Winters v. Fiddie

• Citation: 394 S.C. 629,716 S.E.2d 316
• Decision Date: 31 August 2011
• Docket Number: No. 4884.,4884.
• Parties: Dana WINTERS and Daniella Winters, Appellants/Respondents,v.Joyce FIDDIE, C.W. Burbage, Barbara Daniels, and Prudential Carolina Real Estate, Respondents/Appellants.
• Court: Court of Appeals of South Carolina

394 S.C. 629

716 S.E.2d 316

Dana WINTERS and Daniella Winters, Appellants/Respondents,

v.Joyce FIDDIE, C.W. Burbage, Barbara Daniels, and Prudential Carolina Real Estate, Respondents/Appellants.

No. 4884.

Court of Appeals of South Carolina.

Heard Nov. 3, 2010.Decided Aug. 31, 2011.

Daniel E. Martin, of Charleston, for Appellant–Respondents.Michael A. Scardato, of Charleston, and Michael Christopher Scarafile, of N. Charleston, for Respondent–Appellants.WILLIAMS, J.

On appeal from the trial court, Dana and Daniella Winters (individually “Mr. Winters/Mrs. Winters,” collectively “Buyers”) contend the trial court erred on several grounds when it granted Joyce Fiddie, C.W. Burbage, (collectively “Sellers”) and Barbara Daniels' (“Daniels”) motion for a new trial absolute. On cross-appeal, Sellers and Daniels claim the trial court committed reversible error when it (1) applied the Residential Property Condition Disclosure Act ¹ (“the Act”) to a non-residential transaction; (2) failed to grant Sellers' motion for a directed verdict; and (3) allowed Buyers to introduce a consent order issued by another state agency from a separate proceeding in violation of the South Carolina Rules of Evidence.

FACTUAL/PROCEDURAL BACKGROUND

The underlying negligence action stems from the purchase of a piece of real estate located at 2105 South Live Oak Drive in Moncks Corner, South Carolina (“the Property”). At the time of the sale, the Property consisted of several small storage sheds, an unoccupied house, and a commercial block building. Sellers inherited the Property from their deceased mother in 1999. Sellers rented the house on the Property for several years before enlisting the services of Daniels, a real estate agent for Prudential Carolina, in an effort to sell it. When Daniels listed the Property, the house had been vacant for approximately one and a half years.

Daniels initially listed the Property for sale in March 2001 for $180,000. Due to little interest in the Property, Sellers relisted the Property on several occasions between March 2001 and October 2004. Sellers eventually sold the Property for $110,000 in November 2004 to Buyers.

Prior to Buyers closing on the Property, three prospective purchasers attempted to buy the Property from Sellers. The first buyer, Laura Shambrook, noticed some type of growth on the walls in the house. After a lab report dated September 4, 2004, confirmed the presence of mold, Ms. Shambrook attempted to purchase the Property for approximately $80,000. Ms. Shambrook showed the mold disclosure report to Daniels and Sellers in hopes they would lower their asking price; however, Sellers were unwilling to accept her offer, and the contract fell through.

Shortly thereafter, a second prospective buyer, Anna Oster, contacted Daniels about the Property. Daniels testified she disclosed the presence of mold to Ms. Oster when she showed her the house and surrounding property, but Ms. Oster stated otherwise at trial. On September 14, 2004, Ms. Oster's real estate agent submitted an offer on a “Residential Agreement to Buy and Sell” form to purchase the Property for $125,000. During negotiations, Ms. Oster's agent also requested a residential disclosure form. Daniels never produced a residential disclosure form, but four days after receiving Ms. Oster's offer, Daniels faxed a copy of the mold report to Ms. Oster's agent. Daniels claimed the deal fell apart because the Sellers would not agree to the terms of Ms. Oster's offer; Ms. Oster, however, stated that once Daniels disclosed the presence of mold in the house, the negotiations ended.

During the same month, a third prospective purchaser, Edward Spence, attempted to purchase the Property for $110,000. On September 23, 2004, the parties entered into a “General Use And Lots/Acreage” contract. The contract contained no “as is” language and was contingent only upon Mr. Spence obtaining financing. A mold disclosure and waiver form was also attached to the contract, which Mr. Spence and Daniels signed on September 27, 2004. The parties never closed on the contract due to Mr. Spence's failure to obtain financing.

Following Mr. Spence's inability to obtain financing, Daniels told Mr. Winters about the Property because she knew Mr. Winters was looking for some commercial property. Buyers and Daniels had a pre-existing relationship at the time Buyers bought the Property because Daniels had recently sold Buyers their primary residence. Daniels showed Mr. Winters the Property, at which time Mr. Winters noticed what he called “dirty water” on the walls of several rooms in the house. However, Mr. Winters stated Daniels never mentioned the presence of mold in the house.

