Dana McDaniel and Jonna McDaniel v. Four Hollands, Inc.

ARKANSAS COURT OF APPEALS
NOT DESIGNATED FOR PUBLICATION

DIVISION IV

DANA MCDANIEL AND JONNA MCDANIEL,

APPELLANTS

V.

FOUR HOLLANDS, INC.,

APPELLEE

CA04-120

FEBRUARY 23, 2005

APPEAL FROM THE SEBASTIAN COUNTY CIRCUIT COURT,

GREENWOOD DISTRICT,

(NO. CV-02-110),

HON. NORMAN WILKINSON, JUDGE

AFFIRMED

Sam Bird, Judge

Appellants Dana and Jonna McDaniel were sued by appellee Four Hollands, Inc., (Four Hollands) to recover the balance due on a written contract to construct a sunroom onto the McDaniels' residence. The McDaniels counterclaimed for breach of contract and other matters. A bench trial was held on June 19, 2003. On July 3, 2003, the Sebastian County Circuit Court entered an order of dismissal finding that the McDaniels owed $2,216 on the contract, but that construction had not been completed and the cost to complete was the same as the amount owed, so neither party was entitled to recover judgment against the other. The McDaniels now appeal, claiming that the trial court erred in calculating the amount of damages to which they were entitled. Four Hollands cross-appeals, contending that the trial court erred in failing to award damages to it because the balance due on the construction contract exceeded the cost to complete the project. We affirm.

On December 3, 2001, the McDaniels signed a contract in which they agreed to pay Four Hollands $32,160 to construct a "studio design room" (sunroom) onto the McDaniels' home. Work began on the project in January 2002, with Kevin Bailey assigned as the lead installer. Kerry Smallwood was hired to remove the existing screen room and brick knee wall and to install the new concrete slab with footing for the new sunroom.

When the project neared completion, Greg Holland, owner of Four Hollands, prepared a punchlist for the project. Holland testified that on February 21, 2002, the McDaniels "went through the room and ... were showing [him] some things they wanted corrected, including some of the trim items and some additional caulking and ... a leak around the fireplace that needed to be addressed." Holland said that there were eight to ten items left on the project at that time, including the following:

1. Trim needed caulking;

2. Residue on skylights needed to be cleaned off;

3. Fireplace corners needed caulk to take gaps away;

4. Face of concrete slab needed "acid wash" where stain had dripped down;

5. Paint needed "touch up" to match sand tone color of room;

6. Stickers on room panels needed to be removed; and

7. An old bracket needed to be removed from wall.

Holland testified that he was agreeable to everything on the punchlist and that he had arranged with Kevin Bailey to make the repairs within a week. According to Holland, Bailey returned on February 28, 2002, to make the repairs and left briefly to obtain additional materials for the job. At that point, Holland said, the McDaniels became upset, called Holland, and told Holland that they did not want Bailey to come back. Holland called Bailey and told him not to return to the McDaniels' home. Holland said that he agreed to go out to the McDaniels' residence to see what Bailey had done, but the McDaniels never contacted him to schedule a time. Holland then asked John Wilfong, the salesman who had sold the sunroom to the McDaniels, to contact them by phone. According to Holland, Dana McDanieltold Wilfong that "any future conversations about the sunroom needed to be through their attorney."

Holland further testified that he told the McDaniels that Four Hollands needed to finish the punchlist and "final out the job." According to Holland, the only thing missing from the punchlist was the leak around the fireplace, which he thought had been fixed; when Four Hollands realized that it had not, they were not given a second chance to fix it. He said that he thought it would cost approximately "two to three hundred dollars" to put flashing around the fireplace and that he wanted to "fix the leak and take care of the punch list and collect [his] final payment and finish the job." He later testified that if another sunroom installer were to complete the items on the punchlist, it would cost an additional two to three hundred dollars.

On cross-examination, Holland said that he was not aware that the foundation broke through the form as it was being poured, although he did notice that coloring had dripped down the face of the concrete. He also said that he did not discuss whether the outside of the foundation "bulged out" with the McDaniels on February 21. In addition, he said that he was aware that the McDaniels were not happy with the size of the glass paneling for the sunroom, but that he gave them a $450 credit for using solid paneling instead of glass. Furthermore, he said that he never knew of any complaints regarding the heat and air units that were ultimately used for the sunroom.

