Reighard v. Yates

2012 UT 45, 285 P.3d 1168, 714 Utah Adv. Rep. 45, 2012 Utah LEXIS 107, 2012 WL 3055737
CourtUtah Supreme Court
DecidedJuly 27, 2012
DocketNo. 20100661
StatusPublished
Cited by63 cases

This text of 2012 UT 45 (Reighard v. Yates) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reighard v. Yates, 2012 UT 45, 285 P.3d 1168, 714 Utah Adv. Rep. 45, 2012 Utah LEXIS 107, 2012 WL 3055737 (Utah 2012).

Opinion

Associate Chief Justice NEHRING,

opinion of the Court:

INTRODUCTION

1 The dispute in this case stems from the purchase of a house built in Park City, Utah. Mr. Yates built the house and lived in it for approximately two years. The Reighards then purchased the house from him. After living in the house for over two years, the Reighards discovered mold in some of the windows and walls and sued Mr. Yates.

T2 The jury found in favor of the Reigh-ards on their negligence claim but found in favor of Mr. Yates on the Reighards' negligent misrepresentation claim. The jury also found that the Reighards failed to perform all, or substantially all, of the things the contract required them to do and therefore the jury, as instructed, did not reach the question of whether Mr. Yates breached the contract. The Reighards and Mr. Yates both appeal the decisions of the trial court.

{3 We hold that the economic loss rule prevents recovery of economic damages within the seope of the parties' contract but allows for recovery of damages to other property or for bodily injury. We also hold that the trial court did not err when it permitted Eugene Cole, Ph.D., to testify as an expert witness. Because Mr. Yates prevailed in his claims under the contract, which provided the only basis for awarding attorney fees, he is entitled to recover attorney fees for the breach of contract suit. We hold that the trial court did not err when it denied the Reighards' motion for judgment notwithstanding the verdict. We remand the case for further proceedings consistent with our decision.

[1173]*1173BACKGROUND

{4 Mr. Yates constructed the house at issue. He served as general contractor and resided in the house from November 2001 until approximately March 2004. The Reigh-ards purchased the house from Mr. Yates in early 2004. The parties entered into a standard Real Estate Purchase Contract (REPC). Mr. Yates signed the REPC and a document titled "Seller's Property Condition Disclosure." The Seller's Property Condition Disclosure required Mr. Yates to disclose his "actual knowledge regarding the condition of the property." The document included sections for "mold," "other moisture conditions," and "exterior and exterior features," in which Mr. Yates represented that he was not aware of any moisture-related damage to the walls, floor, or ceiling; was not aware of any mold on the interior of the house; and was not aware of any problems with any portion of the exterior of the house like moisture damage behind stucco. The Reighards knew they were purchasing a used house, and prior to closing the sale they had an independent inspection and appraisal conducted.

T5 In the summer of 2005, exeavation was performed so that a deck could be installed on the corner of the house. Sprinkler modifications were also made in connection with this project. In August 2006, Ms. Reighard noticed mold in the basement. Ms. Reighard called a mold remediation company, which removed and replaced most of the stucco, windows, and drainage on the house. Ms. Reighard believed that the mold was the cause of health problems her family had been experiencing.

T6 The Reighards' original complaint sought damages related to seven causes of action against Mr. Yates. After he was served by Mr. Reighard, Mr. Yates filed a third-party complaint against the stuceo contractor, E. Marshall Plastering, which later settled with the Reighards for $5,000 in return for being dismissed from the case. Before the case was submitted to the jury, Mr. Yates moved for a directed verdict, and all but three of the claims against Mr. Yates-negligent misrepresentation, negligence, and breach of contract-were dismissed. Experts, including Eugene Cole, Ph.D., testified at trial about the effects the mold may have had on the Reighards.

T7 The jury found for the Reighards on their negligence claim and awarded them $10,000 in property damage, $0 in medical expenses, $0 for loss of use and enjoyment of residence, $0 for other economic losses, and $2,500 in noneconomic damages, including pain and suffering. On the other hand, the jury found in favor of Mr. Yates on the Reighards' negligent misrepresentation claim. The jury also found that the Reigh-ards failed to perform some of their contractual duties. The verdict form instructed the jury to stop deliberation on the contract claim if it determined the Reighards had not done what the contract required, so the jury did not reach the question of whether Mr. Yates breached the contract. The trial court granted Mr. Yates's posttrial motion to reduce the jury verdict by $5,000 because the Reighards had already received that amount from E. Marshall Plastering. The trial court determined that there was no prevailing party in the suit and therefore neither side should receive attorney fees.

T8 The Reighards and Mr. Yates raise multiple issues on appeal and cross-appeal. We have jurisdiction to hear this appeal under Utah Code section 78A-3-1028)(J).

ISSUES AND STANDARDS OF REVIEW

19 First, Mr. Yates appeals the trial court's conclusion that, as a builder, he owed a duty to the Reighards. In a related challenge, Mr. Yates argues that the trial court erred when it determined that the economic loss rule does not bar the Reighards' recovery for property damage. "The question of whether a duty exists is a question of law" involving an "examination of the legal relationships between the parties." 1

110 Second, Mr. Yates argues that the trial court abused its discretion by allowing Engene Cole, Ph.D., to testify as an [1174]*1174expert witness. "A trial court has discretion in determining whether a witness has adequate qualifications to testify as an expert and in determining whether specific testimony offered by an expert should be allowed or exceeds the expert's qualifications." 2 Absent an abuse of discretion, the trial court's determination will not be disturbed by an appellate court.3

111 Third, the Reighards appeal the trial court's denial of their motion for judgment notwithstanding the verdict. On appeal, the court will "defer to the jury and evaluate the evidence in a light favorable to the verdict."4 Evidentiary inferences that support the verdiet will be accepted rather than contrary inferences.5 To overturn the jury verdict, appellants "must set out in their briefs ... all the evidence that supports the verdict ... and demonstrate that reasonable people would not conclude that the evidence supports the verdict." 6

Fourth, both Mr. Yates and the Reighards appeal the trial court's determination that there was not a prevailing party and therefore neither side should receive attorney fees. Determination of the prevailing party is an appropriate question for the sound discretion of the trial court and depends in large measure on the context of each case.7 We review the trial court's determination of which party is the prevailing party under an abuse of discretion standard.8

13 Finally, Mr. Yates challenges the trial court's decision to award the Reighards costs as part of the final judgment in this matter and its decision to reduce the amount of the jury's verdict and interim judgment because of a third party settlement.

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Bluebook (online)
2012 UT 45, 285 P.3d 1168, 714 Utah Adv. Rep. 45, 2012 Utah LEXIS 107, 2012 WL 3055737, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reighard-v-yates-utah-2012.