Simms v. Nance Constr., Inc.
| Decision Date | 19 June 2012 |
| Docket Number | 1 CA-CV 10-0870 |
| Parties | JERRY SIMMS, a single man, Plaintiff/Appellee, v. NANCE CONSTRUCTION, INC., an Arizona Corporation, Defendant/Appellant. |
| Court | Arizona Court of Appeals |
See Ariz. R. Supreme Court 111(c); ARCAP 28(c);
(Not for Publication - Rule 28, Arizona Rules of Civil Appellate Procedure)
(Consolidated)
The Honorable Eileen S. Willett, Judge
AFFIRMED
Hill & Hill, P.L.C.
By R. Corey Hill
Ginette M. Hill
Attorneys for Defendant/Appellant
Phoenix
DeCiancio Robbins, P.L.C.
By Christopher Robbins
Attorneys for Defendant/Appellant
Tempe
Warner Angle Hallam Jackson & Formanek P.L.C.
By Stephen E. Jackson
Chris R. Baniszewski
Matthew J. Pierce
And
Phoenix
Law Offices of Joseph C. Dolan P.C.
By Joseph C. Dolan
Attorneys for Plaintiff/Appellee
Phoenix
¶1 Jerry Simms filed suit against Nance Construction, Inc. ("Nance"), the general contractor who had been in charge of the construction of Simms' home several years prior, alleging that Nance was responsible for defects later discovered in the home's construction. Nance appeals the judgment in favor of Simms, raising several issues. For the following reasons, we affirm.
¶2 In 2000, Nance completed construction of a $2.8 million home and guest house for Simms. Nance's subcontractors included Todd Willis d/b/a Northeast Valley Roofing ("Northeast") and Cobra Stucco, L.L.C. ("Cobra").
¶3 In March 2001, a home undergoing construction on a neighboring lot caught fire, extensively damaging Simms' home and guest house. Simms hired Dusty Creek Builders, Inc. ("Dusty Creek") to repair the damage.
¶4 Simms filed a negligence suit in superior court against the owners/developers of the neighboring house (Michael J. Peloquin, the principal owner of Downtown Community Builders Limited Partnership, and MK Custom Residential Construction, L.L.C. ("MK Residential")), as well their general contractor (Vision Building and Development, Inc. ("Vision")), a subcontractor (Christopher Watson), and others.2
¶5 During the course of discovery, defense experts opined both that Dusty Creek had negligently repaired the damage to Simms' residence and that many defects found in the houses were the result of defects in the original construction. Simms retained Jonathan Higgins, an engineer with Rimkus Consulting Group, who Simms would later present at trial as his construction expert against Nance.
¶6 Nance first became aware of issues regarding the original construction of the houses in late May 2005, when Simms and Higgins met with Nance to discuss problems, especially with the roofs. At the meeting, Nance offered to make repairs to the roofs, but Simms refused the offer, ostensibly because Nance requested a release once the repairs were completed.
¶7 On November 28, 2005, counsel for Simms sent Nance a letter in an attempt to comply with Arizona Revised Statutes ("A.R.S.") section 12-1363, a "purchaser dwelling action" statute.3 The letter specifically identified numerous construction defects, but advised Nance that the list was "not a comprehensive and final list of items." In a response letter dated January 25, 2006, counsel for Nance addressed the various defects alleged in the November 28 letter, disputed Nance's responsibility for some of the defects, requested access to the property to make repairs on the defects for which Nance accepted responsibility, and agreed to repair within sixty days those items Nance identified as original construction defects. In a reply letter dated February 24, 2006, counsel for Simms raised numerous "questions and comments" regarding Nance's letter, advised Nance that additional defects and "other potential problems with the original construction" likely existed, addressed many of Nance's responses, and advised Nance that,given the trial court's deadline for adding defendants and the parties' differences, litigation would be necessary.
¶8 On March 13, 2006, Simms filed an amended complaint, adding Nance, Northeast, Cobra, and Dusty Creek as defendants. Simms alleged claims of breach of contract, breach of implied warranty of habitability, and negligence against Nance.
¶9 In March 2007, counsel for Simms wrote to counsel for the defendants asking whether any defendants were willing to offer any repairs before Simms "commenc[ed] repair through our own efforts." Nance apparently did not respond to this inquiry.