Dana McDaniel testified that after Bailey came out on February 28 to make the punchlist repairs, he became "infuriated" and called Greg Holland to tell him not to send anyone else out. McDaniel also testified that he had not undertaken to complete the job, that he had not hired anyone to do it, and that he did not have any written estimates for repair work. He testified that he wanted a sunroom with "as much glass as possible" that "absolutely would not leak." According to McDaniel, Wilfong said that Four Hollands typically did not construct a sunroom that large, but Wilfong told McDaniel that they could do it anyway. McDaniel said that when construction began, they tore down his old porch, cut off his roof, and started pouring concrete. He said that he "started to comment" when the concrete was being poured because it was not in the right place and started to bulge out, but he did not say anything because he thought it was too late. He also stated that insulation and shavings from the roof blew into concrete as it was being poured. In addition, McDaniel said that the glass paneling he originally requested would not fit and that he was told he would have to wait six weeks or accept a "filler panel"; that the dividing wall was not in the right place and the wrong materials were used; and that the holes for the air conditioning and heating units were the wrong size because Bailey attempted to put in the wrong units.

McDaniel testified that he noticed a leak in one of the skylights and said that the roofer came out twice to fix it but that it continued to leak, leaving puddles on the floor. He also said that there were exposed wires and numerous places needing to be sealed with caulk. McDaniel testified that before Kevin Bailey could complete the punchlist, he got mad and sent Bailey away. McDaniel said that the construction crew left trash in the yard and that there were cracks in the concrete slab foundation. He also said that he did not feel that the sunroom he ordered was the one he got.

Kerry Smallwood, who provided concrete services, also testified at trial. He said that there was "no way" that the McDaniels' problems were caused by the "bulging" foundation. He described the problem with the slab as an "aesthetic protrusion," but said that it didn't affect the structural integrity of the foundation. Furthermore, he was not aware of any cracking in the foundation. He said that he could cover the stain on the face of the foundation with a mortar mix, which is typically done at the end of a project.

Len Fort, an expert witness for the McDaniels, testified that he had been a building contractor for twenty-four years, but that his primary experience was in fire restoration, not sunrooms. Fort said that he observed the slab "leaning out" and that he also saw several leaks. He recommended taking the roof structure off, salvaging any reusable parts, and putting the sunroom back together. Fort noted that the contract price for the sunroom was $32,160, but estimated the value of the sunroom with the defects to be around $22,000. He said that, if the existing slab were to be torn up and a new one poured, the repair costs would be around $15,000. According to Fort, if the existing slab was left and the building was reconstructed, costs would run from $7,000 to $8,000. He said that these costs would mainly be for labor. Furthermore, Fort said that there was no guarantee that the leaks could be stopped by flashing around the roof and the chimney.

In reaching its decision, the court stated as follows:

Based on all that I've heard, I believe that you can get [the problems] fixed with the contractor [or] repairman of your choice and get what you bargained for for two thousand two hundred and sixteen dollars. So, basically, that's going to be an off set of the amount that the Plaintiff sued you for. So, I hope that you can. If you can get it done cheaper, you are money ahead. If it cost[s] you more, it just cost[s] you more.... So, basically I guess, both the Complaint and the Counterclaim will be dismissed.

As their sole point on appeal, the McDaniels contend that the trial judge's decision was clearly erroneous because the court erred in calculating the amount of damages that the McDaniels were entitled to receive. Specifically, citing Pennington v. Rhodes, 55 Ark. App. 42, 929 S.W.2d 169 (1996), they argue that there are two measures of damages in cases involving new construction, and that in this case, the judge apparently failed to rely on either one of these measures.

On cross-appeal, Four Hollands contends that it was entitled to damages because the balance due on the construction contract exceeded the cost to complete the project. Citing Whitehall v. Southern Mechanical Contracting, Inc., 269 Ark. 563, 599 S.W.2d 430 (Ark.App. 1980), Four Hollands asserts that damages in this case should be based upon the agreed contract price less the cost to complete the construction project and argues that the trial judge's conclusion that the cost of repairs equaled the balance due on the contract was clearly against the preponderance of the evidence.

Rule 52(a) of the Arkansas Rules of Civil Procedure affords a litigant a right to request specific findings of the trial court. However, failure to make a timely request for separate findings constitutes a waiver of that right. Legate v. Passmore, 268 Ark. 1161, 1162, 559 S.W.2d 151, 152 (Ark. App. 1980). Here, the trial judge failed to indicate the basis for his conclusions that the cost to complete the project equaled the balance due on the contract and that neither party was entitled to recover judgment against the other. However, the parties made no request for findings of fact or conclusions of law that constituted the grounds for the judge's decision.

We cannot reverse the trial judge's order in this case because the basis of the judge's decision is unclear and no explanation was requested by the parties. Furthermore, we think this case is governed in principle by decisions such as Fulbright v. Phipps, 176 Ark. 356, 3 S.W.2d 49 (1928), where the Arkansas Supreme Court recognized that a compromise award must stand if supported by substantial evidence. In the case at bar, there was conflicting testimony regarding damages; while it is uncertain as to how the judge arrived at his decision, the decision undoubtedly fell within the range of choices supported by the proof and thus was supported by substantial evidence. See Pate v. Hook, 262 Ark. 411, 557 S.W.2d 391 (1977) (citing Fulbright, supra).

Affirmed.

Crabtree and Baker, JJ., agree.