Geoscience Grp., Inc. v. Waters Constr. Co., Inc.

NO. 13-1375
NORTH CAROLINA COURT OF APPEALS
Filed: 1 July 2014
GEOSCIENCE GROUP, INC.,
Plaintiff,
v. Mecklenburg County
No. 11 CVS 7680
WATERS CONSTRUCTION
COMPANY, INC.,
Defendant.
Appeal by defendant from orders entered 28 December 2012
and 22 February 2013 by Judge Lindsay R. Davis, Jr., in
Mecklenburg County Superior Court. Heard in the Court of Appeals
8 April 2014.
Keziah Gates, LLP, by Andrew S. Lasine, for plaintiff-
appellee.
Goodman, Carr, Laughrun, Levine & Greene, PLLC, by Miles S.
Levine, for defendant-appellant.
STEELMAN, Judge.
Where defendant failed to object to the trial court’s jury
instructions submitting a claim based upon quantum meruit, that
argument is not subject to appellate review. Where defendant
neither objected to the trial court’s jury instructions nor
requested special instructions, its challenges to the court’s
instructions were not preserved for appellate review. The court
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did not err by denying defendant’s motion for judgment
notwithstanding the verdict.
I. Factual and Procedural Background
Waters Construction Company, Inc., (defendant) is the owner
of a tract of real estate located in Mecklenburg County known as
Lost Tree. In 1986 defendant’s owner, William Waters, obtained a
zoning permit for Lost Tree that allowed construction of 49
houses. Defendant did not develop the land at that time. In 2008
defendant hired Frank Craig to prepare plans for Lost Tree, and
in January 2009 Mr. Craig submitted plans to the Charlotte-
Mecklenburg planning department. The plans were reviewed by
Steve Gucciardi, and were rejected because they did not include
the required wetlands delineations and permits. After Mr.
Gucciardi reviewed the plans, he and Mr. Waters walked through
the property and Mr. Gucciardi showed Mr. Waters the wetlands
and streams that were subject to regulation.
After the plans submitted by Mr. Craig were rejected, Mr.
Waters hired Wendell Overby to perform a preliminary wetlands
review of Lost Tree. In August 2009 Mr. Overby provided Mr.
Waters with a preliminary report stating that in his
“professional opinion that the stream features [in Lost Tree]
were jurisdictional,” meaning that they were subject to
regulation. Mr. Overby recommended that “a detailed wetland
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delineation be performed and jurisdictional features be surveyed
for permitting purposes if applicable[,]” and showed Mr. Waters
the jurisdictional wetlands and streams.
In the fall of 2009 Mr. Waters met with Kevin Caldwell,
plaintiff’s senior vice president, about the possibility of Mr.
Caldwell’s revising the plans submitted by Mr. Craig. Mr. Waters
wanted plaintiff to produce a set of plans for development of
all 49 lots that were approved in 1986, although this would
require two stream crossings. After Mr. Caldwell and Mr. Waters
held several meetings to discuss “the layout of the subdivision”
“in terms of these stream crossings and the impact of the
buildable lots,” they signed a contract for plaintiff to “design
the roads, the water facility, [and] the storm drainage for
[the] 49 lots depicted on [defendant’s] rezoning petition.” The
parties agreed to a contract price of $24,000, with half to be
paid when plaintiff submitted plans to the city and the
remainder when the plans were approved. the contract provided
that plaintiff was responsible for producing preliminary plans
depicting the location of roads, sewage and storm drains in the
subdivision, and for civil engineering plans for grading and
control of erosion, and that defendant was responsible for
surveying and delineating any “wetlands with jurisdictional
streams” and providing plaintiff with this information. The
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contract stated that if “additional service work” were required,
“a work order (fee addendum) will be presented to [defendant]
for authorization prior to proceeding with the additional work.”
“Additional services” were defined in the contract as work that
was “[b]eyond the scope of the basic civil services to be
performed for this proposal” including “wetland
delineation/investigation” and “[p]lan revisions initiated by
[defendant]” after plaintiff had begun work.
The contract was signed on 29 October 2009. Mr. Caldwell
met with Mr. Waters several times during November 2009, but Mr.
Waters did not provide Mr. Caldwell with Mr. Overby’s report or
with any documentation delineating the wetlands or stream
crossings in Lost Tree. Plaintiff submitted plans in early
December 2009, which were again rejected because they failed to
delineate the wetlands or address related issues. After the
plans were rejected, Mr. Waters told Mr. Caldwell about Mr.
