PATRIOT HOMES, INC. AND HERITAGE AMERICAN HOMES, A DIVISION OF PATRIOT HOMES v. MICHAEL WISE AND PAMELA WISE
Annotate this Case
Download PDF
RENDERED:
DECEMBER 1, 2006; 2:00 P.M.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2005-CA-001776-MR
PATRIOT HOMES, INC. AND
HERITAGE AMERICAN HOMES,
A DIVISION OF PATRIOT HOMES
APPELLANTS
APPEAL FROM OHIO CIRCUIT COURT
HONORABLE RONNIE C. DORTCH, JUDGE
ACTION NO. 03-CI-00126
v.
MICHAEL WISE AND PAMELA WISE
APPELLEES
OPINION
AFFIRMING IN PART
VACATING AND REMANDING IN PART
** ** ** ** **
BEFORE:
JUDGE.
COMBS, CHIEF JUDGE; TAYLOR, JUDGE; BUCKINGHAM,1 SENIOR
TAYLOR, JUDGE:
Patriot Homes, Inc., and Heritage American
Homes, a division of Patriot Homes, (collectively referred to as
Patriot Homes) bring this appeal from an August 12, 2005,
judgment of the Ohio Circuit Court awarding Michael and Pamela
Wise (collectively referred to as the Wises) $74,654.00 in
1
Senior Judge David C. Buckingham sitting as Special Judge by assignment of
the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution
and Kentucky Revised Statutes (KRS) 21.580.
compensatory damages for a defective mobile home and $20,422.50
in attorney’s fees.
We affirm in part, vacate in part and
remand.
In its judgment, the trial court succinctly set forth
the facts as follows:
The Defendants are the manufacturer of
a 2000 Patriot/Heritage American home
purchased by the Plaintiffs through an
authorized dealer of the Defendant. The
purchase price of the home is $74,654.00.
The additional money financed by the Wises
was to pay off the land and for improvements
which are not part of the lawsuit. The home
was to be moved and set up on the Wises’
property as part of the purchase price.
This work was to be done by the Defendants’
dealer and, under the Manufacturer/Dealer
agreement, the move and the installation of
the home had to conform to the Defendants’
specifications. Prior to completion of the
set up[sic], the selling dealer for
unexplained reasons was removed from the
picture and replaced by another dealer of
the Defendants. The Defendants subsequently
completed the final setup through an
independent contractor, Ken Sales, who
testified at the trial that he worked on
this home in August/September 2001 and again
in the spring of 2002.
The Plaintiffs first notified the
Defendant of defects in the home in August
2001. The Defendant accepted responsibility
for correcting those defects at that time.
The Plaintiffs notified the Defendants of
problems with the roof in April 2002 and
Defendant provided some shingles in
connection with this problem but refused to
repair the roof. The Plaintiffs elected to
employ a Don Noffsinger to make these
repairs. Mr. Noffsinger testified that the
repairs he corrected were caused by defects
-2-
in the roof. His testimony was not refuted
by the Defendants. The Plaintiffs paid Mr.
Noffsinger $3,200 for these repairs.
After the Defendant refused to repair
the roof in April 2002, Plaintiffs employed
counsel and written notice of defects was
sent to the Defendants in May 2002. As the
Defendants’ requested, a detailed list of
defects was sent to them on June 10, 2002.
Defendants admitted receipt of this notice.
By agreement of the parties, Defendants
inspected the home in July 2002. At
Defendants’ request, the State Fire Marshall
was called in and the property was inspected
again on August 21, 2002. The State Fire
Marshall confirmed defects in the home and
directed the Defendants to make the repairs.
The Defendants worked on the defects from
September 4 to September 11, 2002. After
the Defendants completed this work, the
State Fire Marshall re-inspected the home
and found many of the same defects existed.
The Defendants were again directed to repair
these defects. There has[sic] been no
repairs made by the Defendants after the
Fire Marshall’s second inspection.
