Court Opinion

ID: 4651829
Source: CourtListenerOpinion
Date Created: 2021-01-15 15:05:56.549178+00
Date Added: 2024-06-11T08:01:42.476742
License: Public Domain

RENDERED: JANUARY 8, 2021; 10:00 A.M.
                        NOT TO BE PUBLISHED

                Commonwealth of Kentucky
                           Court of Appeals

                              NO. 2019-CA-0941-MR

WISE TECHNICAL                                                        APPELLANT
MANUFACTURING, LLC

                APPEAL FROM JEFFERSON CIRCUIT COURT
v.                HONORABLE BARRY WILLETT, JUDGE
                        ACTION NO. 17-CI-000889

TREE CARE, INC.                                                         APPELLEE

                                    OPINION
                                   AFFIRMING

                                   ** ** ** ** **

BEFORE: CALDWELL, MAZE, AND MCNEILL, JUDGES.

CALDWELL, JUDGE: Wise Technical Manufacturing, LLC (Wise Technical)

appeals from a Jefferson Circuit Court judgment in favor of Tree Care, Inc. (Tree

Care) following a bench trial. Wise Technical argues that the trial court applied

the wrong standard of proof to its breach of contract claim and issued clearly

erroneous factual findings. But we discern no reversible error arising from the trial

court’s applying a clear and convincing standard of proof to the breach of contract
claim under the facts here and no clear error in the trial court’s factual findings.

And although our reasoning may differ somewhat from the trial court’s, we

conclude that the trial court reached the correct result. Thus, we affirm.

                                       FACTS

             Wise Technical produces and sells mulch colorants. David Wise

(David) owns and manages Wise Technical. His wife, Hilary Wise (Hilary), has

also been involved with the company and has served as its chief marketing officer.

             Tree Care is a landscaping business which provides services including

tree removal, mulching, and outdoor stone work. Tree Care is owned and managed

by Edward “Eddie” Hager (Hager).

             In 2017, Wise Technical filed suit against Tree Care alleging that Tree

Care owed it $16,800 for six totes of brown mulch colorant and asserting claims

for breach of contract, promissory estoppel and unjust enrichment. The trial court

entered judgment in Tree Care’s favor on all claims after a bench trial. Although

Hager and the Wises (David and Hilary) in their individual capacities were not

parties to the case, much of the proof presented concerned these three individuals’

actions.

             As found by the trial court: “In 2011, Wise Technical and Tree Care

entered into a regular business relationship in which they would exchange goods

and services and settle any outstanding balances on their accounts either in cash,

                                          -2-
by check or through bartering.” (Judgment, p. 2) The trial court further found

“[s]ometimes, Tree Care would make payments and render landscaping services

directly to the Wises as compensation for colorant it had ordered from Wise

Technical,” and the parties did not keep detailed written records of transactions.

(Judgment, p. 2).

               Tree Care did not send written purchase orders to Wise Technical;

instead, orders were placed orally by phone. And no receipts were issued when

mulch colorant was delivered to Tree Care or when the Wises received landscaping

services from Tree Care. Similarly, Wise Technical did not immediately send Tree

Care invoices after delivering mulch colorant to Tree Care.

              Despite the lack of other written records, “Tree Care issued several

checks for about $49,000 in total that were made payable directly to Ms. [Hilary]

Wise” from March through August 2013. (Judgment, p. 2). And these checks

were deposited into the joint checking account of David and Hilary Wise, but the

Wises later reimbursed Wise Technical for the cost of the raw materials in the

colorant sold to Tree Care.1 As noted by the trial court, Hager later testified to also

1
  Although not mentioned in the trial court’s judgment, the amount of the reimbursement for raw
materials was $20,200 paid by check from David to Wise Technical from our review of the trial
testimony. Wise testified to only reimbursing Wise Technical for the cost of raw materials
instead of the full $49,000 because Wise Technical owed him a larger sum of money.

                                              -3-
making cash payments to Hilary during the same time period, but Hilary denied

receiving such cash payments.

             Despite the parties’ apparent satisfaction with the arrangement they

had for a while, things broke down sometime between 2013 and the filing of Wise

Technical’s lawsuit in 2017. According to David’s testimony, neither company

owed the other any money, goods or services as of August 31, 2013, when Tree

Care paid the last of several checks to Hilary. According to Wise Technical, it

provided six totes of mulch colorant to Tree Care sometime between late 2013 and

2014, but Tree Care failed to return the colorant or pay for it in money or by

bartering satisfactory landscaping services to the Wises.

