CAPERTON, Judge:
Kathey and Ray Carter and Randal and Carolyn Sweeney appeal from the Martin Circuit Court's grant of Coalfield Lumber Company, Inc.'s motion for judgment notwithstanding the verdict ("JNOV") for failure to properly prove damages to their real estate. In granting the motion, the trial court determined that the Appellants should have offered evidence of the repair costs in addition to the proffered diminution in fair market value evidence. Carter and Sweeney contend that they sustained their burden of proof and that the trial court erred in granting Coalfield's JNOV motion.
After a review of the parties' arguments, the record, and the applicable law, we find no error in the trial court's grant of Coalfield's motion for JNOV on the Sweeneys' claims. However, we agree with the Carters that the court erred in granting Coalfield's motion for JNOV on their claims, and accordingly reverse and remand this matter to the trial court for further proceedings not inconsistent with this opinion.
The facts in the matter sub judice were presented to a jury on February 10, 2009.
As to the Sweeney's claims, Carolyn Sweeney testified that Coalfield had been engaged in excavation activities directly behind the properties for approximately three to four months.
As to the Carters' claims, Ray Carter testified that he owned the property on which Kathy Carter's mobile home was located.
The Carters and the Sweeneys presented an appraiser, Gary Endicott. Endicott testified that the value of the Sweeney home had diminished in value by $25,000 from the damage to the property. Endicott testified that the Carter house was a complete loss of $10,000, the value of the house prior to the damage, as it was completely destroyed and that no new house could be placed there without fixing the slip activity.
At the close of the Coalfield's case-in-chief, Coalfield moved for a directed verdict. During the bench conference the trial court opined that in terms of damages to real property the Plaintiffs had to prove both the cost of repair and the difference in market value. In response, counsel directed the court to the testimony proved by Endicott. The court denied Coalfield's motion. Thereafter, Coalfield presented a representative of the company who testified that he did not believe that they had caused the damage but did acknowledge talking to Randal Sweeney about a rock hitting their pool. Thereafter, Coalfield again moved for a directed verdict which the court denied.
The court submitted the case to the jury and the jury returned a verdict against Coalfield, awarding the Carters $10,000 and the Sweeneys $15,000. Coalfield then moved the court for a JNOV, arguing that the Carters and the Sweeneys had failed to prove their damages by competent evidence.
In granting Coalfield's motion for JNOV, the court noted the long-standing rule that damages for injury to real estate is the lesser of cost of repair or difference in fair market value. If the injury to property is permanent, the difference in fair market value is the measure of damages. If the injury to property is temporary, the measure of damages is the cost of repair. The determination of whether the injury to the property is permanent or temporary depends on comparing the cost of repair to the decline in fair market value. The court then noted that both the Plaintiffs and the Defendant tendered jury instructions which were substantially in accordance with the long-standing rule, which the court gave to the jury, even though the Plaintiffs did not produce evidence of repair costs.
The court then determined that it was certainly possible that the repair costs, especially in the case of the Sweeneys, would have been substantially less than the diminution in fair market value that the appraiser testified to. The court also
On appeal, the Carters and Sweeneys present two arguments. First they argue that the trial court erred in granting Coalfield's motion for JNOV. In support of this argument, the Carters and Sweeneys assert that the law does not require that plaintiffs prove both costs of repair and diminution in value and that because Coalfield did not produce any evidence in rebuttal of the testimony of the appraiser, then the Carters and Sweeneys were not bound by the lesser of the two figures concerning cost of repair versus diminution in value. Moreover, they argue that under Ellison v. R & B Contracting, Inc., 32 S.W.3d 66 (Ky.2000), the fact-finder is free to infer the costs of repair from the diminution in value. Secondly, the Carters and Sweeneys argue that the trial court erred in restricting their claim for damages; namely, the restriction on compensation for reasonable rental value of the property and punitive damages. Coalfield counterargues that the trial court did not err in granting its JNOV motion nor in restricting the Carters' and Sweeneys' claims for damages. After our review of the arguments, we find dispositive the issue concerning the grant of JNOV.