Overby’s report and defendant hired Mr. Overby to prepare a
detailed report delineating the jurisdictional streams and
wetland areas, so that Mr. Caldwell could develop revised plans.
After Mr. Overby delineated the Lost Tree wetlands,
plaintiff identified five alternative approaches for revised
plans that addressed wetland issues, and provided defendant with
a memo setting out these alternatives and indicating the effect
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on construction costs of each choice. After meeting to discuss
which approach defendant preferred, Mr. Waters directed Mr.
Caldwell to prepare plans that would allow development of all 49
building lots, and to first submit the least expensive option.
When these plans were rejected, Mr. Caldwell prepared another
set of plans using the second least expensive option. He also
prepared new plans for the development that adjusted the road
elevation, storm water drainage, and sewer pipes to accommodate
the revised approach to wetlands and stream crossings. These
plans were ultimately approved by “both the City and Charlotte-
Mecklenburg Utility Department.”
After the plans were approved, Mr. Caldwell sent Mr. Waters
an invoice for the additional cost of preparing revised plans.
Plaintiff had been paid $12,000 at the outset of the project,
and sought an additional $38,000. Plaintiff contended that the
additional work was not within the scope of the parties’
contract, but constituted “additional services” as defined in
the contract. Mr. Waters refused to pay the additional amount,
claiming that the work performed was within the scope of their
agreement.
On 26 April 2011 plaintiff filed a complaint against
defendant, seeking damages based upon breach of contract,
implied contract, and unjust enrichment. The case was tried
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before a jury at the 5 November 2012 session of Superior Court
for Mecklenburg County. The trial testimony of Mr. Caldwell and
Mr. Waters agreed with respect to the general sequence of events
described above, but differed sharply in regards to the scope of
work covered by the contract.
Mr. Caldwell testified that he had asked Mr. Waters for
documentation regarding delineation of wetlands before he
prepared the first set of plans, but that Mr. Waters had told
him that he had “a letter” that exempted defendant from
compliance with wetlands regulations, and told him to “go ahead
and submit the plans,” promising that he would provide plaintiff
with the letter “while the plans were being reviewed.” However,
Mr. Waters never showed Mr. Caldwell such a letter. Mr. Waters
denied telling Mr. Caldwell that he had a letter waiving
wetlands requirements.
Mr. Waters conceded that (1) after Mr. Craig’s plans were
rejected because they failed to delineate wetlands, he had hired
Mr. Overby to produce a preliminary report; (2) Mr. Overby’s
preliminary report concluded that there were jurisdictional
streams and wetlands areas on the Lost Tree property; (3) Mr.
Overby gave him this report in August 2009; (4) Mr. Waters did
not show Mr. Caldwell the report until after the first set of
plans plaintiff produced were rejected for failure to delineate
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wetlands, and (5) Mr. Waters did not hire Mr. Overby to prepare
a detailed report with the required delineation of wetlands
until December 2009, after plaintiff’s plans were rejected.
However, Mr. Waters denied that he had withheld any information
from Mr. Caldwell.
Mr. Caldwell testified that when he and Mr. Waters
discussed the additional cost of revised plans, Mr. Waters told
him “that money’s no problem, you just get the plans approved.”
Mr. Caldwell considered Mr. Waters’s statement to constitute “a
handshake agreement” and testified that he “didn’t see the need
for a written agreement[.]”
Q. . . . [D]id you ask for a written
amendment to the contract or written change
order for the contract?
A. At that time we were going through
various . . . options. I couldn’t put a
number on how much it would cost, but he’s
sitting across the table from me saying
money is not a problem, you just get the
plans approved, and I took the man at his
word.
Mr. Waters admitted making the statement that “money is no
problem,” but testified that:
A. . . . I made that comment. He asked me if
money was a problem. At the time we was
right in the depth of a recession and there
was hardly any work going on, and I thought
he meant was we going to finish the
project[.] . . . I said money’s not the
problem. . . . I didn’t even understand what
he was talking about. . . .
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Q. So there was never a handshake agreement
between you Mr. Caldwell that you were going
to pay whatever additional expenses he
incurred above the 24,000?
A. I had no reason to. He was supposed to do
the job for $24,000. . . . When you’re
contractor, that ain’t the way it works. You
take it for a fixed price and that’s what
you deliver at.
Mr. Waters testified that Mr. Caldwell “said he would
finish up the plans and submit it and get it approved for
$24,000, so I took the deal.” He never discussed with Mr.
Caldwell the procedure that would be followed if additional work
was required, testifying that:
He had a contract to do all the work for
$24,000. It didn't make any difference to me
what he had to do. At the time he signed the
contract, I didn’t know what he had to do
other than get the plan finished and get it
approved.
