Opinion
No. ED90186
July 15, 2008
Appeal from Circuit Court of Jefferson County, Hon. Gary P. Kramer.
Jessica A. Mikale, Counsel for Appellant.
Mark A. Kragel, Counsel for Respondent.
Opinion
Jokerst Paving Contracting, Inc. appeals from the judgment of the trial court after a court-tried case that awarded Gateway Foam Insulators, Inc. damages totaling $212,970.55, with interest, on Gateway's negligence claim. The damages consisted of $68,500.00 for property damage, $11,723.83 for the interest on Gateway's loan to purchase replacement equipment, $12,746.72 for the cost of the environmental cleanup caused by the accident and damage to Gateway's truck, and $120,000.00 in lost profits due to Gateway's loss of use of its specialized truck. We affirm in part and reverse in part.
Gateway installs a foam product in new and existing buildings in the St. Louis area, and has done so since 1995. Its primary equipment is a "foam rig," a customized 22-foot box truck with a variety of equipment used in its work, including some specialized equipment, and drums of chemicals. This equipment remained on the vehicle at all times. On November 26, 2002, a vehicle operated by Jokerst struck Gateway's fully-loaded primary foam rig, which caused the foam rig to turn over and slide into the median and resulted in a spill of the chemicals stored on the foam rig. The chemical spill was cleaned up by Environmental Restoration at a cost of $12,746.42.
Environmental Restoration subsequently sued Gateway for the cost of the cleanup, and received a default judgment in its favor in the amount of $12,746.42.
The owners of Gateway, Ron Vunesky ("Mr. Vunesky") and Sue Vunesky ("Mrs. Vunesky"), examined the remains of the foam rig several days after the accident at a tow lot, and took photos of the wreckage. Their examination revealed that virtually all of the equipment and supplies were unsalvageable. The remains of the foam rig were subsequently moved to a lot controlled by Jokerst. Gateway did not regain possession of the foam rig until August 2004, with the remains of some equipment. Gateway subsequently sold what was left of the foam rig as salvage for $2,500.00. Due to financial constraints, Gateway was not able to purchase a "turn-key" foam rig, but was eventually able to borrow money to purchase a used truck and gradually equip it. Until that was accomplished, Gateway had to rely on its older foam rig.
Gateway sued Jokerst on August 30, 2004. In its amended petition, Gateway alleged that an employee of Jokerst negligently struck its foam rig while driving a truck belonging to Jokerst, and that as a direct result of this negligence, Gateway "sustained property damage to its work truck in an amount exceeding $25,000.00 as well as damage to the contents of the vehicle." Gateway also claimed that as a direct result of the negligence of Jokerst's employee, the foam rig had to be repaired or replaced, which caused it to sustain damages "as a result of the loss of use of its vehicle in an amount in excess of $25,000.00."
The case was tried without a jury. Gateway's owners testified about their business, the primary foam rig and the old foam rig, and the equipment and supplies that were used on the foam rig. Gateway's CPA testified about the firm's financial records over its history. The driver of the primary foam rig testified as to its condition and gear on the day of the accident, and its condition later in the tow yard. An expert, Larry Wilson, testified concerning the value of the fully-equipped primary foam rig on the date of the accident, and that it would take up to three weeks to assemble a customized foam rig for use in a business such as Gateway's. Business records were also introduced, and the trial court admitted without objection the record in the default judgment against Gateway in the suit against it by Environmental Restoration for the cost of cleaning up the spill.
The trial court granted judgment in favor of Gateway, and issued findings of fact and conclusions of law. It awarded Gateway the total sum of $212,970.55, plus interest until paid in full. The damage award included: net damages to the foam rig and the equipment and supplies thereon of $68,500.00 ($75,000.00 less $2,500.00 in salvage and less $4,000.00 for useable equipment); interest on Gateway's loan used to replace the primary foam rig in the amount of $11,723.83; $12,746.83 for the environmental cleanup; and $120,000.00 for Gateway's lost profits. Jokerst now appeals from this judgment.
In a court-tried case, we review the trial court's judgment under the rule announced in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). We will affirm the judgment unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. Id. We give due regard to the trial court's opportunity to have determined the credibility of witnesses. Central America Health Sciences University, Belize Medical College v. Norouzian, 236 S.W.3d 69, 77 (Mo.App. 2007). We review the evidence and reasonable inferences drawn therefrom in the light most favorable to the judgment, disregarding evidence and inferences to the contrary. Id. at 80.
