{
  "id": 8202792,
  "name": "WRI/RALEIGH, L.P., Plaintiff v. ISSA F. SHAIKH, Defendant",
  "name_abbreviation": "WRI/Raleigh, L.P. v. Shaikh",
  "decision_date": "2007-05-15",
  "docket_number": "No. COA06-784",
  "first_page": "249",
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          "parenthetical": "\"[w]e find nothing in the new Rules of Civil Procedure which would grant to the court the authority to modify the verdict by changing the amount of the recovery. . . . There must be a new trial on the issue of damages\""
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    "judges": [
      "Chief Judge MARTIN and Judge STROUD concur."
    ],
    "parties": [
      "WRI/RALEIGH, L.P., Plaintiff v. ISSA F. SHAIKH, Defendant"
    ],
    "opinions": [
      {
        "text": "HUNTER, Judge.\nLessee Issa F. Shaikh (\u201cdefendant\u201d) appeals from the trial court\u2019s denial of his summary judgment motion and motions for directed verdict, for a new trial, for judgment notwithstanding the verdict, and for amendment or modification of the judgment, as well as the court\u2019s granting of WRI/Raleigh\u2019s (\u201cplaintiff\u2019) motion for attorneys\u2019 fees. After careful review, we affirm the trial court\u2019s rulings as to all.\nIn early 2002, defendant and plaintiff entered into a lease for premises owned by plaintiff in a shopping center located at 3200 Avent Ferry Road in Raleigh. Defendant\u2019s intention was to operate an Italian and Mediterranean restaurant on the premises. After signing the lease, he approached public utility department officials about the layout of the restaurant and learned that, due to an ordinance passed by the City of Raleigh in 1999, the restaurant was required to have a 1,000-gallon grease trap. Defendant had operated restaurants before and was aware of the need for a grease trap, but believed the minimum capacity for such a trap was well below the 1,000-gallon mark (closer to 200 or 300 gallons). No grease trap or provisions for installing a grease trap existed on the premises.\nWhen defendant learned of the need for a grease trap of this size, he obtained estimates from plumbing engineers as to the cost of modifying the premises to comply with the ordinance. The engineers provided estimates but noted that, due to the layout of the premises, any system created was likely to lead to repeated clogging of the line. As a result, defendant decided he could not open a restaurant on the premises and so tendered the keys to plaintiff.\nPlaintiff thereafter filed suit for breach of contract. A jury found defendant liable in the amount of $158,542.13. Upon motion by plaintiff, the court awarded court costs and attorneys\u2019 fees to plaintiff. Defendant appeals.\nWe first note that one of defendant\u2019s arguments is not properly before this Court, and thus will not be addressed. Defendant argues that the trial court erred in denying his motion for summary judgment because no enforceable contract was created between the parties.\nThis Court cannot consider an appeal of denial of the summary judgment motion now that a final judgment on the merits has been made:\nImproper , denial of a motion for summary judgment is not reversible error when the case has proceeded to trial and has been determined on the merits by the trier of the facts, either judge or jury.\nTo grant a review of the denial of the summary judgment motion after a final judgment on the merits . . . would mean that a party who prevailed at trial after a complete presentation of evidence by both sides with cross-examination could be deprived of a favorable verdict. This would allow a verdict reached after the presentation of all the evidence to be overcome by a limited forecast of the evidence. In order to avoid such an anomalous result, we hold that the denial of a motion for summary judgment is not reviewable during appeal from a final judgment rendered in a trial on the merits. . . .\nHarris v. Walden, 314 N.C. 284, 286, 333 S.E.2d 254, 256 (1985). See also Gregory v. Kilbride, 150 N.C. App. 601, 615, 565 S.E.2d 685, 695 (2002), disc. review denied, 357 N.C. 164, 580 S.E.2d 365 (2003); Pate v. State Farm Fire & Cas. Co., 136 N.C. App. 836, 837-38, 526 S.E.2d 497, 498 (2000); Duke University v. Stainback, 84 N.C. App. 75, 77, 351 S.E.2d 806, 807 (1987). Thus, we cannot address defendant\u2019s first argument.\nDefendant next argues that because his performance under the contract was impossible, the court erred in denying his other motions. Defendant links this argument to assignment of error 8, which concerns only the failure of the jury to follow the court\u2019s instructions in calculating damages. However, because the argument does concern denial of the motions listed in the assignment of error and does relate to a question submitted to the jury, we will consider it here. N.C.R. App. R 2.