J.O. Hooker & Sons, Inc. v. Roberts Cabinet Co., Inc., CA-00144-SCT

• Citation: 683 So.2d 396
• Decision Date: 07 November 1996
• Docket Number: CA-00144-SCT
• Parties: 32 UCC Rep.Serv.2d 92 J.O. HOOKER & SONS, INC. v. ROBERTS CABINET CO., INC. NO. 93-
• Court: Mississippi Supreme Court

Page 396

683 So.2d 396

32 UCC Rep.Serv.2d 92

J.O. HOOKER & SONS, INC. v. ROBERTS CABINET CO., INC.

NO. 93-CA-00144-SCT.

Supreme Court of Mississippi.

Nov. 7, 1996.

Anselm J. McLaurin, McLaurin & McLaurin, Brandon, for Appellant.

Wes W. Peters, Kirkland & Barfield, Jackson, for Appellee.

Before PRATHER, P.J., and BANKS, and SMITH, JJ.

PRATHER, Presiding Justice, for the Court:

I. INTRODUCTION

This case calls upon this Court to review the granting of a motion for summary judgment in favor of a subcontractor against a general contractor who breached a subcontract agreement. This Court considers the granting of the summary judgment motion to have been well taken, but we order a remittitur of $1,260 to the amount of $41,610.

II. STATEMENT OF THE FACTS

In 1991, J.O. Hooker & Sons, Inc. ("Hooker") served as the general contractor for the renovation of residences owned by the Bessemer Public Housing Authority ("BPHA") in Bessemer, Alabama. The renovation involved tearing out fixtures, such as cabinets, and Hooker's contract with the BPHA provided that the BPHA, as the owner of the property, had the option to either keep or salvage fixtures which needed to be torn out during the renovation process. The contract further provided that, in the event that the BPHA elected to keep the cabinets, Hooker would be required to remove the cabinets and move them to a location of the BPHA's choosing. Under said general contract, the cabinets were to become the property of Hooker and to be removed by him in the event that the BPHA elected not to keep said cabinets.

Hooker entered into a subcontract agreement with Roberts Cabinet Co., Inc. ("Roberts"), pursuant to which Roberts was required to "furnish cabinets, tops, plastic laminates on walls and furr down materials and fronts for hot water heaters as per plans and specs for the price listed below." The agreement also provided that "the price includes the cost of tear-out (sic.) old cabinets and installation of new cabinets."

As the date when the cabinets would be needed approached, Roberts informed Hooker that he had underestimated the costs of the job and demanded an additional $23,000, which, Hooker asserts, he had no choice but to pay given the time constraints which were present. Later, a dispute arose between Hooker and Roberts as to which party had the duty to dispose of the cabinets as the BPHA required in the general contract. Roberts asserted that the subcontract did not obligate him to dispose of the cabinets, but Hooker contends that the "as per specs and plans" language in the subcontract agreement served to incorporate by reference the general contract and that Roberts thus assumed Hooker's duties to dispose of the cabinets.

The parties were unable to resolve their dispute, and on December 13, 1991, Hooker sent Roberts a fax in which he stated that he had consulted with his lawyer and was considering the contract null and void. Hooker offered to buy from Roberts the cabinets that Roberts had already constructed, but the parties were unable to come to an agreement.

III. STATEMENT OF THE CASE

On December 18, 1991, Roberts Cabinet Co., Inc. filed suit against J.O. Hooker & Sons, Inc., alleging that Hooker had wrongfully breached a subcontract agreement with Roberts after Roberts had already begun performance. On September 16, 1992, the trial court granted summary judgment in favor of Roberts, finding that Hooker had no legal right to unilaterally terminate the contract in the present case.

On December 10, 1992, a trial was held for the sole purpose of determining the amount of damages suffered by Roberts as a result of Hooker's actions, and a jury determined Robert's damages to be in the amount of $ 42,870. On January 8, 1993, the trial court denied Hooker's motions for a new trial or in the alternative a remittitur of the jury's verdict, and Hooker filed a timely appeal.

IV. WHETHER THE LOWER COURT ERRED IN GRANTING SUMMARY

JUDGMENT AGAINST J.O. HOOKER & SONS, INC., ON THE

ISSUE OF LIABILITY.

A. Was there a genuine issue of material fact with regard to whether Hooker or Roberts had the duty to dispose of the cabinets in question?