In its first point relied on, Jokerst contends that the trial court erred in awarding damages to Gateway for the loss of the use of the primary foam rig and lost profits because damages based on the loss of use of personal property are only available as a remedy when the personal property is damaged and repaired, and not when the personal property is destroyed.
The proper measure of damages caused by negligence to personal property used in business is based on whether the personal property at issue has been destroyed or merely damaged and repairable. See Orr v. Williams, 379 S.W.2d 181, 189 (Mo.App. 1964). If the chattel has been damaged and not destroyed, the measure of damages is the extent of the injury to the property and the value of its use during "a proper period for repairs."Id. However, if the personal property has been destroyed, as is the situation in the case at hand, the damaged party may recover the difference between the value of the property immediately before and after its destruction, but such a recovery for the destroyed chattel "excludes recovery for loss of use of same." Id. See also German v. Centaur Lime Co., 295 S.W. 475 (Mo.App. 1927); 15 Blashfield, Automobile Law and Practice, section 480.7, pp. 35-37 (2003). The evidence reflects that Gateway's primary foam rig was destroyed in the accident of November 26, 2002, having value only as salvage in the amount of $2,500, along with another $4,000 in salvageable equipment. Accordingly, the trial court erred in awarding damages to Gateway for lost profits for the loss of use of the primary foam rig, as the proper measure of damages for Jokerst's negligence is the value of that personal property at the time when it was destroyed, less the salvage value. Point sustained.
The majority of states follow the same principle as Missouri that a party cannot recover for loss of use or lost profits where a vehicle has been destroyed. See Recovery for Loss of Use of Motor Vehicle Damaged or Destroyed, 18 A.L.R.3d 497, section 8 (1968); 15 Blashfield, Automobile Law and Practice, section 480.7, pp. 35-37, fns. 11-12. However, there is a minority view that a party may recover for loss of use for a reasonable period before a replacement can be obtained. See Recovery for Loss of Use of Motor Vehicle Damaged or Destroyed, 18 A.L.R.3d 497, section 9; 15 Blashfield, Automobile Law and Practice, section 480.7, pp. 35-37, fns. 13-16.
In Ameristar Jet Charter, Inc. v. Dodson International Parts, Inc., 155 S.W.3d 50 (Mo. banc 2005), the Missouri Supreme Court discussed the proper method to calculate lost profits where a jet had originally been determined by the insurer to be destroyed and the claim paid in full, but the jet was actually repairable, and so repaired after being purchased as salvage. The issue of whether lost profits may be included in the measure of damages where personal property is destroyed was apparently not before the Missouri Supreme Court in that case, and it did not explicitly address that issue. We note that Gateway cites to Ameristar, to support its calculation of its alleged lost profits, but not for the proposition that lost profits are within the measure of damages for destroyed property.
Having sustained Jokerst's first point relied on, we need not address its second and third points relied on, both of which address the award of damages for lost profits, and proceed to discuss its fourth point relied on. In its fourth point relied on, Jokerst asserts that the trial court erred in awarding damages to Gateway in the amount of $11,723.83 for interest on the money borrowed by Gateway to purchase a replacement foam rig because the proper measure of damages to personal property is the diminution in value of that personal property. Jokerst further argues the award of damages for the interest paid by Gateway on the loan encompasses replacement costs and is a double recovery for Gateway.
As stated in our analysis of Jokerst's first point relied on, the proper measure of damages in a negligence action for personal property that is destroyed is the value of the chattel at the time immediately prior to its destruction, less any salvage value. Id. Accordingly, in a negligence action, the interest on a loan used to purchase personal property to replace the destroyed property is not included in the measure of such damages. The trial court erred in awarding Gateway damages based on the interest on money that it borrowed to purchase a replacement foam rig. Point sustained.
Having sustained Jokerst's fourth point relied on, this Court need not address Jokerst's fifth point relied on as it addresses the trial court's award of damages to Gateway based on the interest it paid for a loan. In its sixth point relied on, Jokerst argues that the trial court erred in awarding damages to Gateway for the cost of the environmental cleanup caused by the accident of November 26, 2002, which destroyed Gateway's primary foam rig and spilled the chemicals stored on the foam rig. Jokerst avers that the trial court misapplied the law because the cost of the cleanup is a special damage that has to be pleaded and proven to be reasonable and necessary. Jokerst also contends that the invoice from Environmental Restoration for the cost of the cleanup was not a business record of Gateway and improperly admitted into evidence.
