THIS OPINION HAS NO PRECEDENTIAL VALUE. IT
SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED
BY RULE 239(d)(2), SCACR.
THE STATE OF SOUTH CAROLINA
In The Court of Appeals
Mark New and Karen New,
Respondents,
v.
Max G. Crosby Construction Co., Inc.,
Appellant.
Appeal From Dorchester County
Diane Schafer Goodstein, Circuit Court
Judge
Unpublished Opinion No. 2004-UP-282
Heard January 13, 2004 Filed April 27, 2004
AFFIRMED IN PART, REVERSED IN PART,
AND REMANDED
Stephen L. Brown, of Charleston, for Appellant.
Steven L. Smith, Esquire and Wm. Mark Koontz, both of Charleston, for Respondents.
PER CURIAM: Purchasers of a home sued the
property development company that sold them the home and the construction company
that built the home for the structural damages resulting from construction.
The construction company, Crosby Construction Company (Crosby Construction),
appeals the jury verdict in favor of the purchasers. We affirm in part, reverse
in part, and remand.
FACTS
Crosby Construction was a charter member
of the Southern Living Builder Program and agreed to build homes according to
Southern Living plans and specifications. However, Max Crosby, owner of Crosby
Construction, testified that Crosby Construction was allowed to alter the Southern
Living plans. Crosby Construction contracted with Greenwood Development Corporation
(Greenwood) to build five model homes in Coosaw Creek Country Club in North
Charleston, South Carolina. One of the five homes built by Crosby Construction
for Greenwood was the home eventually purchased by Mark and Karen New.
Crosby Construction and Greenwood agreed
to numerous modifications of the Southern Living plans with regards to the house
in question. Specifically, the basement was eliminated, a finished media room
was provided, and the master bedroom and kitchen were made larger. Additionally,
rather than utilizing steel beams, as the original Southern Living plans specified,
Crosby Construction changed the design to utilize wooden beams, which Max Crosby
believed were appropriate.
Crosby Construction completed the home
for Greenwood in June of 1998. Greenwood used it as a model home, advertised
the home as a Southern Living home, and sold the home to the News on October
21, 1998. Crosby Construction had no hand in the sale of the house from Greenwood
to the News, and the News contract with Greenwood made no mention of Crosby
Construction. Mark New testified that he and Karen understood they were purchasing
a Southern Living home.
The News discovered several problems with
their home. Most significantly, the News at some point discovered a hump and
sag in their second story floor. Investigation revealed the wood beams Crosby
Construction had substituted for the specified steel beams proved inadequate
to support the load placed on them. Crosby Construction sent a subcontractor
in to fix the beam causing the sag, however, it was inadequate. Other problems
discovered by the News included a leaking roof, inadequate foundation, an incorrectly
sloped yard that did not drain, a bowed exterior wall, cupped and warped floors,
a poorly built retention wall, and poor flashing.
The News brought suit against Greenwood
and Crosby Construction, alleging the breach of several implied warranties,
negligence, and unfair trade practices. The News sought actual and punitive
damages against Crosby Construction and Greenwood. Crosby Construction and
Greenwood filed answers denying the material allegations and asserting various
affirmative defenses. The News subsequently dismissed the action against Greenwood
and chose instead to proceed exclusively against Crosby Construction.
After directing a verdict against the
News on their claim for unfair trade practices, the trial court denied Crosby
Constructions directed verdict motions and objections to the charges presented
to the jury. At the conclusion of the four-day trial, the jury returned a verdict
against Crosby Construction for $285,942 in actual damages. Crosby Construction
then filed post-trial motions for a JNOV, a new trial absolute, and a new trial
nisi remittitur. These motions were denied. This appeal follows.
LAW/ANALYSIS
I. STIGMA DAMAGES
Crosby Construction contends the circuit court
erred in refusing to grant its motion for directed verdict as to the News claim
of diminution in property value, or stigma damages. Crosby Construction also
contends the circuit court erred in failing to grant a new trial absolute where
there was no evidence to support the jurys award. We agree.
