Grand Manor, Inc. v. Dykes

• Decision Date: 28 August 1998
• Citation: 778 So.2d 167
• Parties: GRAND MANOR, INC. v. Vicky H. DYKES and Benny J. Dykes.
• Court: Alabama Court of Civil Appeals

778 So.2d 167

GRAND MANOR, INC. v. Vicky H. DYKES and Benny J. Dykes.

2970137.

Court of Civil Appeals of Alabama.

August 28, 1998.

Rehearing Denied November 6, 1998.

John R. Bradwell of Hill, Hill, Carter, Franco, Cole & Black, P.C., Montgomery, for appellant.

J. Tutt Barrett of Dean & Barrett, Opelika; and Susan G. Copeland of the Law Office of J. Doyle Fuller, Montgomery, for appellees.

ROBERTSON, Presiding Judge.

In November 1996, Vicky H. Dykes and Benny J. Dykes sued Grand Manor, Inc., and Better Cents Home Builders, Inc. ("Better Cents"), in the Lee County Circuit Court. Better Cents sells and installs mobile homes; Grand Manor manufactures mobile homes. The Dykeses alleged that they were damaged when they purchased a mobile home from Better Cents that, they say, had been negligently manufactured by Grand Manor and negligently delivered and installed by Better Cents. The Dykeses also asserted a claim alleging promissory fraud, specifically alleging that Grand Manor and Better Cents had fraudulently misrepresented that the defects in the mobile home would be repaired.

The case was tried before a jury on September 2—September 4, 1997. Grand Manor and Better Cents moved for a judgment as a matter of law pursuant to Rule 50, Ala.R.Civ.P., at the close of the Dykeses' evidence and at the close of all the evidence. Both motions were denied, and the case was submitted to the jury. The jury returned a verdict in favor of the Dykeses against Grand Manor in the amount of $12,500 and a verdict in favor of the Dykeses against Better Cents in the amount of $12,500, and the trial court entered a judgment on the jury's verdict. On September 26, 1997, Grand Manor renewed its motion for judgment as a matter of law; the trial court denied that motion on September 30, 1997.

Only Grand Manor appeals the judgment on the jury's verdict. On appeal, it argues that the trial court erred (1) by denying its motion for a judgment as a matter of law on the Dykeses' claim of negligent delivery and installation,¹ (2) by denying its motion for judgment as a matter of law on the Dykeses' claim of negligent manufacture, and (3) by denying its motion for judgment as a matter of law on the claim of promissory fraud.

We note that Rule 50, Ala.R.Civ. P., effective October 1, 1995, renames the term "motion for a directed verdict" as a "motion for a judgment as a matter of law," and renames the term "motion for a judgment notwithstanding the verdict" as a "renewal of a motion for a judgment as a matter of law." However, the standard of review applicable to the trial court's denial of the motions for a judgment as a matter of law is the same standard of review previously applicable to a trial court's denial of a motion for a directed verdict and a motion for a judgment notwithstanding the verdict:

"The standard of review applicable to a ruling on a motion for JNOV is identical to the standard used by the trial court in granting or denying a motion for directed verdict. Turner v. Peoples Bank of Pell City, 378 So.2d 706 (Ala. 1979). Thus, in reviewing the trial court's ruling on the motion, we review the evidence in a light most favorable to the nonmovant, Ritch v. Waldrop, 428 So.2d 1 (Ala.1982), and we determine whether the party with the burden of proof has produced sufficient evidence to require a jury determination. Macon County Comm'n v. Sanders, 555 So.2d 1054 (Ala.1990)."

American Nat'l Fire Ins. Co. v. Hughes, 624 So.2d 1362, 1366 (Ala.1993). The Court in Hughes also addressed the evidentiary criteria for a trial court's ruling on a renewal of a motion for a judgment as a matter of law:

"In ruling on a motion for a JNOV, the trial court is called upon to determine whether the evidence was sufficient to submit a question of fact to the jury; for the court to determine that it was, there must have been `substantial evidence' before the jury to create a question of fact. See, § 12-21-12(a), Ala.Code 1975. `[S]ubstantial evidence is evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.' West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989)."

