American Bldgs. Co. v. White

• Decision Date: 14 May 1982
• Citation: 640 S.W.2d 569
• Parties: AMERICAN BUILDINGS COMPANY, Plaintiff and Counter-Defendant-Appellant, v. Eddie WHITE d/b/a White Construction Company, Defendant, and DBH ATTACHMENTS, INC., DBH, Inc., and Dean Hunt, Defendants, Counter- Plaintiffs, and Third-Party Plaintiffs-Appellees, v. John W. NORTON, Third-Party Defendant-Appellant, and White Construction Co., Inc., Third-Party Defendant.
• Court: Tennessee Court of Appeals

Page 569

640 S.W.2d 569

AMERICAN BUILDINGS COMPANY, Plaintiff and Counter-Defendant-Appellant, v. Eddie WHITE d/b/a White Construction Company, Defendant, and DBH ATTACHMENTS, INC., DBH, Inc., and Dean Hunt, Defendants, Counter- Plaintiffs, and Third-Party Plaintiffs-Appellees, v. John W. NORTON, Third-Party Defendant-Appellant, and White Construction Co., Inc., Third-Party Defendant.

Court of Appeals of Tennessee,

Western Section.

May 14, 1982.

Rehearing Denied June 15, 1982.

Application for Permission to Appeal

Denied by Supreme Court

Oct. 4, 1982.

Louis F. Allen and Louis Jay Miller, Memphis, for American Buildings Co. and John W. Norton.

Joe Hailey, Selmer, for Eddie White.

W.J. Reynolds and Robert V. Redding, Selmer, for DBH Attachments, Inc., DBH, Inc., and Dean Hunt.

NEARN, Judge.

DBH Attachments, Inc., hereinafter called DBH, contracted with White Construction Company, Inc., for the sum of $19,000.00 for the erection of a metal roof structure on a concrete block building being built by DBH. White procurred the metal roof structure from American Building Company (ABC), a specialist in prefabricated metal structures, and installed same upon the DBH building. The roof was not satisfactory to DBH and it refused to pay White the amount due under their contract. White was unable to pay ABC for the material and as a consequence, ABC filed suit in the Chancery Court of McNairy County against White for the cost of the roof structure and against DBH to enforce an alleged furnisher's lien. DBH then counterclaimed against ABC, joining as a defendant the engineer for ABC, John W. Norton, and cross filed against White for alleged damages resulting from the defective roof structure.

The Chancellor awarded judgment for DBH in the amount of $239,304.53 against White singularly. Of that amount $233,412.67 was also adjudged against White, ABC and Norton as a joint judgment. The Chancellor further decreed that ABC be indemnified by White for any amount it paid to DBH on the joint judgment.

All parties except White have appealed.

The foregoing simple statement of events belies the complexity of the issues raised by this appeal. We deem it best to consider the legal problems of each of the parties separately, because the separate or special relationships have created separate or special problems. Further, we believe that an examination and exploration of the relationship and status of White, the party that has not appealed, will facilitate an understanding of the matter.

THE MATTER OF EDDIE WHITE d/b/a WHITE CONSTRUCTION COMPANY.

The Trial Judge initially rendered judgment against Eddie White personally. However, based upon a post judgment motion the Trial Judge altered the judgment so that it would be against White Construction Company, Inc., and not against White individually. This action of the Trial Judge is the subject of complaint by appellants ABC and Norton. At the outset we state we find no error in the action of the Trial Judge. The proof shows that all parties were aware of the corporate identity of the White Construction Company and all knowingly dealt with Eddie White in a corporate capacity. Therefore, we affirm the post judgment action of the Trial Judge in naming the proper defendant in the judgment.

DBH is the manufacturer of unique labor saving attachment for commercial type sewing machines used by the garment industry. Dean Hunt formed the company in 1974 and because of the utility of its products met with phenomenal success. Accordingly, in 1976 the company needed to expand its manufacturing facilities. For expansion purposes, the company in 1976 purchased real estate near its original facility. Dean Hunt drew up the rough plans for a new building to be placed on the newly acquired land. The structure had a slab foundation and concrete block walls. Hunt contracted out various parts of the concrete block work and acted as general coordinator and supervisor of the project. While the building was under construction, Hunt was contacted by a salesman for White regarding the roof of the building and what is called in the record a metal "standing seam" roof was discussed. Hunt contracted with White for the erection of such a roof. The roof in question is not simply metal sheets laid over an existing wooden or some other type of decking already supported, but consists of the sheet metal roof as well as the truss support system. It was understood that White was to order the prefabricated roof from another and White was to erect it. White agreed to furnish and erect the agreed upon roof for the sum of $19,000.00. In so far as the claim between DBH and White is concerned, suffice it to say that the facts show the roof was improperly and poorly installed. Further, it was necessary for DBH to remove the sheet metal roofing material, add additional supports, repair wall damage and install new roofing.

