Bowen v. Gardner

425 S.W.3d 875, 2013 Ark. App. 52, 79 U.C.C. Rep. Serv. 2d (West) 560, 2013 WL 356047, 2013 Ark. App. LEXIS 69
CourtCourt of Appeals of Arkansas
DecidedJanuary 30, 2013
DocketNo. CA 12-578
StatusPublished
Cited by4 cases

This text of 425 S.W.3d 875 (Bowen v. Gardner) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bowen v. Gardner, 425 S.W.3d 875, 2013 Ark. App. 52, 79 U.C.C. Rep. Serv. 2d (West) 560, 2013 WL 356047, 2013 Ark. App. LEXIS 69 (Ark. Ct. App. 2013).

Opinion

PHILLIP T. WHITEAKER, Judge.

1 Appellants James Bowen and Richard Cagle, doing business as B & C Shavings (B & C), appeal from an order of the Washington County Circuit Court finding no valid contract existed between the parties and awarding damages for unjust enrichment. We affirm, although for different reasons than those set out by the circuit court.

In June 2009, Kendall Gardner approached B & C about purchasing a shavings mill to produce wood shavings for poultry processors. The parties agreed that B & C would build an eight-foot shaving mill for Gardner. On July 13, 2009, B & C faxed an invoice to Gardner reflecting a purchase price of $86,200, a thirty-percent down payment of $25,860, and a “balance due before shipment” of $60,340. Gardner sent a payment of $25,920, which included the bank’s fees, via wire transfer to B & C on July 14, 2009.

In August 2009, Gardner discovered that the poultry plants with whom he had planned on doing business were no longer interested in purchasing wood shavings. Gardner called |2Cagle to inform him of the situation and to see if B & C could stop production of the machine.

On September 10, 2009, B & C wrote a letter to Gardner informing him that the shaving machine had been finished and that the balance of $60,340 was due. The letter further stated that Gardner had “ten days from this date ... to pay the balance due or you will lose the down payment that you paid.” Gardner spoke with Cagle several times on the phone that weekend and eventually responded with a letter dated September 14, 2009, in which he explained his financial circumstances and asked B & C to help him recover part of his down payment. B & C eventually sold the machine to another company for $86,500 in November 2009. B & C never returned any of Gardner’s down payment to him.

Gardner filed a complaint seeking recovery of the down payment and raising claims of unjust enrichment, breach of contract, and statutory restitution pursuant to Arkansas Code Annotated section 4-2-718. B & C answered, contending that it had an express agreement for the purchase of the shaving machine and that the terms included the forfeiture of down payment.

The matter proceeded to bench trial in April 2012. Gardner testified that the only written agreement between him and B & C was the “quote sheet” B & C faxed to him. He also stated that he never had a discussion with B & C as to whether the down payment would be refunded if the sale were not completed. He testified that Cagle assured him that the machine would sell and, upon the sale, Gardner would get his money back. On cross-examination, Gardner admitted that his September 14, 2009 letter did not object to B & C’s warning about losing his deposit; he asserted, however, that the letter from B & C was the first time he had |sheard about that term.

Richard Cagle testified that the eight-foot machine ordered by Gardner was unusual in the industry and was a special order. Cagle disputed Gardner’s testimony concerning the down payment. He stated that he explained to Gardner that if the machine was not purchased after it was built, Gardner would lose his money. Cagle also testified that B & C was able to sell the machine after providing additional work to meet the new purchaser’s specifications. James Bowen, the other partner in B & C, testified that B & C spent $10,406.67 in order to be able to sell the machine to another company.

At the conclusion of the ⅛⅛1⅜ the circuit court found that the bid or quote that B & C faxed to Gardner did not constitute a contract. The court concluded that whether the down payment was refundable was an “incredibly material term and provision” that was omitted. The court stated as follows:

So as a matter of law, I’m finding that no contract exists and that a material term was omitted, namely whether or not this down payment was refundable.
Because we do not have a contract, Plaintiffs Complaint, with respect to Counts It1] and 3 fail and will be dismissed because there is no contract for which Plaintiff can recover for breach of contract.
This clearly, in this court’s view, violates the statute of frauds. It’s well-known to counsel here that the law is long in explaining why we have the necessity of written contracts which contain sufficient terms that the parties know where they , stand in entering into a contract like this. And in this court’s view, you’ve violated the statute of frauds, and that’s why we’re here today.

Given the lack of a valid contract, the court went on to find that Gardner was entitled 14to recover on his theory of unjust enrichment. The court appeared to credit Gardner’s testimony that he had conversations with Cagle concerning recovery of his down payment once the machine was sold. The court concluded that “the equitable thing here” would be for B & C to return Gardner’s down payment to him, less the money that B & C spent making modifications to the machine so that it could be sold. The court therefore subtracted the $10,406 in modifications from the $25,860 down payment and concluded that Gardner was entitled to be awarded $15,454, plus postjudgment interest. The circuit court’s judgment was entered on April 12, 2012. B & C filed a timely notice of appeal and raises two arguments for reversal: (1) the circuit court erred in finding that there was no valid contract, and (2) the circuit court erred in awarding damages to Gardner on a theory of unjust enrichment.

In bench trials, the standard of review on appeal is whether the circuit court’s findings were clearly erroneous or clearly against the preponderance of the evidence. Benefit Bank v. Rogers, 2012 Ark. 419, 424 S.W.3d 812; McQuillan v. Mercedes-Benz Credit Corp., 331 Ark. 242, 961 S.W.2d 729 (1998); Ark. R. Civ. P. 52(a) (2012). We view the evidence in the light most favorable to the appellee, resolving all inferences in favor of the appellee. Benefit Bank, supra. Further, when there is testimony in conflict on the issue of whether the parties agreed to the terms of a contract, a factual question arises that is to be determined by the trial court. Price v. Willbanks, 2009 Ark. App. 849, 374 S.W.3d 28. Disputed facts and determinations of the credibility of witnesses are within the province of the fact-finder. Benefit Bank, supra. A trial court’s conclusions on questions of law, however, are reviewed de novo and given no deference on appeal. Hall v. Bias, 2011 Ark. App. 93, 381 S.W.3d 152.

|fiThe circuit court found no valid contract existed because there was “insufficient evidence of a writing sufficient to indicate that a contract for sale was made between the parties,” citing Arkansas Code Annotated section 4-2-201(1) (Repl. 2001). That statute provides as follows:

Except as otherwise provided in this section ^a contract for the sale of goods for the.

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425 S.W.3d 875, 2013 Ark. App. 52, 79 U.C.C. Rep. Serv. 2d (West) 560, 2013 WL 356047, 2013 Ark. App. LEXIS 69, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bowen-v-gardner-arkctapp-2013.