Thompson v. Gardner

• Decision Date: 26 March 2004
• Citation: 889 So.2d 596
• Parties: Norbert Y. THOMPSON and Helen P. Thompson v. Garry GARDNER, individually and d/b/a Gardner Brothers Home Builders, Inc.
• Court: Alabama Court of Civil Appeals

889 So.2d 596

Norbert Y. THOMPSON and Helen P. Thompson v. Garry GARDNER, individually and d/b/a Gardner Brothers Home Builders, Inc.

2021084.

Court of Civil Appeals of Alabama.

March 26, 2004.

H. Arthur Edge III and W. Brian Collins of Edge & Collins, Birmingham, for appellants.

James A. Kee, Jr., and Angela Collier Shields of Kee & Selby, L.L.P., Birmingham, for appellee.

THOMPSON, Judge.

Norbert Y. Thompson and Helen P. Thompson (hereinafter together referred to as "the plaintiffs") sued Garry Gardner ("Gardner"), Garry Gardner d/b/a Gardner Brothers Home Builders, Inc., Dryvit Systems, Inc., Apache Products, and USX Corporation, asserting claims of breach of express warranty, breach of implied warranty, negligence, and fraudulent suppression and misrepresentation. The plaintiffs alleged that the use of an exterior insulation and finishing system ("EIFS"), commonly known as "Dryvit" or "synthetic stucco," on the exterior of their home caused damage to the home. Gardner and Garry Gardner d/b/a Gardner Brothers Home Builders, Inc. (hereinafter together referred to as "the Gardner defendants"), the general contractors that constructed the plaintiffs' home, filed a third-party complaint against Troy Dillard d/b/a Dillard Plastering Company ("Dillard"). Dillard was the subcontractor that installed the EIFS on the plaintiffs' home.

On May 14, 2001, the Gardner defendants filed a motion for a summary judgment on all of the plaintiffs' claims against them. In their summary-judgment motion, the Gardner defendants argued that the statute of limitations had expired as to those claims, and they also asserted arguments on the merits of the claims. On August 8, 2001, the Gardner defendants filed an amended summary-judgment motion in which they reasserted the arguments made in their original motion and also argued that they were entitled to a judgment as a matter of law based on an alleged spoliation of material evidence.

On January 3, 2003, the trial court entered a partial summary judgment in favor of the Gardner defendants. In its January 3, 2003, order, the trial court found that the spoliation of certain evidence necessitated the dismissal of the plaintiffs' claims against the Gardner defendants. The plaintiffs filed a "motion to alter, amend, or vacate" the January 3, 2003, nonfinal partial-summary judgment order;¹ in that motion, the plaintiffs also sought to strike a portion of an affidavit submitted by the Gardner defendants in support of their amended summary-judgment motion. On April 14, 2003, the trial court entered a notation on the case action summary in which it set aside its January 3, 2003, order, allowed the parties to submit additional arguments or evidentiary materials, and scheduled a hearing for May 30, 2003.

On May 16, 2003, the Gardner defendants renewed their summary-judgment motion, again arguing the issue of spoliation of the evidence. On June 3, 2003, the trial court granted the Gardner defendants' renewed motion for a summary judgment on the plaintiffs' claims. The plaintiffs filed a "motion to vacate," which the trial court denied. On October 10, 2003, on the plaintiffs' motion, the trial court certified its summary judgment in favor of the Gardner defendants as final pursuant to Rule 54(b), Ala. R. Civ. P. The plaintiffs timely appealed.

The record indicates that on May 12, 1992, Gardner, on behalf of the Gardner defendants, entered into a contract with the plaintiffs in which the Gardner defendants agreed to construct a home for the plaintiffs. Gardner hired Dillard, a subcontractor, to install Dryvit-brand EIFS² on the exterior of the plaintiffs' home. The plaintiffs and Gardner "closed" on the contract sometime in 1992.

In 1992, and again in 1996, the plaintiffs discovered water leaks in their home. Gardner repaired those leaks. In 1999, on the advice of a friend, the plaintiffs decided to have the EIFS on their home inspected. A company called "Construction and Mechanical Engineering" (hereinafter "CME") inspected the plaintiffs' home and determined that repairs were required. Norbert Thompson testified that he was told that the repairs were necessary because the EIFS had not been installed correctly. CME performed repairs to the plaintiffs' home between February 1999 and April 1999. At approximately the same time, Gardner performed some repairs to the plaintiffs' patio. The plaintiffs paid approximately $21,421 for all of the repairs performed in the spring of 1999.