\nThe trial court found as a matter of law that the lease agreement signed by the parties was valid, but submitted to the jury the following question: \u201cWas the defendant\u2019s failure to perform under the terms of the commercial lease excused by an event which was not reasonably foreseeable?\u201d The jury answered \u201c[n]o,\u201d and was then asked to \u25a0 consider the amount of damages to be awarded.\nDuring the charge conference, the judge laid out a lengthy example that he planned to give the jury regarding frustration of purpose. He then gave that example to the jury in his instructions to them, taking care to distinguish the defense of impossibility \u2014 which he told them was not applicable here \u2014 from the doctrine of frustration of purpose. Specifically, the judge told the jury that the doctrine of impossibility did not apply because he had determined that no evidence was presented to show that \u201cthe installation of a grease trap was completely impossible in the context of this dispute.\u201d\nDefendant argues that the doctrine of impossibility does apply here, and thus should have been submitted to the jury, because he could not have operated the restaurant he planned to operate in the space. This argument misstates the meaning of the doctrine, which applies when the purpose of a contract is somehow frustrated- such that no one could perform under it, not just the current parties: \u201cImpossibility of performance is recognized in this jurisdiction as excusing a party from performing under an executory contract if the subject matter of the contract is destroyed without fault of the party seeking to be excused from performance.\u201d Brenner v. School House, Ltd., 302 N.C. 207, 210, 274 S.E.2d 206, 209 (1981). See also Steamboat Co. v. Transportation Co., 166 N.C. 582, 82 S.E. 956 (1914) (applying doctrine to contract between ship owner and party leasing it for ferrying purposes when ship was destroyed by fire through no fault of parties); Barnes v. Ford Motor Co., 95 N.C. App. 367, 382 S.E.2d 842 (1989) (affirming trial court\u2019s instruction on doctrine of impossibility where subject matter of lease, a tractor, was destroyed). That clearly is not the case here, as the premises at issue still exist and at the time defendant refused to perform were in the same condition as when the contract was signed.\nIn addition, the trial court\u2019s decision was proper based on the evidence presented at trial: Defendant argues that he could not have opened a restaurant on the premises at issue because it was impossible to install the proper grease trap, but conclusive evidence was presented that the current tenants of the property were in fact running a restaurant and had installed a functioning grease trap. Thus, the court was correct in concluding that the doctrine of impossibility was not an issue for the jury because, clearly, installing the trap was not impossible.\nHowever, while defendant specifically defines its argument as arising under the doctrine of impossibility, defendant\u2019s argument is in fact rooted in the doctrine of frustration of purpose. This is similar to, but distinct from, the doctrine of impossibility:\n\u201c \u2018Although the doctrines of frustration and impossibility are akin, frustration is not a form of impossibility of performance. It more properly relates to the consideration for performance. Under it performance remains possible, but is excused whenever a fortuitous event supervenes to cause a failure of the consideration or a practically total destruction of the expected value of the performance. The doctrine of commercial frustration is based upon the fundamental premise of giving relief in a situation where the parties could not reasonably have protected themselves by the terms of the contract against contingencies which later arose.\u2019 \u201d\nBrenner, 302 N.C. at 211, 274 S.E.2d at 209 (quoting 17 Am. Jur. 2d Contracts \u00a7 401). This concept more accurately describes the argument defendant advances here: That an investigation conducted after the lease was signed revealed conditions that resulted in \u201c \u2018 \u201cpractically total destruction of the expected value of the performance.\u201d \u2019 \u201d Id.\nHowever, the doctrine of frustration cannot be used where the frustrating event was reasonably foreseeable. Brenner, 302 N.C. at 211, 274 S.E.2d at 209. As such, the question submitted to the jury\u2014 \u201cWas the defendant\u2019s failure to perform under the terms of the commercial lease excused by an event which was not reasonably foreseeable?