Davis v. Smartop, Inc.

Decision Date03 May 2022
Docket NumberCOA21-470
Citation871 S.E.2d 579 (Table)
Parties Henry Wayne DAVIS, Lana Davis, and Captain Henry's Gift Shop, Plaintiffs, v. SMARTOP, INC., and Dewey Wayne Willis, Defendants.
CourtNorth Carolina Court of Appeals

Joseph B. Dupree, II, and Stephanie A. Murad, for Plaintiffs-Appellees.

Wheatley Law Group, P.A., by Stevenson L. Weeks, for Defendants-Appellants.

INMAN, Judge.

¶ 1 Defendants-Appellants Dewey Willis ("Mr. Willis") and Smartop, Inc. (together with Mr. Willis as "Defendants") appeal from an order denying their motion for a new trial following a jury verdict and judgment entered in favor of Plaintiffs-Appellees Henry Wayne Davis and Lana Davis ("the Davises"). Specifically, Defendants contend that the trial court erred in declining to order a new trial based on an inconsistent verdict. After careful review, we reverse the trial court's order and remand for a new trial as to damages only.

I. FACTUAL AND PROCEDURAL HISTORY

¶ 2 Mr. Willis is the sole owner and president of Smartop, Inc., a self-storage facility in Carteret County. The Davises rented two storage units at Defendants’ self-storage facility, storing household items in one unit and Christmas decorations in the other. The Christmas decorations were used to decorate their home and a gift shop they operated together.

¶ 3 The Davises made timely rent payments for both units. Mr. Willis mistakenly marked the Davises’ storage unit containing the Christmas decorations as delinquent, leading him to sell its contents at a public yard sale without notice to the Davises. Mrs. Davis, by happenstance, drove by the storage facility on the day of the yard sale while running errands and decided to stop and look through the items being sold. She recognized several items and realized her property was being liquidated.

¶ 4 Mrs. Davis immediately called her husband to come to the facility. After waiting some time for the gate to be unlocked, the Davises, assisted by their son-in-law, attempted to gather their remaining belongings that were scattered and picked through among the yard sale offerings. A week later, Mr. Willis sent an email to the Davises admitting that their possessions were sold by mistake.

¶ 5 The Davises filed suit against Defendants for the unlawful sale of their property, asserting, among other claims, negligence, conversion, breach of contract, and unfair and deceptive trade practices ("UDTP"). Defendants failed to file an answer to the complaint, and the Davises secured an entry of default. After Defendants retained counsel, the entry of default was set aside by the consent of the parties and Defendants filed an answer admitting that they had mistakenly sold the Davises’ personal property. Other material allegations were denied.

¶ 6 At trial, Mrs. Davis testified at length to the nature and value of the items sold, including: over ten Christmas trees; a cedar tree; crab-pot trees; over 25 Santa statutes of varying sizes, many given to her by her daughter over the course of 25 years; several hand-carved Santa heads made and gifted by a family friend; ornaments; decorative lights; wreaths; icicles; holiday glassware; decorative lamps; holiday pictures; throw pillows; rugs; small tables; pocketbooks; and a suitcase. Mrs. Davis purchased some of these items while travelling, while she received others as gifts from family, friends, and her third-grade students from years prior. Mrs. Davis also testified that 12 irreplaceable decorative doves used in a number of family funerals were sold. She testified to the actual and replacement values for many of these items, which totaled in excess of $21,000.

¶ 7 Mr. Willis testified in his defense, telling the jury that Defendants never notified the Davises because their account was not delinquent. He further testified that he authorized the sale in question. His testimony also revealed that Defendants did not keep any records of the actual proceeds of the unlawful sale, making it nearly impossible for the Davises to track down their mistakenly-sold items.

¶ 8 At the conclusion of the Davises’ evidence, Defendants secured dismissal of all claims except negligence, conversion, breach of contract, and UDTP. At the conclusion of all evidence, Defendants moved for a directed verdict and dismissal of the UDTP claim, both of which were denied.

¶ 9 After the charge conference, the trial court gave the same substantive instruction concerning the measure of damages for each cause of action. Specifically, the trial court instructed the jury that the Davises’ damages for every claim was either the fair market value of the property unlawfully sold or, if there was no fair market value, the intrinsic actual value of the property.1 It also provided the jury with the definition of nominal damages, and gave the following instruction explaining when either nominal or actual damages could be awarded:

[I]f you find by the greater weight of the evidence the amount of actual damages caused by the sale of the property of the plaintiffs, then it would be your duty to write the amount in the blank space provided.
If, on the other hand, you fail to so find, then it will be your duty to write a nominal sum, such as one dollar, in the blank space provided.2

In short, the measure of damages for all claims was legally and factually identical: (1) the fair market value of the unlawfully sold property; (2) the intrinsic actual value of the same; or (3) nominal damages absent any proven value under (1) or (2).