Rule 55.19 requires that "[w]hen items of special damage are claimed, they shall be specifically stated." General damages "are those that are natural, necessary, and logical consequences of a wrongful act," whereas "special damages are natural but not necessary results of a defendant's wrongful acts." DeLaporte v. Robey Building Supply, Inc., 812 S.W.2d 526, 534 (Mo.App. 1991). The cost of an environmental cleanup after a vehicular accident involving negligence would be an item of special damage that should be specifically pleaded in a lawsuit. Gateway should have specifically stated this claim for damages in its pleadings, but it did not do so. Its pleadings were for general damages. However, Jokerst never objected to the admission of evidence regarding the costs of the cleanup on the basis that the matter was beyond the scope of the pleadings or that the issue should have been specifically stated as special damages. Rather, Jokerst successfully objected to the testimony of an employee of Environmental Restoration because he had not been included as a possible witness during discovery. Jokerst also objected to the admission of an invoice from Environmental Restoration to Gateway, but not on the basis that the matter was not pleaded as special damages. Instead, the objection was that the invoice was not a business record of Gateway and that there was no evidence that it represented a reasonable cost for the cleanup. The trial court overruled this particular objection and admitted the invoice into evidence. This Court holds a party to the specific objections presented to the trial court. Simpson v. Strong, 234 S.W.3d 567, 575 (Mo.App. 2007). Objections that are not presented to or expressly decided by the trial court are not preserved for review on appeal. Id. Accordingly, Jokerst's contention that the trial court erred in awarding damages for the cost of the environmental cleanup because such damages must be specially pleaded is not preserved.
Jokerst did not object to Mrs. Vunesky testifying about the lawsuit filed against Gateway by Environmental Restoration for non-payment of the bill from Environmental Restoration. In addition, Jokerst did not object to the admission of a certified copy of the court file in the lawsuit between Environmental Restoration and Gateway in which the former was granted a default judgment. The record in the default judgment case included a copy of the contract between Environmental Restoration and Gateway for the cleanup, as well as its cost, and an affidavit from an executive of Environmental Restoration regarding the cost of the work performed by his firm.
Regarding the issue of the cost of environmental cleanup of the spill from Gateway's foam rig, the parties tried the matter by consent. "The failure to make a timely and specific objection to evidence on the ground that it is beyond the scope of the parties' pleadings constituted consent for determination of the issues raised thereby." In re Marriage of Hoskins, 164 S.W.3d 188, 195 (Mo.App. 2005). See also Rule 55.33(b). "`When variance occurs without objection between pleading and proof, such variance, especially in court tried cases, shall be considered immaterial and the pleadings deemed amended to conform to the proof.'" (Emphasis added). Landers v. Sgouros, 224 S.W.3d 651, 663 (Mo.App. 2007) (quoting Pike v. Pike, 609 S.W.2d 397, 400 (Mo. banc 1980)).
Jokerst also argues that the unpaid invoice from Environmental Restoration was not a business record, and implicitly asserts in its point relied on that it was improperly admitted and should not have been used as evidence of the reasonableness of the costs of the cleanup. Section 490.680 RSMo 2000 provides that:
A record of an act, condition or event, shall, insofar as relevant, be competent evidence if the custodian or other qualified witness testifies to its identity and the mode of its preparation, and if it was made in the regular course of business, at or near the time of the act, condition or event, and if, in the opinion of the court, the sources of information, method and time of preparation were such as to justify its admission.
As noted above, the statute sets forth three foundational requirements for the admission of a document under the business records exception to the hearsay rule. See In re the Estate of Newman, 58 S.W.3d 640, 646 (Mo.App. 2001). The invoice does not meet those requirements, as the custodian of Gateway's records could not testify as to the mode of its preparation, or even if it was made in the ordinary course of business. This would have required testimony from a qualified person associated with Environmental Restoration, which prepared the invoice.
In a court-tried case, prejudicial or reversible error in the rejection or admission of evidence is not an issue on appeal. Heavrin v. Shop `n Save, 922 S.W.2d 463, 465 (Mo.App. 1996) (citing City of Town Country v. St. Louis County, 657 S.W.2d 5989, 608 (Mo. Banc 1983)). The issue is whether the evidence should have been admitted and considered, or excluded and not considered. Id. After that issue is determined, the next issue is what the judgment of the court should be, based on a consideration of the admissible, competent evidence. Id. Where there is other substantial, competent evidence to support the judgment, this Court will not reverse that judgment. See id. In addition, a party cannot be prejudiced by the admission of purportedly inadmissible evidence if the challenged evidence is merely cumulative to other evidence admitted without objection. In re the Estate of Looney, 975 S.W.2d 508, 514-15 (Mo.App. 1998) (quoting Tryon v. McElyea, 912 S.W.2d 73, 78 n. 2 (Mo.App. 1995).
