control, Inc., James Aycock, Dannie McClusky,
and Harold Pinckard.   The complaint alleged fraudulent
1
misrepresentation, 
fraudulent 
suppression, 
negligence,
negligence 
per 
se, 
breach 
of 
contract, 
negligent
misrepresentation, unjust enrichment, failure to warn, and
negligent training, supervision, and retention of employees.2
The complaint was later amended to add a bad-faith claim, but
that claim was ultimately withdrawn.  All the claims were
based upon Cook's alleged failure to treat and control a
termite infestation in a house purchased by the Rebars and to
repair the damage to the house caused by the termites.
Facts and Procedural History
In March 2000, the Rebars entered into a contract to
purchase a house from Richard Duell and Marsha Duell.  The
Duells built the house in 1987, and it suffered from a defect
that 
made 
it 
susceptible 
to 
termite 
infestation.
Specifically, the front wall of the house was built below
1050029, 1050128
3
grade, which resulted in some of the wood siding being in
contact with the ground.  The house was protected by a
termite-control contract issued by Cook's to the Duells when
the house was built.  This contract was a "re-treatment-only"
contract, which provided that Cook's would inspect the
property for termites annually and would re-treat the property
if termites were found.  In 1998, termites were found at the
property, and Cook's re-treated the areas of infestation.  The
evidence presented at trial suggested that, when it re-treated
the property, Cook's learned about the defect that made the
house more susceptible to infestation.  Cook's advised the
Duells to fix the defect. 
The purchase contract between the Duells and the Rebars
stated that "the [Rebars] require[] additional inspection of
the property at [the Rebars'] expense."  The purchase contract
further stated that "if such inspections reveal conditions
unsatisfactory to [the Rebars], [the Rebars] may, at [the
Rebars'] option, (a) terminate the contract or (b) request
that [the Duells] correct the unsatisfactory condition(s)."
The contract provided that the Rebars must exercise the option
"by written notice to [the Duells] delivered to [the Duells]
1050029, 1050128
4
on or before 5:00 PM on March 30, 2000."  Separately, the
purchase contract stated that "[the Rebars] require a wood
infestation report," but the contract was silent as to what
would occur if the wood-infestation report revealed any
unsatisfactory conditions.
After contracting to purchase the house, the Rebars hired
Hank Belcher, a structural engineer who worked for a home-
inspection company, to inspect the property.  On March 27,
2000, Belcher issued a report that stated that the property
was in good condition.  Belcher also prepared a "punch list"
of minor or cosmetic items that needed to be repaired.  The
Duells agreed to repair the items on the punch list.
Pursuant to the purchase contract, Cook's inspected the
property 
and 
prepared 
the 
required 
wood-infestation 
inspection
report ("WIIR").  The WIIR indicated that the inspection did
not find an active termite infestation but noted that a
previous infestation was reported in the Duells' file.  Cook's
inspector, Dennis Duggan, later added to the WIIR a signed,
handwritten note, which indicated that the previous termite
damage had been repaired by the Duells.  Specifically, the
note stated: 
1050029, 1050128
It is unclear who, if anyone, was responsible for the
3
delay in preparing and delivering the WIIR.
5
"Previous Termite Damage
"- Front windows above sub-floor of basement
  Damage repaired by customer 1999
"- Siding ground contact -- termite damage
  See graph -- customer cut siding 1999."
Although, the WIIR contained disclaimers that it is not
intended to be a report of damage, the WIIR emphasized that
"evidence of infestation may be synonymous with damage."  The
WIIR was prepared after the March 30, 2000, inspection
deadline, and it was not presented to the Rebars until the
closing on April 21, 2000.  
3
Mr. Rebar testified that, in deciding to close on the
purchase of the house, he relied upon the representation that
Cook's had properly treated the house for termites since the
house was constructed and upon the representations in the WIIR
that all termite damage had been repaired.  Upon seeing the
WIIR at the closing, Mr. Rebar expressed concerns over the
contents of the document.  However, he was assured that
Duggan's handwritten note should alleviate his concerns, and
he went through with the closing.  
An invoice was included with the documents the Rebars
received from Cook's at the closing on April 21, 2000.  This
1050029, 1050128
6
invoice showed a "transfer fee" of $95.  Also in April 2000,
the Rebars and Cook's executed a liquid-treatment contract
that, like the Duells' contract, was a "re-treatment-only"
contract. 
