Bobby D. Wall v. Selma Curtis ( 2012 )

IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
November 17, 2011 Session
BOBBY D. WALL v. SELMA CURTIS
Appeal from the Chancery Court for Montgomery County
No. MCCHCVCD084 Laurence M. McMillan, Jr., Chancellor
No. M2011-01285-COA-R3-CV - Filed April 23, 2012
Homeowner and Contractor entered into an agreement for the construction of a new house.
The contract provided that no changes would be made to the terms and specifications of the
contract without a writing describing the changes signed by both parties. The parties ignored
this provision and made changes without preparing change orders. Before the house was
completed the parties had a dispute, and the homeowner contracted with someone else to
complete her house. Homeowner alleged Contractor breached the contract by walking off
the job and refusing to complete the house, and Contractor alleged Homeowner fired him and
told him not to return to her property. Contractor sued Homeowner for breach of contract
and sought to recover his damages, which included expenses he incurred for materials and
labor that Homeowner refused to pay. Homeowner counterclaimed for breach of contract
and sought to recover as damages the amount she paid other contractors to complete her
house. The trial court found Homeowner committed the first breach and entered judgment
for Contractor in the amount of $21,120.69. Homeowner appealed, arguing the evidence did
not support the trial court’s judgment. Concluding the evidence supports the trial court’s
findings of fact, we affirm the trial court’s judgment in all respects.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
P ATRICIA J. C OTTRELL, P.J., M.S., delivered the opinion of the Court, in which F RANK G.
C LEMENT, J R. and R ICHARD H. D INKINS, JJ., joined.
Gregory D. Smith, Clarksville, Tennessee, for the appellant, Selma Curtis.
Steven T. Atkins, Clarksville, Tennessee, for the appellee, Bobby D. Wall.
OPINION
I. B ACKGROUND
Selma Curtis owned a parcel of real estate in the Bradbury Farms Subdivision in
Montgomery County, Tennessee. She entered into an agreement titled “Construction
Contract” (the “Contract”) with Bobby D. Wall, dated February 12, 2006, in which Mr. Wall
agreed to build Ms. Curtis a house for the price of $234,900. The Contract included details
about the types of doors, windows, flooring, and trim that would be used in the house, and
had an “Allowance Summary” that specified how much Ms. Curtis could spend for particular
items, such as cabinets, appliances, floor coverings, brick, plumbing, and fixtures, in order
to stay within the Contract price.
The Contract included the following statement in paragraph 3: “Buyers understand
overages will be paid to Contractor if they exceed specific allowances as set by Contractor.”
Paragraph 4 provided in part:
That no changes from the original plans and specifications in this contract shall
be made unless both parties agree in writing as to the extent of any changes
and the amount to be charged or deducted for those changes, before any
materials are purchased or work connected with those changes shall be done.
Mr. Wall began constructing the house in March 2006, but by July the parties’
relationship had soured and Mr. Wall discontinued his work on Ms. Curtis’s house. Mr. Wall
claimed Ms. Curtis terminated the Contract by telling him not to come onto her property
anymore and that she would complete the house on her own without him. Ms. Curtis claimed
Mr. Wall walked off the job leaving the house half completed and that she waited months for
him to return to complete the job.
By the time of the parties’ dispute Ms. Curtis had paid Mr. Wall a total of $158,000.
Mr. Wall claimed he had incurred additional expenses on behalf of Ms. Curtis, however, and
he filed a lawsuit against Ms. Curtis in an effort to recover this money. In his lawsuit, Mr.
Wall asserted Ms. Curtis breached the parties’ contract and that he was entitled to damages
of $54,316 from Ms. Curtis for unpaid materials and work, some of which resulted from Ms.
Curtis’s change orders.
Ms. Curtis responded to Mr. Wall’s Complaint and denied that she terminated the
Contract. Ms. Curtis filed a Counter Petition in which she contended Mr. Wall failed to
fulfill the obligations imposed upon him by the Contract and that his failure constituted a
breach for which she was entitled to damages. Ms. Curtis alleged she had to engage other
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contractors to perform the tasks Mr. Wall was obligated to perform under the Contract and
that she suffered damages in the amount of $124,226.
