Court Opinion

ID: 9912447
Source: CourtListenerOpinion
Date Created: 2023-12-22 15:05:17.006465+00
Date Added: 2024-06-11T12:59:28.490325
License: Public Domain

RENDERED: DECEMBER 15, 2023; 10:00 A.M.
                           TO BE PUBLISHED

                 Commonwealth of Kentucky
                            Court of Appeals
                               NO. 2023-CA-0062-MR

RODGER SPARKS                                                             APPELLANT

                  APPEAL FROM JACKSON CIRCUIT COURT
v.                 HONORABLE OSCAR G. HOUSE, JUDGE
                         ACTION NO. 19-CI-00140

MICHAEL ROSE                                                                APPELLEE

                                 OPINION
                         REVERSING AND REMANDING

                                     ** ** ** ** **

BEFORE: THOMPSON, CHIEF JUDGE; ECKERLE AND TAYLOR, JUDGES.

THOMPSON, CHIEF JUDGE: Rodger Sparks (“Appellant”) appeals from a trial

order and judgment of the Jackson Circuit Court in favor of Michael Rose

(“Appellee”) in Appellant’s claim alleging breach of contract. Appellant argues

that the circuit court erred in finding that the parties did not enter into a contract,

when the parties acknowledged the existence of a contract. He also argues that the

court’s delay in ruling on the matter for 575 days improperly prejudiced the

proceedings against him, and that the court made a hasty ruling in retaliation on the
day after he filed a motion for a ruling. He seeks an opinion reversing the

judgment, remanding the matter for new proceedings, and appointing a new trial

judge. After careful review, we conclude that the parties’ mutual agreement as to

the existence of a contract, coupled with underlying facts including the exchange

of payment for the installation of custom-made kitchen cabinets, demonstrates the

existence of an implied contract. Accordingly, we reverse the judgment on appeal

and remand the matter to the Jackson Circuit Court.

                    FACTS AND PROCEDURAL HISTORY

              According to Appellant, he is a cabinet maker in Jackson County,

Kentucky, who has operated a successful business for more than 30 years. He

alleged that in February 2019, Appellee asked him to build and install cabinets in

Appellee’s new home that was under construction. Appellant alleged that the

parties discussed the project, agreed on specifications, drew up plans for the

installation, and mutually agreed via text messages on an estimated cost of

$27,300.00.

              According to Appellant, Appellee made payments of $10,000.00 and

$3,000.00 in April 2019, and July 2019, respectively. Appellant alleged that

Appellee then made changes to the plans which increased the cost by $11,700.00,

and undertook some demolition on his own that reduced the project cost by

$4,800.00. According to Appellant, this left a balance owing of $21,200.00.

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             Appellant alleged that after the work was completed, he requested

payment of the balance. It was then that, according to Appellant, Appellee

complained about the workmanship of the cabinetry. Appellant alleged that he

agreed to fix anything to Appellee’s satisfaction, but Appellee refused and also

refused to pay the balance.

             Thereafter, Appellant filed the instant action against Appellee in

Jackson Circuit Court alleging breach of contract. Appellee answered with a

general denial and filed a counterclaim alleging breach of contract, promissory

estoppel, and negligence. The matter proceeded to a bench trial on June 14, 2021,

where oral and documentary evidence was submitted, and the parties’ arguments

were heard. After the conclusion of the trial, the matter languished without action

for approximately 17 months. Appellant asserts that he was reluctant to file a

motion for a judgment for fear of angering Judge Oscar Gayle House.

             On January 5, 2023, the circuit court entered a notice to dismiss for

lack of prosecution. In response, on January 9, 2023, Appellant filed a motion for

a judgment. The following day, the circuit court rendered the judgment now

before us. The court found in relevant part that Appellant had not proved the

existence of a contract between the parties, and therefore denied Appellant’s claim

for damages arising from Appellee’s alleged breach of contract. The court then

addressed Appellee’s counterclaims. Having found no contract to exist, the court

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denied Count 1 of the counterclaim alleging breach of contract. Count 2 of the

counterclaim set forth a claim of promissory estoppel. The court ruled in favor of

Appellee on this claim, upon finding that Appellant breached his promise to build

and install custom cabinetry in a workmanlike manner. Lastly, the court sustained

Count 3 of Appellee’s counterclaim alleging negligence. It found that there were

several workmanship errors in the construction and installation of the cabinets that

were due to the negligent workmanship of Appellant. The court determined that as

a proximate result of Appellant’s negligent workmanship, Appellee suffered injury

due to having to repair or replace the cabinets. The court awarded nothing to

Appellant on his claim of breach of contract, $10,600 to Appellee based on Counts

2 and 3 of Appellee’s counterclaim, and $3,000 in attorney fees to Appellee. This

appeal followed.1

                          ARGUMENTS AND ANALYSIS

              Appellant’s primary argument on appeal is his contention that the

Jackson Circuit Court erred in finding that the parties did not enter into a contract

for the construction and installation of cabinets. Appellant argues that the parties

are in agreement that a contract exists; that the parties asserted the existence of a

1
  Appellant failed to comply with Kentucky Rules of Appellate Procedure (“RAP”) 32(A)(3) and
(4), requiring ample supportive references to the record in the Statement of the Case and
Argument sections of the brief. Per RAP 10(B), we will consider his written argument as if it
were compliant with the rules.