This Court reviews de novo the record on appeal from a grant of a motion for summary judgment. In Brown v. Credit Center, Inc. 444 So.2d 358, 362 (Miss.1983) this Court interpreted Rule 56 and the standards that the trial court should use in considering a motion for summary judgment. This Court explained that:

The trial court must review carefully all of the evidentiary matters before it--admissions in pleadings, answers to interrogatories, depositions, affidavits, etc. The evidence must be viewed in the light most favorable to the party against whom the motion has been made. If in this view the moving party is entitled to judgment as a matter of law, summary judgment should forthwith be entered in his favor. Otherwise the motion should be denied. Brown, 444 So.2d at 362.

Northern Electric Co. v. Phillips, 660 So.2d 1278, 1281 (Miss.1995), quoting Brown v. Credit Center, Inc. 444 So.2d 358, 362 (Miss.1983).

Hooker argues that the trial court was in error in granting Roberts' motion for summary judgment on the issue of liability, given that disputed issues of fact remained which, Hooker contends, should have been resolved by the jury rather than the judge. Specifically, Hooker asserts that there was a disputed issue of fact as to whether Roberts had the duty of carrying away and disposing of the cabinets which were removed from the dwellings in question.

Hooker asserts that the contract in question should be interpreted in the context of Article 2 of the Uniform Commercial Code, Miss.Code Ann. § 75-2-101 et seq., given that the transaction involved was for the sale of goods, namely cabinets. Hooker cites no authority for this proposition, and Roberts does not address this issue at all, but it is of importance to determine what law should apply to the contract. There appear to be no Mississippi cases directly on point, but this Court finds that, although the transaction in this case did involve a sale of goods, the dispute in this case actually concerns the performance of services and the delegation of duties under a contract.

A number of states which have considered this issue have concluded, based on an interpretation of UCC § 2-102, that Article 2 does not apply to construction or service contracts. See Perlmutter v. Don's Ford, Inc., 96 Misc.2d 719, 409 N.Y.S.2d 628 (1978); Christiansen Bros., Inc. v. State, 90 Wash.2d 872, 586 P.2d 840 (1978). The present contract, however, is properly viewed as a mixed transaction of goods and services, and courts have reached differing conclusions as to whether the UCC should apply to such mixed transactions.

In Snyder v. Herbert Greenbaum & Associates, Inc., 38 Md.App. 144, 380 A.2d 618 (1977), the Maryland Court of Appeals held that a contract for the installation of carpeting in a large apartment complex was primarily a contract for sale, rather than installation, of such carpeting and thus was subject to UCC Article 2. In Freeman v. Shannon Const., Inc., 560 S.W.2d 732 (Tex.Civ.App. 7th Dist.1977), by contrast, a Texas appellate court held that a contract between a general contractor and subcontractor, pursuant to which the subcontractor was to complete cement construction work on an apartment project, was in essence a service contract, even though it did involve the transfer of goods, and thus the UCC should not apply.

It is very often the case that a construction contract will involve the furnishing of goods by a subcontractor, and this Court holds that, in such a mixed transaction, whether or not the contract should be interpreted under the UCC or our general contract law should depend upon the nature of the contract and also upon whether the dispute in question primarily concerns the goods furnished or the services rendered under the contract. The present case clearly does not concern the cabinets manufactured, but rather the refusal of Roberts to assume duties which Hooker contractually obligated itself to perform. This Court would not hesitate to apply Article 2 if the present case involved, for example, a dispute over the quality of the cabinets, but the present case is in actuality a fairly standard contract dispute involving delegation of duties under a contract and the right to unilaterally rescind said contract. The fact that goods were furnished in the present contract has no bearing on the legal analysis involved, given that the dispute in this case clearly concerns the service aspect of this mixed transaction.

Hooker's desire to have this contract interpreted under the provisions of the UCC is based on the fact that Miss.Code Ann. § 75-2-202 (1972), which contains the UCC version of the parol evidence rule, provides a more permissive approach for the admission of extrinsic evidence than that found in our general body of law. Specifically, § 75-2-202 does not require that the agreement in question first be found to be incomplete or ambiguous before evidence of course of dealing and usage of trade may be considered.

Under our general, non-UCC, parol evidence rule, by contrast, a document must first be found to be incomplete or ambiguous before said document may be explained, but not contradicted, by extrinsic evidence. Busching v. Griffin, 542 So.2d 860 (Miss.1989). In Busching, Griffin sold an option to purchase property for $50,000, and, upon deciding that said price was too low, breached the option contract, asserting that she thought that the option price was a loan to pay her taxes. Busching, 542 So.2d at 861. The trial court accepted Griffin's argument, but this Court reversed, finding that the contract in question was not ambiguous and thus that Griffin could not introduce extrinsic evidence to supplement said contract. Id. at 865.

As in Busching, the subcontract in the present case is clear and unambiguous in that it clearly provides that Roberts' bid...