The case was tried without a jury in August and November 2010. Mr. Wall and Ms.
Curtis presented conflicting testimony regarding the circumstances surrounding the
Contract’s termination. Mr. Wall testified that beginning in the spring of 2006 Ms. Curtis
was directing his subcontractors to change certain features of the house without letting Mr.
Wall know of the changes first. Mr. Wall testified that Ms. Curtis told his subcontractors she
would pay them for the extra work, but that once the extra work was done she refused to pay
anything more than was in the Contract. Mr. Wall testified that he tried to have Ms. Curtis
sign change orders whenever she made a change from the contract terms, but that she refused
to sign any change orders.
Mr. Wall testified that by July 20, Ms. Curtis was making so many changes to the
terms of the Contract that he sent her a proposed Addendum to Construction Contract in an
effort to quantify the changes and make sure Ms. Curtis knew she would be responsible for
paying for the changes she had made and for additional changes going forward. Mr. Wall
stated “There will be no more changes unless a written agreement, as per the contract, is
signed with the agreed cost change stated.” In addition, Mr. Wall explained that Ms. Curtis
would be responsible for paying the cost of all cabinets and vanities over and above the
$5,000 allowance set forth in the Contract. Mr. Wall also made clear Ms. Curtis would be
responsible for paying $4,675 to cover the cost of the extra brick and labor necessary to
install brick on a part of the house that the parties initially agreed was going to be covered
in vinyl. Lastly, Mr. Wall stated that Ms. Curtis would be responsible for paying the cost of
all trim materials in excess of the $5,085 budgeted for trim in the Contract.
Ms. Curtis sent Mr. Wall a response at the end of July in which she agreed to stay
within the $5,000 budgeted for cabinets and vanities. She stated that she would pay $3,400
for extra brick work, not the $4,675 Mr. Wall requested. Ms. Curtis refused to pay anything
extra for the trim materials, stating that “[t]hese items should be constructed, to the Owners
satisfaction, by the Contractor under the original contract at no additional cost to the Owner.”
Mr. Wall testified that following Ms. Curtis’s letter at the end of July, Mr. Wall did
not hear from Ms. Curtis again. Mr. Wall testified that his subcontractors informed him that
Ms. Curtis told them she would be in charge of the construction going forward. Mr. Wall’s
attorney sent Ms. Curtis a letter stating Mr. Wall “remains ready, willing, and able to
complete construction” and that he “anticipate[s] that it would approximately take 30 days
to complete the improvements provided he receives your cooperation.” Mr. Wall testified
that Ms. Curtis phoned him at the end of September and said to him, “Bobby, I told you not
to come back on my job. I told you last week. I’m going to cut you up. I’m going to kill
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you.”
Ms. Curtis agreed during her examination at trial that she made changes to the
Contract without a written change order. She explained that she was getting along so well
with Mr. Wall it did not seem necessary to have a written change order. When asked about
the changes in trim that she insisted on, she explained that she did not understand what was
set forth in the Contract regarding the trim and that she was not happy with the terms she had
agreed to initially.
When Ms. Curtis was asked what happened after she and Mr. Wall exchanged letters
in July, Ms. Curtis testified:
Well, first of all, we come to this point and Mr. Bobby was - - all the
changes he was doing and we were talking, and he just kind of started
threatening me. That’s when it came to this point.
He would - - every time I was saying something I wanted to see what
he was doing, and he [would] tell me that he’s going to quit. He left. I
call[ed] him. I begged him to come back. I told him I won’t do that. I wanted
him to do that. Well, then he just said okay. He wanted me to take the
responsibility of the house, as-is, and don’t ask any more. Just accept the way
it is.
II. T RIAL C OURT’S F INDINGS OF F ACT
Both Mr. Wall and Ms. Curtis submitted Proposed Findings of Fact and Conclusions
of Law following the trial. The trial court issued an Order on March 29, 2011, in which it
found as follows:
1. That the Findings of Fact and Conclusions submitted by the Plaintiff,
Bobby D. Wall, are adopted by the Court in their entirety.
