Best Price Plumbing, Inc. v. Erie Ins. Exch.

• Decision Date: 03 May 2012
• Docket Number: No. 2010AP1474.,2010AP1474.
• Citation: 2012 WI 44,340 Wis.2d 307,814 N.W.2d 419
• Parties: BEST PRICE PLUMBING, INC., Plaintiff–Respondent–Petitioner, v. ERIE INSURANCE EXCHANGE, Defendant–Appellant.
• Court: Wisconsin Supreme Court

340 Wis.2d 307

814 N.W.2d 419

2012 WI 44

BEST PRICE PLUMBING, INC., Plaintiff–Respondent–Petitioner,

v.ERIE INSURANCE EXCHANGE, Defendant–Appellant.

No. 2010AP1474.

Supreme Court of Wisconsin.

Argued Feb. 7, 2012.

Decided May 3, 2012.

For the plaintiff-respondent-petitioner there were briefs filed by George W. Love and Love Law Offices, LLC, Waukesha, and oral argument by George W. Love.

For the defendant-appellant there was a brief by Elissa M. Bowlin, Brandon J. Robison and Jacobson Legal Group, S.C., Brookfield, and oral argument by Elissa M. Bowlin.

ANN WALSH BRADLEY, J.

[340 Wis.2d 309]¶ 1 Best Price Plumbing, Inc., seeks review of an unpublished court of appeals decision that reversed an order entered by the circuit court and reinstated a jury verdict.¹ At trial, the jury found that a contract existed between Erie Insurance Exchange and Best Price, but that Erie did not breach the contract. The circuit court granted Best Price's motion after verdict to change the jury's answer. It concluded as a matter of law that a breach occurred, and it entered judgment in favor of Best Price.

¶ 2 Best Price argues that the court of appeals erred in reversing the circuit court. It asserts that under State v. Kenosha Home Telephone Co., 158 Wis. 371, 148 N.W. 877 (1914), it was entitled to judgment as a matter of law.

¶ 3 The problem with Best Price's argument is that the Kenosha Home Telephone case was not raised at any time prior to or during the jury trial. Because the jury was not given any instruction about the Kenosha Home Telephone rule, the jury never applied that rule to the facts of this case, and it was not asked to answer any questions that would support the application of that rule as a matter of law. We conclude that any error in the jury instructions has been forfeited, and that we should evaluate the evidence in the context of the instructions that were given to the jury.

¶ 4 We further determine that there was sufficient evidence to support the jury's verdict and the circuit court was clearly wrong when it changed that answer to the verdict question. Accordingly, we affirm the court of appeals.

I

¶ 5 Although several important facts in this case are disputed, the parties agree on many of the events that preceded this lawsuit. Willtrim Group, LLC, owned rental property that sustained damage as a result of frozen pipes. Trevor Trimble, a member of Willtrim Group, contacted its insurer, Erie Insurance Exchange, and Erie agreed that the damage was covered under the policy. Trimble called Best Price Plumbing to repair the property damage because Trimble's partner had hired Best Price in the past.

¶ 6 Upon receiving Trimble's call, Darryl Michlig, who was employed by Best Price, met with Trimble to examine the property. Trimble called Erie's property adjuster and then handed the phone to Michlig. The property adjuster told Michlig that Erie would be paying for the repairs. Best Price sent a proposal to Erie's office on February 5, 2008. Erie never signed or returned the proposal. Representatives of Erie and Best Price testified that they did not specifically discuss mode of payment.

¶ 7 Best Price performed the repair work, and it sent Erie's adjuster an invoice for $8,997. The adjuster authorized payment in the amount set forth in the invoice. He issued a two-party check payable to Willtrim Group, LLC and Best Price Plumbing, Incorporated, and he mailed the check to Willtrim's address. The adjuster later testified that it comports with Erie's practice and insurance industry standards to issue a two-party check in such a situation.

¶ 8 It is undisputed that the check, which bore two handwritten endorsements (one signed “Willtrim LLC” and the other signed “Best Price Plumbing”), was ultimately deposited into Willtrim's account. However, the parties disagree about what happened to the check after it was mailed and whether Best Price ever endorsed it.

¶ 9 Trimble testified that he gave the check to a handyman by the name of Abdul, and he instructed Abdul to get an endorsement from a Best Price employee. He testified that “[i]t would have either been Darryl or Paul” who endorsed the check with the name “Best Price Plumbing.” He explained that two Best Price employees, Darryl and Paul, were at the work site, and Abdul did not need to go anywhere to get the signature. Three Best Price principals testified that no one from Best Price ever endorsed the check.