             By around the end of 2013, there were discussions about Tree Care

possibly building a patio for the Wises’ residence to pay for mulch colorant from

Wise Technical. But the Wises were not satisfied with Tree Care’s design and had

difficulty contacting a Tree Care employee so they decided not to have Tree Care

build the patio in the spring of 2014. According to Hager’s testimony, Tree Care

paid about $1,100 to develop a patio design and paid over $6,600 to buy stones to

build a patio for the Wises. Hilary denied authorizing Tree Care to buy the stones

in her testimony. As of the trial, the stones remained unused at the Tree Care

facility.

             There appears to be no dispute on appeal that:

                                         -4-
              After the Wises decided not to hire Tree Care for the
              patio project, Wise Technical sent an invoice to Tree
              Care demanding payment for the six totes of mulch
              colorant by July 26, 2014. Mr. Hager received the
              invoice but did not immediately dispute the amount that
              Wise Technical stated it was owed. Nor did Tree Care
              pay the amount listed on the invoice by July 26, 2014.

(Judgment, p. 3) (footnote omitted).

              David sent some text messages to Hager to inquire into possible

bartering arrangements for paying off the invoice in late May 2015. Hager did not

respond to the messages and later testified he did not recall receiving them. In

spring and/or summer 2015, there were additional discussions about Tree Care

possibly providing other landscaping services to the Wises, but no agreement was

reached. The Wises hired a different landscape company for one project because

Tree Care’s estimate of its cost was considerably higher than what the other

company charged.

              In early 2016, David and Hilary learned that a Tree Care employee

sent to their home to discuss possible landscaping work was a convicted sex

offender. So, David informed Hager that a bartering relationship was no longer

possible, and Tree Care would need to pay the $16,800 in money instead of

services. Tree Care made no payments. Then, in early 2017, Wise Technical filed

suit against Tree Care alleging breach of contract, promissory estoppel and unjust

enrichment.

                                         -5-
             Tree Care’s answer denied that it owed the money to Wise Technical

and asserted the affirmative defenses of waiver, estoppel and laches. Tree Care did

not file a counterclaim. In its answer, it admitted to the allegations of paragraph 4

of the complaint, stating: “Initially the owner of the Defendant [Tree Care] offered

to ‘pay’ the Plaintiff [Wise Technical] through a bartering arrangement whereby

[Tree Care] would install an outdoor stone patio with fireplace at the residence of

David Wise, owner of Wise Technical Manufacturing, LLC.”

             Following the bench trial, the trial court asked the parties to file

proposed findings of fact, conclusions of law and judgment. Thereafter, the trial

court entered its own written findings of fact, conclusions of law and judgment.

After summarizing the evidence in its findings of fact, the trial court determined in

its conclusions of law that Wise Technical was not entitled to prevail on any of its

claims. The trial court discussed both evidence and legal authorities in separate

sections on each claim.

             Within its discussion of the contract claim, the trial court specifically

found the Wises’ testimony to be no more credible than Hager’s. And noting the

conflicts in these witnesses’ testimony, the trial court expressed that it was difficult

or impossible to figure out “the terms and performance of whatever contract might

have existed between the parties.” (Judgment, p. 6). Similarly, it stated that it

could not figure out the “contours” of the bartering arrangement about the six totes

                                          -6-
of mulch colorant or the “true state of the parties’ accounts with one another.”

(Judgment, pp. 6-7).

              Next, it stated: “The Court is as convinced that Tree Care failed to

compensate Wise Technical for the six totes of mulch colorant as it is that Wise

Technical failed to account properly for an equal and offsetting amount of services

provided by Tree Care to the Wises.” (Judgment, p. 7).2

              Then the trial court concluded that Wise Technical had failed to prove

the elements of its breach of contract claim by clear and convincing evidence so it

was not entitled to prevail on this claim.

                               STANDARD OF REVIEW

              We review the factual findings made by the trial court following the

bench trial for clear error. Thus, we must not set aside its factual findings unless

they are not supported by substantial evidence. And we must give due regard to

the trial judge’s opportunity to judge the credibility of the witnesses. But we do

not extend similar deference to its application of the law and legal rulings, which

we review de novo. EQT Production Co. v. Big Sandy Co., L.P., 590 S.W.3d 275,

285 (Ky. App. 2019).

