Jeffrey Keith Phillips and Jennifer Phillips v. Eugene Russell

Court of Appeals of Tennessee·Decided March 4, 1996·No. 03A01-9509-CV-00298·Published

Opinion

I N THE COURT OF APPEALS

FILED March 4, 1996

Cecil Crowson, Jr. Appellate C ourt Clerk J EFFREY KEI TH PHI LLI PS a nd ) WASHI NGTON CI RCUI T J ENNI FER PHI LLI PS, ) C. A. NO. 03A01- 9509- CV- 00298 ) ) Pl a i nt i f f s - Appe l l e e s ) ) ) ) ) ) vs . ) HON. G. RI CHARD J OHNSON ) J UDGE BY I NTERCHANGE ) ) ) ) ) EUGENE RUSSELL, ) AFFI RMED AND REMANDED ) De f e nda nt - Appe l l a nt )

TI M OTHY S. BELI SLE, Ande r s on, Fuga t e , Gi ve ns , Count s , & Be l i s l e , J o h n s o n Ci t y, f or Appe l l a nt .

ROBERT J . J ESSEE, J ohns on Ci t y, f or Appe l l e e s .

O P I N I O N

M M r a y, J . c ur The pa r t i e s t o t hi s a p pe a l e nt e r e d i nt o a c ont r a c t whe r e by t h e

a pp e l l a nt wa s t o c ons t r uc t a home f or t he a ppe l l e e s . Pr obl e ms

d e v e l o p e d be t we e n t he pa r t i e s whi c h r e s ul t e d i n a n a c t i on by t h e

p l a i nt i f f s - a ppe l l e e s to r e c ove r da ma ge s f r om t he de f e nda n t -

a pp e l l a nt f or de f e c t i ve wor kma ns hi p i n t he c ons t r uc t i on a n d t o

r e mo v e a c l oud f r om t he i r t i t l e r e s ul t i ng f r om a l i e n f i l e d by t he

d e f e n d a nt . The de f e nda nt f i l ed a c o u n t e r c l a i m a ga i ns t t he

p l a i nt i f f s a n d a c r os s - c l a i m a ga i ns t Shi r l e y G. Hughe s . Shi r l e y

Hu g h e s wa s t r us t e e unde r a de e d of t r us t e xe c ut e d by t he pl a i nt i f f s

t o s e c ur e pa yme nt o f a pr omi s s or y not e i n t he a mount of $80, 000. 0 0 . 1 p a y a b l e t o El i z a be t ht on Sa vi ngs a nd Loa n As s oc i a t i on.

I n hi s c ount e r c l a i m, t he de f e nda nt s ought to r e c ove r t he

unpa i d ba l a nc e of t he c ont r a c t pr i c e pl us a dd i t i ona l s ums he

c l a i ms t o h a v e e xpe nde d i n t he c ons t r uc t i on of t he hous e . He

a l l e g e s t ha t he i s e nt i t l e d t o r e c ove r f r om t he pl a i nt i f f s on t he

t h e o r y of qua nt um me r ui t . No r e c ove r y i s s ought a ga i ns t t he c r os s -

d e f e n d a nt .

Af t e r a be nc h t r i a l t he c our t r e s ol ve d t he i s s ue s i n f a vor o f

t he p l a i nt i f f s a nd a wa r de d j udgme nt a ga i ns t t he d e f e nda nt i n t h e

a mo u n t of $3, 412. 69. Fr om t hi s j udgme nt t he de f e nda nt ha s a ppe a l e d

a n d p r e s e nt s t he f ol l owi ng i s s ue s f or our c ons i de r a t i on:

1 For simplicity, the parties will be referred to in the capacity in which they appeared in the trial court.

2 1. W t he r t he c onduc t of t he pl a i nt i f f s , i n p e r - he mi t t i ng t he de f e nda nt t o c ont i nue wo r k on pl a i n- t i f f s ’ hous e de s pi t e pe r c e i ve d de vi a t i ons f r om t he c ont r a c t a n d i n not a l l owi ng t he de f e nda nt s uf f i - c i e nt oppor t uni t y t o c or r e c t t he de f e c t s a f t e r not i c e t ha t t he pl a i nt i f f s ’ i nt e nde d t o wi t hhol d pa yme nt u nt i l t he de f e c t s we r e c or r e c t e d, s houl d pr e c l ude t he m f r om pr e va i l i ng a ga i ns t t he de f e n- da nt .

2. W t he r t he t r i a l c our t e r r e d i n a wa r di ng j udgme nt he t o p l a i nt i f f s wh e r e t he e vi de nc e f a i l e d t o e s t a b- l i s h p l a i nt i f f ’ s ’ e nt i t l e me nt t o j udgme nt .