In the present case, the court file from the default judgment granted in favor of Environmental Restoration against Gateway, was admitted without objection as an exhibit. The default judgment records included the contract between Gateway and Environmental Restoration for the cleanup, dated November 26, 2002, the date of the accident, and an affidavit from the vice-president of Environmental Restoration. In this affidavit, the vice-president stated that he was the custodian of records for the company, that there was a contract between Gateway and Environmental Restoration and that the work had been performed, and that there was a principal balance for that contract in the amount of $12,746.72, plus interest, reasonable attorney's fees, and court costs. The invoice is cumulative of this evidence, and there was no prejudice to Jokerst in the admission of this exhibit. Based on the records from the default judgment, there is competent, substantial evidence of the cost of the environmental cleanup. Point denied.
In its final point relied on, Jokerst contends that the trial court erred in awarding Gateway $68,500.00 because there was insufficient evidence as to the diminution in value of the foam rig and the equipment and supplies thereon, "because no testimony was adduced as to the fair market value of the property prior to the accident or subsequent to the accident."
The general rule for damage to personal or real property is the diminution in value test, which is the difference between the fair market value before and after the event causing the damage. Tull v. Housing Authority of City of Columbia, 691 S.W.2d 940, 942 (Mo.App. 1985). Gateway's witness on foam rigs, Larry Wilson, was qualified as an expert on foam rigs without objection. He stated that he was familiar with used equipment. He had examined the primary foam rig after the accident. Wilson testified that as of the date of the accident, November 26, 2002, a foam rig equipped like that of Gateway, from bumper-to-bumper, would be worth approximately $75,000.00 to $80,000.00. The trial court has discretion in deferring to an expert's assessment of what data is reasonably reliable. Scott v. SSM Healthcare St. Louis, 70 S.W.3d 560, 572 (Mo.App. 2002). Questions concerning the sources and bases of an expert's opinion affect the weight given to the opinion, but not the admissibility thereof. Sanders v. Hartville Mill. Co., 14 S.W.3d 188, 208 (Mo.App. 2000). Gateway's employee testified that on the date of the accident, the primary foam rig was equipped with the items necessary for working on a residential project that day, including tools. Exhibit 3, which was admitted into evidence, listed the equipment that was on the primary foam rig on that date, and its value. This exhibit was compiled by the owners of Gateway, Mr. and Mrs. Vunesky. Mrs. Vunesky testified that they paid the prices for the equipment listed the exhibit, which totaled $76,575.49. Wilson testified that this list of equipment was consistent with what most contractors in that line of work should have on their vehicles. Gateway's employee, who had operated the primary foam rig on the date of the accident, testified that he and the owners examined the primary foam rig a few days after the accident, and "everything was gone." He stated that the work tools were gone, and that the foam equipment had been so badly damaged that "we couldn't use any of it." Mr. Vunesky testified that when Gateway finally got the primary foam rig back, he sold it for salvage for $2,500.00 to pay for the storage cost. Mr. Vunesky also stated that he thought that the usable equipment, an air compressor and generator, were worth approximately "$4,000.00 together. Although not an expert, an owner may testify, without further qualification, about the reasonable market value of personal property that has been destroyed. Collier v. City of Oak Grove, 246 S.W.3d 923, 926 (Mo. banc 2008). Missouri courts also ordinarily permit an owner of property to testify as to the value of an item of personal property in both its undamaged state and in its damaged condition, though he or she is not an expert. Delgado v. Mitchell, 55 S.W.3d 508, 512 (Mo.App. 2001). Viewed in the light most favorable to the judgment, there is competent and substantial evidence to support the trial court's award of damages of $68,500.00. Point denied.
The judgment of the trial court is affirmed as to the awards of $68,500.00 for property damage and $12,746.72 for the cost of the environmental cleanup, and is reversed as to the awards of $120,000.00 for lost profits and $11,723.83 for interest on Gateway's loan.
Gateway's motion to dismiss Jokerst's points relied on is denied.
Richter, P.J., and Norton, J., concur.