Tsonev v. McAir

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA19-674
Filed: 4 August 2020
Dare County, No. 16-CVS-644
DIANA TSONEV for the ESTATE of ROBERT SHEARER and MINERVA SHEARER
by DIANA TSONEV, Plaintiffs,
v.
MCAIR, INC. d/b/a OUTER BANKS HEATING & COOLING and MCAIR, INC. d/b/a
DR. ENERGY SAVER, Defendant.
Appeal by plaintiffs from orders entered 20 March 2019 by Judge Alma Hinton
in Dare County Superior Court. Heard in the Court of Appeals 7 January 2020.
The Wills Law Group, by Gregory E. Wills, for plaintiff-appellants.
McAngus Goudelock & Courie, PLLC, by Walt Rapp and Sean R. Madden, for
defendant-appellees.
BRYANT, Judge.
Parties are generally free to contract as they see fit. Where, as here, the
contract contains an express provision that no action may be brought more than two
years after the completion of the work contracted, we affirm the trial court’s directed
verdict dismissing an action commenced more than five years after completion of the
work.
PROCEDURAL HISTORY/ FACTS
TSONEV V. MCAIR, INC.
Opinion of the Court
Mr. and Mrs. Robert Shearer, represented by Diana Tsonev,1 (“plaintiffs”) filed
a complaint against defendant McAir, Inc. d/b/a Outer Banks Heating and Cooling
(“defendant McAir OBHC”) and McAir, Inc, d/b/a Dr. Energy Saver (“defendant McAir
DES”) (collectively “defendants”) on 29 November 2016 in Dare County Superior
Court. Plaintiffs alleged that defendants did not properly remediate flood damage to
their home and negligently caused damage in excess of $25,000. Plaintiffs sought
recovery for negligence, negligent misrepresentation, breach of contract, breach of
implied warranty, and breach of express warranty. On 28 January 2019, a jury trial
commenced before the Honorable Alma Hinton, Judge presiding.
The evidence of record shows that plaintiffs owned a house in Kill Devil Hills,
North Carolina. On 27 August 2011, the home was damaged by flood waters as a
result of Hurricane Irene. Plaintiffs hired defendant McAir OBHC to repair the
HVAC system, which included replacing the duct system under the house. Defendant
McAir informed plaintiffs that their affiliated company, defendant McAir DES, could
remediate other damage to the subfloor and crawlspace under the house. Defendant
McAir DES submitted a proposal to plaintiffs detailing the scope of the work to be
performed, which included six items. Defendant McAir DES would (1) remove all
insulation under the home, (2) foam seal the chimney base and all penetrations of
electrical or plumbing works, (3) treat all biochemical areas of the crawlspace, (4)
1 Upon the death of Robert Shearer his daughter, Diana Tsonev, was allowed to be substituted
as plaintiff for Robert and allowed to represent Minerva Shearer as her attorney in fact.
-2-
TSONEV V. MCAIR, INC.
Opinion of the Court
install new R-19 bat insulation, (5) clean all wood in the crawlspace, and (6) clean up
and remove all debris. The proposal stated that a chemical treatment and seal
(“Aftershock”) would be applied in order to stop existing mold growth. A number of
terms and conditions provided that the contract would supply only the work specified
and that all services performed and materials supplied would be free from defects for
two years following installation. “[Defendant McAir DES] [is] not liable for any
consequential, incidental, indirect, punitive, treble, speculative, or special damages
of any kind whatsoever, and [purchasers] may not bring any action against
[defendant McAir DES] more than two (2) years after the Completion Date.” Finally,
the proposal contained a merger clause which stated the following:
This Agreement (and all attachments) contain the entire,
final agreement between you and us, and supersedes all
prior written and oral agreements, proposals, and
understandings. You (i) have had the opportunity to
review it with an attorney of your choice, (ii) have read and
understood each part, (iii) are satisfied with all of its
provisions, and (iv) affirm that neither we, nor any of our
representatives, have made, nor have you relied on any
other representatives or promises, oral or otherwise, that
are outside this Agreement. All waivers must be in writing
to be effective.
Plaintiffs signed and accepted the proposal on 2 September 2011. The crawlspace
remediation was completed at the end of September 2011.