At the outset, we note that a motion for JNOV shall not be granted unless "there is a complete absence of proof on a material issue or if no disputed issues of fact exist upon which reasonable minds could differ." Bierman v. Klapheke, 967 S.W.2d 16, 18-19 (Ky.1998). We review a decision granting JNOV for clear error. Moore v. Environmental Const. Corp., 147 S.W.3d 13, 16 (Ky.2004). We must review the evidence presented to the jury, drawing all reasonable inferences most favorable to the verdict returned by the jury and that we must uphold the trial court's decision if a reasonable person could not have found as the jury did. Id. Moreover, in our determination we must bear in mind that,
Taylor v. Kennedy, 700 S.W.2d 415, 416 (Ky.App.1985).
In Ellison, our Kentucky Supreme Court addressed the inverse situation presented by the case sub judice. In Ellison, the Plaintiffs submitted evidence on the cost to repair their property but no evidence on diminution of value. In holding that evidence of repair costs created a reasonable inference as to the diminution in fair market value of the subject property, the Court noted:
Ellison at 69-70 (internal citations omitted).
In the case sub judice, the Sweeneys offered evidence solely on diminution of value through the testimony of Endicott. Endicott testified that the value of the Sweeney home had diminished in value $25,000 as a result of the damage to the property. Under Ellison, the Sweeneys did not sustain their burden of proof concerning their claim for damages as they failed to provide evidence of the cost of repair to their property. See Ellison at 77. Thus, the trial court did not err in granting the motion for JNOV as to the Sweeneys' claim. However, a different factual situation was presented by the Carters.
Endicott testified that the Carter house was "completely destroyed" at a loss of $10,000, the value of the house prior to
Our Supreme Court in Ellison distinguished between permanent and temporary losses and found that damages for cost of repair were available only where the fact-finder determined that the injury to the property may properly be characterized as temporary. We find little similarity between the terms "temporary" and "completely destroyed" and, in light of no evidence that the property could be repaired, opine that the jury could not have found damages for repair.
Accordingly, we hold that in instances where property can only be determined to be a complete loss; i.e., where it cannot be repaired but instead must be replaced, that evidence of diminution in value alone is sufficient to overcome a motion for directed verdict as well as a motion for JNOV.
We now turn to the second argument presented by the Carters and Sweeneys; namely, that the trial court erred in restricting their claim for damages by restricting compensation for reasonable rental value of the property and for punitive damages. We agree with Coalfield that the trial court did not err in declining to issue jury instructions for the Carters' and Sweeneys' claims for damages for the reasonable rental value of the property. In Brumley v. Mary Gail Coal Co., 246 S.W.2d 148, 151 (Ky.1952), the court held:
Id.
Moreover, the Carters and Sweeneys failed to provide evidence of the rental value of the property; thus, the trial court properly rejected the jury instructions. See also Adams Const. Co. v. Bentley, 335 S.W.2d 912, 913-14 (Ky.1960).
We likewise agree with Coalfield that the trial court did not err in declining to issue jury instructions for the Carters' and Sweeneys' claim for punitive damages, as "punitive damages are not justified just because the injury was intentional. ... Punitive damages may be awarded for conduct that is outrageous, because of the defendant's evil motive or his reckless indifference to the rights of others." Horton v. Union Light, Heat & Power Co., 690 S.W.2d 382, 389 (Ky.1985)(emphasis original). The Carters and Sweeneys failed to provide evidence of Coalfield's "evil motive." Thus, the trial court did not err in declining to issue jury instructions for the Carters' and Sweeneys' claims for punitive damages.
In light of the foregoing, we affirm the grant of JNOV on the Sweeneys' claims, and we reverse the trial court's grant of JNOV on the Carters' claims. Further, we affirm the denial of the trial court to include jury instructions for the Carters' and Sweeneys' claims of damages for the reasonable rental value of the property
ALL CONCUR.