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Greg and Sandra Bennett As v. A.T. Masterpiece Homes At

March 6, 2012

GREG AND SANDRA BENNETT AS HUSBAND AND WIFE, KURT AND CAROL HOEFFERLE, AS HUSBAND AND WIFE APPELLEES
v.
A.T. MASTERPIECE HOMES AT BROADSPRINGS, LLC AND GRANT COLLEDGE APPELLANTS



Appeal from the Judgment Entered August 12, 2011 In the Court of Common Pleas of York County Civil Division at No(s): 2007-SU-1589-Y01

The opinion of the court was delivered by: Gantman, J.

J-A03006-12

BEFORE: GANTMAN, J., ALLEN, J., and MUNDY, J.

OPINION BY GANTMAN, J.:

Appellant, Grant Colledge, appeals from the judgment entered in the York County Court of Common Pleas, in favor of Appellees in this action for breach of contract, breach of warranty, and violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL").*fn1 In this appeal, Appellant asks us to determine whether the evidence was sufficient to permit a finding of personal liability and whether the court's decision to permit UTPCPL liability based on "misleading conduct" was an improper reading of Pennsylvania law. For the following reasons, we hold the evidence adduced at trial was sufficient for the jury to find that Appellant specifically agreed to assume personal liability on the contracts at issue. We further hold the court correctly instructed the jury on the relevant standard for the UTPCPL catchall provision when it stated "misleading conduct" could support a violation and later properly doubled the damages award pursuant to the UTPCPL. Accordingly, we affirm.

The relevant facts and procedural history of this case are as follows. In 2004, Appellees Greg and Sandra Bennett ("the Bennetts") and Kurt and Carol Hoefferle ("the Hoefferles") contracted with A.T. Masterpiece Homes at Broadsprings LLC ("A.T. Masterpiece")*fn2 for the construction of new residential homes in a development called Overpond Court. Appellant was the managing member of A.T. Masterpiece. During construction of the homes, both the Bennetts and Hoefferles noticed numerous building deficiencies. Appellant was the primary contact during the construction process and assured the Bennetts and the Hoefferles regarding the quality of the work on their homes. Appellant's assurances were specific, direct, and often in the form of personal guarantees. Once construction finished, Appellees discovered their newly-constructed homes were in various states of disrepair and structural failure.

The problems in the Hoefferles' house were mainly in the dormer above the garage. When Mr. Hoefferle noticed the dormer Appellant and A.T. Masterpiece had constructed did not correspond to the building plans and structural design, he raised the issue with Appellant. Appellant assured him that the dormer had been redesigned, and the final product would work fine. Mr. Hoefferle expressed continued concern, but Appellant certified the design and quality of the new dormer. After construction finished, the dormer was in such bad structural shape that Mr. Hoefferle had to install temporary bracing to avoid collapse. There were also deficiencies in other parts of their home. Nails protruded from sections of drywall and the floors were so poorly laid, a person could feel the joints move while walking. The windows were drafty and, on several occasions, the Hoefferles could smell gas coming from the basement.

Steven Yingst, an engineering expert who inspected the Hoefferles' home, stated the home had several items in violation of the housing code. Other aspects were code compliant but nevertheless poorly designed or constructed. Regarding the dormer, Mr. Yingst concluded the work did not comply with the structural specifications and had inadequate support in the framing. Mr. Yingst believed there would have been structural failure in the dormer if Mr. Hoefferle had not taken corrective action. In addition, Mr. Yingst noted the lumber used throughout the house was a poor grade of wood. The bad lumber led to insufficient floor support in several areas of the home, which caused the floors to sag, bounce, and flex. The insulation, height clearances, ventilation, and electrical systems were all in violation of the housing code. In total, Mr. Yingst estimated repairs to the Hoefferles' home would cost approximately $64,000.00.

The Bennetts had similar experiences during the construction of their home. While visiting the house to check on its progress, Mrs. Bennett noticed a crack in the foundation. She also found water in the basement and traced the water to a crack in a basement doorframe. When Mrs. Bennett reported the crack to Appellant, he said he "will take care of it and will take care of you." The floorboards in other areas of the home were warped, and Mrs. Bennett brought it to Appellant's attention. Appellant made more guarantees regarding the flooring and repeated his intention to take care of both the specific problem and Mrs. Bennett's general concerns. Once construction finished and the Bennetts moved in to their new home, more problems arose. Mr. Bennett found kitchen tiles were cracked and felt the floors bounce as he walked across them.

Mr. Yingst also examined the Bennetts' home and found construction defects similar to those he had seen in the Hoefferles' residence. The floor joists were improperly installed and caused the flooring to sag and bounce. Like the Hoefferles, the lumber used in the Bennetts home was not grade stamped. The plumbing, electrical, and ventilation systems were in violation of the housing code. In Mr. Yingst's estimation, the Bennetts' home required $122,000.00 in repairs.

On May 2, 2007, the Bennetts and the Hoefferles (collectively, Appellees) filed suit against Appellant and A.T. Masterpiece for breach of contract, breach of warranty, and violations of the UTPCPL. Appellees alleged Appellant and A.T. Masterpiece built defective homes for Appellees and engaged in deceptive and dishonest practices during the construction process. After extensive discovery, the case proceeded to a bifurcated jury trial in April 2011. At the conclusion of the first phase, the jury found Appellant and A.T. Masterpiece liable for breach of contract, breach of warranty, and violations of the UTPCPL. Further, the jury concluded Appellant's representations and guarantees regarding the homes exposed him to personal liability. The case then moved to the damages phase, where the jury found Appellant liable to the Hoefferles for $26,000.00 and to the Bennetts for $85,000.00. The court doubled the damages, pursuant to the UTPCPL, and assessed counsel fees of $3,250.00. As a result, the total judgment against Appellant was $173,250.00 for the Bennetts and $55,250.00 for the Hoefferles. On April 15, 2011, Appellant timely filed post-trial motions seeking a new trial, which the court denied on July 11, 2011. On July 22, 2011, Appellant timely filed a notice of appeal. The court ordered Appellant to file a concise statement of errors complained on appeal pursuant to Pa.R.A.P. 1925(b), and Appellant timely complied on August 9, 2011.

Appellant raises three issues for our review:

DID THE TRIAL COURT ERR BY PERMITTING THE JURY TO HOLD [APPELLANT] PERSONALLY LIABLE TO [APPELLEES] FOR BREACH OF CONTRACT AND BREACH OF WARRANTY WHEN HE DID NOT "SPECIFICALLY AGREE TO ASSUME LIABILITY"?

DID THE TRIAL COURT ERR BY PERMITTING THE JURY TO HOLD [APPELLANT] PERSONALLY LIABLE FOR BREACH OF THE UTPCPL WHEN THERE IS NO ...


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