Almost five years later, in July 2016, plaintiffs noticed that the floor of the
residence was sagging. Thereafter, plaintiffs discovered that in the crawlspace, the
-3-
TSONEV V. MCAIR, INC.
Opinion of the Court
wood which had been painted with Aftershock had rotted. A building inspector later
examined the crawlspace. Floor joists and girders had failed and collapsed, and the
rest were in the process of failing. The inspector condemned the house as being
unsafe for human occupants.
Following the close of plaintiff’s case-in-chief, the court rendered a directed
verdict in favor of defendants. Plaintiffs filed a motion for a new trial. On 20 March
2019, the court entered its written order granting defendants’ motion for directed
verdict.
[T]he [c]ourt . . . finds that there is a contract in this case
that calls for any action to be taken within two years. That
action was not taken. The contract was signed by [p]laintiff
and it appears to be a valid contract acknowledged by
[defendant McAir DES], or a representative thereof, that
requires action to be taken within two years.
On 20 March 2019, the court also entered its order denying plaintiffs’ motion for a
new trial. Plaintiffs appeal both orders.
_______________________________________________________
On appeal, plaintiffs contend the trial court erred by (I) failing to apply the
“discovery rule,” (II) excluding evidence in support of the claim for negligent
misrepresentation, (III & IV) excluding expert witness testimony, and (V) entering a
directed verdict and failing to grant plaintiffs’ motion for a new trial.
Standard of Review
-4-
TSONEV V. MCAIR, INC.
Opinion of the Court
When considering a motion for a
directed verdict, a trial court must view the
evidence in the light most favorable to the
non-moving party, giving that party the
benefit of every reasonable inference arising
from the evidence. Any conflicts and
inconsistencies in the evidence must be
resolved in favor of the non-moving party. If
there is more than a scintilla of evidence
supporting each element of the non-moving
party’s claim, the motion for a directed verdict
should be denied.
. . . [B]ecause the trial court’s ruling on a motion for a
directed verdict addressing the sufficiency of the evidence
presents a question of law, it is reviewed de novo.
Bradley Woodcraft, Inc. v. Bodden, 251 N.C. App. 27, 31, 795 S.E.2d 253, 257 (2016)
(citations omitted).
I
Plaintiffs argue that the trial court erred by granting the motion for a directed
verdict and not applying the “discovery rule,” pursuant to N.C. Gen. Stat. §§ 1-52(16)
and 1-50(5) (describing periods of repose and limitation for the commencement of
actions arising from improvements to real property). Plaintiffs contend that the
directed verdict granted on the basis of their failure to bring this action within the
two-year period expressed in the contract was improper as they commenced the action
within the periods set by our statutes of limitation and repose as defined by sections
1-52(16) and -50(5). We disagree.
-5-
TSONEV V. MCAIR, INC.
Opinion of the Court
N.C. Gen. Stat. § 1-52(16) states that “unless otherwise provided by law, for . .
. physical damage to claimant’s property, the cause of action . . . shall not accrue until
. . . physical damage to his property becomes apparent . . . .” N.C. Gen. Stat. § 1-
52(16) (2019). Additionally, N.C. Gen. Stat. § 1-50(5) states that,
[n]o action to recover damages based upon or arising out of
the defective or unsafe condition of an improvement to real
property shall be brought more than six years from the
later of the specific last act or omission of the defendant
giving rise to the cause of action or substantial completion
of the improvement.
Id. § 1-50(5).
N.C. Gen. Stat. § 1-50(5) sets out a six-year statute of repose that is meant to
provide “protection to those who make improvements to real property.” Christie v.
Hartley Constr., 367 N.C. 534, 540, 766 S.E.2d 283, 288 (2014). In Christie, our
Supreme Court reasoned that there was “no public policy reason why the beneficiary
of a statute of repose cannot bargain away, or even waive, that benefit.” Id. at 540,
766 S.E.2d 283, 287. “North Carolina has long recognized that parties generally are
‘free to contract as they deem appropriate.’ ” Id. at 540, 766 S.E.2d 283, 287 (quoting
Hlasnick v. Federated Mut. Ins. Co., 353 N.C. 240, 244, 539 S.E.2d 274, 277 (2000)).
This Court has also stated that when “the language of a contract ‘is clear and only
one reasonable interpretation exists, the courts must enforce the contract as written.’