Mr. Waters admitted meeting with Mr. Caldwell in January
2010 to discuss options for addressing wetlands issues, but
testified that they never discussed additional costs, and that
he “didn’t know anything about any additional costs” until Mr.
Caldwell sent him a bill in June 2010. There was a conflict in
the parties’ evidence concerning the scope of their contract and
whether the provision for written change orders had been
abandoned.
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On 8 November 2012 the jury returned verdicts finding in
relevant part that:
1. Defendant breached its contract with
plaintiff by failing to pay the full
contract price.
2. Defendant owed plaintiff $12,000 for
breach of contract.
3. The parties abandoned the provision of
their contract requiring prior written
agreement for additional services.
4. Plaintiff was entitled to recover $26,410
from defendant for additional services.
On 28 December 2012 the trial court entered judgment for
plaintiff in accord with the jury’s verdict. On 4 January 2013
defendant filed a motion for entry of judgment notwithstanding
the verdict (JNOV), pursuant to N.C. Gen. Stat. § 1A-1, Rule
50(b). The trial court denied defendant’s motion in an order
entered 22 February 2013.
Defendant appeals from the judgment and the denial of its
motion for JNOV.
II. Jury Instructions
A. Standard of Review
When a challenge to the trial court’s instructions to the
jury raises a legal question, it is subject to review de novo.
See, e.g. Jefferson Pilot Fin. Ins. Co. v. Marsh USA, Inc., 159
N.C. App. 43, 53, 582 S.E.2d 701, 706-07 (2003) (“The trial
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court erred in giving the incorrect re-instruction to the jury
as a matter of law. Questions of law are reviewable de novo.”)
(citing In re Appeal of the Greens of Pine Glen Ltd. P’ship, 356
N.C. 642, 647, 576 S.E.2d 316, 319 (2003)). However, a challenge
to a matter within the court’s discretion is reviewed for abuse
of discretion. “The form and phraseology of issues is in the
court’s discretion, and there is no abuse of discretion if the
issues are sufficiently comprehensive to resolve all factual
controversies..” Barbecue Inn, Inc. v. CP & L, 88 N.C. App. 355,
361, 363 S.E.2d 362, 366 (1988) (citing Pinner v. Southern Bell,
60 N.C. App. 257, 263, 298 S.E. 2d 749, 753 (1983)).
B. Preservation of Defendant’s Challenges to Jury
Instructions
Rule 10(a)(1) of the North Carolina Rules of Appellate
Procedure states the general rule that “to preserve an issue for
appellate review, a party must have presented to the trial court
a timely request, objection, or motion, stating the specific
grounds for the ruling the party desired the court to make” and
must “obtain a ruling upon the party’s request, objection, or
motion.” Rule 10(a)(2) specifically addresses challenges to jury
instructions and provides that:
A party may not make any portion of the jury
charge or omission therefrom the basis of an
issue presented on appeal unless the party
objects thereto before the jury retires to
consider its verdict, stating distinctly
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that to which objection is made and the
grounds of the objection; provided that
opportunity was given to the party to make
the objection out of the hearing of the
jury, and, on request of any party, out of
the presence of the jury.
As a result, a party waives appellate review of jury
instructions to which no objection is made at trial:
“Rule 10[(a)](2) of our Rules of Appellate
Procedure requiring objection to the charge
before the jury retires is mandatory and not
merely directory.” “[W]here a party fails
to object to jury instructions, it is
conclusively presumed that the instructions
conformed to the issues submitted and were
without legal error.”
Wilson v. Burch Farms, Inc., 176 N.C. App. 629, 633, 627 S.E.2d
249, 254 (2006) (quoting Wachovia Bank v. Guthrie, 67 N.C. App.
622, 626, 313 S.E.2d 603, 606 (1984) (internal quotation
omitted), and Madden v. Carolina Door Controls, 117 N.C. App.
56, 62, 449 S.E.2d 769, 773 (1994) (internal quotation omitted).
In addition, Rule 21 of the General Rules of Practice
provides in pertinent part that in every jury trial, “the trial
judge shall conduct a conference on instructions with the
attorneys of record[,]” that an “opportunity must be given to
the attorneys . . . to request any additional instructions or to
object to any of those instructions proposed by the judge[,]”
and that if “special instructions are desired, they should be
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submitted in writing to the trial judge at or before the jury
instruction conference.” Rule 21 also requires that:
At the conclusion of the charge and before
the jury begins its deliberations, and out
of the hearing, or upon request, out of the
presence of the jury, counsel shall be given
the opportunity to object on the record to
any portion of the charge, or omission
therefrom, stating distinctly that to which
he objects and the grounds of his objection.