Shortly after the April closing, Mr. Rebar contacted
Cook's to discuss their contract.  He wanted to upgrade from
a "re-treatment-only" contract to a repair contract.  However,
the Rebars were not moving into the house until later in the
summer, so it was decided that they would delay discussion of
the termite-protection contract until that time.  In August
2000, after the Rebars moved into the house, Duggan met with
Mrs. Rebar and convinced her to change the liquid-treatment
contract they had executed in April 2000 to a termite-control
contract specifying the use of Sentricon Colony Elimination
System, a more expensive baiting product that did not require
a liquid treatment of the property.  The Sentricon termite-
control contract executed by the Rebars specified that it was
for re-treatment services only and did not cover damage caused
by, or repairs necessitated by, a termite infestation.  The
contract also contained a provision that voided the re-
treatment guarantee if the house had a wood-below-grade
1050029, 1050128
7
problem like the one at the Rebars' house.  The Sentricon
termite-control 
contract 
also 
contained 
an 
arbitration
agreement. 
During an inspection related to the Sentricon termite-
control contract, Duggan indicated that there was damage in
the front window sill that needed to be repaired before the
Sentricon system could be installed.  Duggan told Mrs. Rebar
that the damage might have been from carpenter ants, but it
was later discovered that it was termite damage.  
In September 2000, during the repair of the window sill,
an active termite infestation was found in the Rebars' house.
After discovering the termites, Mrs. Rebar contacted Cook's,
but she was not satisfied with Cook's proposed solutions to
the infestation, and she contacted the Alabama Department of
Agriculture and Industries ("ADAI").  The ADAI's inspection of
the house revealed an extensive termite infestation.  The ADAI
also informed the Rebars of the wood-below-grade problem.  At
ADAI's instruction, Cook's retreated the property at no cost
to the Rebars in May 2001.  It was later discovered that the
Sentricon system would not be effective at the Rebars' house
because of the wood-below-grade problem.  The Rebars spent
1050029, 1050128
8
about $56,000 repairing the damage to the house caused by
termites, and they alleged that the value of the house was
diminished because of the damage.
The Rebars sued Cook's, seeking compensatory and punitive
damages.  Shortly before filing this action, on August 16,
2001, the Rebars sent Cook's, along with their renewal payment
for the Sentricon termite-control contract, an insert seeking
to modify the Sentricon termite-control contract.  The insert
stated that acceptance of the payment and continued service
would constitute acceptance of the terms of the addendum,
which included a provision that stated that the parties were
free to litigate any dispute.  Cook's accepted payment and
continued service but nonetheless sought to compel arbitration
of the Rebars' action.  The trial court denied Cook's motion
to compel arbitration, and Cook's appealed that decision.  On
December 13, 2002, this Court affirmed the trial court's order
denying arbitration. Cook's Pest Control, Inc. v. Rebar, 852
So. 2d 730 (Ala. 2002).
Cook's filed a motion for a summary judgment, and on June
21, 2004, the trial court entered a summary judgment in favor
of Cook's on all claims.  However, on July 21, 2004, the
1050029, 1050128
It appears from the record that Cook's motion for a JML
4
was also granted on the fraudulent-suppression claim, but some
of the trial court's instructions to the jury relate to that
claim.  Likewise, the record indicates that the trial court
appeared to grant Cook's motion for a JML on the negligence
per se claim, but the trial court likewise instructed the jury
on this claim.  Therefore, we are treating those claims as not
having been disposed of by a JML.
9
Rebars moved the trial court to alter, amend, or vacate the
summary judgment and, on October 18, 2004, the trial court
withdrew the summary judgment.  The case then proceeded to
trial before a jury.  At the close of all the evidence, Cook's
moved for a judgment as a matter of law ("JML") on all claims,
and the trial court granted the motion as to the unjust-
enrichment and failure-to-warn claims.4
The remaining claims went to the jury, and the jury
returned a general verdict of $100,000 in compensatory damages
and $3 million in punitive damages.  The jury did not indicate
what portions of the award were to apply to each of the
various claims.  The judgment was entered on the verdict on
May 25, 2005.  On May 31, 2005, Cook's filed a renewed motion
for a JML, a motion for a new trial, and a motion for
remittitur.  The trial court heard these motions on August 19,
2005.  The motion for a JML and the motion for a new trial
were denied.  The trial court left the $100,000 compensatory-
1050029, 1050128
10
damages award intact but reduced the punitive-damages award to
$500,000, pursuant to the statutory cap on punitive damages in
§ 6-11-21, Ala. Code 1975.
Cook's appeals the denial of its motion for a JML and
challenges the amount of compensatory and punitive damages.