2
 Although contained within the section entitled Conclusions of Law, at least some of this
discussion appears to involve some fact-finding or assessment of witness credibility.

                                              -7-
                                     ANALYSIS

   I.     No Reversible Error in Applying Clear and Convincing Evidence
          Standard

             First, Wise Technical argues that the trial court applied the wrong

standard of proof to its breach of contract claim. It asserts that the trial court

should have applied a preponderance of the evidence standard. Wise Technical

had claimed that preponderance of the evidence was the applicable standard of

proof in its proposed findings of fact, conclusions of law and judgment submitted

to the trial court. So, we believe the issue was fairly brought to the trial court’s

attention and properly preserved for review.

             The trial court’s conclusions of law about the breach of contract claim

began with the following discussion:

             To prevail on a claim for a breach of contract, the
             plaintiff must establish the following elements by clear
             and convincing evidence: (1) the existence of a contract;
             (2) a breach of that contract; and (3) damages flowing
             from that breach. See Barnett v. Mercy Health Partners-
             Lourdes, Inc., 233 S.W.3d 723, 727 (Ky. App. 2007).

(Judgment, p.6). Wise Technical correctly points out that Barnett does not

mention a clear and convincing evidence standard. However, Barnett does discuss

how a plaintiff must show existence of a contract, breach and damages resulting

from the breach to prevail on a breach of contract claim. 233 S.W.3d at 727. We

                                           -8-
believe that the trial court cited to Barnett to recognize that a plaintiff must prove

all three of these elements to prevail on a breach of contract claim.

              While Barnett does not refer to a clear and convincing evidence

standard,3 long-standing precedent applies a clear and convincing evidence

standard of proof to cases involving alleged oral contracts.4 See Corbin’s Ex’rs v.

Corbin, 302 Ky. 208, 213, 194 S.W.2d 65, 68 (1946) (“The general rule is that

where the alleged expressed contract is oral the evidence to support it must be clear

and convincing.”). See also Industrial Equip. Co. v. Emerson Elec. Co., 554 F.2d

276, 288 (6th Cir. 1977) (quoting Corbin rule about clear and convincing evidence

standard of proof applying to alleged oral contracts); Quadrille Business Systems v.

Kentucky Cattlemen’s Ass’n, Inc., 242 S.W.3d 359, 364 (Ky. App. 2007) (in case

involving allegations of breach of oral contract, mentioning: “As the court in Auto

Channel Inc. v. Speedvision Network LLC, 144 F.Supp.2d 784, 790 (W.D. Ky.

2001) stated: In Kentucky, Plaintiffs must show that an actual agreement existed

between the parties with clear and convincing evidence. Industrial Equip. Co. v.

Emerson Elec. Co., 554 F.2d 276, 288 (6th Cir. 1977).”).

3
 Barnett did not involve allegations of an oral contract. Instead, the plaintiff argued that a
document he signed about being financially responsible for receiving treatment created a contract
with a hospital. Id. at 726.
4
 Wise Technical does not appear to dispute that any contract existing under these facts would be
an oral contract. See Appellant’s brief, p. 15: “Here, since Wise Technical is establishing an
oral contract . . . .”

                                              -9-
             Corbin has never been overruled and remains good law. We lack the

authority to overrule it. Kentucky Rules of Supreme Court (SCR) 1.030(8)(a). So,

we cannot say that the trial court erred in applying a clear and convincing standard

of proof to Wise Technical’s breach of oral contract claim.

             While Wise Technical cites for our consideration recent unpublished

state and federal cases applying a preponderance of the evidence standard to breach

of contract claims, the cases cited are not binding on this Court and furthermore do

not appear to involve allegations of oral contracts. See DeCampos v. Reed, No.

2015-CA-000688-MR, 2018 WL 4264925 at *1 (Ky. App. Sept. 7, 2018)

(unpublished) (noting in factual summary that the trial court found plaintiff failed

to establish breach of contract by a preponderance of the evidence; standard of

proof was not a contested issue on appeal); Babcock Power, Inc. v. Kapsalis, Civil

Action No. 3:13-CV-717-CRS, 2019 WL 1518166 at *1-2 (W.D. Ky. Apr. 8,

2019) (applying preponderance of evidence standard to breach of contract claim

based on alleged breach of employee non-disclosure and non-solicitation

agreement(s) which would presumably have been in writing).