A. Directed Verdict
At trial, Crosby Construction moved for
a directed verdict on the News claim for stigma damages, arguing there was
no testimony regarding the value of the home after repairs and to award both
the cost of repairs and stigma damages would amount to double recovery. The
circuit court disagreed, finding Dr. New had testified to the value of the home
after all the repairs had been made, amounting to diminution in value. Crosby
Construction contends the circuit court erred in allowing the question of stigma
damages to go to the jury.
In ruling on motions for directed verdict,
the trial court is required to view the evidence and the inferences that reasonably
can be drawn therefrom in the light most favorable to the party opposing the
motion[] and to deny the motion[] where either the evidence yields more than
one inference or its inference is in doubt. Strange v. S.C. Dept of Highways
& Pub. Transp., 314 S.C. 427, 429-30, 445 S.E.2d 439, 440 (1994). We
will reverse the trial court only when there is no evidence to support the ruling
below. Id. at 430, 445 S.E.2d at 440.
Stigma, or diminution in value, damages are generally
awarded when there is a permanent injury to real property. See Gray
v. S. Facilities, Inc., 256 S.C. 558, 569, 183 S.E.2d 438, 443 (1971) (holding
that [t]he general rule is that in case of an injury of a permanent nature
to real property . . . the proper measure of damages is the diminution of the
market value by reason of that injury, or in other words, the difference between
the value of the land before the injury and its value after the injury). Thus,
where there is a permanent injury to land, damages are based on the diminution
in value of the property based on its value before the injury and after the
injury. Yadkin Brick Co. v. Materials Recovery Co., 339 S.C. 640, 645,
529 S.E.2d 764, 767 (Ct. App. 2000).
While proof, with mathematical certainty, of the amount
of loss or damage is not required, in order for damages to be recoverable the
evidence should be such as to enable the court or jury to determine the amount
thereof with reasonable certainty or accuracy. Neither the existence, causation
nor amount of damages can be left to conjecture, guess or speculation.
Gray, 256 S.C. at 570-71, 183 S.E.2d at 444.
The News presented evidence at trial that
repairs to their home would cost $129,930.42. This figure consisted of estimates
to repair the foundation, flashing, roof leaks, ridge beam and holes, landscaping
problems, as well as cosmetic damages. Although the News experts testified
that repairing the problems would not give the News the Southern Living home
they expected, they stated the problems could all be repaired. However, one
expert opined that an entire new roof would need to be put in place because
there would always be leaks even if the current roof were repaired.
Dr. Mark New testified at trial that he wanted
the jury to give him enough money to repair the house. He also expressed concern
that he would have to disclose the structural damage to the house upon resale.
Dr. New estimated the value of the home if it were in good condition to be $550,000.
When asked to estimate the value of the home in its present condition, Dr.
New stated it would be $300,000 to $350,000. Thus, we interpret Dr. News
testimony to state that the difference in value of the home if it had been built
in accordance with Southern Living plans and the value of the home in its then
current, unrepaired state to be between $200,000 and $250,000.
Viewing the evidence in the light most favorable
to the News, no evidence was presented as to the diminution in value of the
home if all the repairs were performed. Although Dr. New testified regarding
the problems disclosing the prior structural damage would pose in trying to
sell the house, he did not place a value on the home after repairs were performed.
His testimony only addressed the value of the home in its unrepaired state and
the value of the home had it been constructed according to the Southern Living
plans. As Crosby Construction argued before the circuit court, allowing recovery
for both the cost of repairs and the diminution in value of the home prior to
repairs would amount to double recovery. Further, the failure to present evidence
of the diminution in value of the repaired home left the jury to speculate as
to the amount of stigma damages. Because there was no testimony regarding the
amount of stigma damages, the circuit court erred in failing to direct a verdict
on this theory of recovery. [1]
Gray, 256 S.C. at 570-71, 183 S.E.2d at 444; see also Collins
Music Co. v. Smith, 332 S.C. 145, 147, 503 S.E.2d 481, 482 (Ct. App. 1998)
(noting the general rule that there can be no double recovery for a single injury).
Accordingly, we reverse the circuit courts denial of the motion for a directed
verdict as to stigma damages.
B. New Trial Absolute
Crosby Construction argues the circuit court erred in failing to
grant a new trial absolute because there was no evidence to support the jurys
award. We agree.