On June 1, 1999, the plaintiffs filed their complaint in this action. On November 17, 1999, Rayford Smith, the expert witness for the Gardner defendants, went to the plaintiffs' home to inspect it. Smith testified that he walked around and viewed the plaintiffs' home. Smith testified that when he arrived at the plaintiffs' home, the Gardner defendants' attorney instructed him not to perform a moisture analysis on the plaintiffs' home because "that was not necessary [because] the home ha[d] been repaired."

The record contains a form indicating that the plaintiffs' attorney scheduled an appointment for January 16, 2001, with a company known as "Precision HomeCrafters" to provide an estimate on the cost of removing the EIFS from the plaintiffs' home and recladding the home with a brick exterior. A document listing a series of invoices³ indicates that between mid-February 2001 and late May 2001, Precision HomeCrafters removed the EIFS from the plaintiffs' home and replaced it with a brick exterior. The total cost of the reclad work performed by Precision HomeCrafters was over $112,000.

George Williams, who was affiliated with Precision HomeCrafters, was present during much of the reclad work. Joel Werhman, a registered professional engineer, inspected the plaintiffs' home approximately 11 times during the time the reclad work was being performed. The plaintiffs listed both Williams and Werhman as witnesses who would testify for them on the issue of the damage the plaintiffs alleged was caused by the EIFS or by the Gardner defendants' improper installation of the EIFS. The plaintiffs indicated that, among other things, Werhman would testify regarding "the inability to identify the true amount of damage until the EIF system is removed," and that Williams would testify "to the necessity for the complete removal of the EIFS and substrate in order to inspect and repair underlying timbers."

It is undisputed that the plaintiffs did not notify the Gardner defendants of the fact that they were having the home reclad with a brick exterior. It is also undisputed that the Gardner defendants first learned of the reclad project in July 2001, after all of the reclad work had been completed. Therefore, Smith, the Gardner defendants' expert, did not inspect the plaintiffs' home during the reclad process.

All of the EIFS materials were removed and either disposed of or destroyed during the reclad process. However, the plaintiffs and their witnesses took numerous photographs of the home during the reclad work. In his affidavits, however, Smith testified that he was unable to determine the cause or extent of the damage to the plaintiffs' home from just the photographs taken by the plaintiffs and their witnesses. In Smith's May 14, 2003, deposition, the plaintiffs' attorney asked Smith to make conclusions based on the photographs taken by the plaintiffs and their witnesses. Smith repeatedly indicated that he was unsure what some of the photographs depicted and that it was difficult for him to determine the subject of the photographs or whether they indicated that the EIFS had been installed correctly.

On May 16, 2003, two days after Smith's deposition, the Gardner defendants filed their renewed motion for a summary judgment. Smith's May 16, 2003, affidavit, submitted in support of the renewed summary-judgment motion, reads, in part, as follows:

"When I first saw the [plaintiffs'] home in 1999, the original installation of the EIFS system had been altered by a third party. Therefore, I cannot state with reasonable certainty whether the EIFS system on the [plaintiffs'] home, at the time of original construction, was installed in accordance with the manufacturer specifications and/or industry standards.

"Without having a significant amount of properly labeled EIFS material which has been removed from the [plaintiffs'] home, it is impossible to determine the causation of any potential damage to the subject home.

"Because the EIFS was removed and the exterior reclad on the [plaintiffs'] residence without giving me the opportunity to inspect the house during the reclad process, it is impossible to determine the extent of damages due to alleged improper installation. It is also impossible to determine whether any water damages [sic] was caused by improper installation. In conclusion, because the EIFS was removed and the exterior of the house reclad without my having an opportunity to see the home during the reclad process, it is not possible for me to determine the extent of damage, if any, and the true cause and origin of the damage.

"Further, I have viewed the photographs provided by the [p]laintiffs' counsel at my deposition on May 14, 2003. These photographs fail to provide sufficient information for me to conclude with any degree of certainty the extent, source and cause of damage to the [plaintiffs'] house."

On appeal, the plaintiffs argue that the trial court erred in entering a summary judgment in favor of the Gardner defendants based on the theory of spoliation of the evidence. The most severe sanction available where a party's actions lead to the spoliation of relevant evidence is the dismissal of the party's claims or of the action. Capitol Chevrolet, Inc. v. Smedley, 614 So.2d 439 (Ala.1993). The dismissal of a claim or claims may be an appropriate sanction if a party destroys or disposes of evidence that it knows or should know is evidence that is important to possible or pending litigation. Capitol Chevrolet, Inc. v....