             Wise Technical also cites Alph C. Kaufman, Inc. v. Cornerstone

Industries Corp., 540 S.W.3d 803 (Ky. App. 2017), to argue that since Wise

Technical is arguing to establish an oral contract, preponderance of the evidence is

the proper standard. We noted the applicability of a clear and convincing

                                        -10-
evidence standard of proof to questions of proving by parol evidence the existence

of a written contract based upon a lost document in Cornerstone, 540 S.W.3d at

812-13. Wise Technical argues that this somehow means that a lesser standard of

proof should be used here to prove an oral contract. But Cornerstone does not

reach the question of what the standard of proof is for oral contracts, and Wise

Technical’s argument is inconsistent with controlling precedent in Corbin. In any

event, to the extent that our decision in Cornerstone even arguably may be

contrary to the standard of proof expressed in Corbin, SCR 1.030(8)(a) mandates

that Corbin would control.

             Thus, despite Wise Technical’s arguments that the mere money at

stake here is less compelling than other societal interests in which clear and

convincing evidence standards control, the trial court did not err in applying the

clear and convincing evidence standard of proof to the breach of oral contract

claim. While we need not reach here whether a preponderance of the evidence

standard should be applied in breach of contract cases not involving allegations of

oral contracts, we perceive no error in the trial court’s applying the clear and

convincing evidence standard in this case.

             Furthermore, there is no indication in the trial court’s judgment that it

would have concluded that Wise Technical would have prevailed if it had applied

the preponderance of the evidence standard rather than clear and convincing

                                         -11-
evidence. Essentially, the trial court found that Wise Technical’s witnesses were

no more credible and its proof no more compelling than Tree Care’s witnesses and

proof. Finding their positions in equipoise, the trial court implicitly suggested that

there was no preponderance of the evidence in favor of Wise Technical. Thus,

assuming arguendo that preponderance of the evidence standard should have been

applied, any error in the trial court’s passing references to a clear and convincing

evidence standard of proof was harmless. CR5 61.01.

      II.   Trial Court’s Findings of Fact are Not Clearly Erroneous

                After arguing that the trial court applied the wrong standard of proof

to its breach of contract claim in the first argument section of its brief, Wise

Technical argues that the trial court’s factual findings are clearly erroneous6 in the

next section. But some of the issues it raises in this second section are not purely

about whether there is clear error in its factual findings, and so we consider such

issues separately. But first, we examine the trial court’s factual findings for clear

error.

5
    Kentucky Rules of Civil Procedure.
6
  Generally, we agree with Wise Technical that in this bench trial case, additional action (such as
a motion or objection) was not required to preserve for review the issue of whether the trial
court’s factual findings were clearly erroneous, meaning not supported by substantial evidence—
although this rule does not apply to all other legal issues related to a trial court’s findings.
Eiland v. Ferrell, 937 S.W.2d 713, 715-16 (Ky. 1997).

                                               -12-
             Having thoroughly reviewed the record, we cannot say that the trial

court’s factual findings are clearly erroneous despite Wise Technical’s arguments

to the contrary. The trial court’s factual findings included the following statement:

             In 2011, Wise Technical and Tree Care entered into a
             regular business relationship in which they would
             exchange goods and services and settle any outstanding
             balances on their accounts, either in cash, by check, or
             through bartering.

(Judgment, p. 2).

             Wise Technical asserts that the trial court erred by stating, “that Wise

Technical and Tree Care bartered in exchange for goods and services from 2011

onward when the parties did not begin bartering until late 2013.” But we do not

believe that the trial court specifically found that bartering began in 2011. Instead,

we construe the trial court’s findings as indicating that the parties’ recurrent

business relationship began in 2011 and that this relationship included some

bartering without making a definitive finding as to when the bartering began.

Thus, we disagree with Wise Technical’s argument that the trial court clearly erred

in finding bartering began in 2011, as the trial court did not make this finding.

             Although we disagree with Wise Technical’s assertion that the trial

court found bartering began in 2011, we note why Wise Technical believes this

matters since it impacts other arguments it makes which we discuss later.

                                         -13-
According to Wise Technical, bartering did not begin until late 2013 rather than

2011 and:

             This is an important distinction because from 2011 to
             2013, it was only acceptable for Tree Care to pay Wise
             Technical with money as indicated by the checks from
             that time period. Wise Technical became open to
             bartering around the time Tree Care ordered the totes in
             question, showing that bartering was the exception rather
             than the rule, and that there was always a foundation of
             paying for goods and services to the parties’ business
             relationship.