2. That the Plaintiff, Bobby D. Wall, is entitled to recover against the
Defendant, Selma Curtis, for the following unpaid items:
a. Additional materials for field lines $468.00, additional
equipment time for septic tank and field lines $1,470.00, charges
for moving water line $2,000.00, charges for moving driveway
$4,000.00, additional equipment and labor on foundation
$2,360.00, additional block and labor for foundation $2,060.00,
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engineering charges $275.00, additional brick work $4,675.00,
work on front steps after final draw $2,080.00, incidental
charges for port-a-potties, construction utility services, and
builder’s risk insurance $1,732.69, for a total of $21,120.69.
3. That the counter claim of the original Defendant, Selma Curtis, should
be dismissed.
The relevant Findings of Fact that the trial court adopted include the following:
3. Due to the presence of rock and the slope of the property the lot
was a difficult one on which to construct a house due to septic tank
regulations.
.....
12. The parties entered into construction contract on February 12, 2006
memorializing the parties’ agreement and setting forth various allowances and
specifications for the construction of the house.
.....
21. The elevation of the house and its location on the lot were
dictated by septic system requirements.
22. Additional expenses for site work due to rock were incurred by
Mr. Wall as follows:
Additional materials
Additional equipment time $1,470
Relocate water line
Relocation of driveway $4,000.00
23. Due to the presence of rock Mr. Wall expended the following
amounts to avoid blasting:
a. Extra concrete block and brick $2,060.00
b. Additional equipment and man power time on foundation $2,360
24. Mr. Wall discovered the necessity of raising the house when the
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lot was being graded and found it would be necessary to either dynamite rock
at extra expense or raise the elevation of the house.
.....
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26. Mr. Wall incurred additional unpaid engineering charges in the
amount of $275.00 for a change order proposed by Ms. Curtis.
27. Mr. Wall incurred extra costs for additional brick as a result of
a change order from vinyl siding to brick, with Ms. Curtis agreeing to pay
$3,400.00 for the extra brick. These charges have not been paid.
.....
29. After being terminated by Ms. Curtis, Mr. Wall continued to
furnish water service, electric service, porta potties, and builder’s risk
insurance through December of 2006 at a total expense to Mr. Wall of
$1,732.69 for which he has not been reimbursed.
30. Ms. Curtis has no evidence to dispute Mr. Wall’s testimony that
he paid for the portable toilets, builder’s risk insurance, construction electric
service, and water service from July 31st until December 31st of 2006.
31. Although numerous changes from the plans occurred during
construction, no written change orders were signed.
32. In early July, the parties began discussions concerning previous
change orders as well as trim for the interior of the house and a disagreement
occurred as to the quality and quantity of trim dictated by the contract.
33. After Ms. Curtis directed certain changes to subcontractors with
respect to arches and trim components without consultation with him, Mr.
Wall prepared an addendum to the parties’ contract in an attempt to resolve the
parties’ disagreements.
.....
35. The total amount expended by Mr. Wall for labor and materials
incurred prior to or in existence at his termination was $137,415.12.
.....
37. After his last draw, Mr. Wall expended labor and materials on the
front steps costing $2,080.00 for which he was not paid.
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.....
42. Randy Meyer, a material salesman at Thomas Lumber Company,
testified that in early July of 2006 Mr. Wall and Ms. Curtis discussed trim with
him at Thomas Lumber Company. Mr. Wall had him show Ms. Curtis trim
such as Mr. Wall normally used in houses but that Ms. Curtis wanted an
upgraded trim package beyond that provided in her contract.
.....
44. On July 7, 2006, Mr. Meyer also provided a quote on behalf of
Thomas Lumber Company for an upgraded trim package incorporating Ms.
Curtis’ desired trim at a cost for materials of $10,253.00. On July 20, 2006
Ms. Curtis ordered the materials set out in Trial Exhibit 12 reflecting upgraded
trim and on or about July 20th Ms. Curtis informed Mr. Meyer that Mr. Wall
was not going to be building her house anymore and that she was going to
finish it herself.
45. Mr. Meyer testified that all of the trim purchased by Ms. Curtis
after Mr. Wall was no longer on the job was an upgrade over the contract
specifications.