\u201d \u2014 correctly conveyed the doctrine of frustration of purpose. During the charge conference, defendant did not object to this question being submitted to the jury on either of the two occasions when the court presented it to both parties. Presumably, then, this question properly conveyed the issue that defendant wanted the jury to answer. It also properly conveys the law. As such, we cannot say the trial court erred on this point.\nDefendant\u2019s final two arguments are properly before the Court. The first such argument is that the trial court erred in denying defendant\u2019s motions for new trial and amendment or modification of judgment because the jury failed to follow the court\u2019s instructions on calculating damages \u2014 specifically, that the jury failed to reduce damages to present value. We disagree.\nThe instructions to the jury regarding present value in the calculation of damages went as follows:\nAnd, ladies and gentlemen, I further instruct you that since the landlord in this case seeks to recover damages for future rents that were lost, any amount you award as future damages for breach of contract must be reduced to their present value because receiving a smaller sum now is equal sum [sic] to be received in the future.\nIn his closing statement, plaintiffs attorney gave plaintiff\u2019s damages as exactly $158,542.13, based on calculations from plaintiffs exhibit 19, which showed various financial data concerning the transactions between the two parties. One of defendant\u2019s attorneys referred to reducing damages to present value in his closing statement:\nNow the third issue, and I think the Judge will instruct you on this, when you of course under this document [sic], the payments that they\u2019re calculating are \u2014 is money that they can expect to receive out to \u2014 to five years from now ... to 2010. And so that\u2019s money that they are not entitled to receive until five years from now. And so, the law is that they\u2019re only entitled to the present value of that future stream of revenue.\nSo, somehow you must figure a way to discount that stream of revenue. And quite frankly, nobody in here [sic] and there has-n\u2019t been any evidence as to how you go about doing it. I think there\u2019s something called a discount rate or some way there\u2014 there are typically formulas to reduce future revenues to their present value. I \u2014 I quite frankly don\u2019t know exactly what they are and there isn\u2019t any evidence in here at all as to how you are to do that. But in fact, the law requires you to make some sort of adjustment for that fact.\nThe jury returned a verdict in plaintiff\u2019s favor for exactly $158,542.13. Defendant made a motion for new trial or amendment of judgment under Rule 59 based on the jury\u2019s disregard of the trial court\u2019s instructions as to damages.\nDefendant argues that, because there is no evidence that this number represents damages reduced to their present value, the jury\u2019s calculations are invalid and thus the case must be remanded for new trial. We disagree.\nIt has been long settled in our jurisdiction that an appellate court\u2019s review of a trial judge\u2019s discretionary ruling either granting or denying a motion to set aside a verdict and order a new trial is strictly limited to the determination of whether the record affirmatively demonstrates a manifest abuse of discretion by the judge. . . .\n[I]t is plain that a trial judge\u2019s discretionary order pursuant to G.S. 1A-1, Rule 59 for or against a new trial upon any ground may be reversed on appeal only in those exceptional cases where an abuse of discretion is clearly shown.\nWorthington v. Bynum and Cogdell v. Bynum, 305 N.C. 478, 482-84, 290 S.E.2d 599, 602-03 (1982); see also Roary v. Bolton, 150 N.C. App. 193, 194, 563 S.E.2d 21, 22 (2002) (\u201c[g]ranting a motion for a new trial under Rule 59 is directed to the discretion of the trial court. The trial court\u2019s ruling will thus not be disturbed upon appeal without a finding of abuse of discretion\u201d) (citations omitted). \u201cAn abuse of discretion occurs when the trial court\u2019s ruling \u2018is so arbitrary that it could not have been the result of a reasoned decision.\u2019 \u201d Chicora Country Club, Inc. v. Town of Erwin, 128 N.C. App. 101, 109, 493 S.E.2d 797, 802 (1997) (quoting White v. White, 312 N.C. 770, 777, 324 S.E.2d 829, 833 (1985)).\nAs noted above, the amount of the judgment was the same amount requested by plaintiffs. The trial court considered and rejected defendant\u2019s argument in post-trial motions that this figure had not been reduced to present value. We cannot say that this ruling is an \u201cexceptional case\u201d that rises to the level of a \u201cmanifest abuse of discretion\u201d by the trial court.