The Rebars cross-appeal, arguing that the trial court should
not have reduced the punitive damages because, they argue,
Cook's waived the imposition of the statutory damages cap by
not pleading it as an affirmative defense.  The Rebars also
argue that the trial court erred on certain evidentiary
issues.
Standard of Review
In Mobile Infirmary Medical Center v. Hodgen, 884 So. 2d
801 (Ala. 2003), this Court stated the standard of review
applicable to a ruling on a motion for a JML, as follows:
"Our standard of review for a renewed motion for
a JML is well settled:
"'In reviewing the trial court's ruling on
a motion for a JML, an appellate court uses
the same standard the trial court used in
ruling on the motion initially. Thus, "'we
review the evidence in a light most
favorable 
to 
the 
nonmovant, 
and 
we
determine whether the party with the burden
of proof has produced sufficient evidence
to 
require 
a 
jury 
determination.'"
1050029, 1050128
11
Acceptance Ins. Co. v. Brown, 832 So. 2d 1,
12 (Ala. 2001), quoting American Nat'l Fire
Ins. Co. v. Hughes, 624 So. 2d 1362,
1366-67 (Ala. 1993); see, also, Jim Walter
Homes, Inc. v. Kendrick, 810 So. 2d 645,
649-50 (Ala. 2001).'
"Hicks v. Dunn, 819 So. 2d 22, 23-24 (Ala. 2001).
Thus, in reviewing the evidence in this case, we are
required to construe the facts and any reasonable
inferences that the jury could have drawn from them
most favorably to [the nonmovant]."
884 So. 2d at 808-09.
Discussion
Cook's argues that its motion for a JML should have been
granted because, it says, the claims submitted to the jury
were not supported by substantial evidence.  The Rebars do not
attempt to address this argument.  Instead, the Rebars argue
that Cook's failed to preserve for review virtually all the
issues it raises on appeal because, they say, Cook's failed to
object to the trial court's jury instructions on the disputed
claims.  
The Rebars argument is without merit.  The Rebars cite
several cases that stand for the proposition that to preserve
for review an objection to an erroneous jury instruction the
objection "must be made at the close of the court's initial
instructions to the jury, and it must be stated with
1050029, 1050128
12
sufficient clarity or specificity to preserve the error -- in
other words, an exception designating only the subject treated
by the court in its oral charge is insufficient." McElmurry v.
Uniroyal, Inc., 531 So. 2d 859, 859 (Ala. 1988).  The Rebars
also point out that "'[u]nchallenged jury instructions become
the law of the case.'" Thompson Props. 119 AA 370, Ltd. v.
Birmingham Hide & Tallow Co., 897 So. 2d 248, 263 (Ala. 2004)
(quoting BIC Corp. v. Bean, 669 So. 2d 840, 844 (Ala. 1995)).
However, Cook's is not claiming error in and seeking review of
the trial court's jury instructions.  Cook's is alleging that
the claims that were submitted to the jury were not supported
by substantial evidence, and, thus, it argues, it was entitled
to a JML.  To preserve its argument, Cook's was required to
follow the mandates of Rule 50, Ala. R. Civ. P., which governs
a JML.  Contrary to the Rebars' contention, preservation of
Cook's argument does not require following the mandates of
Rule 51, Ala. R. Civ. P., which governs objections to jury
instructions.  
In King Mines Resort, Inc. v. Malachi Mining & Minerals,
Inc., 518 So. 2d 714 (Ala. 1987), this Court held:
"One who, on appellate review, seeks, on the
ground of insufficiency of the evidence, the
1050029, 1050128
13
reversal of an adverse judgment and the entry of a
judgment in his favor, must meet a two-pronged test:
1) He must ask for a directed verdict [now renamed
a JML] at the close of all the evidence, specifying
'insufficiency of the evidence' (lack of proof) as
a ground; and 2) he must renew this motion by way of
a timely filed post-judgment motion for J.N.O.V.
[now renamed a renewed motion for a JML], again
specifying the same insufficiency-of-the-evidence
ground. See Rule 50, [Ala.]R.Civ.P., and Committee
Comments; Bains v. Jameson, 507 So. 2d 504, 505
(Ala. 1987); and Ritch v. Waldrop, 428 So. 2d 1
(Ala. 1982)."
518 So. 2d at 716.  Cook's satisfied both requirements.
Contrary 
to 
the 
Rebars' 
allegation, 
Cook's 
was 
not
additionally required to object to the trial court's jury
instructions on the same grounds as set forth in its motions
for a JML.  