If the trial court complies with Rule 21, a party who fails
to object to jury instructions or to submit proposed special
instructions may not raise the issue on appeal:
Defendant failed to object to the trial
court’s instructions [and] . . . did not
object after the trial court instructed the
jury. Defendant was expressly given the
opportunity to object on both occasions in
accordance with the provisions of Rule 21 of
the General Rules of Practice for the
Superior and District Courts. . . .
Defendant has not properly preserved this
issue for appellate review.
State v. Storm, __ N.C. App. __, __, 743 S.E.2d 713, 716 (2013).
C. Instruction on Quantum Meruit
Defendant argues that “the trial court erroneously
submitted the issue of quantum meruit to the jury” on the
grounds that “an express contract governed the relationship of
the parties and thus precluded recovery under a quantum meruit
claim.” We hold that defendant failed to preserve this issue for
appellate review.
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At trial, defendant objected to the admission of evidence
concerning the reasonable value of the additional services
provided by plaintiff, on the grounds that recovery under a
theory of quantum meruit was not allowed where an express
contract governed the same subject matter. Following the
presentation of evidence, the trial court held a conference on
proposed jury instructions. The court informed the parties that
it intended to instruct the jury on two issues pertaining to
plaintiff’s breach of contract claim. The court also informed
the parties that it intended to submit three issues concerning
plaintiff’s quantum meruit claim for payment for additional
services: (1) a special interrogatory asking whether the parties
had abandoned the requirement in the contract that all
additional work be approved in writing; (2) whether plaintiff
had performed additional work; and (3) if so, the amount to
which plaintiff was entitled.
Plaintiff objected to the court’s submission of the
“preliminary issue” of whether the parties had abandoned the
contract provision requiring a written change order as a
prerequisite to plaintiff’s entitlement to recovery under the
theory of quantum meruit. Plaintiff argued that under Yates v.
Body Co., 258 N.C. 16, 128 S.E.2d 11 (1962), it was entitled to
an instruction on quantum meruit because there was evidence to
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support recovery under that theory. Defendant proffered Keith v.
Day, 81 N.C. App. 185, 343 S.E.2d 562 (1986), directing the
court’s attention to its holding that the plaintiff was not
entitled to recover under quantum meruit in the absence of a
jury finding that the parties had abandoned particular
provisions of their express contract. The court denied
plaintiff’s request to submit the issue of quantum meruit
without predicating recovery on a finding that the parties had
abandoned the written change order requirement. The trial court
then asked defendant for any requests or objections, but
defendant neither requested any special instructions, nor
objected to the trial court’s proposed instructions:
THE COURT: Yes. And I haven’t heard from
[defense counsel] the things that he wants.
[DEFENSE COUNSEL]: I didn’t have any changes
in what you had.
After the trial court instructed the jury, but before it began
its deliberations, the court again offered the parties an
opportunity to state specific objections to its instructions, or
to request special instructions:
THE COURT: The jury has retired, and I will
hear from counsel regarding any objections
or requests for additional instructions.
[Your] exceptions and objections during the
charge conference are already [p]reserved.
[PLAINTIFF’S COUNSEL]: Yes, sir. Those are
my objections and exceptions.
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[DEFENSE COUNSEL]: My objections I think
were on the whole issue of quantum meruit
with respect to both cases.
THE COURT: All right. I’ve considered the
arguments previously given on both of those
issues or questions that were raised. Your
objections are noted.
Because defendant had not objected to the court’s proposed
instructions, the reference to an objection to “the whole issue
of quantum meruit with respect to both cases” can only refer to
his objection during trial to testimony concerning the
reasonable value of plaintiff’s services. Defense counsel’s
reference to an earlier objection to the introduction of certain
testimony does not constitute an objection to a specific jury
instruction and does not “stat[e] distinctly that to which
objection is made and the grounds of the objection” as required
by Rule 10 of the Rules of Appellate Procedure. We hold that
defendant failed to preserve the challenge to the trial court’s
instruction on quantum meruit for appellate review.
Moreover, even if this issue were properly preserved, we
would hold that the trial court did not err. Defendant notes the
general rule that “[t]here cannot be an express and an implied
contract for the same thing existing at the same time.” Campbell
v. Blount, 24 N.C. App. 368, 371, 210 S.E. 2d 513, 515 (1975)
(internal citation omitted). However, it is long established
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that “[a] written contract may be abandoned or relinquished [by]
. . . conduct clearly indicating such purpose[.]” Bixler v.
