Opinion
No. COA10-975
Filed 1 March 2011 This case not for publication
Appeal by Plaintiff from order entered 8 April 2010 by Judge Jayrene R. Maness in Moore County District Court. Heard in the Court of Appeals 27 January 2011.
Chris Kremer for Plaintiff. Foyles Law Firm, PLLC, by Jody Stuart Foyles, for Defendants.
Moore County No. 09 CVD 1481.
Factual and Procedural Background
In September 2006, Plaintiff David Hodges ("Hodges") purchased a spa from Sandhills Pools Spas LLC ("Sandhills"), a North Carolina corporation managed by Defendant James L. Young, Jr. ("James Young"). According to the invoice received by Hodges, Hodges paid $6,953.93 for a 52-jet, three-pump spa with an "ozonator."
Although Sandhills is referred to as "Sandhills Pools, Spas Service" in the caption of the 8 April 2010 order, the name of the company, according to its articles of incorporation, is "Sandhills Pools Spas LLC."
The spa was installed by James Young, on behalf of Sandhills, in November 2006. In April 2009, Hodges discovered that the spa installed at his home was actually a two-pump, rather than a three-pump, spa. In August 2009, after Hodges informed Sandhills of the problem and requested repair or restitution, Hodges filed a complaint in Moore County District Court against "James L. Young, Jr. and Constance J. Young, d/b/a Sandhills Pools, Spas, Service" ("Defendants"), alleging claims for relief based on breach of contract and unfair trade practices.
In October 2009, Defendants filed motions to dismiss Hodges' complaint alleging that Hodges failed to state a claim upon which relief can be granted in that (1) Sandhills is a limited liability corporation and Hodges "made no allegations or claims to pierce the corporate veal [sic]" and (2) Hodges' complaint does not "describe[] any conduct by [] the Defendants which indicates the Defendants willfully engaged in unfair or deceptive acts[.]" On 1 February 2010, the district court, the Honorable Jayrene R. Maness presiding, denied Defendants' motions.
In early March 2010, following a brief period of discovery, Defendants moved for summary judgment on all of Hodges' claims. On 22 March 2010, Defendants' summary judgment motion was heard by Judge Maness, who, at the close of the hearing, granted Defendants' motion. Judge Maness filed the order allowing Defendants' motion for summary judgment on 8 April 2010. Hodges appeals.
Discussion
On appeal, Hodges first argues that the trial court erred in granting summary judgment for Defendants on Hodges' breach of contract claim because there are genuine issues of material fact as to the terms of the contract between the parties and as to Hodges' damages. For the following reasons, we agree.
A motion for summary judgment should be granted upon a showing "that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law." N.C. Gen. Stat. § 1A-1, Rule 56(c) (2009). "On appeal, an order allowing summary judgment is reviewed de novo." Howerton v. Arai Helmet, Ltd., 358 N.C. 440, 470, 597 S.E.2d 674, 693 (2004).
"The elements of a claim for breach of contract are (1) existence of a valid contract and (2) breach of the terms of that contract." Poor v. Hill, 138 N.C. App. 19, 26, 530 S.E.2d 838, 843 (2000). In this case, the evidence clearly shows the existence of a valid contract between the parties: the invoices presented by both parties indicate that Hodges agreed to pay, and in fact paid, $6,953.93 to Sandhills for their delivery and installation of a three-pump spa with an ozonator. What is less clear is what exactly the terms of the contract were and whether Defendants breached those terms.
While neither party disputes that the agreement called for the installation of a three-pump spa with an ozonator, the parties dispute the meaning of the term "three-pump spa." Based on James Young's assertion in his deposition that "the ozonator counts as a third pump," Defendants argue that the disputed "three-pump spa" term called for a spa with three pumps, one of them being an ozonator, and that, consequently, installation of a spa with two pumps and an ozonator satisfied their obligation under the contract.