The Rebars attempt to avoid this conclusion by alleging
that "the trial court decided Cook's JML motion using a fairly
unique procedure." (Rebars' brief, at 25.)  According to the
Rebars, the trial court addressed the issues raised in Cook's
motion for a JML only during the charge conference when it
considered the parties' requested jury charges.  However, it
does not appear that this allegation accurately depicts the
trial court's actions, nor does it appear that it would be
relevant if the allegation did so accurately depict those
1050029, 1050128
14
actions.  First, only after the trial court heard considerable
argument on Cook's motion for a JML and purported to make
various rulings on the motion did the trial court state: 
"So let's go through all of the issues and
figure out which ones -- I think the easiest way to
deal with the [JML] motion is going -- is granted in
part and overruled in part on the motion for
judgment as a matter of law.  I think the best way
of dealing with what's still here is to go through
the jury charges as proposed.
"We are now officially in charge conference, to
the extent you have to say that.  I am going to
start and just for purposes of -- I'll start with
the jury charges requested by plaintiffs and just go
through them."  
The trial court granted in part and overruled in part the
motion for a JML before it started the charge conference.  It
appears that the trial court merely intended to use the charge
conference as an efficient way to identify what claims were
"still here."  The trial court did not use the charge
conference to receive additional arguments or to make
additional rulings on the motion for a JML.  Furthermore, even
if the trial court addressed the issues raised in the motion
for a JML by considering the requested jury charges, the
Rebars do not clearly explain the relevance of this procedure.
If the trial court decided to address the motion for a JML
1050029, 1050128
15
during the charge conference, that decision did not add an
extra requirement to the two requirements for preservation of
insufficiency-of-the-evidence claims set forth in King Mines
Resort, supra.  The Rebars do not cite any case that mandates
any 
additional 
requirement 
for 
preserving 
an 
insufficiency-of-
the-evidence claim in a situation like the present one.  All
the cases cited by the Rebars discuss only preserving issues
for review concerning erroneous jury instructions under Rule
51, Ala. R. Civ. P., not claims set forth in a motion for a
JML under Rule 50, Ala. R. Civ. P.  Therefore, Cook's
insufficiency-of-the-evidence claims are properly before this
Court because it moved for a JML at the close of all the
evidence and it renewed this motion by way of a timely filed
postjudgment motion.
Next, we must decide whether each claim that was
submitted to the jury was supported by substantial evidence.
It appears that the jury was instructed on the following
claims: fraudulent misrepresentation, fraudulent suppression,
breach 
of 
contract, 
negligence 
(including 
negligent
misrepresentation and negligent supervision and retention of
employees), negligence per se based on an alleged violation of
1050029, 1050128
Although the Rebars did not assert a claim of promissory
5
estoppel in their complaint, the trial court's instructions
included a charge on promissory estoppel.
16
Ala. 
Admin. 
Code 
(Agriculture), 
Chapter 
80-10-9, 
and
promissory estoppel.5
First, it appears that the Rebars attempted to base some
of their claims on actions taken by Cook's before it prepared
the WIIR for the Rebars.  However, the Rebars do not have
standing to assert such claims.  
In Ray v. Montgomery, 399 So. 2d 230 (Ala. 1980), the
purchasers of a termite-infested house sued a termite-control
company based on a termite-control contract the company had
entered into with the prior owners of the home.  In rejecting
the purchasers' claim, this Court explained:
"There is no contractual obligation on the part
of [the termite-control company] to the [purchasers
of the home]. Protection under the service contract
does not run to the owner of the property but to the
contractual 
parties. The [purchasers] are not
third-party beneficiaries under that contract as
they were not intended beneficiaries. The contract
was entered into for the purpose of protecting the
house as the property of the [prior owners]. The
[prior owners] were protecting their interest and
investment and were not altruistically protecting
the property for subsequent purchasers." 
399 So. 2d at 233.
1050029, 1050128
17
Also, in Keck v. Dryvit Systems, Inc., 830 So. 2d 1 (Ala.
2002), subsequent purchasers of a house sued the manufacturer,
the distributor, and the installer of an exterior insulation-
finishing system ("EIFS"), alleging that they had sustained
damage based on the inability of the system to prevent water
intrusion or to allow water to properly drain.  This Court
held:
"[The defendants] did not enter into a contract to
manufacture and apply the EIFS to a house owned by
the [plaintiffs]. As subsequent purchasers of the
house, the [plaintiffs] had no relationship with,
and no other contact with, the builder of the house
or any of [the defendants]. Because the [plaintiffs]
did not enter into a contract with [the defendants]
to apply the EIFS to the house, because the
[plaintiffs] were not the intended purchasers of the
house 
when 
the 
EIFS 
was 
applied 
during 
the
construction 
of 
the 
house, 
and 
because 
[the
defendants] could not have anticipated when or if
the [plaintiffs] would purchase the house, [the
defendants] owed the [plaintiffs] no duty to
manufacture and apply the EIFS with reasonable
care."