                                             -4-
contract in the complaint and counterclaim; that Appellee acknowledged the

existence of a contract in his answers to interrogatories; and, that text messages

were entered into evidence which show the terms of the contract and the parties’

acceptance. Appellee has not filed an Appellee’s Brief nor a cross-appeal.

             The circuit court correctly determined that the record does not contain

an express, written contract setting out the terms of the parties’ agreement.

However,

             [a] contract may be inferred wholly or partly from such
             conduct as justifies the promisee in understanding that
             the promisor intended to make a promise. To constitute
             such a contract there must, of course, be a mutual assent
             by the parties – a meeting of minds – and also an
             intentional manifestation of such assent. Such
             manifestation may consist wholly or partly of acts, other
             than written or spoken words.

Furtula v. University of Kentucky, 438 S.W.3d 303, 308 (Ky. 2014), as modified

(Jun. 23, 2014) (italics in original) (citation omitted). Further,

             [w]ords are not the only medium of expression. Conduct
             may often convey as clearly as words a promise or an
             assent to a proposed promise, and where no particular
             requirement of form is made by the law a condition of the
             validity or enforceability of a contract, there is no
             distinction in the effect of a promise whether it is
             expressed (1) in writing, (2) orally, (3) in acts, or (4)
             partly in one of these ways and partly in others.

Kellum v. Browning’s Adm’r, 231 Ky. 308, 314-15, 21 S.W.2d 459, 463 (1929)

(internal quotation marks and citation omitted).

                                          -5-
             Though Appellant has not cited to the record in compliance with RAP

32(A)(3) and (4), our review of the record shows that: 1) Appellant’s complaint

asserts that the parties entered into a contract whereby Appellant would build and

install cabinetry for a certain payment; 2) Appellee’s answer states that the parties

entered into the contract; 3) Appellee’s answers to interrogatories state that the

parties entered into the contract; and, 4) text messages show the parties negotiating

the terms of the agreement, the price at $27,300.00, and Appellee stating “we are

in business on everything,” indicating his assent to the estimate.

             Further, the parties agree, and the record so demonstrates, that the

parties made certain changes to the terms of the installation as the project

progressed, that Appellant installed the cabinetry, and that Appellee made a

payment – though the quality of the installation and the amount of payment are in

dispute. In addition, the circuit court found that Appellant, “promised to build and

install custom cabinetry in . . . [Appellee’s] newly constructed home in a

workmanlike manner,” and that Appellee “has paid a substantial amount of the

agreed upon price.”

             Thus, the parties agree that they entered into a contract; the pleadings

and record evince their agreement; both parties performed under the agreement;

and, the circuit court found that Appellant promised to build and install the

cabinetry in a workmanlike manner and at an agreed upon price. Per Furtula and

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Kellum, supra, we conclude that the parties’ words and conduct, coupled with their

respective promises and performance based on those promises, demonstrate the

existence of a contract. The circuit court erred in failing to so find.

             Having determined that a contract existed between the parties, we turn

to the circuit court’s disposition of Appellee’s counterclaim. Appellant has not

directly argued that the circuit court erred in sustaining Appellee’s counterclaims

of promissory estoppel and negligence, though it is implicit in his argument that

the parties entered into a contract. As a general rule, we will not address issues

unless they are preserved for appellate review and raised on appeal by the parties.

Mitchell v. Hadl, 816 S.W.2d 183, 185 (Ky. 1991). There are limited exceptions to

this rule, however, where the facts require the appellate court to address issues not

raised by the parties.

                    Ordinarily, this Court confines itself rather closely
             to deciding only those issues which the parties present.
             We take the view that counsel and the courts below have
             sufficiently identified the issues; that we need not
             redefine the question in the last stage of the litigation.
             However, we are constrained by no rule of court or
             constitutional provision to observe this procedure, and on
             rare occasions, the facts mandate a departure from the
             normal practice. When the facts reveal a fundamental
             basis for decision not presented by the parties, it is our
             duty to address the issue to avoid a misleading
             application of the law.

Id. (emphasis added). Thus, having concluded that the circuit court erred in failing

to find the existence of a contract, we are duty-bound to address the whole of the

                                          -7-
circuit court’s judgment in order “to avoid a misleading application of the law.”

Id.

             In Kentucky, the measure of damages in a construction contract is

thoroughly discussed in Deskins v. Estep, 314 S.W.3d 300, 305 (Ky. App. 2010).