The Wises filed a complaint in the Ohio Circuit Court
against Patriot Homes for alleged manufacturing defects in the
mobile home.
They claimed these defects resulted from Patriot
Homes’ negligence and constituted breach of the parties’
contract and the express warranty given by Patriot Homes.
At
the conclusion of the Wises’ proof at trial, they moved pursuant
to Ky. R. Civ. P. (CR) 15 to amend their pleadings to conform to
the evidence regarding claims asserted under Kentucky Revised
Statutes (KRS) Chapter 367, which the trial court granted.
-3-
The action was tried by the court without a jury.
52.01.
CR
In its judgment, the trial court concluded the Wises had
“sustained their burden of proof and [were] entitled to damages
both under KRS 367 and for breach of warranty.”
The court
determined the appropriate measure of compensatory damages was
$74,654.00, representing the purchase price of the mobile home,
and also awarded $20,422.50 in attorney fees.
This appeal
follows.
Under CR 52.01, the findings of fact of the trial
court shall not be set aside unless clearly erroneous, and “due
regard” shall be given to the court’s judgment upon credibility
of witnesses.
However, issues of law are reviewed de novo.
Gosney v. Glenn, 163 S.W.3d 894 (Ky.App. 2005).
Our review
proceeds accordingly.
Patriot Homes argues the trial court improperly
concluded that the Wises were entitled to damages for violation
of the Mobile Home Sales Act (the Act), Kentucky Revised
Statutes (KRS) 367.710-775.
Specifically, Patriot Homes
maintains the Wises failed to give notice as required by the
Act.
The notice requirement under the Act is codified in KRS
367.725 and provides:
The owner shall give the manufacturer notice
by certified mail, return receipt requested,
with a copy to the dealer from whom the
mobile home was purchased, within ten (10)
days following establishment of the
-4-
conditions recited in KRS 367.715 containing
an accurate description of the condition or
conditions which render the mobile home
nonmerchantable and the owner's name and
address and his election to exercise the
rights provided by KRS 367.745.
We agree with Patriot Homes that this statute is both specific
and unambiguous as concerns the notice requirement under the
Act.
However, in conjunction with this transaction, Patriot
Homes entered into an express limited warranty agreement with
the Wises that was introduced into evidence at trial.
Paragraph
5 of the limited warranty agreement sets forth explicit notice
provisions that the Wises were to follow in the event the mobile
home had any damage or defect.
The warranty also provided that
the Wises may have other rights under applicable state law.
Based upon the evidence, the trial court found that
Patriot Homes received timely and substantial notice of the
alleged defects and problems with the Wises’ mobile home.
As
early as August 2001, Patriot Homes had been contacted by the
Wises both in writing and by telephone communication regarding
the defects.
Given the totality of the circumstances
surrounding the defective condition of the mobile home and the
terms of the limited warranty agreement regarding the notice of
the defects, we believe Patriot Homes waived the notice
requirements set forth in KRS 367.725, including that notice of
the alleged defects be given by certified mail.
-5-
A waiver is the intentional voluntary relinquishment
of a known right.
731 (Ky. 1973.)
Harris Bros. Const. Co. v. Crider, 497 S.W.2d
A legal right may be waived by contract even
where such right was statutorily created.
and Waiver § 75 (1996).
31 C.J.S. Estoppel
A waiver may be either expressed or
implied and may also be inferred from the conduct of a party.
Conseco Finance Servicing Corp. v. Wilder, 47 S.W.3d 335
(Ky.App. 2001).
The conduct of Patriot Homes in this action can
clearly be inferred to constitute a waiver to receive a notice
of the alleged defects to the mobile home by certified mail.
Patriot Homes was on notice of the alleged defects under both
KRS Chapter 367 and the limited warranty.
The evidence clearly
established that Patriot Homes failed to cure or correct the
defects in accordance with the statute or under the limited
warranty.
To conclude otherwise would result in a manifest
injustice for the Wises given that they clearly had established
that the mobile home was defective within the first twelve
months after delivery in accordance with KRS 367.715.
