Southwestern Bell Telephone Co. v. Harris Co.

109 S.W.3d 637, 353 Ark. 487, 2003 Ark. LEXIS 319
CourtSupreme Court of Arkansas
DecidedJune 5, 2003
Docket02-1261
StatusPublished
Cited by5 cases

This text of 109 S.W.3d 637 (Southwestern Bell Telephone Co. v. Harris Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Southwestern Bell Telephone Co. v. Harris Co., 109 S.W.3d 637, 353 Ark. 487, 2003 Ark. LEXIS 319 (Ark. 2003).

Opinion

Tom Glaze, Justice.

This appeal was certified to the supreme court by the court of appeals pursuant to Ark. Sup. Ct. R. l-2(g), which provides that cases may be transferred between the courts in order to achieve a fair allocation of the appellate workload.

On April 9, 2001, the Harris Company was working to widen and lower a road when, in the course of excavating part of the road bed, one of its machines damaged a buried phone line belonging to Southwestern Bell. The phone fine consisted of a copper cable, used for transmitting telephone lines and data, and a fiber optic cable. Prior to beginning its excavation, Harris Co. failed to comply with the notice requirements set out in Ark. Code Ann. § 14-271-101 et seq. (Repl. 1998), the Underground Facilities Damage Prevention Act. 1 Southwestern Bell sued Harris Co. to recover its losses incurred as a result of the damages to the phone lines; the complaint sought damages totaling $21,865.08, including damages “related to the repair of the telephone/data lines and equipment, labor, materials, and loss of use.” Harris Co. admitted that it damaged Southwestern Bell’s telephone lines, but denied that the damages were as excessive as Southwestern Bell claimed. Harris Co. also denied that Southwestern Bell was entitled to any damages for “loss of use,” because any such damages would constitute an unjust enrichment.

Because Harris Co. admitted liability for causing the damage to Southwestern Bell’s telephone lines, the case proceeded to jury trial solely on the question of damages. Prior to trial, counsel for both sides discussed whether evidence regarding loss of use would be relevant and admissible. Counsel for Southwestern Bell contended that such evidence was relevant, arguing that the company should be permitted to demonstrate to the jury how much it would have cost them to rent replacement lines for the amount of time that the cables were inoperable. Counsel for Harris Co. responded that Southwestern Bell did not actually go out and rent any additional cables, so any evidence to that effect would have been irrelevant. The trial court, noting that there were jury instructions that covered damages to personal property, but did not mention loss of use, ruled that any evidence of what it would have cost Southwestern Bell to rent extra lines was irrelevant, because Southwestern Bell had not actually rented any lines.

At the close of Southwestern Bell’s case, the trial court granted a partial directed verdict in favor of Harris Co., on the issue of loss-of-use damages. At the end of the trial, the jury awarded Southwestern Bell $7,000 in damages. The judgment was entered on September 6, 2002, and Southwestern Bell filed a timely notice of appeal. On appeal, Southwestern Bell argues that the trial court erred as a matter of law in finding that loss of use was not an appropriate element of damages, in determining that there was insufficient evidence of loss of use, and in excluding evidence and testimony regarding loss-of-use damages.

In Arkansas, the measure of damages to personal property is calculated by determining the difference in the fair market value of the property immediately before and immediately after the occurrence. In determining this difference, the fact-finder is allowed to take into consideration the reasonable cost of repairs. AMI Civ. 4th 2227; see also Daughhetee v. Shipley, 282 Ark. 596, 669 S.W.2d 886 (1984); Nicholas v. Bingamon, 219 Ark. 748, 244 S.W.2d 782 (1952). Generally, however, one is not entitled to recover damages for the loss of use of personal property, except in cases of damage to an automobile. See Sharp v. Great Southern Coaches, Inc., 256 Ark. 773, 510 S.W.2d 266 (1974) (the court pointed out that Arkansas was the only state that denied recovery for loss of use of a vehicle; the court then proceeded to hold that, when a vehicle is partially destroyed, loss of use of the vehicle should be considered as an element of damages, and cases inconsistent with that proposition were overruled). 2

Subsequent to this court’s decision in Sharp, supra, the General Assembly passed Act 643 of 1974, which is now codified at Ark. Code Ann. § 27-53-401 (1987). That statute provides as follows:

In all cases involving damage to motor vehicles, the measure of damages shall be the difference between the value of the vehicle immediately before the damage occurred and the value after the damage occurred, plus a reasonable amount of damages for loss of use of the vehicle.

(Emphasis added.) This statute has since been incorporated into AMI Civ. 4th 2210, and that instruction has been applied and cited as recognizing that, under Arkansas law, one can recover loss-of-use damages in cases involving automobiles. See Zhan v. Sherman, 323 Ark. 172, 913 S.W.2d 776 (1996); Daughhetee v. Shipley, supra.

However, in cases dealing with damage to personal property other than motor vehicles, there is no comparable provision in the Arkansas Model Jury Instructions or in the Arkansas Code. The jury instruction on damages to personal property — AMI Civ. 4th 2227 — provides that the measure of damages to personal property is as follows:

The difference in the fair market value of his [insert description of the property] immediately before and immediately after the occurrence. [In determining this difference you may take into consideration the reasonable cost of repairs.]

Nevertheless, Southwestern Bell insists that Arkansas should recognize damages for loss of use in cases involving personal property other than motor vehicles, and that it should be permitted to recover damages for the loss of use of its cables, because, it claims in its brief, “the recoverability of loss-of-use damages serves to protect property rights.” In support of this argument, Southwestern Bell cites Arkansas-Missouri Power Co. v. Deal, 263 Ark. 645, 566 S.W.2d 747 (1978), wherein this court held that a hotel owner was entitled to damages for the lost rental value of his fire-damaged hotel, even though the hotel never turned a customer away during the time after the fire. Southwestern Bell claims that this case demonstrates that Arkansas “allows an owner whose property has been damaged by the tortious conduct of another the recoverable costs to repair the damaged property and the loss of use of property during the time of repair.”

However, Deal is distinguishable in one very significant way. Deal involved damage to a hotel, which is real property, and not personal property. Damages to real property are covered in AMI Civ.

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Bluebook (online)
109 S.W.3d 637, 353 Ark. 487, 2003 Ark. LEXIS 319, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southwestern-bell-telephone-co-v-harris-co-ark-2003.