” State ex rel. Utils. Comm’n v. Thrifty Call, Inc., 154 N.C. App. 58, 63, 571 S.E.2d
622, 626 (2002) (quoting Woods v. Nationwide Mut. Ins. Co., 295 N.C. 500, 506, 246
-6-
TSONEV V. MCAIR, INC.
Opinion of the Court
S.E.2d 773, 777 (1978)); see also Hall v. Refining Co., 242 N.C. 707, 709, 89 S.E.2d
396, 397 (1955) (“While contracts exempting persons from liability for negligence are
not favored by the law, and are strictly construed against those relying thereon
nevertheless, the majority rule, to which we adhere, is that, subject to certain
limitations . . . a person may effectively bargain against liability for harm caused by
his ordinary negligence in the performance of a legal duty arising out of a contractual
relation.” (citations omitted)); Bob Timberlake Collection, Inc. v. Edwards, 176 N.C.
App. 33, 43–44, 626 S.E.2d 315, 323–24 (2006) (holding that the plaintiff’s failure to
adhere to the express provision of the contract—setting the period during which an
action for damages could be brought—was controlling).
Agreements signed by plaintiffs can exempt defendants from liability for
negligence alleged in the complaint. See Hall, 242 N.C. at 709, 89 S.E.2d at 397 (“[A]
person may effectively bargain against liability for harm caused by his ordinary
negligence in the performance of a legal duty arising out of a contractual relation.”
(citations omitted)). While we are not unsympathetic to the injury suffered to
plaintiffs’ real property and otherwise, our sympathy cannot displace our duty to
apply the law. Had plaintiffs not signed the agreement which clearly limited the time
in which an action could be brought, plaintiffs’ claims could have gone forward subject
to the discovery rule and/or the statute of repose. However, absent evidence of fraud
or misrepresentation in the making of the contract, plaintiffs are bound by the
-7-
TSONEV V. MCAIR, INC.
Opinion of the Court
language in the contract into which they entered. See Herring v. Herring, 231 N.C.
App. 26, 28, 752 S.E.2d 190, 192 (2013) (“[A]ny . . . contract . . . may be set aside or
reformed based on grounds such as fraud, mutual mistake of fact, or unilateral
mistake of fact procured by fraud.” (citations omitted)); Top Line Constr. Co. v. J.W.
Cook & Sons, Inc., 118 N.C. App. 429, 432–33, 455 S.E.2d 463, 465 (1995) (affirming
summary judgment against the plaintiff who sought monetary damages for work
completed but not compensated where the plaintiff expressly agreed to be bound by
the decision of a third party architect or engineer as to the satisfaction, approval, or
acceptance of the plaintiff’s work).
In the instant case, the contract provided that the writing contained the entire,
final agreement of the parties. The provisions of the contract included an express
limitation: “[defendant is] not liable for any consequential, incidental, indirect,
punitive, treble, speculative, or special damages of any kind whatsoever, and you may
not bring any action against us more than two (2) years after the Completion Date.”
(emphasis added). The crawlspace remediation was completed in September 2011.
Plaintiffs’ brought suit in November 2016, more than five years later.
Because the express provision of the contract is clear, the contract must be
enforced as written. See Hall, 242 N.C. at 709, 89 S.E.2d at 397; Herring, 231 N.C.
App. at 28, 752 S.E.2d at 192; Bob Timberlake Collection, Inc., 176 N.C. App. at 43–
44, 626 S.E.2d at 323–24; Thrifty Call, Inc., 154 N.C. App. at 63, 571 S.E.2d at 626;
-8-
TSONEV V. MCAIR, INC.
Opinion of the Court
Top Line Constr. Co., 118 N.C. App. at 432–33, 455 S.E.2d at 465. The trial court did
not err by failing to apply the discovery rule in accordance with N.C. Gen. Stat. §§ 1-
52(16) and 1-50(5), and thus, plaintiff’s argument is overruled. Accordingly, we
affirm the 20 March 2019 order of the trial court granting defendants’ motion for a
directed verdict.
As we affirm the court’s 20 March 2019 order granting defendant’s motion for
a directed verdict based on the express limitation in the contract, we need not reach
plaintiffs’ remaining arguments.
AFFIRMED.
Judges ZACHARY and COLLINS concur.
-9-