830 So. 2d at 10.
In the present case, any actions relating to the house
taken by Cook's before the Rebars contracted to purchase the
house were for the benefit of the Duells, not the Rebars.
Cook's owed the Rebars no duty based on these actions, and the
Rebars' purchase of the house did not gain them any
1050029, 1050128
18
protections under the termite-control contract between Cook's
and the Duells.  Therefore, any contract or tort claims
arising out of Cook's relationship with the Duells before the
Rebars contracted to purchase the house would necessarily have
to be brought by the Duells, not the Rebars, and Cook's was
entitled to a JML on any such claims.
Next, to the extent that the Rebars' fraudulent-
suppression, 
fraudulent-misrepresentation, 
or 
negligence
claims are based on Cook's preparation of the WIIR pursuant to
the purchase contract for the home, the claims are not
supported by substantial evidence.
  
"A claim for fraudulent suppression requires
that the plaintiff show: (1) that the defendant had
a duty to disclose material facts; (2) that the
defendant concealed or failed to disclose those
facts; (3) that the concealment or failure to
disclose induced the plaintiff to act; and (4) that
the defendant's action resulted in harm to the
plaintiff." 
Booker v. United American Ins. Co., 700 So. 2d 1333, 1339 n.10
(Ala. 1997). 
"To establish a prima facie case of fraudulent
misrepresentation, a plaintiff must show: (1) that
the representation was false, (2) that it concerned
a material fact, (3) that the plaintiff relied on
the false representation, and (4) that actual injury
resulted from that reliance. § 6-5-101, Ala. Code
1975; Crowder v. Memory Hill Gardens, Inc., 516 So.
1050029, 1050128
19
2d 602 (Ala. 1987); International Resorts, Inc. v.
Lambert, 350 So. 2d 391 (Ala. 1977)."
Boswell v. Liberty Nat'l Life Ins. Co., 643 So. 2d 580, 581
(Ala. 1994).
"'To establish negligence, the plaintiff must
prove: (1) a duty to a foreseeable plaintiff; (2) a
breach of that duty; (3) proximate causation; and
(4) damage or injury. Albert v. Hsu, 602 So. 2d 895,
897 (Ala. 1992).'"
Brushwitz v. Ezell, 757 So. 2d 423, 432 (Ala. 2000).
Fraudulent-suppression, 
fraudulent-misrepresentation, 
and
negligence claims all require the plaintiff to prove an injury
or damage resulting from the defendant's conduct.  In the
present case, the Rebars' have failed to present substantial
evidence indicating that they suffered an injury or damage as
a result of any suppression or misrepresentation by Cook's in
preparing the WIIR.  In Reeves v. Porter, 521 So. 2d 963 (Ala.
1988), this Court held that "'one suffers no damage where he
is fraudulently induced to do something which he is under
legal obligation to do, such as ... perform a valid
contract.'" 521 So. 2d at 968 (quoting 37 Am.Jur.2d Fraud and
Deceit 
§ 
295, 
at 
392-93 
(1968) 
(emphasis 
omitted)).
Furthermore, this Court stated that "'[a] person who is
induced by false representations to do what his legal duty
1050029, 1050128
20
requires him to do cannot recover therefor, because he suffers
no legal injury.'" Reeves, 521 So. 2d at 968 (quoting 37
Am.Jur.2d Fraud and Deceit § 283, at 379 (1968)).
In the present case, when the WIIR was prepared and
presented to the Rebars at the closing, the deadline for the
Rebars 
to 
terminate 
the 
purchase 
contract 
based 
on
unsatisfactory conditions had passed.  Furthermore, the
performance of the contract was not contingent on the contents
of the WIIR.  The Rebars were contractually obligated to
purchase the house from the Duells before they received the
WIIR, regardless of the contents of the WIIR.  Therefore, the
Rebars have failed to present substantial evidence indicating
that they suffered any injury because of any suppression or
misrepresentation by Cook's in preparing the WIIR.