(Appellant’s brief, p. 18) (footnotes omitted). However, the trial court did not

make findings that Tree Care was only allowed to pay with money before 2013 or

when exactly Wise Technical became “open to bartering” or that “there was

always a foundation of paying for goods and services” before 2013. Instead, the

trial court made clear that it was unable to discern what the parties had agreed to,

or how they were supposed to or did perform any alleged contractual obligations.

             Other than the rejected assertion of error about when bartering began,

Wise Technical does not argue that the trial court’s factual findings (as opposed to

its legal conclusions) are inaccurate—i.e., not based on substantial evidence of

record. Although Wise Technical takes issue with the trial court’s legal

conclusions and with what evidence the trial court considered—separate issues,

which we discuss separately—we discern no clear error in the trial court’s factual

findings.

                                         -14-
    III.   No Reversible Error in Trial Court’s Conclusion that Wise Technical
           Failed to Establish All Elements of Breach of Contract Claim

              In its conclusions of law about the breach of contract claim, the trial

court determined that Wise Technical was not entitled to prevail on its breach of

contract claim because it failed to prove all elements of this claim. Although we

would perhaps frame our discussion in different terms than the trial court, the trial

court did not commit reversible error in reaching this conclusion about the breach

of contract claim. Instead, its ultimate conclusion on this claim was consistent

with its factual findings and not contrary to law. Thus, even though our reasoning

may be slightly different than that set forth in the trial court’s discussion under the

conclusions of law heading, we affirm its conclusion of law that Wise Technical

did not prevail on its breach of contract claim. See generally Goetz v. Asset

Acceptance, LLC, 513 S.W.3d 342, 344-45 (Ky. App. 2016) (recognizing power of

appellate courts to affirm lower court decision based on alternate grounds).

              Even ignoring any evidence of Tree Care providing landscaping

services to the Wises—especially any services rendered before the alleged delivery

of the six totes in 2013 or 2014,7 the trial court made findings supported by the

7
  The trial court discussed in detail how the evidence was conflicting regarding whether and
when Tree Care provided landscaping services on the Wises’ property and if it had previously
received payment—particularly at page 5, FN 9 and page 7, FN 11 of its judgment. And its
judgment reflects it was clearly aware that the Wises disputed owing Tree Care anything for past
services rendered, especially those dating back before 2013.

                                             -15-
record which support its conclusion that Wise Technical could not establish all

elements of its breach of contract claim. Assuming arguendo that some contract

existed between the parties,8 we see no reversible error in the trial court concluding

that Wise Technical failed to prove breach or damages resulting from the breach—

especially since the trial court noted the lack of conclusive proof that the six totes

were actually delivered to Tree Care.

               In its factual findings, the trial court noted David’s testimony that

Tree Care took delivery of the six totes in “one or two trips” but that David was

unable to remember the precise dates of such trip or trips. (Judgment, p. 2). The

trial court also noted the lack of any receipt or any other written record

documenting that the delivery of the six totes took place. And it found that

8
  Given the lack of clear and definite terms perceived by the trial court, it arguably could have
concluded that no contract existed. See Kovacs v. Freeman, 957 S.W.2d 251, 254 (Ky. App.
1997) (“Not every agreement or understanding rises to the level of a legally enforceable contract
. . . . Under Kentucky law, an enforceable contract must contain definite and certain terms
setting forth promises of performance to be rendered by each party.”). See also Veluzat v. Janes,
462 S.W.2d 194, 196-97 (Ky. 1970) (to establish existence of a contract, one must show with
some definiteness what the parties agreed to be bound to do—such as, what services are to be
provided and when and for what consideration.). We decline to affirmatively determine whether
or not a contract existed based on the record, since the trial court did not do so. But if a contract
supposedly exists although its terms are indecipherable, this logically creates difficulties in
proving that a party failed to comply with its terms and thus breached the contract.

Wise Technical argues in its brief that a contract should have been found to exist based on its
perceptions of similarities with Cornerstone, supra, but we need not reach this argument. The
trial court in the instant case did not affirmatively determine whether or not a contract existed.
And regardless of whether a contract existed, the trial court here properly concluded that Wise
Technical could not prevail on its breach of contract claim and this is supported by lack of
conclusive proof of damage and breach.

