Smith v. Johnston

• Decision Date: 24 October 1978
• Docket Number: No. 49543,49543
• Parties: Jack SMITH, Appellee, v. Gary C. JOHNSTON and Otto R. Krueger Electric Co., Inc., Appellants.
• Court: Oklahoma Supreme Court

Page 1260

591 P.2d 1260

Jack SMITH, Appellee, v. Gary C. JOHNSTON and Otto R. Krueger Electric Co., Inc., Appellants.

No. 49543.

Supreme Court of Oklahoma.

Oct. 24, 1978.

Rehearing Denied March 12, 1979.

Appeal from the District Court of Oklahoma County; David M. Cook, trial judge.

Owner brings action against general contractor and the electrical sub-contractor for damages in the construction of a house. At trial, owner waives any contract action and sues on tort. Jury returns verdict for actual and exemplary damages against the general and the electrical sub-contractors. Ordered remittitur accepted. Contractors appeal. AFFIRMED.

Patrick Brown, Keith R. Treadway, Oklahoma City, for appellee.

Hunt, Thomas, Dawson & Gile, Oklahoma City, for appellant, Gary C. Johnston.

William C. Majors, Oklahoma City, for appellant, Otto R. Krueger Elec. Co., Inc.

LAVENDER, Vice Chief Justice:

Jack C. Smith (owner) and Gary C. Johnston (contractor) entered into a contract in 1971 for Johnston to build a house for Smith. Otto R. Krueger Electric Co., Inc. (electrical contractor) was the electrical sub-contractor on the construction. House was completed and Smith took occupancy that same year. In 1974, Smith sought the addition of other lighting by another electrical contractor. In performing that work, the latter electrical contractor found conditions in the house wiring that he believed justified the notification of the city electrical inspector. An inspection determined the house to be dangerous. The last electrical contractor was hired by owner to remedy certain deficiencies so as to make the house safe. Owner brought suit against the contractor and his electrical sub-contractor.

Owner's petition contained two causes of action. The first cause of action sought an accounting from the general contractor, under a fee basis in the contract. Second cause of action seeks money damages including actual and exemplary damages. The allegations in that second cause of action included intentional acts creating a dangerous condition in the house making it inherently dangerous and of the contractors conspiring to commit fraud through the use of inferior materials.

At pre-trial conference, an order was entered eliminating from jury trial the consideration of the accounting pled in the first cause of action and narrowing the jury trial issue to damages for difference in value of material required and of material installed along with exemplary damages. During trial and on questioning of the court, owner's attorney limited consideration to torts based on fraud in using aluminum instead of copper wiring as claimed was required by the specifications and installed so negligently as to cause a fire hazard. Trial court allowed into evidence a cost item of some $438.00 that owner testified was the cost of necessary work to make the house safe from fire. Trial court refused into evidence the cost of replacing the aluminum wiring with copper wiring.

Jury returned a verdict of $432.25 actual damages against both contractors and exemplary damages against the general contractor of $25,000 and $10,000 against the electrical contractor. Plaintiff subsequently accepted a court ordered remittitur of $5,000.00 against each of the amounts recovered as exemplary damages. Contractors appeal.

Consideration of this appeal requires a determination as to just what kind of action was involved, either contract or tort; and if the essential elements were present, including actual damages resulting therefrom, for a tort action.

This jurisdiction's case law has allowed on occasions the "waiving of contractual rights and suing on the tort." Hobbs v. Smith, 27 Okl. 830, 115 P. 347, 350 (1911) ; Hall Jones Oil Corporation v. Claro, Okl., 459 P.2d 858 (1969). Other like Oklahoma authorities were reviewed in Burton v. Juzwik, Okl., 524 P.2d 16 (1974), but there the gravamen of the cause of action was determined to be a breach of contract and not tort, so as not to present an election to the plaintiff.

In present case, owner chose to bottom his action on tort. The issue then becomes whether the owner had the option of choosing between a tort or contract action. That stance must be viewed in the present posture of the case coming after trial and judgment for actual and exemplary damages.

Though not always clear, an examination of the pleadings, evidence at trial, and instructions to the jury suggest (1) a tort based on fraud in not using in the construction of the dwelling the alleged specified kind of wiring, and (2) a tort based on malfeasance in performance through negligent work in installation so as to create a hazardous condition for owner.

As to the fraud position, the remedy of a finished product not conforming to the contract is non-performance and not one based on fraud. Jones v. Featherston, Okl., 373 P.2d 16 (1962). Nor was there any evidence allowed to go to the jury in the present case upon which an award for damages resulting from fraud could have been based. We find no tort action based upon fraud nor evidence of fraud upon which the jury could have allowed the actual damages determined of $432.25.

Prosser ¹ acknowledges the relation between remedies in contract and tort as a confused field. He speaks of the early developed dividing line of "nonfeasance," which meant not doing the thing at all, and "misfeasance," which meant doing it improperly. He says that division is scorned but generally followed, for it draws a valid line between the complete non-performance of a promise, which in the ordinary case is a breach of contract only, and a defective performance, which may also be a matter of tort.

In present case, it is argued there was no violation of a duty. Crowe, in an article "The Anatomy of a Tort," ² in discussing a violation of a duty, talks of labeling factors of negligence so as to include (1) likelihood of harm; (2) gravity of the harm; and (3) burden of prevention. If the likelihood and gravity of a given harm are of no particular moment, but the defendant could have avoided, with little or no appreciable effort, the harm, then he indicates "the pendulum may swing back toward a finding of negligence." See also 76 O.S.1971, § 1. ³

Here, the owner's house as wired by the contractors was determined by the city electrical inspector witness to "have great danger to property" and "cause a fire hazard." Cost of removing that danger was some $400. Though the likelihood of harm may have been of no particular moment, the gravity was great and, with little appreciable effort, could have been avoided. We find there was a violation of a duty owed by law, regardless of whether it was also imposed by contract, to the owner by the contractors. Burden of prevention in taking steps to prevent the harm from occurring was that of the contractors. This burden was shifted to the owner at an expenditure and damage to him of $432.25 found as actual damages by the jury. The necessary elements to sustain a tort action were present.

Electrical contractor argues limitation of two years under 12 O.S.1971, § 95 ⁴ with the construction being completed in 1971 and the tort action filed in 1974. Here, with the likelihood of harm being of no particular moment, and having begun in 1971, that harm continued until it was abated. Abatement by the owner could take place only upon his discovery and learning of harm and of the hazardous condition. Though distinguishable from present case, in Seitz v....