624 So.2d at 1367.

Viewing the facts most favorably to the Dykeses, we note that the record reveals that the Dykeses began shopping for a new mobile home in September 1995. They went to the sales lot of Better Cents and found a particular mobile home that they liked. Andy Hollis, a salesman employed by Better Cents, told them that they could order the same mobile home from Grand Manor. The Dykeses decided to order a mobile home rather than buying the one that had been on display. The order form shows that the home was ordered on September 28, 1995, showing Grand Manor as the manufacturer and Better Cents as the dealer. Based on the order form and its communication with Better Cents, Grand Manor knew when it constructed the mobile home that it was building the home for the Dykeses according to their specifications. The cost of the mobile home, including the items that the Dykeses specifically requested, was $48,500.

The mobile home was delivered at the end of October 1995 and installed in early November 1995. The installation was performed by an employee of Better Cents. Soon after they moved into the mobile home, the Dykeses noticed a number of problems. The major problems included defects in, and discoloration of, the kitchen cabinets,² unaccountable dimming of the lights when household appliances were in use, and plumbing problems that resulted in toilets backing up and overflowing and drops in cold water pressure causing scalding in the showers. The Dykeses presented evidence that their son had been scalded and that their carpets had been damaged by the plumbing problems. There were also numerous other problems, including flaws in trim work and molding, cracks in the walls, incomplete underpinning, and leaks and cracks in the bathrooms. At the request of Better Cents, on November 28, 1995, the Dykeses supplied Better Cents with a list of the problems they had found in the mobile home.

On December 22, 1995, Better Cents contacted the Dykeses and informed them that they must complete the financing, "close the loan," or move out. The Dykeses informed Better Cents that they were unwilling to complete the purchase until the problems that they had noted in the mobile home were fixed; Better Cents informed them that it would execute a written document in which it would agree to make the repairs if the Dykeses would complete the financing. The Dykeses met Robert Banks, an employee of Better Cents, at a lawyer's office for the closing of the financing transaction. At the closing, the Dykeses presented a new list of problems with the mobile home that they wanted corrected. The list was attached to the closing documents and the Dykeses were assured, both orally and in writing, that the problems would be repaired by January 17, 1996. During the closing, Banks telephoned J.T. Hogan, an employee of Grand Manor, and read him the Dykeses' list of problems. Grand Manor also agreed to repair the problems by January 17, 1996.

On January 3, 1996, a Grand Manor employee, Mike Mathis, went to the Dykeses' mobile home and made some repairs. However, he did not have the time or the materials to complete the work. Mathis returned on January 9, 1996, and did additional work. Mrs. Dykes refused to sign a work order stating that the work was "complete," because the major problems with the cabinets, plumbing, and electricity had not been repaired. When she called Hogan at Grand Manor, Grand Manor told her it would make no further repairs. Hogan testified that he had informed Banks at Better Cents in February 1996 that the Dykeses' problems were not Grand Manor's responsibility. On February 15, 1997, Banks, on behalf of Better Cents, informed the Dykeses that Better Cents would not perform any repairs because the problems were not its responsibility and that Grand Manor was also refusing to make any further repairs. As of the date of the trial, the problems still had not been repaired. At trial, the Dykeses presented expert testimony regarding the numerous defects in the mobile home.

Grand Manor argues that the trial court erred in denying its motion for a judgment as a matter of law on the Dykeses' claim of negligent manufacture of the mobile home. Grand Manor argues that the general rule in Alabama is that, in the absence of a contractual relationship, manufacturers are not liable to consumers for negligent manufacture. Sterchi Bros. Stores v. Castleberry, 236 Ala. 349, 182 So. 474 (1938). Essentially, the rule is that a manufacturer has no duty of care to a particular consumer unless there is a direct contract between the consumer and the manufacturer to purchase the manufacturer's product.

However, in Berkel & Co. Contractors, Inc. v. Providence Hosp., 454 So.2d 496, 501 (Ala.1984), our Supreme Court stated that "Alabama Courts have rejected the absence of privity of contract as a defense to a negligence action." The Court in Berkel also relied on the following discussion from this court in Federal Mogul Corp. v. Universal Constr. Co., 376 So.2d 716, 724 (Ala.Civ.App.1979):

"Although plaintiff may be barred from recovering from defendant as a third party beneficiary to defendant's contract with another, plaintiff may nevertheless recover in negligence for defendant's breach of duty where defendant negligently performs his contract with knowledge that others are relying on proper performance and the resulting harm is reasonably foreseeable."

See also McFadden v. Ten-T Corp., 529 So.2d 192, 200 (Ala.1988)

("a defendant will not be relieved from liability merely on the basis of lack of...