                                                -16-
although Hager did not deny placing the orders, he questioned whether Tree Care

would have needed that much colorant (six totes) at once and expressed doubt that

it would take delivery of that much colorant in the fall and winter due to limited

demand for mulch at that time.

               The trial court noted in a footnote that the invoice purportedly sent by

Wise Technical to Tree Care was “the only business record documenting the

placement or delivery of any orders from Tree Care for the six totes of mulch

colorant.” And it also noted that it could not determine when the invoice was

created based on the “blurry screen shot of a computer entry” presented at trial.

(Judgment, p. 3, FN 5).9

               Although the trial court may not have explicitly found that the six

totes of mulch colorant were not actually delivered to Tree Care, its findings

clearly identify a lack of conclusive proof of actual delivery. And it did not make a

clear, affirmative finding that the six totes were actually delivered to Tree Care.

Given the trial court’s findings about the uncertainty in the proof of record about

whether and when the six totes were actually delivered, the trial court could have

9
  The blurry screen shot was the only copy of the invoice presented at trial from our review of
the record. And we are aware that David Wise testified that due to the age of the invoice (dating
back to a prior fiscal year), he could not print out a hard copy of the invoice from his computer
due to the idiosyncrasies of his computer accounting software. Regardless, it was Wise
Technical’s obligation to offer legible, clear proof on its breach of contract claim, and its failure
to do so—for whatever reason—may be a factor in ruling against it.

                                                -17-
reasonably concluded that no breach or damage was shown on this basis alone—

regardless of the evidence that Wise Technical billed Tree Care or otherwise

sought payment for colorant which may or may not have been delivered.

              Thus, given the lack of conclusive proof that the six totes were

actually delivered, the record supports the trial court’s conclusion that Wise

Technical failed to establish all elements of its breach of contract claim, especially

damages and breach. In other words, even if we assume that the trial court

concluded an oral contract existed, we find no error in its conclusion that Wise

Technical failed to meet its burden to show that Tree Care breached that contract’s

terms and thus damaged Wise Technical. So, we affirm the trial court’s conclusion

that Wise Technical could not prevail on its breach of contract claim.

   IV.    As Wise Technical Fails to Show Preservation of Its Argument that the
          Trial Court Should Not Have Considered Evidence of Bartered
          Landscape Services (Particularly those Dating back past 2013) as Setoff
          and Does Not Request Palpable Error Review, We Decline to Reach this
          Argument

              Although brought up in the section of its brief purportedly arguing

that the trial court’s factual findings were clearly erroneous, Wise Technical goes

beyond arguing that findings are not supported by evidence and argues that the trial

court improperly considered evidence of “setoff.” Wise Technical argues that the

trial court should have recognized that Tree Care had the burden to prove it was

entitled to a setoff:

                                         -18-
             The Circuit Court essentially found that Wise Technical
             did not succeed in disproving Tree Care’s setoff theory
             even though (1) Tree Care did not present its compulsory
             counterclaim and therefore was barred from making the
             argument in the first place and (2) even if Tree Care had
             presented its compulsory counterclaim, Tree Care would
             have been the party with the burden to prove the
             existence of a setoff, not Wise Technical.

                    The Circuit Court should never have considered
             the factual allegations of Tree Care’s setoff argument as
             Tree Care did not present these allegations in a
             counterclaim, and since Tree Care chose not to present
             the compulsory counterclaim, such an argument is now
             barred under res judicata. DCI Props.-DKY, LLC v.
             Coppage Constr. Co., 465 S.W.3d 886, 889 (Ky. App.
             2015), citing Ky. R. Civ. P. 13.01; Compulsory
             counterclaims. Defendants are not permitted to hide
             counterclaims until trial by failing to plead counterclaims
             in their answers and neglecting to list counterclaim
             damages in itemizations of damages. Since Tree Care
             hid this argument, Wise Technical had no notice of the
             counterclaim. Even if it was proper for Tree Care to
             make the setoff argument, the burden would be on Tree
             Care, not Wise Technical, to prove that Tree Care was
             entitled to a setoff. Lyric Piano v. Purvis, 241 S.W. 69,
             70-71 (Ky. Ct. App. 1922); see also Tuggle v. Davis, 165
             S.W.2d 844 (Ky. 1942). The Court interpreting the facts
             to mean otherwise was clearly erroneous.

