Roggasch v. Sims , 2016 Ark. App. LEXIS 50 ( 2016 )


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    ARKANSAS COURT OF APPEALS
    DIVISION III
    No. CV-11-1243
    Opinion Delivered   January 27, 2016
    RYAN ROGGASCH and ELITE    APPEAL FROM THE SALINE
    HOMES OF ARKANSAS, INC.    COUNTY CIRCUIT COURT
    APPELLANTS [NO. CV-06-920-3]
    V.                                              HONORABLE GRISHAM PHILLIPS,
    JUDGE
    TASHA SIMS and JOHN SIMS
    APPELLEES AFFIRMED
    BRANDON J. HARRISON, Judge
    Tasha Sims hired Elite Homes, Inc. (Elite Homes) to be the general contractor for a
    custom “dream” home she intended to build near Benton, Arkansas. Tasha Dailey (now
    Sims) and Ryan Roggasch (a representative for and president of Elite Homes) signed the
    written contract. The contract stated that Elite Homes
    will be following the guidelines, rules, and codes provided by the state of
    Arkansas in the construction of this home and . . . will be . . . overseeing the
    project till completion. It is our intention to provide the greatest quality of
    product and craftsmanship during and after construction completion. . . . The
    total price for providing these services is $20,000[.]
    The project was estimated to begin in late November 2005 and be completed by the
    end of March 2006. Elite Homes promised to work diligently and at the pace requested by
    the home owner. Tasha paid Elite Homes $10,000 before construction of the new home
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    began. Elite Homes performed the general contracting services from November 2005 until
    July 2006. During that time, Roggasch introduced Tasha to John Sims; Tasha and John
    eventually married. In September 2006, Tasha and John filed a complaint against Elite
    Homes, alleging that it had breached the terms of the contract and breached certain implied
    warranties. Attached to the Simses’ complaint was an exhibit of “Estimated Construction
    Cost” from Elite Homes, dated 21 November 2005.             The document stated that the
    estimated cost to build the residence was $231,708. Elite Homes answered the Simses’
    complaint and counter-claimed for breach of contract, seeking the remaining $10,000 under
    the contract’s terms.
    In August 2009, the Simses filed an amended complaint that incorporated their
    original complaint. The amended complaint added Ryan Roggasch as a defendant, alleging
    that he had represented to them that he was “covered by an insurance policy which would
    cover negligent workmanship.” They also alleged that the home was built in a negligent
    manner and that Roggasch and Elite Homes had violated Arkansas’s Deceptive Trade
    Practices Act.
    In March 2011, a jury awarded Tasha Sims and John Sims $140,000 in damages
    following a trial in Saline County Circuit Court. The jury rejected Roggasch’s and Elite
    Homes’s breach-of-contract counterclaim.        In June 2011, the circuit court entered a
    $209,244 judgment against Roggasch and Elite Homes; the final judgment amount included
    prejudgment interest and attorney’s fees and costs. Roggasch and Elite Homes appeal that
    judgment.
    On appeal, appellants make six points:
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    1.       The circuit court erred in permitting John Sims to be a party to the lawsuit.
    2.       The circuit court erred in instructing the jury on a violation of the Deceptive
    Trade Practice Act.
    3.       The circuit court erred when it instructed the jury on both negligence and
    contractual claims.
    4.       The circuit court erred when it allowed the jury to consider any claims against
    Ryan Roggasch individually.
    5.       The circuit court erred when it did not request that the jury allocate damages for
    each claim for each defendant.
    6.       The circuit court abused its discretion in awarding attorney’s fees and
    prejudgment interest.
    We affirm the judgment of the circuit court. 1
    Point 1: John Sims
    For their first point on appeal, appellants argue that no legal authority exists to give
    John Sims standing to sue them. During the course of the litigation, the circuit court
    repeatedly denied the appellants’ request to dismiss Sims as a plaintiff. To be a proper
    plaintiff in an action, one must have an interest which has been adversely affected or rights
    which have been invaded. City of Dover v. City of Russellville, 
    352 Ark. 299
    , 
    100 S.W.3d 689
    (2003). Only a claimant who has a personal stake in the outcome of a controversy has
    standing. Pulaski Cnty. v. Ark. Dem. Gazette, Inc., 
    371 Ark. 217
    , 
    264 S.W.3d 465
    (2007).
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    Roggasch and Elite Homes have not challenged the jury’s verdict as excessive or
    contrary to the law or preponderance of the evidence under Arkansas Rule of Civil
    Procedure 59. As we discuss in point five, the jury rendered a general verdict on the issue
    of damages. We cannot accurately determine how the jury divided the damages award it
    gave among the various legal theories of liability it had before it (negligence, breach of
    contract, breach of warranties, or deceptive trade practices).