Having concluded that the trial court did not err in
allowing the Wises’ claim under the Act, we now address the
damages issue raised by Patriot Homes.
The trial court awarded
damages to the Wises under both KRS Chapter 367 and for breach
of warranty, finding that the measure of damages were “virtually
-6-
identical.”
Patriot Homes argues that the Wises were not
entitled to any recovery for breach of warranty.
We disagree
with Patriot Homes and believe the circuit court properly found
that the mobile home contained manufactured defects covered by
the express warranty.
In fact, the evidence clearly disclosed
numerous defects with the mobile home that Patriot Homes failed
to cure or correct.
The Wises’ right to assert a warranty claim
is in addition to any claims under KRS Chapter 367 as provided
for by KRS 367.775.
However, we believe the circuit court
failed to apply the correct measure of damages for a warranty
claim, and that the Wises failed to present sufficient evidence
to support an award of damages for their breach of warranty
claim.
In a breach of warranty claim, where the buyer has
accepted the goods, the proper measure of damages is governed by
KRS 355.2-714(2):
The measure of damages for breach of
warranty is the difference at the time and
place of acceptance between the value of the
goods accepted and the value they would have
had if they had been as warranted, unless
special circumstances show proximate damages
of a different amount.
Under KRS 355.2-714(2), the appropriate measure of damages is
the difference between the value of the goods as accepted and
the value of the goods as warranted, not the purchase price of
the goods.
Evidence of the purchase price of the mobile home
-7-
looks to the value of the mobile home as warranted and is not
sufficient to establish the value of the mobile home as
accepted.
In fact, no evidence was presented to the trial court
to establish the value of the mobile home as accepted in order
to determine damages under KRS 355.2-714(2).
Accordingly, the
Wises were not entitled to breach of warranty damages under KRS
under KRS 355.2-714(2).
Having previously concluded that the Wises did
properly assert a claim under KRS Chapter 367, the measure of
their damages is thus controlled by KRS 367.750.
Under this
statute, the owner of a mobile home may recover the purchase
price paid less any diminution in value due to abuse by the
owner or by the actions of a third party.
The circuit court
awarded the Wises their purchase price in the amount of
$74,654.00, but made no findings regarding the statutory
deductions or credits that Patriot Homes may have been entitled
to.
We thus remand for additional findings on this issue.
We also note that there is a strong policy in this
Commonwealth that forbids a double recovery for the same
elements of a loss.
Hardaway Management Co. v. Southerland, 977
S.W.2d 910 (Ky. 1998).
In other words, the Wises are not
entitled to recover the purchase price from Patriot Homes and
retain the mobile home under KRS 367.750.
The circuit court
made no findings on this issue either which should also be
-8-
addressed on remand in determining the amount of damages due the
Wises under the statute.
Patriot Homes’ final argument is that the circuit
court erred in awarding attorney’s fees to the Wises.
Having
concluded the Wises presented a timely claim under the Mobile
Homes Sales Act and there was sufficient evidence to support the
court’s findings that the mobile home was defective and
otherwise nonmerchantable under the Act, we find no error in the
award of attorney’s fees that is explicitly provided for in KRS
367.750, if the mobile home owner prevails in an action under
the statute.
In this case, the mobile home owner did prevail in
an action under the Act.
Accordingly, the award of attorney’s
fees to the Wises was proper.
For the foregoing reasons, the judgment of the Ohio
Circuit Court is affirmed in part, vacated in part, and this
cause remanded for proceedings not inconsistent with this
opinion.
ALL CONCUR.
-9-
BRIEFS FOR APPELLANTS:
BRIEF AND ORAL ARGUMENT FOR
APPELLEES:
Griffin Terry Sumner
John S. Higgins
FROST BROWN TODD LLC
Louisville, Kentucky
John H. Helmers
Owensboro, Kentucky
ORAL ARGUMENT FOR APPELLANTS:
Griffin Terry Sumner
FROST BROWN TODD LLC
Louisville, Kentucky
-10-
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