\nThis Court is aware of no requirement that a trial court instruct a jury on the concept and calculation of present damages in cases such as the one at hand. Regardless, it cannot be said with certainty that the jury\u2019s calculation of damages made no adjustments for present value and thus disregarded the instruction. Both sides presented evidence as to the amount of damages, such as the possibility of plaintiff\u2019s being able to re-let the premises to new tenants (thus lowering damages) as well as the possibility of the current tenants abandoning the premises before expiration of their lease (thus increasing damages). Further, defendant provided the jury no evidence as to the present value of damages, nor did he request that the court instruct the jury on a formula or even general guidelines for determining present value. As such, we see no support for defendant\u2019s claim at this late date that the jury failed to properly calculate the present value of damages.\nDefendant cites Circuits Co. v. Communications, Inc., 26 N.C. App. 536, 216 S.E.2d 919 (1975), for the tenet that when a jury miscalculates damages by disregarding an instruction of the trial court, the appropriate remedy is remand for a new trial. However, in Circuits, the trial court made a finding of fact that the jury had disregarded its instructions and the trial court modified the amount of the award itself to conform it to those instructions. It is that act on which the Court based its reversal. Id. at 540, 216 S.E.2d at 922 (\u201c[w]e find nothing in the new Rules of Civil Procedure which would grant to the court the authority to modify the verdict by changing the amount of the recovery. . . . There must be a new trial on the issue of damages\u201d). This case is inapposite to the case sub judice, where the trial court made no such modification to the jury\u2019s decision and in fact refused to disturb it. We find no error.\nDefendant next argues that the trial court erred in granting attorneys\u2019 fees based on N.C. Gen. Stat. \u00a7 6-21.2 (2005) because the statute is inapplicable. We disagree.\nUpon motion by plaintiff, the trial court ordered defendant to pay plaintiff attorneys\u2019 fees in the amount of $23,781.32 pursuant to N.C. Gen. Stat. \u00a7 6-21.2, which states that \u201c[obligations to pay attorneys\u2019 fees upon any note, conditional sale contract or other evidence of indebtedness . . . shall be valid and enforceable, and collectible as part of such debt[.]\u201d Defendant appeals this order on the grounds that a lease is not evidence of indebtedness under the statute.\nOur Supreme Court has held that even where parties have contractually obligated themselves to pay attorneys\u2019 fees,' there must still be statutory authority for their recovery. Enterprises, Inc. v. Equipment Co., 300 N.C. 286, 289, 266 S.E.2d 812, 814 (1980) (\u201cthe general rule has long obtained that a successful litigant may not recover attorneys\u2019 fees . . . unless such a recovery is expressly authorized by statute\u201d). Thus, even though attorneys\u2019 fees are expressly provided for by the lease contract, they must also be authorized by statute.\nOur Supreme Court has determined that the language of N.C. Gen. Stat. \u00a7 6-21.2 is to be interpreted broadly: \u201c[W]e hold that the term \u2018evidence of indebtedness\u2019 as used in G.S. 6-21.2 has reference to any printed or written instrument, signed or otherwise executed by the obligor(s), which evidences on its face a legally enforceable obligation to pay money.\u201d Enterprises, Inc., 300 N.C. at 294, 266 S.E.2d at 817. In addition, this Court has applied N.C. Gen. Stat. \u00a7 6-21.2 to disputes regarding the lease of real property. RC Associates v. Regency Ventures, Inc., Ill N.C. App. 367, 372, 432 S.E.2d 394, 397 (1993). Thus, we see no error in the trial court\u2019s awarding of attorneys\u2019 fees on the basis of this statute.\nBecause the trial court did not err in denying defendant\u2019s motions for new trial and amendment of judgment based on the jury\u2019s calculation of damages, or in awarding attorneys\u2019 fees to plaintiff based on statute, we affirm.\nAffirmed.\nChief Judge MARTIN and Judge STROUD concur.\n. In the same motion to the trial court, defendant also renewed his motion for a directed verdict by asking for a judgment notwithstanding the verdict. However, defendant makes no mention of this motion in his brief, and as such it is not properly before us.",
        "type": "majority",
        "author": "HUNTER, Judge."