The decision to grant or deny a motion
for a new trial absolute is within the trial courts discretion and will not
be reversed unless the courts decision is wholly unsupported by the evidence
or the conclusions reached are controlled by error of law. Vinson v. Hartley,
324 S.C. 389, 405, 477 S.E.2d 715, 723 (Ct. App. 1996). In determining whether
the trial court erred in denying a motion for a new trial, we must look at the
testimony and inferences raised therefrom in favor of the nonmoving party.
Id.; Welch v. Epstein, 342 S.C. 279, 302-03, 536 S.E.2d 408, 420
(Ct. App. 2000).
The circuit court may grant a new trial absolute
in two instances. The court must grant a motion for a new trial absolute when
the verdict is so grossly excessive that it shocks the conscience of the court
and clearly indicates the verdict was the result of caprice, passion, prejudice,
partiality, corruption, or other improper motive. Duncan v. Hampton Co.
Sch. Dist. No. 2, 335 S.C. 535, 547, 517 S.E.2d 449, 455 (Ct. App. 1999)
(quoting Knoke v. South Carolina Dept of Parks, Recreation & Tourism,
324 S.C. 136, 141, 478 S.E.2d 256, 258 (1996)). Alternatively, the trial court
may grant a new trial absolute when, sitting as the thirteenth juror,
it concludes the jurys verdict is not supported by the evidence. Duncan,
335 S.C. at 547, 517 S.E.2d at 455 (emphasis in original). However, substantial
deference should be given to a jurys determination of damages. Knoke,
324 S.C. at 141, 478 S.E.2d at 258.
The jury rendered a general verdict in
favor of the News in the amount of $285,942. The evidence presented at trial
showed that it would cost $129,930.42 to make the repairs to the home. Dr.
New opined that his home was worth between $200,000 and $250,000 less in its
unrepaired state than it would be worth had the home been built to Southern
Living specifications. As discussed above, this estimate does not indicate
the depreciation to the home after repairs are made and cannot be considered
in isolation. Giving substantial deference to the jurys verdict, there is
not any evidence in the record to support a verdict $155,000 greater than the
estimate of damages. Because there was no evidence to support the amount of
the jurys verdict, the circuit court erred by failing to grant Crosby Constructions
motion for a new trial absolute. Accordingly, we reverse the circuit courts
denial of the motion and remand the case for a new trial absolute.
II. Insurance Testimony
Crosby Construction asserts the circuit court erred
in admitting into evidence information regarding the insurance related work
of one of its experts. We disagree.
Generally, the fact that a defendant is protected
by insurance from liability in an action for damages shall not be made known
to the jury. Dunn v. Charleston Coca-Cola Bottling Co., 311 S.C. 43,
45, 426 S.E.2d 756, 757 (1993). The rule protects against unfair prejudice
in the verdict that might result from the jurys knowledge that the defendant
will not have to pay the award amount. Dunn, 311 S.C. at 45, 426 S.E.2d
at 757-58. However, this general rule does not require evidence of insurance
to be kept from the jury where it is offered for some other purpose. Rule 411,
SCRE provides:
Evidence that a person was or was not insured against liability
is not admissible upon the issue whether the person acted negligently or otherwise
wrongfully. This rule does not require the exclusion of evidence of insurance
against liability when offered for another purpose, such as proof of agency,
ownership, or control, or bias or prejudice of a witness.
Rule 411, SCRE.
Our Supreme Court has adopted a substantial
connection analysis to determine whether an experts connection to a defendant
insurer is sufficiently probative of witness bias to outweigh the prejudice
to the defendant resulting from the knowledge that the defendant carries liability
insurance. Yoho v. Thompson, 345 S.C. 361, 366, 548 S.E.2d 584, 586
(2001). In Yoho, the defendant in a car wreck case was represented by
the underinsured motorist carrier, Nationwide Insurance Company. One of the
defendants experts, Dr. Brannon, did a fair amount of consulting work for Nationwide
and between ten to twenty percent of his practice included consulting for insurance
companies. Our state Supreme Court reversed the circuit courts refusal to
allow Yoho to question Dr. Brannon regarding his potential bias due to his work
with insurance companies. The Court determined the connection between Brannon
and Nationwide was substantial enough to permit Yoho to question him about the
relationship and potential bias. Yoho, 345 S.C. at 366, 548 S.E.2d at
586. The Court went on to note that showing the connection to the insurance
company was qualitatively different from showing the expert worked for the defense
and was much more indicative of possible bias in favor of the defendant. Id.