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    Courts will not allow suit by one who is a “stranger to the record” or for the purpose of
    vindicating an abstract principle of justice. City of 
    Dover, supra
    .
    The appellants are correct that John Sims was not a party to the written contract with
    Elite Homes and would not have standing on the breach-of-contract claim. Yet we find
    no error in this case because the jury was instructed that the contract was between Tasha
    Sims and Elite Homes only. Moreover, appellants mention, but do not develop, their point
    that John Sims did not have standing to bring a negligence or deceptive-trade-practices
    claim. We do not research or develop arguments for an appellant on appeal. Smith v.
    Heather Manor Care Ctr., Inc., 
    2012 Ark. App. 584
    , 
    424 S.W.3d 368
    . Point one is affirmed.
    Point 2: Deceptive Trade Practice
    Appellants next argue that the circuit court erred in instructing the jury on a violation
    of the deceptive trade practices act because (1) the Simses’ expert witness Mr. Looney
    testified that workmanship insurance is not available to those in residential construction; (2)
    the Simses failed to prove that Roggasch’s statement about insurance proximately caused
    their damage; and (3) the deceptive trade practices claim was a ruse for extending the statute
    of limitations on a fraud claim.
    The court instructed the jury on the Trade Practices Act as follows:
    TASHA SIMS and JOHN SIMS claim damages from RYAN
    ROGGASCH and ELITE HOMES OF ARKANSAS, INC. for using
    deceptive trade practice and have the burden of proving each of three essential
    propositions:
    First, that he/she has sustained damages;
    Second, that RYAN ROGGASCH and ELITE HOMES OF
    ARKANSAS, INC. used a deception, fraud, or false pretense or concealed,
    suppressed, or omitted a material fact in connection with the sale of goods
    and/or services; or knowingly took advantage of TASHA SIMS and JOHN
    SIMS, who were reasonably unable to protect his/her interest; or engaged in
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    an unconscionable, false, or deceptive act or practice in business, commerce,
    or trade; and
    Third, that RYAN ROGGASCH and ELITE HOMES OF
    ARKANSAS, INC.’s conduct was a proximate cause of TASHA SIMS and
    JOHN SIMS’s damages.
    If you find from the evidence in this case that each of these propositions
    has been proved, then your verdict should be for TASHA SIMS and JOHN
    SIMS; but if, on the other hand, you find from the evidence that any of these
    propositions has not been proved, then your verdict should be for RYAN
    ROGGASCH and ELITE HOMES OF ARKANSAS, INC.
    The jury-verdict forms reflect that the jury found against Roggasch and Elite
    Homes on the Simses’ deceptive-trade-practice claim. The appellants did not make a timely
    objection to this particular instruction at trial, so they may not argue about it now. See St.
    Louis Sw. Ry. Co. v. Grider, 
    321 Ark. 84
    , 88, 
    900 S.W.2d 530
    , 532 (1995) (outlining
    procedure for preserving jury-instruction error). Appellants’ point two is labeled as a jury-
    instruction issue, but the substance of point two is that Roggasch and Elite Homes have
    challenged the sufficiency of the evidence on the deceptive-trade-practices claim at trial
    during their directed-verdict motions and here on appeal.          We therefore address the
    substance of their sufficiency arguments.
    Our standard of review of the denial of a motion for directed verdict is whether the
    jury’s verdict is supported by substantial evidence. Stewart Title Guar. Co. v. Am. Abstract &
    Title Co., 
    363 Ark. 530
    , 
    215 S.W.3d 596
    (2005). Substantial evidence is that which goes
    beyond suspicion or conjecture and is sufficient to compel a conclusion one way or the
    other. 
    Id. We only
    review the record for substantial evidence to support the jury’s verdict.
    
    Id. In determining
    whether there is substantial evidence, we view the evidence and all
    reasonable inferences arising therefrom in the light most favorable to the party on whose
    behalf judgment was entered. 
    Id. 5 Cite
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    Tasha Sims testified that Roggasch “looked really young” to her but that he told her
    he was twenty-six and had built between sixty and seventy homes. Tasha explained that
    Roggasch said he had three educational degrees, including an engineering degree. She also
    told the jury that Roggasch “definitely” told her he had “workmanship” insurance.
    According to Tasha, she told Roggasch that “the most important thing” to her was that he
    use a waterproofing product called Bituthene so that water could not enter into the
    basement and that Roggasch had agreed to use it. The total estimate Roggasch presented
    to build the approximately 3,000 square-foot house was $180,000, according to Tasha.