Moreover, the Rebars did not present substantial evidence
satisfying the duty element of their negligence or fraudulent-
suppression claims.  Specifically, the Rebars did not present
substantial evidence indicating that Cook's had a duty to
inform the Rebars of the wood-below-grade problem with the
house when it prepared the WIIR or that Cook's failed to
fulfill any of its duties in preparing the WIIR.  The WIIR
1050029, 1050128
21
explicitly limited Cook's duty to a visual inspection of the
house, and the disclaimers in the WIIR limited the scope of
the WIIR "to determin[ing] the presence or previous presence
of an infestation of the listed organisms and [was] not
intended to be a report of damage."  The WIIR went on to
state:
"If 
visible 
evidence 
of 
active 
or 
previous
infestation of listed organisms is reported, it
should be assumed that some degree of damage is
present. Evaluation of damage and any corrective
action should be performed by a qualified inspector
approved by the purchaser. This report is subject to
all conditions enumerated on the reverse side and is
issued 
without 
warranty, 
guarantee 
or
representation, except as provided in Rule No.
80-10-9-.18, ALABAMA ADMINISTRATIVE CODE, or subject
to any treatment guarantee specified below."
Therefore, preparing the WIIR did not impose a duty on Cook's
to inform the Rebars of the wood-below-grade problem with the
house or to locate an active termite infestation that could
not be found by a visual inspection.
In addition, "[a]n action for suppression will lie only
if the defendant actually knows the fact alleged to be
suppressed." McGarry v. Flourney, 624 So. 2d 1359, 1362 (Ala.
1993). Even if Duggan should have discovered an active termite
infestation during his inspection, unless he actually did
1050029, 1050128
22
discover it, a claim of fraudulent suppression will not lie.
There was no evidence indicating that Duggan actually
discovered termites and suppressed that information on the
WIIR.  
For the above-stated reasons, the JML for Cook's is
proper 
on 
the 
fraudulent-suppression, 
fraudulent-
misrepresentation, and negligence claims to the extent that
those claims are based on Cook's preparation of the WIIR.
Next, the Rebars did not present substantial evidence to
support their general allegation that Cook's was negligent per
se for allegedly violating Ala. Admin. Code, Chapter 80-10-9,
which contains the administrative regulations generally
governing 
termite-control 
companies. 
 
"To 
establish 
negligence
per se, a plaintiff must prove: (1) that the statute the
defendant is charged with violating was enacted to protect a
class of persons to which the plaintiff belonged; (2) that the
plaintiff's injury was the kind of injury contemplated by the
statute; (3) that the defendant violated the statute; and (4)
that the defendant's violation of the statute proximately
caused the plaintiff's injury." Dickinson v. Land Developers
Constr. Co., 882 So. 2d 291, 302 (Ala. 2003).  Cook's states
1050029, 1050128
23
that "the evidence was undisputed that Cook's did not violate
any applicable statutes or regulations with respect to its
inspections or treatments of the subject property." (Cook's
brief, at 34.)  The Rebars do not respond to this statement;
they do not identify any specific provisions of Rule 80-10-9
that were violated; and they do not attempt to set forth any
evidence that was presented at trial that satisfied the
elements of negligence per se.  Therefore, the trial court
erred in denying Cook's motion for a JML on the Rebars'
negligence per se claim.
Next, Cook's alleges that the Rebars did not present
substantial evidence to support their claim that Cook's
committed 
fraudulent 
misrepresentation 
by 
allegedly
representing to the Rebars that it was transferring the
Duells' liquid-barrier termite-control contract to the Rebars
in exchange for an additional payment and, instead, inducing
the Rebars to execute, in conjunction with the closing, a new
liquid-barrier termite-control contract with what the Rebars
say were less favorable terms.  The primary difference between
the two contracts was that the new liquid-barrier contract
contained an arbitration clause and certain exclusions that
1050029, 1050128
24
were not present in the Duells' contract.  Both contracts were
"re-treatment-only" contracts.  The Rebars alleged that
evidence of the misrepresentation included a notation on an
invoice that Mr. Rebar received from Cook's at the closing
that referred to a $95 "transfer" fee.  However, Cook's argues
that the Rebars did not present substantial evidence
indicating that they reasonably relied on the alleged
misrepresentation. 
In Massey Automotive, Inc. v. Norris, 895 So. 2d 215
(Ala. 2004), this Court stated:
"One 
of 
the 
earlier 
formulations 
of 
the
reasonable-reliance standard was articulated in
Torres v. State Farm Fire & Casualty Co., 438 So. 2d
757 (Ala. 1983), to which standard this Court
'returned' in Foremost Insurance [Co. v. Parham, 693
So. 2d 409 (Ala. 1997)]. In Torres, the Court
explained 
that 
'[i]n 
order 
to 
recover 
for
misrepresentation, the plaintiff's reliance must,
therefore, 
have 
been 
reasonable 
under 
the
circumstances. If the circumstances are such that a
reasonably prudent person who exercised ordinary
care would have discovered the true facts, the
plaintiffs should not recover.' 438 So. 2d at 759.