In the present case, Crosby Construction presented
Robert Lanier as an expert in general contracting. Although the News expert
testified that most of the repairs to the home could be accomplished for $84,580,
Lanier testified he could perform the same repairs for $41,901.15. Outside
the presence of the jury, the News stated they wanted to question Lanier regarding
his estimates for insurance companies which comprised between seventy-five and
eighty percent of his work. Over Crosby Constructions objections, the circuit
court allowed the News to question Lanier about his insurance work. Lanier
testified to the jury that most of his work came from making repairs for insurance
companies on claims on homeowners insurance policies. He also stated he was
willing to change his estimates upon the request of insurance companies. The
parties did not know whether Lanier had ever performed work for Zurich, Crosby
Constructions liability insurer, and no testimony was elicited identifying
specific insurance companies Lanier worked with.
The present case is distinquishable from
Yoho. Whereas the expert in Yoho actually performed work for
the insurance carrier representing the defendant, nothing in this case indicates
Lanier ever worked for Zurich. Lanier worked with insurance companies under
homeowners policies, not liability policies. Despite the fact that up to eighty
percent of Laniers work came from insurance companies, the substantial connection
to the specific carrier that existed in Yoho is simply not present here.
Even though there is no substantial connection
in the present case, we believe the admission of evidence regarding Laniers
connection to insurance carriers was permissible. A witness may be cross-examined
on any matter relevant to any issue in the case, including credibility. Rule
611(b), SCRE. Considerable latitude is allowed in cross-examination to test
a witnesss bias, prejudice, or credibility. Yoho, 345 S.C. at 364-65,
548 S.E.2d at 585. The trial courts ruling regarding scope of cross-examination
to show bias or test credibility will not be overturned on appeal absent an
abuse of discretion. Id.
Lanier testified that he worked for insurance companies
on homeowners claims. He did not implicate liability insurance in violation
of Rule 411, SCRE. Further, the testimony elicited at trial did not indicate
whether Crosby Construction was insured. However, Laniers dependence upon
insurance companies in general for up to eighty percent of his income was evidence
that impacted Laniers credibility or could show potential bias. As the evidence
did not impermissibly inform the jury regarding Crosby Constructions insurance
status and it was used to test Laniers bias, we find no abuse of discretion
in the present case. [2]
CONCLUSION
The circuit court erred in failing to grant Crosby
Constructions motion for a directed verdict on the claim for stigma damages
where there was no evidence to support the amount of stigma damages and allowing
the jury to consider stigma damages amounted to double recovery. The circuit
court also erred in failing to grant Crosby Constructions motion for a new
trial absolute because there was no evidence to support the amount of the jurys
award. Finally, we find the circuit court did not abuse its discretion in allowing
evidence that Crosby Constructions expert was connected to insurance companies. Accordingly, the trial court is AFFIRMED
IN PART, REVERSED IN PART, and REMANDED for a new trial absolute.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
GOOLSBY and ANDERSON, JJ., and CURETON, AJ.,
concur.
[1] In further support of its claim that the circuit court erred in failing
to grant a directed verdict, Crosby Construction argues there was no evidence
to support a claim for stigma damages because the problems with the property
were not permanent and could be repaired. Testimony from the experts indicated
the problems with the home could be repaired, thus the damages were not necessarily
permanent in nature. However, Crosby Construction did not make this argument
before the circuit court in support of its motion for directed verdict. Accordingly,
this argument is not preserved for appellate review. Staubes v. City of
Folly Beach, 339 S.C. 406, 412, 529 S.E.2d 543, 546 (2000).
[2] Because we reverse and remand on the issues of the trial judges
failure to grant Crosby Constructions motions for directed verdict and a
new trial absolute, we need not address Crosby Constructions remaining issues
on appeal. However, we have chosen to address the issue regarding Laniers
connection to insurance companies because it is an issue that is likely to
repeat itself upon retrial of this case.