3. W t he r de f e nda nt he i s e nt i t l e d t o j udgme nt a ga i ns t t he p l a i nt i f f s .

W wi l l f i r s t c ons i de r t he t hi r d i s s ue . e I t i s undi s put e d t ha t

t he d e f e nda nt - c ount e r - pl a i nt i f f wa s not a l i c e ns e d c ont r a c t o r . 2 T. C. A. § 62- 6- 103 pr ovi de s i n pe r t i ne nt pa r t a s f ol l ows :

62- 6- 103. Li c e ns e r e qui r e m nt - Re c ove r y of e xpe ns e s e by unl i c e ns e d c ont r ac t or . ( a ) ( 1) Any pe r s on , f i r m or c o r por a t i on e nga ge d i n c ont r a c t i ng i n t hi s s t a t e s ha l l be r e qui r e d t o s ubmi t e vi de nc e t ha t s uc h pe r s on, f i r m or c o r po r a t i on i s qua l i f i e d t o e nga ge i n c ont r a c t i ng, a nd s ha l l be l i c e ns e d a s he r e i na f t e r pr ovi de d. I t i s unl a wf ul f or a ny pe r s on, f i r m or c or por a t i on t o e nga ge i n or of f e r t o e nga ge i n c ont r a c t i n g i n t he s t a t e , u nl e s s s uc h p e r s on, f i r m or c or po r a t i on ha s be e n dul y l i c e ns e d unde r t he pr ovi s i ons of t hi s c ha pt e r , a s he r e i na f t e r pr ovi de d. An y pe r s on, f i r m or c or por a t i on e nga ge d i n c ont r a c t i ng, i n c l udi ng s uc h pe r s on, f i r m or c or por a t i on t ha t e nga ge s i n t he c ons t r uc t i on of r e s i de nc e s or dwe l l i ngs c on- s t r uc t e d on pr i va t e pr ope r t y f or t he pur pos e of r e s a l e , l e a s e , r e nt or a ny ot he r s i mi l a r pur pos e , s ha l l be r e qui r e d t o s ubmi t e vi de nc e t ha t s uc h pe r s on, f i r m or c o r por a t i on i s qua l i f i e d t o e nga ge i n c ont r a c t i ng a nd/ or b u i l di ng, a nd s ha l l be l i c e ns e d. I t i s unl a wf ul f or a ny

2 T.C.A. § 62-6-103 was amended in 1994. The text set out here is the text as it existed before the 1994 amendment.

3 p e r s on, f i r m, or c or por a t i on t o e nga ge i n, or of f e r t o e n ga ge i n, c ont r a c t i ng or bui l di ng a s he r e i na bove d e s c r i be d, unl e s s s uc h pe r s on, f i r m or c or por a t i on ha s b e e n dul y l i c e ns e d unde r t he pr ovi s i ons of t hi s c ha pt e r .

* * * *

( c ) Any unl i c e ns e d c ont r a c t or c ove r e d by t he p r ovi s i ons of t hi s c ha pt e r s ha l l be pe r mi t t e d i n a c our t o f e qui t y t o r e c ove r a c t ua l doc ume nt e d e xpe ns e s onl y upon a s howi ng of c l e a r a nd c onvi nc i ng pr oof .

To a voi d t he c ons e que nc e s of t hi s s t a t ut e , t he de f e nda n t

t h e or i z e s t ha t t he pl a i nt i f f s ar e e s t oppe d f r om a s s e r t i ng t he

u n l i c e n s e d s t a t us of t he de f e nda nt . De f e nda nt i ns i s t s t ha t t he

pl a i nt i f f s ' a c t i ons i n a l l owi ng hi m t o go f or wa r d knowi ng t ha t h e

wa s u n l i c e ns e d c r e a t e d a n e s t oppe l . No a ut hor i t y i s c i t e d t o u s

a nd we h a ve f ound none whe r e by e s t oppe l c a n be s uc c e s s f ul l y i nvok e d

t o d e f e a t t he pur pos e s of t he a bove s t a t ut e . Eve r yone i s pr e s u me d

t o k n o w t he l a w. Da vi s v. M t r opol i t a n Gove r nme nt of Na s hvi l l e , e

6 2 0 S. W 2d 532 ( Te nn. . App . 1981) . The r e f or e , t he de f e nda nt is

c ha r g e a bl e wi t h t he knowl e dge t ha t he c oul d r e c ove r no mor e t h a n

t he s t a t ut e a l l ows , i . e . , a c t ua l doc ume nt e d e xpe ns e s a nd t he n, a nd

o n l y t h e n, upon a s howi ng, by c l e a r a nd c onvi nc i ng pr oof , t ha t h e

i n c u r r e d t he e xpe ns e s . To hol d o t he r wi s e woul d be t o c r e a t e a

j ud i c i a l e xc e pt i on t o t he s t a t ut e whi c h we a r e unwi l l i ng t o do. We

h o l d t h a t e s t oppe l doe s not a ppl y unde r t he c i r c ums t a nc e s of t h i s

case.

4 As doc ume nt e d pr oof , t he de f e nda nt of f e r e d i nt o e vi de n c e

c he c ks i n t he t ot a l a mount of $88, 774. 32, whi c h he c l a i ms r e-

p r e s e nt e d moni e s e xpe nde d on t he pl a i nt i f f s ’ hous e .

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