46. Despite verbal and written communications between the parties
between July 20th and July 31st to the contrary, Ms. Curtis testified she was
willing to pay for the trim upgrade but in her last written communication to
Mr. Wall on July 31st refused to pay for the trim upgrade.
.....
48. David Aldridge, who plumbed the house testified that Ms. Curtis
directed him to make several changes to include moving a half bath on the
main floor twice.
.....
62. That Ms. Curtis exceeded her contract allowances in the
following respects:
a. All expenses for rock removal
b. Cabinet allowance exceeded in the amount of $3,670.42
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c. Door hardware allowance exceeded in the amount of $516.47
d. Hardwood floor allowance exceeded in the amount of $278.10
e. Exterior doors allowance exceeded in the amount of $86.43
f. Appliance allowance exceeded in the amount of $121.11
.....
71. After terminating Mr. Wall, Ms. Curtis finished a different house
than the one for which she contracted.
Ms. Curtis filed a Motion to Alter or Amend Order in which she argued the evidence
presented at trial did not support the court’s findings and order that she pay Mr. Wall
$21,120.69. The trial court found that Ms. Curtis’s motion was not well taken and denied
it. This appeal followed.
III. A NALYSIS
A. Standard of Review
Ms. Curtis argues on appeal that the trial court erred in finding she was liable to Mr.
Wall for damages because Mr. Wall was the first to materially breach the parties’ contract.
Our review on appeal of the trial court’s findings of fact is de novo with a presumption of
correctness, unless the evidence preponderates otherwise. Tenn. R. App. P. 13(d); Cracker
Barrel Old Country Store, Inc. v. Epperson, 284 S.W.3d 303, 308 (Tenn. 2009); Blair v.
Brownson, 197 S.W.3d 681, 684 (Tenn. 2006); Bogan v. Bogan, 60 S.W.3d 721, 727 (Tenn.
2001); Hass v. Knighton, 676 S.W.2d 554, 555 (Tenn. 1984). We review a trial court’s
conclusions of law de novo, with no presumption of correctness. Whaley v. Perkins, 197
S.W.3d 665, 670 (Tenn. 2006); Union Carbide Corp. v. Huddleston, 854 S.W.2d 87, 91
(Tenn. 1993).
The interpretation of a written agreement is a question of law rather than one of fact.
Cracker Barrel, 284 S.W.3d at 308 (citing Guiliano v. Cleo, 995 S.W.2d 88, 95 (Tenn.
1999)). Our review of the trial court’s conclusions of law are therefore de novo, with no
presumption of correctness accorded to the decisions of the court below. Cracker Barrel,
284 S.W.3d at 308 (citing Taylor v. Fezell, 158 S.W.3d 352, 357 (Tenn. 2005)).
B. The Record Supports the Trial Court’s Finding that Ms. Curtis First
Breached the Contract
The law in Tennessee is well established that the party who first commits a material
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breach of a contract is not entitled to any damages resulting from the other party’s subsequent
breach of the same contract. Forrest Constr. Co. v. Laughlin, 337 S.W.3d 211, 226 (Tenn.
Ct. App. 2009); United Brake Systems, Inc. v. American Envtl. Protection, Inc., 963 S.W.2d
749, 756 (Tenn. Ct. App. 1997); see Santa Barbara Capital Corp. v. World Christian Radio
Found., 491 S.W.2d 852, 857 (Tenn. App. Ct. 1972) (holding there can be no recovery for
damages by breaching party in breach of contract action).
Ms. Curtis and Mr. Wall presented conflicting testimony about which party first
breached the Contract. They both contended the other breached the Contract by making
changes to the house that were not contemplated by the Contract and that were not
memorialized in a writing signed by both parties. Despite the requirement in the Contract
that no changes were to be made to the plans or specifications of Ms. Curtis’s house without
a writing signed by both parties, Mr. Wall’s and Ms. Curtis’s conduct amounted to a
modification of this requirement to the extent both parties agreed to changes without a signed
writing. “After a written contract is made, it may be modified by the express words of the
parties in writing, as well as by parol.” Galbreath v. Harris, 811 S.W.2d 88, 91 (Tenn. Ct.