    Tasha later found out that Roggasch had misrepresented some facts. He was only
    twenty-one years old, had no college education, and, according to Roggasch’s trial
    testimony, had only “possibly built twenty or thirty residential homes.” On cross-
    examination, Roggasch indicated that he did mainly cabinetry and other finishing processes
    on the houses he had built.    Tasha also testified that Roggasch and Elite Homes used a
    product called “drylok” instead of the Bituthene that Tasha had insisted they use. According
    to Tasha, Roggasch “absolutely refused to put it on.” When Tasha tried to file an insurance
    claim for shoddy workmanship against Elite Homes, she was told that Elite Homes had no
    such policy.
    There was also substantial and cumulative expert and lay testimony about the serious
    structural problems that emerged while Roggasch was in charge of the home building. For
    example, Ben Reeves, Tasha Sims’s loan officer, testified that there was an exterior wall on
    the house that “you could actually push and it would move” and that the deck located
    twenty to thirty feet off the ground was secured only by a 4 x 4 post that was not anchored
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    to the main structure. James Higgins, a contractor Tasha hired to help fix some of the
    problems, said that there was a load-bearing wall without a foundation under it, that the
    roof leaked because it was not installed properly, and that the basement flooded with up to
    three to four inches of standing water at a time. Gary Looney, a local contractor, testified
    that it was “not possible” to build the home for the $180,000 Roggasch had estimated and
    that it would cost $140,000 to bring the house “close to code.”             He also said that
    “workmanship” insurance policies were not available to residential contractors.
    Substantial evidence existed for the jury to conclude that Roggasch, acting for Elite
    Homes, omitted or concealed material facts in connection with the home services. He
    made certain representations about his age, education, experience, and insurance coverage
    that were false. There was sufficient evidence for the jury to reasonably conclude that the
    appellants’ failure to speak truthfully caused the Simses damage. They had to hire an
    experienced contractor to repair major problems, costing $140,000, or so the jury could
    have concluded. Looking at the evidence in the light most favorable to the Simses, as our
    standard of review requires, substantial evidence supports the jury’s conclusion that
    Roggasch and Elite Homes violated the act. To the extent that Roggasch and Elite Homes
    argue that the Simses’ deceptive-trade-practice claim was a ploy to extend the statute of
    limitations on a fraud claim, they never received a ruling from the circuit court on the issue;
    and they may not raise it for the first time on appeal. See Hodges v. Huckabee, 
    338 Ark. 454
    ,
    465, 
    995 S.W.2d 341
    , 349 (1999) (“This court will not review a matter on which the trial
    court did not rule, and a party seeking to raise the point on appeal concerning a ruling has
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    the burden to obtain a ruling. Matters left unresolved simply may not be raised on appeal.”).
    We affirm on point two.
    Point 3: Negligence and Contractual Claims
    Appellants contend that the circuit court erred when it instructed the jury on
    negligence and contractual claims. “An underlying principle of compensatory damages is
    that the plaintiff, although entitled to a fair, adequate and complete recovery, should not
    obtain a double recovery.” Howard W. Brill, 1 Arkansas Law of Damages § 4:8 (5th ed.
    2004). Apart from a bare statement that the court erred in instructing the jury on the
    negligence and breach-of-contract claims, the appellants make no convincing or cohesive
    arguments for reversal. They conflate the measure of damages recoverable for breach of
    contract, negligence, and breach of implied warranties and do not provide any citations to
    authority on this point. Appellants also raise a statute-of-limitations argument with regard
    to negligence, but there is no evidence that this issue was ever raised to or ruled on by the
    circuit court. Roggasch and Elite Homes bear the burden, when arguing on appeal, to
    demonstrate error, and they have not done so. Bratton v. Gunn, 
    300 Ark. 140
    , 
    777 S.W.2d 219
    (1989); see also Seth v. St. Edward Mercy Med. Ctr., 
    375 Ark. 413
    , 420, 
    291 S.W.3d 179
    ,
    185 (2009) (appellant must present convincing arguments and citations to authority).
    Appellants’ point three is affirmed.
    Point 4: Ryan Roggasch Individually
    Roggasch argues that he should not be personally liable because he acted in his
    capacity as president of Elite Homes when he built the home, and the court erred when it
    allowed the jury to pierce the corporate veil. We do not decide whether the corporate veil
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    was pierced in this case on the Simses’ tort and contract claims. We instead affirm because
    there is a separate and unchallenged basis upon which the jury could hold Roggasch
    individually liable in this case: Ryan Roggasch could be held individually liable by the jury
    for the Simses’ damages because he violated the deceptive trade practices act.