Britton, 192 N.C. 199, 201, 134 S.E. 488, 489 (1926) (citations
omitted).
The heart of defendant’s argument is that
plaintiff’s own evidence showed an express
contract, and that where there is an express
contract, no implied contract can exist. We
recognize the validity of defendant’s
argument as to this principle of contract
law. [However,] . . . plaintiff’s evidence
clearly showed that as plaintiff’s work on
the project progressed, plaintiff . . . was
assured that it would be paid for its work.
Thus, [because the parties’] . . . conduct
clearly indicat[ed] a different
understanding, an implied contract could
arise between them.
John D. Latimer & Assoc. v. Housing Authority of Durham, 59 N.C.
App. 638, 642, 297 S.E. 2d 779, 782 (1982) (citing Campbell v.
Blount) (other citations omitted).
Defendant does not acknowledge that even when parties have
an express contract recovery based on quantum meruit is possible
if there is evidence that the parties abandoned the contract,
and does not attempt to distinguish the cases addressing this
issue. Nor does defendant contest the sufficiency of the
evidence on the issue of abandonment. “[T]he evidence warranted
a finding . . . that the conduct of the parties clearly
indicated that they were not adhering to the written provision
of the contract relative to desired changes in construction.
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Upon abandonment of the quoted provision by the parties, it was
proper for the court to allow recovery for the changes on the
basis of quantum meruit or an implied contract.” Campbell, 24
N.C. App. at 371, 210 S.E. 2d at 515-16. Therefore, if we were
to review this issue we would hold that the trial court did not
err by instructing the jury that, if it found that the parties
had abandoned the contractual requirement of written change
orders, it could then consider whether plaintiff was entitled to
recover based on the reasonable value of its services to
defendant.
D. Other Challenges to Jury Instructions
In addition to challenging the trial court’s instruction on
quantum meruit, defendant contends that the court made a variety
of other errors in its instructions to the jury. However, none
of defendant’s appellate challenges to the court’s instructions
were the subject of an objection or of a request for a special
instruction before the trial court. “A party who is dissatisfied
with the form of the issues or who desires an additional issue
should raise the question at once, by objecting or by presenting
the additional issue. If a party consents to the issues
submitted, or does not object at the time or ask for a different
or an additional issue, he cannot make the objection later on
appeal. Because defendant neither objected to the issue
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submitted to the jury nor asked for a different issue, as the
record unequivocally reveals, it cannot do so on this appeal.”
Hendrix v. Casualty Co., 44 N.C. App. 464, 467, 261 S.E.2d 270,
272-73 (1980) (citing Baker v. Construction Corp., 255 N.C. 302,
121 S.E. 2d 731 (1961) (other citation omitted). Defendant’s
arguments concerning other alleged errors in the court’s
instructions to the jury are dismissed.
III. Judgment Notwithstanding the Verdict
Finally, defendant argues that the trial court “erred in
denying defendant’s motion for judgment notwithstanding the
verdict, when the evidence presented to the court was
insufficient to support the jury’s verdict.” However, defendant
fails to identify any issue or element for which the evidence
was insufficient, or to cite any authority addressing the
sufficiency of evidence of breach of contract or of recovery
under quantum meruit. Instead, defendant makes a conclusory
argument that the “court’s failure to properly and clearly
instruct the jury on the material issues based on the pleadings,
considering all evidence presented, substantially prejudiced the
defendant and therefore the court’s denial of defendant’s
judgment notwithstanding the verdict was improper.”
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Moreover, defendant’s motion for JNOV did not allege that
plaintiff’s evidence was insufficient, but was based solely on
defendant’s contention that the existence of an express contract
precluded recovery based on quantum meruit. “Such a shift runs
contrary to our long standing admonition that parties may not
present, nor prevail upon, arguments in the appellate courts
that were not argued in the trial court. . . . ‘[T]he law does
not permit parties to swap horses between courts in order to get
a better mount’ before an appellate court).’” Hamby v. Profile
Prods., L.L.C., 361 N.C. 630, 642-43, 652 S.E.2d 231, 239 (2007)
(quoting Weil v. Herring, 207 N.C. 6, 10, 175 S.E. 836, 838
(1934)). This argument lacks merit.
For the reasons discussed above, we conclude that the trial
court did not err and that its judgment and order should be
AFFIRMED.
Judges HUNTER, Robert C., and BRYANT concur.