Buyers and Sellers subsequently entered into a “General Use And Lots/Acreage” contract for the purchase of the property for $110,000. Daniels prepared the contract and included language to convey the property “as is.” Mr. Winters agreed the “as is” language was present when he signed the contract but claimed Daniels added the language, “[b]uyer acknowledges the presence of mold in the house,” after he signed the contract, and he was unaware of this language until the underlying suit was commenced. Daniels countered Mr. Winters' testimony at trial and stated she told Mr. Winters about the mold, but it was immaterial to him because he was going to tear down the house as soon as they closed on the Property. Mr. Winters testified no disclosures were made about the presence of mold at the closing. He stated he was unaware of its existence in the house until Ms. Oster, one of the prior prospective buyers, walked onto the Property one day and disclosed it to him while he was repairing the house.

Buyers filed suit against Sellers and Daniels for failure to disclose the presence of toxic mold in the house and for failure to provide Buyers with written reports in Sellers and Daniels' possession confirming the existence of toxic mold. Buyers additionally asserted Daniels breached certain sections in Title 40 based on her statutory duties to Buyer as a real estate broker. Buyers requested actual damages as well as $1.5 million in punitive damages. The case was tried before a jury on August 12 and 13, 2008.

Over Daniels' objection at trial, Buyers introduced a consent agreement between the South Carolina Labor, Licensing, and Regulations board and Daniels, which sanctioned Daniels for failing to disclose to Buyers “reports indicating the presence of structural defects and toxic mold ... [until] ... approximately one month after purchase.” Daniels confirmed she did not provide Buyers with a copy of the mold disclosure report but stated she told Buyers about the presence of mold. Further, Daniels testified she attempted numerous times after she was sanctioned to contact Buyers in an effort to remediate the problem, but Buyers never returned her phone calls.

At the close of Buyers' case, Sellers made a motion for a directed verdict on several grounds, which the trial court denied. Sellers renewed their directed verdict motion after the close of evidence, which the court denied. The trial court then charged the jury on the law but neglected to charge the appropriate burden of proof for punitive damages. Neither party objected to the jury charges. The jury returned a verdict in favor of Buyers for $50,000 in actual damages and $75,000 in punitive damages.

Sellers timely filed a motion for JNOV, New Trial Absolute, or, in the alternative, New Trial Nisi Remittitur. Sellers raised numerous grounds for granting a new trial, including the trial court's failure to charge the jury that the award of punitive damages requires clear and convincing proof. After a hearing on the motion, the trial court granted Sellers' motion for a new trial, finding it had the authority to grant a new trial absolute pursuant to Rule 59(d), SCRCP, despite Sellers' failure to timely object to the jury charge. Buyers' motion to reconsider was denied. Buyers appealed and Sellers cross-appealed.

I. Buyers' Appeal

Buyers contend the trial court erred in granting Sellers a new trial absolute because Sellers failed to timely object to the trial court's flawed jury instruction. In response, Sellers claim their failure to timely object to the jury charge did not prevent the trial court from being able to grant a new trial pursuant to Rule 59, SCRCP.² We agree with Buyers.

The grant or denial of a new trial motion rests within the trial court's discretion, and its decision will not be disturbed on appeal unless the court's findings are wholly unsupported by the evidence or its conclusions are controlled by error of law. Vinson v. Hartley, 324 S.C. 389, 405, 477 S.E.2d 715, 723 (Ct.App.1996).

A trial court's authority to grant a new trial is rooted in Rule 59, SCRCP. Rule 59(a) permits a trial court to grant a new trial “to all or any of the parties and on all or part of the issues [ ] in an action in which there has been a trial by jury, for any of the reasons for which new trials have heretofore been granted in actions at law in the courts of the State....” More specifically, Rule 59(d), SCRCP, states,

Not later than 10 days after entry of judgment, the court of its own initiative may order a new trial for any reason for which it might have granted a new trial on motion of a party. After giving the parties notice and an opportunity to be heard on the matter, the court may grant a motion for a new trial, timely served, for a reason not stated in the motion. In either case, the court shall specify in the order the grounds therefor.

Rule 51, SCRCP, which pertains to jury instructions, states, “No party may assign as error the giving or the failure to give an instruction unless he objects thereto before the jury retires to consider its verdict, stating distinctly the matter to which he objects and the grounds for his objection.”

Rule 59 does not expressly address whether a trial court's ability to grant a new trial for “any...