    Arkansas Code Annotated section 4-88-113(d)(1) (Repl. 2011), which was pled in
    the Simses’ amended complaint, states:
    Every person who directly or indirectly controls another person who is in
    violation of or liable under this chapter and every partner, officer, or director
    of another person who is in violation of or liable under this chapter shall be
    jointly and severally liable for any penalties assessed and any monetary
    judgments awarded in any proceeding for civil enforcement of the provisions
    of this chapter, provided that the persons to be held jointly and severally liable
    knew or reasonably should have known of the existence of the facts by reason
    of which the violation or liability exists.
    Because we have found substantial evidence supports the jury’s finding on the deceptive-
    trade-practices claim, we see no error in Roggasch being held individually accountable
    under section (d)(1), as an officer of the corporation Elite Homes. Point four is affirmed.
    Point 5: Damages
    Roggasch and Elite Homes maintain that the circuit court erred in not requesting
    that the jury allocate damages for each claim against each defendant. At trial, separate
    special-verdict forms were submitted to the jury on Tasha’s claim for breach of contract
    against Elite Homes, the Simses’ claims for breach of implied warranties and for negligence
    against Roggasch and Elite Homes, the Simses’ claim for Arkansas Deceptive Trade Practices
    against Roggasch, and the Simses’ claim for Arkansas Deceptive Trade Practices against Elite
    Homes.    In short, the jury assessed the defendants/appellants’ liability for each claim
    separately. The same, however, cannot be said about how the jury allocated the damages
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    award. Here, there was only one general verdict on damages. It stated: “We, the jury,
    assess the Plaintiffs’ damages at $140,000[.]”
    The appellants objected during a conference with the circuit court, arguing that the
    instruction
    lumps all the damages in together for all different causes of actions. . . . [I]t’s
    not clear as to what . . . is for negligence, what [ ] is for implied warranty or
    what amounts are being awarded for any contract dispute . . . [T]here should
    be one for each type of damage that’s awardable . . . I don’t know that you
    can tell from the verdict forms and from the instructions what exactly . . . [the
    jury] [is] awarding it for.
    After some further discussion and argument, the circuit court told appellants’ counsel, “Your
    objection is noted and I’m [going to] give these instructions that the Plaintiff has submitted.”
    The jury was instructed that if the Simses were damaged by appellants due to “negligence,
    breach of contract, and/or breach of warranties,” then the Simses were entitled to past and
    future expenses for necessary repairs. Roggasch and Elite Homes did not proffer any jury
    instructions containing a separate allocation of damages on each separate claim.
    We hold that the appellants’ argument that the court should have instructed the jury
    to determine damages for each claim and defendant separately is not preserved. Arkansas
    Rule of Civil Procedure 51 states that “no party may assign as error the failure to instruct
    on any issue unless such party has submitted a proposed instruction on that issue.” The
    appellants never proffered special interrogatories or special-verdict forms for the jury to
    award separate damages for each successful claim. Therefore, their argument that the court
    failed to correctly instruct the jury regarding separate damages for each defendant is waived.
    See Ludwig v. Bella Casa, LLC, 
    2010 Ark. 435
    , 
    372 S.W.3d 792
    . Because we must take the
    jury’s “lump sum” damage award as we find it, we cannot determine the amount of money
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    that may have been awarded on each separate legal claim. In other words, the damages
    award in this case is a finding upon the whole case. See Tyson Foods, Inc. v. Davis, 
    347 Ark. 566
    , 579, 
    66 S.W.3d 568
    , 576 (2002) (“When special interrogatories concerning liability or
    damages are not requested, we are left in the position of not knowing the basis for the jury’s
    verdict, and we will not question nor theorize about the jury’s findings.”). We affirm point
    five.
    Point 6: Prejudgment Interest and Attorney’s Fees
    As their final point, Roggasch and Elite Homes contend that the circuit court abused
    its discretion in assessing prejudgment interest and attorney’s fees. The Simses filed a petition
    for attorney’s fees, costs, and prejudgment interest in April 2011 after the jury trial; attached
    to the petition was an affidavit by the Simses’ attorney. The record shows that the appellants
    never responded to the Simses’ petition for attorney’s fees and prejudgment interest. The
    court did not enter a judgment awarding prejudgment interest and attorneys’ fees until June
    2011. Because Roggasch and Elite Homes failed to respond to the Simses’ petition for
    attorney’s fees and prejudgment interest, they never raised before the circuit court the
    arguments they now make on appeal. Arguments not raised at the circuit court level are
    not considered on appeal. Bd. of Dirs. of City of Hot Springs v. Pritchett, 
    2015 Ark. 17
    , 
    454 S.W.3d 223
    . We therefore affirm on point six.
    Affirmed.
    VAUGHT and HIXSON, JJ., agree.
    Dyer and Jones, by: Dustin D. Dyer, for appellants.
    David C. Hawkey, for appellees.
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