App. 1990) (citing Co-Operative Stores Co. v. United States Fidelity & Guaranty Co., 195
S.W.177, 180 (1917)). “Whether written or oral, modifications of written contracts must be
with the consent of both parties.” Galbreath, 811 S.W.2d at 92 (citation omitted).
Until Mr. Wall prepared the Addendum in which he described the more substantial
changes Ms. Curtis wanted and documented the additional money Ms. Curtis would have to
pay for these changes, both Ms. Curtis and Mr. Wall consented to the changes made orally
to the Contract. The Tennessee Court of Appeals addressed a written change order
requirement in a construction contract and the parties’ waiver of this requirement in Moore
Constr. Co. v. Clarksville Dept. of Elec., 707 S.W.2d 1 (Tenn. Ct. App. 1985):
Including a written change order requirement in a construction contract
is not uncommon. It promotes a more definite understanding between the
parties and thus, helps to avoid potential controversies. . . . However, like
other contractual provisions, they can be waived or abrogated by the parties.
The waiver of a written change order requirement by an owner is not
always required to be in writing but may be the result of the parties’ conduct
on the job. Thus, it is not uncommon for courts to find that an owner has
waived a written notice requirement in cases where extra work has been
ordered verbally by the owner or the extra work has been performed with the
owner’s knowledge and without its objection.
Id. at 12-13 (citations and footnote omitted). The Moore Constr. Co. court explained further:
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The course of dealing between the parties can also amount to a waiver
where the conduct of the parties makes it clear that they did not intend to rely
strictly upon a contract’s written notice requirement and that adherence to such
a requirement would serve no useful purpose. . . . Once a party has waived the
requirement with regard to a particular matter, it cannot revoke its waiver, in
whole or in part, at its convenience.
Id. at 13 (citations omitted); see M.R. Stokes Co., Inc. v. Shular, 2008 WL 544665, at *4
(Tenn. Ct. App. Feb. 26, 2008) (“contract provisions can be waived, especially in
construction projects because of the nature of construction which often require decisions to
be made quickly to keep the project progressing”); Vakili v. Hawkersmith, 2001 WL
1173285, at * 5-7 (Tenn. Ct. App. Oct. 5, 2001) (despite contract provision that change
orders were to be in writing signed by the parties, court held parties’ conduct waived written
requirement). Thus, as to the changes Mr. Wall and Ms. Curtis agreed to orally, neither party
can now complain the other breached the Contract by failing to comply with the written
change order provision set forth in the Contract.
Besides the absence of written change orders, both Ms. Curtis and Mr. Wall assert
other conduct that constituted the first material breach of the Contract. Mr. Wall contends
Ms. Curtis breached the Contract when she told him not to come back onto her property
before the house was completed. Ms. Curtis denied that she instructed Mr. Wall not to return
to her house, arguing instead that Mr. Wall breached the Contract by walking off the job.
The trial court found that Ms. Curtis had fired Mr. Wall and thereby first breached the
Contract. The trial court made extensive and detailed findings of fact. We have reviewed
the transcript of the trial court proceedings and conclude the testimony and evidence support
the trial court’s findings of fact and do not preponderate otherwise. Consequently, we
conclude Ms. Curtis committed the first material breach of the Contract and is required to
compensate Mr. Wall for his resulting damages.1 Ms. Curtis does not contest the amount of
damages the trial court ordered her to pay. The record supports the amount of damages the
court ordered Ms. Curtis to pay to Mr. Wall. We therefore affirm the trial court’s judgment.
1
Ms. Curtis argues in her Brief that the Contract was ambiguous and should be construed against Mr.
Wall, who authored the Contract. Ms. Curtis fails to point to any particular ambiguity in the Contract,
however. We therefore decline to consider this argument.
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IV. C ONCLUSION
For the reasons stated above, we affirm the trial court’s judgment in all respects.
Costs of this appeal shall be assessed against the appellant, Selma Curtis, for which execution
shall issue if necessary.
____________________________
PATRICIA J. COTTRELL, JUDGE
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