Marshall v. Bare
| Decision Date | 31 August 1984 |
| Docket Number | No. 14617,14617 |
| Citation | 107 Idaho 201,687 P.2d 591 |
| Parties | J. C. MARSHALL, Plaintiff-Appellant, v. Duane BARE and Diane Bare, husband and wife, Defendants-Respondents. |
| Court | Idaho Court of Appeals |
John J. Rose, Jr., Wallace, for plaintiff-appellant.
R. Romer Brown, Brown & Justh, Coeur d'Alene, for defendants-respondents.
J. C. Marshall contracted to sell a lot to Duane and Diane Bare and to construct a new home on the property. The Bares took possession of the property following completion of the home. Approximately three and one-half months later, on February 15, 1979, the parties closed the transaction; the Bares paid the purchase price and received a deed to the property from Marshall. Marshall later filed suit against the Bares to collect "rent" for the period of time the Bares were in possession of the property prior to closing. The Bares counterclaimed to recover from Marshall the cost of repairs to remedy defects in the construction of the home.
Following trial before a magistrate, the court awarded judgment to both parties. Marshall received $920, representing rent at the rate of $10.00 per day for 92 days, and the Bares received $2183 for their repairs and corrections. The judgment gave net recovery to the Bares of $1263 after offset for the rental awarded to Marshall. Both parties appealed to the district court.
Sitting as an appellate court, the district judge affirmed the award to the Bares in the amount of $2183. However, the district court reversed the award to Marshall for the recovery of rent. The district court held that the Bares were not liable for any "rent" because there was no contract or agreement for the payment of rent between the parties and the Bares were in possession as contract purchasers of the property, not as tenants. But the district court further concluded that because Marshall had incurred the expense of interest on his construction loan, insurance and property taxes, for the period the Bares were in possession prior to closing, the Bares would be unjustly enriched if they did not compensate Marshall for those expenses. The district court therefore remanded the case to the magistrate for determination of the amount of unjust enrichment for which the Bares should be liable to Marshall. Marshall now appeals from the decision of the district court. We affirm the decision of the district court in respect to the award in favor of the Bares. We also affirm the district court's disallowance of the recovery of rent, but we reverse the district court's determination allowing recovery on the unjust enrichment theory.
Marshall raises four issues on appeal. First, he questions whether the Bares should recover for Marshall's breach of warranty of workmanship, because the Bares sold their house to a third party before any of the defects were corrected. Second, he contends that the amount of the magistrate's award of damages for his breach of warranty is not supported by substantial, competent evidence. Third, he asserts it was error to exclude as hearsay Marshall's testimony on the fair market value of the repair work done on the Bares' home, which was based upon statements from other contractors. Finally, he argues that the district court should have affirmed the magistrate's award of damages for the rental value of the house, or in the alternative that the amount of unjust enrichment is equal to the rental value of the house. Both parties seek an award of attorney fees on appeal.
We first consider Marshall's challenge to the propriety of any award for his breach of warranty. He contends that because the Bares had sold the house before the repairs were made, and because the contract under which the Bares sold the house did not require that these repairs be made, the Bares suffered no injury for which Marshall could be held liable.
At trial, evidence was submitted showing that the Bares' purchase of the property was financed by a bank loan guaranteed by the Veteran's Administration. The plans and specifications for the construction of the house were approved by the VA. Upon completion of the building, Marshall signed a written warranty, warranting that the house was in substantial compliance with the approved plans. From the evidence, the trial court found that "during the spring thaw in 1979, problems did develop which constituted a breach of the warranty." Marshall was notified by the VA of the corrections which were needed. In the meantime, the Bares, who were moving out of state, sold the house to a third party. In that transaction, the Bares agreed to correct most of the items which were defective under the warranty. When Marshall failed to remedy the defects, the Bares hired others to do the work.
Contrary to Marshall's contention, the evidence supports the court's finding that the Bares assumed the responsibility with their buyers to have the defects remedied. This finding will be upheld. Nor does the fact of the sale of the house before the repairs were made afford any relief to Marshall from liability for breach of the warranty.
Marshall argues that "[w]rong without damage or damage without wrong does not constitute a cause of action," citing 22 Am.Jur.2d Damages § 2 (1965). However, that maxim is not applicable here. The wrong is Marshall's breach of his warranty of workmanship; the damage is the economic loss suffered by the Bares as a result of the breach. The magistrate found there was a causal relationship between the alleged defective workmanship and the economic loss suffered by the Bares. The magistrate's finding in this regard is supported by substantial evidence and will be upheld. I.R.C.P. 52(a).
Marshall also contends that the amount of the magistrate's award of damages for his breach is not supported by the evidence. The court awarded damages for the cost of repairing a wooden deck and the concrete walkway in front of the house, replacing posts to support the eaves and excavating on two sides of the house to provide for drainage of water away from the house, to prevent water from leaking into the basement. The testimony of several witnesses established the scope of the work done and the expense which the Bares incurred in making those repairs. Marshall did not produce any evidence to dispute that testimony, to establish that the cost of that work was unreasonable, or to establish that the work done was not necessary, though he argued that such was the case. The magistrate implicitly found the Bares' economic loss from Marshall's breach was equal to the cost of repairing the defects, and we see no error in that finding upon the facts of this case. The magistrate's findings are supported by the evidence and its conclusions of law on this issue follow from those findings. Ustick v. Ustick, 104 Idaho 215, 657 P.2d 1083 (Ct.App.1983). Therefore, we affirm the award of damages to the Bares.
Marshall also challenges the exclusion of testimony which he offered at trial. His offer of proof shows that Marshall would have testified that other contractors would have repaired the damages to the home at substantially less expense than the Bares incurred. The magistrate ruled that this testimony was hearsay and excluded it. Marshall argues that it is not hearsay because the statements were not offered as proof of the facts contained in the statement but merely as proof that the statement was made. However, if the testimony were offered only as proof that the statement was made, we do not see the legal significance of that statement. The statement is relevant to the legal issues presented in this case only if the statement--which tended to show that the expenses incurred by the Bares were excessive--was offered as proof of that fact. If so, the statement was properly excluded under the hearsay rule. E.g., Frank v. City of Caldwell, 99 Idaho 498, 584 P.2d 643 (1978). If not, then it was not relevant and could be excluded for that reason. Briscoe v. Nishitani, 105 Idaho 175, 667 P.2d 278 (Ct.App.1983). We conclude that the magistrate properly excluded the proferred testimony as hearsay evidence.
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