Hodges, on the other hand, submitted an affidavit sworn by Keith Patterson ("Patterson"), who claimed to have been "in the business of selling and servicing pools and spas" for 20 years and who averred that "[t]he ozonator is not a pump." Based on Patterson's affidavit, Hodges argues that the disputed "three-pump spa" term called for three pumps, not including the ozonator, and that, therefore, installation of a spa with two pumps and an ozonator was a breach of the terms of the contract. Because the meaning of the term "three-pump spa" is so obviously central to the determination of Hodges' breach of contract claim, this dispute by the parties as to the meaning of that term necessarily raises a genuine issue as to a material fact and precludes summary judgment.
Despite this material factual dispute, Defendants argue that summary judgment was appropriate because Hodges failed to prove any damages based on the alleged breach of contract. This argument is meritless and, indeed, wholly irrelevant.
Unlike claims of negligence, the existence of damages is not an element of a prima facie claim for breach of contract. See Poor, 138 N.C. App. at 26, 530 S.E.2d at 843 ("The elements of a claim for breach of contract are (1) existence of a valid contract and (2) breach of the terms of that contract."); Catoe v. Helms Constr. Concrete Co., 91 N.C. App. 492, 497-98, 372 S.E.2d 331, 335 (1988) (holding that where a plaintiff makes out a prima facie case of breach of contract but submits no evidence of damages, he is nonetheless entitled to nominal damages); see also Winters v. Lee, 115 N.C. App. 692, 694, 446 S.E.2d 123, 124 ("To establish a prima facie case of actionable negligence, a plaintiff must allege facts showing . . . plaintiff suffered damages as the result of defendant's breach."), disc. review denied, 338 N.C. 671, 453 S.E.2d 186 (1994). As such, Hodges' ability to prove damages arising from Defendants' alleged breach of the contract is irrelevant in a summary judgment hearing, and entry of summary judgment based on the theory that Hodges failed to prove damages would have been error. See Spinks v. Taylor, 303 N.C. 256, 264-65, 278 S.E.2d 501, 506 (1981) (in the context of conversion, holding that summary judgment was improperly rendered for defendant where plaintiff would be entitled to recover at least nominal damages); Nick v. Baker, 125 N.C. App. 568, 571-72, 481 S.E.2d 412, 414 (1997) (in the context of negligent conduct invading legal right of plaintiff, reversing summary judgment where plaintiff was entitled to nominal damages).
Because triable issues remain in Hodges' breach of contract claim, and because Defendants are not entitled to judgment as a matter of law on that claim, we conclude that the trial court erred by granting summary judgment for Defendants on Hodges' breach of contract claim.
With respect to his unfair trade practices claim, Hodges argues that the grant of summary judgment was erroneous because "[n]othing that [Defendants] have introduced as evidentiary forecast so far subtracts" from Hodges' allegations that (1) Defendants should have known "that the [installed] spa had only 2 pumps instead of the agreed-upon 3 pumps" and (2) "Defendants either knew or should have known that [Hodges] would rely on Defendants' expertise[.]" We are unpersuaded by Hodges' argument.
As previously held by this Court, "[a] mere breach of contract does not constitute an unfair or deceptive trade practice." Mosley Mosley Builders, Inc. v. Landin, Ltd., 97 N.C. App. 511, 518, 389 S.E.2d 576, 580 (1990). Rather, the complained-of conduct must be "fraudulent or deceptive[,]" id., or must be "immoral, unethical, oppressive, unscrupulous, or substantially injurious to consumers." Coble v. Richardson Corp., 71 N.C. App. 511, 520, 322 S.E.2d 817, 823-24 (1984). While Defendants have presented no evidence to refute Hodges' allegations of unfair trade practices, we conclude that there is nothing in these allegations to raise Defendants' alleged breach of contract to the level of unfair or deceptive practice. Accordingly, we conclude that the trial court did not err in granting Defendants' motion for summary judgment on Hodges' unfair trade practices claim.
For the reasons stated herein, we affirm the trial court's grant of summary judgment for Defendants on Hodges' unfair trade practices claim, but reverse the court's grant of summary judgment for Defendants on Hodges' breach of contract claim.
AFFIRMED in part, REVERSED in part.
Judges GEER and MCCULLOUGH concur.
Report per Rule 30(e).