Opinion
NO. 2019-CA-000803-MR
05-22-2020
R.A. JONES & CO., INC. APPELLANT v. KEITH STURDIVANT APPELLEE
BRIEFS FOR APPELLANT: Gerald F. Dusing Olivia F. Amlung Covington, Kentucky Steven D. Brown Allison D. Kewer Richmond, Virginia BRIEF FOR APPELLEE: T. Lawrence Hicks Edgewood, Kentucky
NOT TO BE PUBLISHED APPEAL FROM BOONE CIRCUIT COURT
HONORABLE RICHARD A. BRUEGGEMANN, JUDGE
ACTION NO. 14-CI-01095 OPINION
REVERSING AND REMANDING
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BEFORE: GOODWINE, KRAMER, AND MAZE, JUDGES. GOODWINE, JUDGE: R.A. Jones & Co., Inc., appeals a Boone Circuit Court judgment in favor of Keith Sturdivant. R.A. Jones argues the trial court incorrectly ruled that it failed to prove damages sufficient to justify an award in any amount with reasonable certainty. After review of the record, we reverse and remand.
BACKGROUND
R.A. Jones employed Sturdivant for over 26 years. During that time, Sturdivant travelled extensively for his job. R.A. Jones regularly sent approximately 60 employees on regular business trips each year. Because of this practice, R.A. Jones obtained company credit cards, issuing the cards to each travelling employee and registering the cards in the employee's name. When costs accrued on the company credit cards, employees would list the expenses on expense management software called "Expense Concur" ("Concur"). Once an employee listed a charge, R.A. Jones would reimburse the employees and list the reimbursement on Concur. At that point, the employees would pay off the credit card charges. But if employees failed to pay the balance of charges on the cards, R.A. Jones was ultimately responsible to pay the balance due. Sturdivant received his card statements and could review various charges made and the card's balance.
On August 27, 2013, PNC Bank informed R.A. Jones that the closing balance of Sturdivant's card was $11,767.22. Of that amount, $6,161.88 was 30 days past due and $4,530.86 was 60 days past due. The remaining $1,073.48 was current. Because over $10,000.00 in charges were past due, R.A. Jones paid PNC Bank $10,693.74 on Sturdivant's behalf.
From March 2013 to August 2013, deposit records show that R.A. Jones reimbursed Sturdivant over $34,000.00 to pay credit card expenses. Sturdivant admitted that he had been reimbursed for the charges but failed to use those charges to pay the expenses. Considering that admission, Sturdivant signed a letter prepared by R.A. Jones on October 31, 2013, acknowledging he owed R.A. Jones $10,693.74 for credit card charges, less adjustments. That letter reads as follows:
Dear Keith:Record on Appeal (R.) at 305.
Please see the attached PNC credit card statement. Currently, you owe R.A. Jones $10,693.74 [adjusted to $8,943.06] for credit card charges incurred by you that were paid on your behalf by the Company. You have been reimbursed the above amount by the Company and failed to pay the credit card bill. Additional charges of $1,073.48 are 30 days outstanding and require immediate payment.
By signing below, you acknowledge the above information to be true and accurate.
[/s] Keith Sturdivant
On November 4, 2013, Sturdivant executed a document authorizing R.A. Jones' deduction of money from his paycheck to satisfy his debt from the company credit card. R.A. Jones' Director of Human Resources, Kevin Cheek, signed the document, as well. It reads as follows:
I currently owe R.A. Jones $10,693.74 [adjusted to $8,943.06] for failure to pay the Company credit card bill. I will reimburse the Company the above amount via a bi-weekly payroll deduction of $150.00.
This letter confirms approval for the bi-weekly payroll deduction of $150.00 to continue until the above is paid in full.R. at 306.
I understand that effective immediately I am responsible for timely and accurate expense reports.
[/s] Keith Sturdivant
The total amount owed will be adjusted as needed due to billing corrections.