¶10 Simms ultimately decided that, rather than attempt to identify and repair all of the defects on an item-by-item basis, he would have the entire roof and EIFS system (the exterior coating of the home) replaced. In June 2007, Simms entered a fixed-price contract with Advanced Repair Technologies ("ART"), pursuant to which he paid $1,578,999 for repairs that included a complete remodel of the roof and the exterior stucco system.
¶11 That same month, Nance filed a motion for summary judgment/motion to dismiss, asserting that Simms had failed to adequately disclose the repairs for which he sought to hold Nance responsible and had failed to give Nance proper notice and an opportunity to repair as required under the statutes related to purchaser dwelling actions. See A.R.S. §§ 12-1361 to -1366. The trial court denied the motion.
¶12 In April 2010, in advance of trial, Simms filed a motion in limine to preclude Nance from introducing "character evidence of Plaintiff Jerry Simms." Nance responded that it sought to introduce evidence of Simms' conduct with and as documented by the Arizona Department of Gaming, which had denied Simms' application for a license after expressing concern he had been involved in "questionable business practices, illegal activities and financial transactions with a person purportedly involved in organized crime." The trial court granted Simms' motion to preclude the character evidence.
¶13 Trial began on May 17, 2010. By the time of trial, Simms had settled with most of the defendants, and only two remained: Nance and Vision, the general contractor on the neighboring house.
¶14 At trial, Simms' expert, Higgins, testified as to his repair recommendations for the defects that were found. Higgins conceded that he initially believed the defects could have been fixed on an item-by-item basis and that he did not specifically recommend the roofs be torn down to the studs, although he stated that it was an "alternate choice" available to Simms. He also conceded that he was not asked to prepare a cost-to-repair estimate. He further testified, however, that had he known beforehand of all the problems ultimately revealed by removal of the EIFS system and the roof, he would have recommended the"teardown" repair approach be taken. He explained that doing the repairs on an issue-by-issue basis would have meant that the cost of the work would be determined by a "time and material" approach, a problematic and unattractive proposition for Simms because he would not know the total cost until all repairs had been completed.
¶15 Simms also called David Slany, the former project manager for ART.4 Slany indicated he was knowledgeable concerning the work ART performed and was present during major phases of the work on Simms' property.5 He testified as to the $1,578,999 contract price between Simms and ART, and he broke that figure into specific component costs - including for demolition, roofing, stucco, scaffolding, electrical and plumbing repairs, and replacement landscaping - although he did not directly testify as to the reasonableness of thoseindividual costs.6 He further testified that he had been involved in the initial meetings with Simms involving the work, but not in "[t]he final contract," and had not worked up the pricing himself. He admitted he did not have copies of the subcontracts, but stated that the ART-Simms contract was a fixed-price contract for which ART had obtained multiple bids for the subcontracts issued, and he explained the financial risks faced by ART and its subcontractors in entering the contract, as well as various logistical difficulties encountered in the repair that affected the agreed-upon cost. When Slany was asked if it was "reasonable and necessary to do what Mr. Simms did, in terms of this repair," there was no objection from Nance, and Slany affirmatively stated, "I think the only way that it could be done correctly was the way that it was done."
¶16 Simms also testified. He stated that, after reviewing Higgins' report and conducting its own investigation, ART recommended the EIFS be removed down to the studs and the roof replaced because "you don't know what's behind there." ART informed Simms that it would not do the work on an issue-by-issue basis because in its experience, entirely replacing the EIFS and roof was necessary. Simms submitted evidence of hisoriginal contract with and payments to Nance, which ostensibly allowed the jury to compare the price of the original work with the price of the repair work. Simms also submitted evidence that he paid ART for the work it performed.
¶17 After Simms rested, Nance moved for judgment as a matter of law7 on the basis that Simms had failed to offer evidence that ART's cost of repair was reasonable. Counsel for Simms argued that prima facie evidence of reasonableness existed in the form of testimony that indicated the ART-Simms contract "was an arms-length transaction and not a cost-plus contract, like Nance['s]"; the owner of ART "was a skilled and experienced construction remediation, construction defect contractor" who had been independently recommended to Simms; and Slany had given "a breakout of the information that he had from ART at the time the job was being done, as to what the component parts were . . . [and] how in his estimation that will be...
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