¶ 10 The jury returned a verdict finding that Defendants were liable under all three theories and awarded the following damages:

(1) Negligence and Conversion: $1.00
(2) Breach of Contract: $1.00
(3) UDTP: $19,098.00

¶ 11 On 18 September 2019, Defendants moved for judgment notwithstanding the verdict, arguing there was insufficient evidence to submit the UDTP claim to the jury. Defendants also moved for a new trial, arguing: (1) the verdict was inconsistent and contradictory; (2) the jury instructions were disregarded; (3) damages were excessive; (4) insufficiency of evidence; and (5) error of law in the trial court's failure to grant the Defendantsmotion for directed verdict. Both motions were denied following a hearing. The trial court subsequently granted the Davises’ motion for treble damages and attorney's fees on the UDTP claim, bringing the total judgment to $117,605.50. A final judgment memorializing the award was entered on 1 September 2020.

¶ 12 On 4 September 2020, Defendants submitted a second motion for new trial, as their prior motion had been determined before entry of the judgment and thus was decided by the trial court without jurisdiction. See, e.g., Kor Xiong v. Marks , 193 N.C. App. 644, 653, 668 S.E.2d 594, 600 (2008) (holding that "though a motion for new trial may be filed before entry of judgment, the trial court does not have jurisdiction to hear and determine the motion until after entry of judgment" (emphasis in original)). The trial court denied Defendants’ renewed motion and entered written findings of fact and conclusions of law at the request of Defendants on 29 January 2021. Defendants appeal.

II. ANALYSIS

¶ 13 Defendants contend that the jury's verdict is irreconcilably inconsistent based on the differing damages awards. Because all of the Davises’ claims sought recovery for the same injury—and the jury received the same damages instruction for each cause of action—Defendants argue the nominal damage awards for negligence, conversion, and breach of contract are inconsistent with the award of $19,098.00 for UDTP. In light of the instructions given by the trial court, we agree with Defendants and hold that there is a material contradiction in the verdict regarding damages that requires a new trial on that issue.

A. Standard of Review

¶ 14 The parties dispute the appropriate standard of review applicable to this appeal, with Defendants arguing for de novo review and the Davises advancing the abuse of discretion standard. In light of Defendants’ argument that the allegedly inconsistent verdict requires a new trial, our standard of review is clear:

[T]he decision concerning whether to grant a new trial on the basis of allegedly inconsistent verdicts is one of discretion rather than one of law. For that reason, our review of defendant's challenge to the denial of his motion for a new trial on the grounds that the jury's verdicts were impermissibly inconsistent "is strictly limited to the determination of whether the record affirmatively demonstrates a manifest abuse of discretion by the judge." Worthington v. Bynum , 305 N.C. 478, 482, 290 S.E.2d 599, 602 (1982) (citations omitted). An abuse of discretion has occurred when a trial court's discretionary decision was "manifestly unsupported by reason"; for that reason, such a discretionary decision will not be overturned on appeal absent "a showing that it was so arbitrary that it could not have been the result of a reasoned decision." White v. White , 312 N.C. 770, 777, 324 S.E.2d 829, 833 (1985).

Piazza v. Kirkbride , 372 N.C. 137, 144, 827 S.E.2d 479, 485 (2019).

¶ 15 As for Defendants’ argument concerning the adequacy of the trial court's findings of fact and conclusions of law, "the standard of review on appeal is whether there was competent evidence to support the trial court's findings of fact and whether its conclusions of law were proper in light of such facts." Shear v. Stevens Bldg. Co. , 107 N.C. App. 154, 160, 418 S.E.2d 841, 845 (1992). Findings of fact are conclusive on appeal when they are supported by competent evidence. Andrews v. Peters , 318 N.C. 133, 138, 347 S.E.2d 409, 413 (1986). "Unchallenged findings of fact are presumed correct and are binding on appeal." Branch Banking & Tr. Co. v. Schiphof (In re Schiphof), 192 N.C. App. 696, 700, 666 S.E.2d 497, 500 (2008). Conclusions of law are fully reviewable on appeal. State v. Greene , 332 N.C. 565, 577, 422 S.E.2d 730, 737 (1992). Together, the findings of fact and conclusions of law must be sufficiently...

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