Under Foremost Insurance, reliance can be declared
unreasonable, as a matter of law, 'where the
undisputed evidence indicates that the party or
parties claiming fraud in a particular transaction
were fully capable of reading and understanding
their documents, but nonetheless made a deliberate
decision to ignore written contract terms' that
clearly contradicted 
the 
alleged 
misrepresentations.
693 So. 2d at 421."
1050029, 1050128
25
895 So. 2d at 220.
In the present case, the Rebars presented no evidence
indicating that they could not read the termite-control
contract they executed, that someone prevented them from
reading the termite-control contract, or that they could not
have understood the contract had they read it.  The
arbitration clause and exclusions, which were not in the
Duells' termite-control contract, were readily apparent in the
new termite-control contract, and these written terms clearly
contradicted the alleged representation by Cook's that it was
transferring the Duells' termite-control contract to the
Rebars.  The Rebars presented no evidence concerning the
transfer-fee notation on the Cook's invoice presented at the
closing that would support an inference that Cook's made a
misrepresentation about the scope of the termite-control
contract the Rebars received at the closing that would warrant
the Rebars' disregarding the plain language of the contract.
Therefore, the Rebars did not reasonably rely on any
misrepresentation made by Cook's concerning the contract, and
the Rebars cannot recover for fraudulent misrepresentation
based on their entering into the termite-control contract with
1050029, 1050128
26
Cook's in April 2000.  The trial court erred in denying Cook's
motion for a JML as to this claim.
Next, the Rebars claimed that Cook's fraudulently
suppressed material facts about the wood-below-grade problem
of the house and the history of that problem and that this
suppression induced them to enter into the Sentricon termite-
control contract, which was more expensive than the liquid-
barrier treatment and completely inappropriate for their
house.  Cook's fails to address this claim in its brief to
this Court.  Therefore, Cook's waives any argument concerning
this claim, and we cannot say it is entitled to a JML on this
claim. See Tucker v. Cullman-Jefferson Counties Gas Dist., 864
So. 2d 317, 319 (Ala. 2003) ("'An appeals court will consider
only those issues properly delineated as such, and no matter
will be considered on appeal unless presented and argued in
brief.'" (quoting Braxton v. Stewart, 539 So. 2d 284, 286
(Ala. Civ. App. 1988), citing in turn Ex parte Riley, 464 So.
2d 92 (Ala. 1985))).
Next, Cook's argues that the Rebars did not present
substantial evidence in support of their claim that Cook's
breached the April 2000 termite-control contract by failing to
1050029, 1050128
27
apply 
a 
liquid-termite 
re-treatment 
to 
the 
property
immediately upon entering into the contract.  "The elements of
a breach-of-contract claim under Alabama law are (1) a valid
contract binding the parties; (2) the plaintiffs' performance
under the contract; (3) the defendant's nonperformance; and
(4) resulting damages." Reynolds Metals Co. v. Hill, 825 So.
2d 100, 105-06 (Ala. 2002).  The elements of a valid contract
include: "'an offer and an acceptance, consideration, and
mutual assent to terms essential to the formation of a
contract.'" Ex parte Grant, 711 So. 2d 464, 465 (Ala. 1997)
(quoting Strength v. Alabama Dep't of Fin., Div. of Risk
Mgmt., 622 So. 2d 1283, 1289 (Ala. 1993)).  
In the present case, the liquid-barrier contract executed
by Cook's and the Rebars in April 2000 guaranteed that "during
the term of this Guarantee" Cook's would, among other things,
"treat the soil with an approved product manufactured for the
control of native Subterranean Termites."  Concerning the term
of the contract, the contract stated: "This Guarantee is
effective for a period of one (1) year following the initial
1050029, 1050128
Ultimately, at the instruction of the ADAI, Cook's did
6
treat the property in May 2001.
28
treatment."  It is unclear from the contract when the initial
treatment was to be performed.6
Concerning this breach-of-contract claim, Cook's argues
that it did not breach the liquid-barrier contract because, it
argues, this contract was extinguished by novation when the
parties executed the Sentricon contract in August 2000.  We
disagree.  
"A novation is the substitution of one contract for
another; a novation releases the party bound by the original
contract. 
A 
novation 
extinguishes 
the 
preexisting 
obligation."
Golden v. Bank of Tallassee, 639 So. 2d 1366, 1369 (Ala.