The seminal opinion cited by Deskins was written by Justice Palmore in State

Property and Buildings Commission v. H.W. Miller Construction Company, 385

S.W.2d 211 (Ky. 1964). Therein, Kentucky’s highest court states that “the real

measure of damages for defective performance of a construction contract is the

cost of remedying the defect, so long as it is reasonable.” Id. at 214 (citations

omitted). The Court went on to explain:

                    In simple terms, the measure of damages is the
             amount that is reasonably necessary in order to make the
             building conform to the requirements of the contract, but
             in no event to exceed the difference, if any, between its
             market value as it should have been constructed and its
             market value as it was actually constructed.

             ....

             [T]he damages should not exceed the sum that is
             reasonably required in order to put the owner in the same
             position in which he would have been had the contract
             been performed.

Id.

             In the matter before us, the Jackson Circuit Court failed to address or

apply the proper measure of damages. On remand, the circuit court is directed to

                                          -8-
address the correct measure of damages per Deskins and H.W. Miller Construction

Company, as well as Appellee’s mitigation of damages, if any, which is discussed

in Deskins, 314 S.W.3d at 305.

             Further, since a bench trial was conducted below, the circuit court was

required to make specific findings of fact and conclusions of law as required by

Kentucky Rules of Civil Procedure (“CR”) 52.01, from which the clearly

erroneous standard of review emanates. Factual findings are clearly erroneous if

unsupported by substantial evidence. Moore v. Asente, 110 S.W.3d 336, 354 (Ky.

2003). Substantial evidence is “some evidence of substance and relevant

consequence, having the fitness to induce conviction in the minds of reasonable

men.” Whittaker v. Rowland, 998 S.W.2d 479, 481-82 (Ky. 1999) (citation

omitted).

             In the matter before us, the circuit court made only limited findings

which are not based on the evidence of record. This was likely because the court

waited more than seventeen months after the trial to draft them. We conclude that

the circuit court’s limited findings were not supported by substantial evidence per

Moore, supra.

             In addition, we review the circuit court’s conclusions of law de novo.

Hoskins v. Beatty, 343 S.W.3d 639, 641 (Ky. App. 2011). The circuit court’s

judgment sustaining Appellee’s claim of promissory estoppel and negligence is not

                                         -9-
consistent with applicable law nor supported by the record, as the record clearly

reveals that the parties entered into a contract.

             Appellant goes on to argue that the 575-day delay between the bench

trial and the judgment prejudiced the proceedings against him. In light of the

foregoing, this argument is moot.

             Lastly, Appellant requests that we appoint a new trial judge to

consider the matter on remand. “A motion for recusal should be made

immediately upon discovery of the facts upon which the disqualification rests.

Otherwise, it will be waived.” Adkins v. Wrightway Readymix, LLC, 499 S.W.3d

286, 291 (Ky. App. 2016) (internal quotation marks and citations omitted).

Appellant does not direct our attention to any recusal motion made before the

circuit court, leaving us nothing to review on this issue.

                                   CONCLUSION

             For the foregoing reasons, we reverse the judgment of the Jackson

Circuit Court and remand the matter for a new trial based on our determination that

the parties entered into a contract. On remand, the circuit court shall 1) determine

if one or both parties breached the contract; 2) make specific findings per CR

52.01; and, 3) address the amount of damages, if any, including Appellee’s

mitigation of damages, based on Deskins and H.W. Miller Construction Company,

supra.

                                          -10-
              ECKERLE, JUDGE, CONCURS.

              TAYLOR, JUDGE, CONCURS AND FILES SEPARATE OPINION.

TAYLOR, JUDGE, CONCURRING: I concur totally with the thorough analysis

and disposition of this case by the Chief Judge. I write separately to emphasize

that upon remand for a new trial, the trial court must address the doctrine of

substantial performance. Under this long-standing doctrine, a builder, upon

substantial performance of a construction contract, is entitled to recovery of the

contract price notwithstanding that the work may have been defective and not

completed to the satisfaction of the homeowner. Meador v. Robinson, 263 S.W.2d

118 (Ky. 1953). As in this case, Meador looked to an oral construction contract.

Upon substantial performance by the builder, the remedy of the homeowner is a

claim for damages for the defective workmanship, which is the basis for the

counterclaim below. Id. See also Shreve v. Biggerstaff, 777 S.W.2d 616, 618 (Ky.

App. 1989).

              Under the facts of this case, the substantial performance doctrine

would preclude a windfall for the homeowner, which appears to be the result of the

judgment rendered by the circuit court now before this Court. If on remand, the

evidence establishes that the oral construction contract was substantially performed

by the appellant, then the doctrine is applicable.

                                         -11-
BRIEF FOR APPELLANT:     NO BRIEF FOR APPELLEE.

Marsha Taylor
McKee, Kentucky

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