¶ 10 The parties agree that Willtrim never forwarded any funds to Best Price and that Best Price never received payment for its services. Best Price filed suit against Erie, alleging a breach of contract. Erie defended the suit on the basis that there was no contract between Erie and Best Price, and, even if there were a contract,Erie satisfied its obligations to Best Price by sending the two-party check to its insured. The lawsuit proceeded to trial.

¶ 11 Best Price submitted a proposed special verdict with two questions. First, Best Price's proposed verdict asked whether there was a contract. Second, it asked whether Erie breached the “duty of good faith in performing its contract” with Best Price.

¶ 12 The court reviewed the submissions and modified the special verdict questions to read as follows:

1. Did Erie Insurance Exchange enter into a contract with Best Price Plumbing, Inc.?

2. If you have answered Question No. 1 yes, then, and only then, answer this question. Did the defendant Erie Insurance Exchange, breach its contract with Best Price Plumbing, Inc.?

¶ 13 During the jury instruction and special verdict conference, the court explained that it had shared the proposed verdict with the parties and that Best Price had no objection to the form of the verdict as modified by the court: “We have been discussing the jury verdict. The proposed verdict was shown to the parties. The plaintiff is satisfied with it.”

[340 Wis.2d 313]¶ 14 The court moved on to address Erie's objection to the proposed verdict. Erie requested that, in addition to asking the jury whether it had breached the contract, the jury also be asked whether Erie substantially performed by mailing the two-party check to its insured. The circuit court disagreed, concluding that a question about substantial performance would “cloud[ ] the issue.”

¶ 15 The court explained that, based upon its understanding of the legal arguments advanced by the parties, an additional verdict question was unnecessary. It indicated that if the jury determined that Erie satisfied its contractual obligations by mailing the two-party check to Willtrim, it would find that there was no breach: “If the jury concludes that [Erie] could have given [the two-party check] to Trimble, then you have won the case. Then there is not a breach. I just don't see the—I don't see the application of substantial performance.”

¶ 16 The court then confirmed that Best Price had no objection to the special verdict:

So I would leave the verdict stand as I drafted it with, ‘Was there a contract, yes or no? Was it breached, yes or no[?]’ ...

If [Best Price does not] prevail on one [and] two, they get nothing. That's how I read the case.

The court inquired whether Best Price's attorney had “any disagreement with that,” and he answered, “None.”

¶ 17 With the special verdict behind them, the court and both parties turned to discussing the jury instructions. Neither party lodged any objection to the jury instructions proposed by the court.

¶ 18 Regarding the applicable contract law, the court instructed the jury on agreement, offer, acceptance,consideration, definiteness and certainty, and implied contracts.² After the instructions were given, both parties agreed that they were complete and did not vary from the instructions agreed upon at the instruction and verdict conference.

¶ 19 During closing arguments, both parties primarily focused on the first question, the existence of a contract between Erie and Best Price. Regarding the second question, breach of that contract, Best Price's attorney argued: “The problem is [Erie] never delivered the check. Now, if the check is written and thrown on the street or put in Mr. Trimble's hands, but it never reaches Best Price Plumbing, then there has been no payment made because there has been no delivery.” He argued that Erie breached its contract with Best Price “not because they were evil but because delivery was not made and they still have not made delivery of the money.”

¶ 20 The jury returned a verdict in favor of Erie. With one juror dissenting, it found that there was a contract between Best Price and Erie, and therefore, it answered the first question “yes.” However, it also found that Erie did not breach the contract. Therefore, the jury answered the second question “no.”

¶ 21 Best Price filed a motion after verdict under Wis. Stat. § 805.14(5)(c) (2009–10) ³ and asked that the circuit court change the answer to the second question from “no” to “yes.” It listed five grounds for relief. Of these five grounds, none had been previously raised.⁴

¶ 22 During the hearing on Best Price's motion, much of the argument revolved around a common law rule set forth in State v. Kenosha Home Telephone Co., 158 Wis. 371, 148 N.W. 877 (1914).⁵ Under that case, “[w]here a contract for the payment of money is silent as to the place of payment, in the absence of any legitimate inferences to the contrary the law implies that payment shall be made at the residence, office, or place of business of the creditor, if within the state.” Id. at 374, 148 N.W. 877. Best Price argued that Erie's failure to send the check to its place of business constituted a breach of contract as a matter of law.

¶ 23 The circuit court appeared to struggle to reconcile Best Price's motion regarding the sufficiency of evidence with the fact that Best Price's new theory regarding breach of contract was not raised or argued at trial. It indicated that, “depending how one looks at the evidence, the court could make the finding...