1994).  "Novation requires: '(1) a previous valid obligation;
(2) an agreement of the parties thereto to a new contract or
obligation; (3) an agreement that it is an extinguishment of
the old contract or obligation; and (4) the new contract or
obligation must be a valid one between the parties thereto.'"
Boh Bros. Constr. Co. v. Nelson, 730 So. 2d 132, 134 (Ala.
1999) (quoting Warrior Drilling & Eng'g Co. v. King, 446 So.
2d 31, 33 (Ala. 1984)).  
1050029, 1050128
29
In the present case, it is undisputed that the liquid-
barrier contract was a valid obligation and that the parties
intended to enter into a new obligation when they executed the
Sentricon termite-control contract.  Furthermore, nothing in
the record indicates that the parties intended to continue
with a liquid-barrier treatment after they executed the
Sentricon termite-control contract.  In fact, the Sentricon
termite-control contract states: 
"State regulations may require specific treatment
standards for a conventional liquid barrier termite
treatment. However, these standards will not be
performed as part of this Agreement because the
Sentricon System is a conceptually different type of
termite treatment which does not involve a liquid
barrier treatment." 
However, the Sentricon termite-control contract is not valid
if it was procured by fraud, and, if it is not valid, the
purported extinguishment of the liquid-barrier contract would
be ineffective.  Therefore, because Cook's has waived any
argument relating to the Rebars' claim that they were
fraudulently induced to enter into the Sentricon termite-
control contract, Cook's argument on appeal that the liquid-
barrier contract was extinguished by novation is without merit
1050029, 1050128
30
and Cook's has failed to demonstrate to this Court that it was
entitled to a JML on the breach-of-contract claim.
Finally, like the fraudulent-suppression claim discussed
earlier, Cook's does not address the promissory-estoppel claim
that was submitted to the jury.  Therefore, Cook's waives any
argument 
concerning 
this 
claim. 
See 
Tucker 
v.
Cullman-Jefferson Counties Gas Dist., supra.
Cook's contends that if it is entitled to a JML on any
but not all the Rebars' claims that were submitted to the
jury, then it is entitled to a new trial based on the "good
count-bad count" rule. See Alfa Life Ins. Corp. v. Jackson,
906 So. 2d 143, 157 (Ala. 2005) ("Because the jury returned a
general verdict for the plaintiffs and the two 'bad counts'
may have infected this verdict, we must reverse the judgment
entered upon that verdict.").  We agree.  
In the present case, the jury returned a general verdict,
without indicating which of the various claims it based its
verdict upon.  This Court cannot presume that the verdict was
based solely upon the "good" counts, i.e., the claims that are
supported by the evidence.  The jury could have based its
verdict, awarding compensatory and punitive damages, solely
1050029, 1050128
31
upon the "bad" counts, i.e., the claims that are not supported
by the evidence.  For this reason, we have no alternative but
to order a new trial.
Conclusion
In conclusion, Cook's is entitled to a JML on: (1) all
the claims that are based on actions taken by Cook's before it
prepared the WIIR for the Rebars; (2) the fraudulent-
suppression, fraudulent-misrepresentation, and negligence
claims, to the extent those claims are based on Cook's
preparation of the WIIR; (3) the negligence per se claim; and
(4) the fraudulent-misrepresentation claim based on the
allegation that Cook's represented to the Rebars that it was
transferring the Duells' termite-control contract to the
Rebars and, instead, induced the Rebars to enter into a new
termite-control contract, the terms of which, the Rebars say,
were less favorable.  
Cook's is not entitled to a JML on the claim that Cook's
fraudulently suppressed facts about the house and that this
suppression induced the Rebars to enter into the Sentricon
termite-control contract, the claim that Cook's breached the
1050029, 1050128
32
liquid-barrier 
contract, 
or 
the 
promissory-estoppel 
claim 
that
was submitted to the jury.
Because this Court cannot presume that the jury's general
verdict was based solely upon the claims that were supported
by the evidence, the trial court's judgment is reversed and
the case is remanded for a new trial.  Our reversal of the
judgment moots the issues whether the damages awarded were
excessive and whether the remittitur of the punitive-damages
award was proper.  Furthermore, we do not address the Rebars'
arguments that the trial court erred on certain evidentiary
issues because the disputed evidence may not be presented at
the new trial.  Therefore, the Rebars' cross-appeal is
dismissed as moot.
1050029 -– REVERSED AND REMANDED.
1050128 –- APPEAL DISMISSED.
Cobb, C.J., and Lyons, Stuart, Smith, Bolin, Parker, and
Shaw, JJ., concur.
Murdock, J., dissents.