[/s] Kevin J. Cheek
R.A. Jones allowed the prospect of reductions and corrections to the billing amount, as evidenced by Cheek's signature, because the company allowed multiple employees to use the same card, making billing errors a possibility. After Sturdivant signed the agreement, he began reviewing expense records. He found an instance where a hotel charge of $1,750.68 was put on his credit card, though it should not have been. Because of the error, R.A. Jones initialed a handwritten correction to Sturdivant's November 4 agreement, adjusting the total from $10,693.74 to $8,943.06. R.A. Jones personally added other handwritten notes to the agreement, documenting payment from the payroll deductions that further reduced the balance owed.
On January 8, 2014, Sturdivant's card had $1,073.48 in overdue charges remaining from August 2013. At that time, R.A. Jones agreed to advance him an additional $1,073.48 to pay off the outstanding charges. After giving the advancement, Cheek adjusted the November 4 agreement, via a handwritten note, which raised Sturdivant's repayment amount from $8,943.06 to $10,016.54. On April 4, 2014, Sturdivant resigned from his position with R.A. Jones. Fourteen days later, and at the time of his last payroll deduction, Sturdivant owed R.A. Jones $8,216.54.
Sturdivant's payroll deductions totaled $1,800.00.
Three months later, R.A. Jones filed a civil action against Sturdivant in the Boone Circuit Court, alleging breach of contract and promissory estoppel. In April 2018, R.A. Jones moved for summary judgment on both its claims. The trial court granted R.A. Jones' summary judgment motion, finding there was a valid contract between the parties that Sturdivant had breached. It then ordered a bench trial to determine the appropriate damages.
Following a bench trial, the trial court entered judgment in favor of Sturdivant. In its ruling, the trial court found that R.A. Jones failed to prove the amount owed with reasonable certainty. This appeal followed.
STANDARD OF REVIEW
The factual findings of the trial court shall not be set aside unless clearly erroneous, i.e., not supported by substantial evidence. Moore v. Asente, 110 S.W.3d 336, 354 (Ky. 2003). Substantial evidence is evidence, when taken alone or considering all the evidence, that has sufficient probative value to induce conviction in the mind of a reasonable person. Id. We review the trial court's conclusions of law under a de novo standard. Tavadia v. Mitchell, 564 S.W.3d 322, 326 (Ky. App. 2018). And when reviewing the trial court's award of damages, we will give due regard "to the opportunity of the trial court to judge the credibility of the witnesses." CR 52.01.
Kentucky Rules of Civil Procedure.
ANALYSIS
This case is about damages arising from a breach of contract action. The trial court found the existence of a valid contract and that Sturdivant breached that contract. However, following a bench trial, the trial court found R.A. Jones failed to prove damages with reasonable certainty. The question before us is whether R.A. Jones met its burden to prove damages caused by Sturdivant's breach with reasonable certainty. We find that it did.
The following facts are undisputed: (1) R.A. Jones paid PNC Bank $11,767.22 for overdue amounts on Sturdivant's company card; (2) Sturdivant admitted that R.A. Jones reimbursed funds to him to pay the company card's charges and he failed to do so; (3) Sturdivant found a billing error of $1,750.68 and R.A. Jones gave him credit for that amount; and (4) Sturdivant paid to R.A. Jones $1,800.00 in payroll deductions by agreement prior to leaving the company. Based on these undisputed facts, Sturdivant owes R.A. Jones $8,216.54.
Under Kentucky law, "[d]amages for breach of a contract are normally that sum which would put an injured party into the same position it would have been in had the contract been performed." Univ. of Louisville v. RAM Eng'g & Const., Inc., 199 S.W.3d 746, 748 (Ky. App. 2005) (citation omitted). In breach of contract actions, Kentucky law allows a plaintiff to recover for damages only where the fact of damage is reasonably certain. Pauline's Chicken Villa, Inc. v. KFC Corp., 701 S.W.2d 399, 401-02 (Ky. 1985). And contingent, uncertain, and speculative damages generally may not be recovered. Spencer v. Woods, 282 S.W.2d 851, 852 (Ky. 1955). But where it is reasonably certain that damage has resulted, mere uncertainty as to the amount does not preclude one's right of recovery or prevent a jury decision awarding damages. Roadway Exp., Inc. v. Don Stohlman & Associates, Inc., 436 S.W.2d 63, 65 (Ky. 1968). Here, the facts are undisputed.