(Appellant’s Brief, pp. 18-19). And in response to Tree Care’s argument that it did

not seek to recover money from Wise Technical through a counterclaim but simply

to defend itself, Wise Technical asserts in its reply brief that Tree Care failed to

preserve setoff as an affirmative defense and that Tree Care would have the burden

of proof on setoff as an affirmative defense.

                                         -19-
               Although Wise Technical presents these setoff issues within its

argument section about the factual findings being clearly erroneous in its initial

brief, these questions about what evidence the trial court might properly consider

and who had the burden of proof are about the trial court’s application of the law—

not about whether its findings are supported by substantial evidence. Thus, we do

not believe such arguments may be properly considered upon appeal if they were

not raised to the trial court and thus were not properly preserved for review.

               Wise Technical does not cite to the record10 to indicate where it

argued to the trial court that it should not even consider factual allegations (or

evidence) of setoff or that Tree Care had the burden of proving it was entitled to a

setoff as an affirmative defense. And from our review of its proposed findings of

fact, conclusions of law and judgment, Wise Technical cited Tree Care’s failure to

file a compulsory counterclaim and criticized the evidence presented by Tree Care

about landscaping services rendered, but it did not argue that the trial court could

not even consider evidence of Tree Care providing such services. Nor did it argue

that the trial court should only consider evidence of services provided after the six

totes were allegedly shipped in late 2013 or early 2014 or that Tree Care had the

burden of proving any setoff. In short, this is not just a question of whether the

10
  CR 76.12(4)(c)(v) requires that an appellant’s brief “shall contain at the beginning of the
argument a statement with reference to the record showing whether the issue was properly
preserved for review and, if so, in what manner.”

                                               -20-
trial court’s findings were supported by evidence; there is no showing that these

setoff-related arguments were presented to the trial court and preserved for review.

              As the issue is not preserved for our review and Wise Technical has

not requested review for palpable error under CR 61.02, we decline to review this

issue as we perceive no extreme circumstances amounting to a substantial

miscarriage of justice. See Shepherd v. Com., 251 S.W.3d 309, 316 (Ky. 2008)

(“Absent extreme circumstances amounting to a substantial miscarriage of justice,

an appellate court will not engage in palpable error review pursuant to [Kentucky

Rule of Criminal Procedure] RCr 10.26 unless such a request is made and briefed

by the appellant.”). See also Nami Resources Company, L.L.C. v. Asher Land and

Mineral, Ltd., 554 S.W.3d 323, 338 (Ky. 2018) (“The language of CR 61.02 is

identical to its criminal law counterpart, RCr 10.26, and we interpret that language

identically.”).11

              Our discussion has mainly concerned the breach of contract claim and

the parties have not briefed in detail the validity of the trial court’s handling of

other claims. But Wise Technical generally asserts that the trial court’s allegedly

11
   Although not binding precedent, at least one of our unpublished opinions has applied Shepherd
in a civil context to hold that since palpable error review under CR 61.02 was not requested, we
would only review the unpreserved issue to determine whether there were extreme circumstances
amounting to a substantial miscarriage of justice. See C.H. v. Cabinet for Health and Family
Services, No. 2015-CA-000098-ME, 2016 WL 1069037 at *4 (Ky. App. Mar. 18, 2016)
(unpublished). See also A.G. v. Cabinet for Health and Family Services, No. 2018-CA-001218-
ME, 2020 WL 2609985 at *4 (Ky. App. May 22, 2020) (unpublished) (discretionary review
granted by Kentucky Supreme Court on October 22, 2020).

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erroneous “interpretation of facts” impacts its other claims as well and requests

reversal with directions to “only consider the facts properly presented in the

record” on remand. But given the lack of conclusive evidence that the six totes

were actually delivered to Tree Care and Wise Technical’s failure to adequately

preserve its arguments that evidence of landscape services should not be

considered for purposes of setoff or that Tree Care had the burden of proving

setoff, we see no reason to disturb the trial court’s conclusion that Wise Technical

was not entitled to prevail on any of its claims.

                                   CONCLUSION

               For the foregoing reasons, the judgment of the Jefferson Circuit Court

is affirmed.

               ALL CONCUR.

 BRIEFS FOR APPELLANT:                      BRIEF FOR APPELLEE:

 Garry R. Adams                             Jason A. Dattilo
 Abigail V. Lewis                           Louisville, Kentucky
 Louisville, Kentucky

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