      }
    ],
    "attorneys": [
      "Maupin Taylor, P.A., by John I. Mabe, Jr., Mark Whitson, and Heather E. Bridgers, for plaintiff-appellee.",
      "Hatch Little & Bunn, L.L.P., by John E. McKnight and David H. Permar, for defendant-appellant."
    ],
    "corrections": "",
    "head_matter": "WRI/RALEIGH, L.P., Plaintiff v. ISSA F. SHAIKH, Defendant\nNo. COA06-784\n(Filed 15 May 2007)\n1. Appeal and Error\u2014 appealability \u2014 denial of summary judgment \u2014 final judgment on merits rendered\nAlthough defendant contends the trial court erred in a breach of contract case by denying his motion for summary judgment, this issue cannot be addressed because a final judgment on the merits has been made.\n2. Contracts\u2014 breach \u2014 impossibility of performance \u2014 frustration of purpose\nThe trial court did not err in a breach of contract case by denying defendant\u2019s motions for a new trial , and amendment of judgment based on the jury\u2019s calculation of damages, because: (1) the doctrine of impossibility of performance was inapplicable when the premises at issue still exist and at the time defendant refused to perform were in the same condition as when the contract was signed; (2) although defendant contends he could not have opened a restaurant on the pertinent premises based on the fact that it was impossible to install the proper grease trap, conclusive evidence was presented that the current tenants of the property were in fact running a restaurant and had installed a functioning grease trap; and (3) the doctrine of frustration of purpose cannot be used where the frustrating event was reasonably foreseeable.\n3. Damages and Remedies\u2014 calculation \u2014 present value\nThe trial court did not abuse its discretion in a breach of contract case by denying defendant\u2019s motions for a new trial and amendment of judgment based on the jury\u2019s alleged failure to follow the court\u2019s instructions on calculating damages based on present value, because: (1) the amount of damages was the same amount requested by plaintiffs, and the trial court considered and rejected defendant\u2019s argument in post-trial motions that this figure had not been reduced to present value; (2) there is no requirement that a trial court instruct a jury on the concept and calculation of present damages in cases such as this one; (3) it cannot be said with certainty that the jury\u2019s calculation of damages made no adjustments for present value; and (4) defendant provided the jury no evidence as to the present value of damages, nor did he request that the court instruct the jury on a formula or even general guidelines for determining present value.\n4. Costs\u2014 attorney fees \u2014 breach of lease of real property\nThe trial court did not err in a breach of lease case by awarding attorney fees to plaintiff under N.C.G.S. \u00a7 6-21.2, because: (1) the term \u201cevidence of indebtedness\u201d under the statute has reference to any printed or written instrument, signed or otherwise executed by the obligors, which evidences on its face a legally enforceable obligation to pay money; and (2) the Court of Appeals has previously applied N.C.G.S. \u00a7 6-21.2 to disputes regarding the lease of real property.\nAppeal by defendant from an order entered 11 July 2005 by Judge Ronald L. Stephens, denial of defendant\u2019s motion for summary judgment and directed verdict entered in open court 25-26 July 2005, judgment entered 6 September 2005, and an order entered 6 December 2005 by Judge Donald W. Stephens, respectively, in Wake County Superior Court. Heard in the Court of Appeals 5 February 2007.\nMaupin Taylor, P.A., by John I. Mabe, Jr., Mark Whitson, and Heather E. Bridgers, for plaintiff-appellee.\nHatch Little & Bunn, L.L.P., by John E. McKnight and David H. Permar, for defendant-appellant."
  },
  "file_name": "0249-01",
  "first_page_order": 281,
  "last_page_order": 290
}