It is unclear why the trial court found that R.A. Jones could not prove damage from Sturdivant's breach to a reasonable certainty. But that finding is not supported by substantial evidence. The trial court noted that "[R.A. Jones] has shown that [Sturdivant] likely owes something, possibly the entire amount demanded. But possibly is not enough. R.A. Jones must prove the amount with reasonable certainty." R. at 330. Basically, it proffered that R.A. Jones did not submit enough proof to reconcile the charges for the amounts in issue. We disagree based on the record before us.
We briefly note the trial court found that "[Sturdivant]'s testimony and evidence did not rebut any specific charge or what the amount should be." We agree with this finding. At trial, and on appeal, Sturdivant consistently made two arguments: (1) the amount he agreed to pay R.A. Jones was incorrect because deductions needed to be made for expenses not credited to him, but rather to other employees; and (2) he did not have the opportunity to contest these issues. Both arguments fail.
As previously noted, R.A. Jones made Sturdivant aware of the charges on October 31, 2013, and they entered into a repayment agreement four days later. Almost immediately, Sturdivant reported an erroneous charge of $1,750.68 and R.A. Jones immediately deducted that amount from the amount owed. Sturdivant had another five months to dispute other charges. As the record indicates, Sturdivant did nothing. He made no further challenges to the amount owed. While this is ultimately not germane to the premise of our reversal, we agree with R.A. Jones that Sturdivant's failure to either conduct any further investigation over the next five months, or to locate any additional issues, operated as a waiver of any argument that the amount due was incorrect. See Unifund CCR Partners v. Harrell, 509 S.W.3d 25, 29 (Ky. 2017) (internal quotation marks and citation omitted) ("A waiver is a voluntary and intentional surrender or relinquishment of a known right, or an election to forego an advantage which the party at his option might have demanded or insisted upon.").
The timeline speaks for itself and is substantial evidence sufficient to support a finding of damages owed in the amount of $8,216.54.
• From March 2013 to August 2013, Sturdivant charged $24,987.22 in expenses.
• From March 2013 to August 2013, R.A. Jones reimbursed Sturdivant $34,977.44. This left Sturdivant with a surplus of $9,990.22.
• On August 27, 2013, PNC Bank informed R.A. Jones that the closing balance on Sturdivant's card was $11,767.22. Of this amount, $6,161.88 was 30 days past due; $4,530.86 was 60 days past due; and $1,073.48 was current.
• On October 31, 2013, R.A. Jones notified Sturdivant there was a $10,693.74 outstanding overdue charge on his company credit card. Sturdivant failed to pay it.
• R.A. Jones paid PNC Bank $10,693.74.
• In November 2013, Sturdivant disputed $1,750.68 in charges and R.A. Jones gave him credit for that amount.
• On January 8, 2014, the $1,073.48 from the August 31st notification was now overdue. R.A. Jones paid PNC Bank that amount and added it to the amount Sturdivant owed the company.
• On April 4, 2014, Sturdivant resigned. At that time, he had repaid R.A. Jones $1,800.00 in payroll deductions.
In sum, R.A. Jones reimbursed Sturdivant with the funds necessary to cover his card's charges and he failed to pay PNC Bank, necessitating R.A. Jones to pay PNC Bank on Sturdivant's behalf. Based on the above calculations, Sturdivant owes R.A. Jones $8,216.54.
Considering this evidence, there was sufficient probative value to induce conviction in the mind of a reasonable person that R.A. Jones could prove damages to a reasonable certainty. Pauline's Chicken Villa, 701 S.W.2d at 401-02. Therefore, we reverse the trial court's judgment and remand for entry of a judgment in favor of R.A. Jones in the amount of $8,216.54.
CONCLUSION
Based on our review of the record, we find the Boone Circuit Court's findings of fact clearly erroneous and its conclusions fail as a matter of law. Therefore, we reverse its judgment and remand this action to the trial court for entry of a judgment consistent with this opinion.
ALL CONCUR. BRIEFS FOR APPELLANT: Gerald F. Dusing
Olivia F. Amlung
Covington, Kentucky Steven D. Brown
Allison D. Kewer
Richmond, Virginia BRIEF FOR APPELLEE: T. Lawrence Hicks
Edgewood, Kentucky