Woodkrest Custom Homes Inc. v. Cooper

108 So. 3d 460, 2013 WL 221462, 2013 Miss. App. LEXIS 24
CourtCourt of Appeals of Mississippi
DecidedJanuary 22, 2013
DocketNo. 2011-CA-00340-COA
StatusPublished
Cited by8 cases

This text of 108 So. 3d 460 (Woodkrest Custom Homes Inc. v. Cooper) is published on Counsel Stack Legal Research, covering Court of Appeals of Mississippi primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Woodkrest Custom Homes Inc. v. Cooper, 108 So. 3d 460, 2013 WL 221462, 2013 Miss. App. LEXIS 24 (Mich. Ct. App. 2013).

Opinion

GRIFFIS, P.J.,

for the Court:

¶ 1. This is the second time this Court has considered the appeal of the lawsuit that James and Sandra Cooper filed against Woodkrest Custom Homes Inc., Nationwide Custom Construction LLC, and Robert Kress Sr., individually (the “Defendants”). In Woodkrest Custom Homes Inc. v. Cooper, 24 So.3d 340, 347 (¶ 30) (Miss.Ct.App.2009), this Court vacated the award of damages in the default judgment and remanded the case for the circuit court to conduct an on-the-record hearing on damages.

¶ 2. On remand, the circuit court entered a judgment and awarded compensatory damages, emotional-distress and mental-anguish damages, punitive damages, and attorney’s fees. The defendants return to this Court with an appeal of that judgment. Here, the Defendants argue that the circuit court erred when it: (1) awarded damages for emotional distress and mental anguish; (2) awarded punitive damages; (3) did not consider the Defendants’ financial condition and net worth; and (4) awarded attorney’s fees based on the award of punitive damages. Having considered the circuit court’s judgment, we reverse and render in part and affirm in part as set forth below.

FACTS

¶ 3. The Coopers entered into a contract with Woodkrest for the construction of their home. Nationwide was to serve as the contractor and builder.1

¶ 4. The Coopers’ complaint alleged that materials were not produced, a deposit was never made to secure the price of an elevator, and the project was not adequately supervised or timely constructed. The Coopers asserted claims for breach of contract, negligent and fraudulent misrepresentation, misappropriation, and conversion of money. The complaint did not request a specific sum for damages. The complaint did not allege a claim for intentional infliction of emotional distress.

¶ 5. The Defendants were served with process and failed to respond. Upon proper request, the clerk entered a default, and the Coopers filed a motion for a default judgment. Attached to the motion was an affidavit that asked for “$119,387.14 [in] compensatory damages, together with $268,161.42 in punitive damages, $5,000 [in] attorney’s fees and expenses, pre-judgment and post-judgment interest and all costs incurred herein.”

¶ 6. The affidavit also stated, “Defendants, through their intentional misrepresentations and abandonment of this project have caused delays of at least six months in completing the project for which the Plaintiffs should be entitled to a minimum of $30,000 compensation.” The affidavit was the first mention of the request for $30,000, which evolved into a request for mental-anguish damages based on delay and misrepresentations.

¶ 7. The circuit court entered a default judgment. The judgment awarded damages in the amount of $119,387.14 in compensatory damages, together with $268,161.42 in punitive damages, $5,000 in attorney’s fees and expenses, and prejudgment and post-judgment interest at the legal rate. The judgment did not award any damages for emotional distress.

[463]*463¶ 8. The Defendants filed a motion to set aside the default judgment, which the circuit court denied. Upon appeal, this Court affirmed the denial of the motion to set aside the default judgment but vacated the award of damages in the default judgment and remanded the case for the circuit court to conduct an on-the-record hearing on damages. Id. This Court ruled:

The Defendants’ final argument is that the circuit court erred when it awarded the Coopers unliquidated damages without a hearing on the record. The Coopers claim that the damages are primarily liquidated damages and that there was a hearing on May 4, 2006, to determine damages.
In [Greater Canton Ford Mercury, Inc. v. Lane, 997 So.2d 198, 206 (¶ 30) (Miss.2008) ], the supreme court held:
The assessment of damages is a finding of fact, and the appellate court reviews an award of damages under the clearly erroneous standard. This Court has stated that damage awards are only overturned when the trial judge has abused his discretion or in exceptional cases where such awards are so gross as to be contrary to right reason. The appellate court must review the damages award by looking to the “facts of each case.”
(Internal quotations and citations omitted). “An on-the-record hearing must be held prior to the entry of default judgment under which unliquidated damages are requested.” Capital One Servs. v. Rawls, 904 So.2d 1010, 1018 (¶ 26) (Miss.2004).
Here, the circuit court awarded the Coopers $119,387.14 in compensatory damages, which included $30,000 for the delay in construction; $268,161.42 in punitive damages; and $5,000 in attorney’s fees. The Coopers argue that the circuit court conducted a hearing on damages. However, if there was a hearing on damages, it was not included in the record.
The Coopers also claim that the damages awarded were primarily liquidated damages. We disagree. Liquidated damages are those that “are set or determined by a contract when a breach occurs. Unliquidated damages are damages that have been established by a verdict or award but cannot be determined by a fixed formula, so they are left to the discretion of the judge or jury.” Moeller v. Am. Guar. & Liab. Ins. Co., 812 So.2d 953, 959 (¶ 18) (Miss.2002) (internal quotations omitted).
After a review of the record before us, this Court is unable to reconcile mathematically the award for compensatory damages with the worksheet^] “Funds due from Woodkrest Custom Homes,” which was attached to the Coopers’ motion for [a] default judgment. Furthermore, the circuit court awarded the Coopers $30,000 in unliquidated damages and $268,161.42 in punitive damages.
The supreme court has recognized that:
Although punitive damages are not ordinarily recoverable in cases involving breach of contract, they are recoverable where the breach results from an intentional wrong, insult, or abuse as well as from such gross negligence as constitutes an independent tort. In these instances, they act to punish, and are to set an example, thereby discouraging others from similar behavior. As such, punitive damages are allowed only with caution and within narrow limits.
Before punitive damages can be recovered from the defendant, the plaintiff must prove by a preponderance of the evidence that the defendant acted with (1) malice, or (2) gross negligence [464]*464or reckless disregard for the rights of others.
Hurst v. Sw. Miss. Legal Servs. Corp., 708 So.2d 1347, 1350 (¶ 6) (Miss.1998) (internal citations and quotations omitted). The punitive damages awarded were unliquidated damages because they were not set or determined by a contract when the breach occurred. Further, there is no finding by the circuit court that the Defendants acted with malice or gross negligence or reckless disregard for the rights of others.
Accordingly, we vacate the default judgment insofar as the award of damages, and we remand this case based on the circuit court’s failure to conduct an on-the-record hearing regarding damages and instruct that such hearing on damages be held.

Woodkrest Custom Homes, 24 So.3d at 346-47 (¶¶ 24-30).

¶ 9.

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Bluebook (online)
108 So. 3d 460, 2013 WL 221462, 2013 Miss. App. LEXIS 24, Counsel Stack Legal Research, https://law.counselstack.com/opinion/woodkrest-custom-homes-inc-v-cooper-missctapp-2013.