Since there is privity between DBH and White as evidenced by their contractual relationship, it is evident that White is liable to DBH for breach of contract and for the damages that normally would flow from that breach. Further, whether the contract was breached through "negligence," or not is immaterial. The action between DBH and White is for breach of contract. DBH sought damages from White for the repair of the roof, damage to the concrete block walls of the building, and economic loss represented by loss of profits. We are of the opinion that if properly proven, DBH would be entitled to all the foregoing items of damage against White.

THE CLAIM OF DBH AGAINST ABC.

The claim of DBH against ABC is based upon theories of negligent design, breach of express and implied warranties, strict liability, negligent or willful misrepresentation, and violation of the Tennessee Consumer Protection Act. The Chancellor's Trial Opinion states that he found in favor of DBH on all of the theories except the Consumer Protection Act. DBH has appealed the Chancellor's ruling as to the Act and seeks the treble damages and attorney's fees therein provided. ABC and Norton have appealed all theories of liability against them as well as the measure of damages applied.

The Chancellor found and we agree that the evidence establishes that the roof failed to meet the obligations of both White and ABC. The roof, as erected on DBH's building, was unstable and its movement cracked the masonry walls. The record reveals that the cause of this instability was a poor erection job and, as well, the roof system was designed with inadequate strength to support the loads made necessary by the masonry walls of the building. Testimony in the record indicates that the roof system was designed with deficiencies in either the bracing provided, the diaphragm capacity, or the types of bolts and holes used, or a combination of these.

ABC took the position at trial that even if the design was inadequate for the building, they have no liability for this failure because the roof system was designed according to an order form filled out by White and ABC was required to do no more than fill the order that White submitted. In that order form White specified the load limits as 12 and 15 pounds for the structure to be fabricated and gave no further information other than the style of roof desired and the width and length of the building. ¹ ABC has insisted that it is not its duty to check and see if a dealer actually wants what it has ordered or whether the dealer's order follows the wishes of the owner or meets the contract requirements between owner and dealer.

We find, as did the Chancellor, that ABC, through its promotional literature, made direct representations about their design responsibilities to the purchaser DBH and that White acted as an agent of ABC for the purpose of forwarding design information, which representations were relied upon by DBH. We further find that ABC failed to meet its obligations under those representations to DBH and such failure constitutes tortious misrepresentation as recognized in Ford Motor Co. v. Lonon, (1966) 217 Tenn. 400, 398 S.W.2d 240.

Dean Hunt of DBH testified that in choosing to order the ABC roofing system he relied upon ABC brochures furnished by White that described ABC products and processes. The back pages of the brochures had a space saying "Your American Builder is" and stamped in that space on some of the brochures was "Eddie White Const. Co., Inc.," with an address. The brochures contained the following language:

It's very likely that the American Builder in your area has already built a building that would be just right for you. But even if he hasn't, it will pose little or no problem for him. He'll work with you from foundation to completion and assure you complete satisfaction. That's his business ... and he does a good job at it.

American's structural systems are a combination of computerized, pre-designed components. When your building requirements are determined, the structural components for your building are processed through American's modern manufacturing facilities under constantly controlled factory conditions.

It is through this method that American, and your nearby American Builder, can provide a variety of systems to achieve your desired building width, length, and eave heights.

By utilizing these systems, the American Builder is professionally equipped to fulfill your building needs quickly and economically to your complete satisfaction.

Although one of the hundreds of standard designs in this brochure may be just right for your need ... you aren't limited to only a standard building.

Everyday, special-design buildings represent a larger percentage of our sales. This is largely because we set a precedent in our industry when we went to computer-aided design and computer drawings.

What it used to take us weeks to do in designing and drawing, is now done in just hours.

With our engineering and manufacturing know-how, plus our computer-aided design and drawing capabilities...