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  "name_abbreviation": "Hodgson Construction, Inc. v. Howard",
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    "judges": [
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      "HODGSON CONSTRUCTION, INC., Plaintiff v. RONALD WALLACE HOWARD and wife, SHIRLEY ANN HOWARD, Defendants"
    ],
    "opinions": [
      {
        "text": "STROUD, Judge.\nPlaintiff appeals from judgment notwithstanding the verdict (JNOV) granted in favor of defendants on the grounds that plaintiff entered into a contract to construct a house for defendants which exceeded the scope of plaintiff\u2019s limited general contractor\u2019s license. Because we conclude that the value of the construction of defendants\u2019 home did not exceed the scope of plaintiffs limited general contractor\u2019s license, we remand for reinstatement of the jury verdict for plaintiff, and entry of judgment for plaintiff.\nI. Background\nOn 14 March 2005, plaintiff filed a complaint against defendants seeking judgment in the sum of $70,315.92, plus interest accruing after 27 September 2004, as well as costs, expenses, and attorney\u2019s fees pursuant to Chapter 44A of the North Carolina General Statutes. Plaintiff also filed a claim of lien upon defendants\u2019 real property pursuant to Chapter 44A of the North Carolina General Statutes.\nThe complaint alleged that plaintiff had entered into three contracts with defendants for the construction of a house upon defendants\u2019 real property: (1) a cost-plus contract for the construction of a house foundation (\u201cfoundation contract\u201d), (2) a cost-plus contract for installation of framing, trusses, and windows in the same house (\u201cwindow contract\u201d), and (3) a contract dated 31 May 2004 for construction of the house (\u201chouse, contract\u201d).\nThe house contract provided for plaintiff to construct a \u201cthree level house\u201d with heated space of 3472 square feet, with plaintiff to \u201cfurnish material and labor \u2014 complete in accordance with the above specifications, for the sum of Three hundred fifty nine thousand, six hundred twenty dollars ($359,620.00).\u201d This stated contract price expressly excluded the foundation work, which had already been completed by plaintiff pursuant to the foundation contract, and \u201cfloor and roof trusses, rock labor and rock material, elevator, windows and exterior doors\u201d which defendants were to provide. The house contract also identified various \u201callowances\u201d in specific amounts and items which were to be \u201cfurnished\u201d or \u201cprovided by owner.\u201d\nThe complaint finally alleged that plaintiff constructed the house as required by the three contracts but defendants failed to pay all sums owed. Plaintiff sought outstanding balances owed of $61,587.93 on the house contract and of $8,727.99 for the foundation and installation of framing, trusses, and windows, a total of $70,315.92, plus interest and various litigation costs.\nOn 12 April 2005, defendants filed a motion to dismiss plaintiff\u2019s complaint pursuant to N.C. Gen. Stat. \u00a7 1A-1, Rule 12(b)(6), alleging that plaintiff did not possess an intermediate contractor\u2019s license as was required by North Carolina law to be able to enforce the contract to construct defendants\u2019 house. On 31 May 2005, plaintiff filed an amended complaint, which contained essentially the same allegations as the original complaint, but also alleged that the house contract provided for allowances of $79,389.00 to be paid for by defendants, making the \u201cactual contract price upon which plaintiff would recover . . . $280,231.00[,]\u201d and seeking the same amounts of damages under each portion of the contract as in the original complaint. On 20 June 2005 the trial court denied the motion to dismiss. Defendants filed their answer on 25 July 2005, alleging that the window contract never existed, and alleging by way of counterclaim that plaintiff had breached the house contract by failing to perform the work in a proper manner and by abandoning construction of the home before completion.\nJury trial began on 8 May 2006 and concluded on 11 May 2006. The jury found that defendants did not breach the foundation contract, but that they did breach the house contract and that plaintiff was entitled to recover damages of $51,000.00. On defendants\u2019 counterclaim, the jury found that plaintiff did not breach the contract.\nDefendants moved in open court for judgment notwithstanding the verdict pursuant to N.C. Gen. Stat. \u00a7 1A-1, Rule 50(b). On 23 May 2006, the trial court entered an order granting defendants\u2019 motion for JNOV, finding that the house contract was unenforceable by plaintiff because \u201cthe plaintiff acted as a general contractor for a single project with a value in excess of three hundred fifty thousand dollars ($350,000), a project for which the plaintiff was unlicensed\u201d under N.C. Gen. Stat. \u00a7 87-10(a). The trial court therefore set aside the jury\u2019s verdict as to the $51,000.00 awarded as damages to plaintiff. Plaintiff filed notice of appeal from the order granting judgment notwithstanding the verdict.\nII. Standard of review\nPlaintiff argues that the standard of review for a JNOV is de novo. Defendant, citing Carter v. Foster, 103 N.C. App. 110, 404 S.E.2d 484 (1991) (holding that the trial court\u2019s findings of fact which were supported by competent evidence were conclusive on appeal when the parties waived trial by jury in favor of a bench trial), urges us to consider the trial court\u2019s ruling on the JNOV as if it was made at a bench trial and accord deference to factual findings of the trial court which are supported by evidence in the record.\nA motion for judgment notwithstanding the verdict\nis essentially a renewal of an earlier motion for directed verdict. Accordingly, if the motion for directed verdict could have been properly granted, then the subsequent motion for judgment notwithstanding the verdict should also be granted. In considering any motion for directed verdict [or JNOV], the trial court must view all the evidence that supports the non-movant\u2019s claim as being true and that evidence must be considered in the light most favorable to the non-movant, giving to the non-movant the benefit of every reasonable inference that may legitimately be drawn from the evidence with contradictions, conflicts, and inconsistencies being resolved in the non-movant\u2019s favor. This Court has also held that a motion for judgment notwithstanding the verdict is cautiously and sparingly granted.\nBryant v. Nationwide Mut. Fire Ins. Co., 313 N.C. 362, 368-69, 329 S.E.2d 333, 337-38 (1985) (internal citations and quotation marks omitted) (emphasis added). \u201cWhen a judge decides that a directed verdict [or JNOV] is appropriate, actually he is deciding that the question has become one exclusively of law and that the jury has no function to serv\u00e9.\u201d N.C. Gen. Stat. \u00a7 1A-1, Rule 50, comment. However, \u201ca genuine issue of fact must be tried by a jury unless this right is waived.\u201d In re Will of Jarvis, 334 N.C. 140, 143, 430 S.E.2d 922, 923 (1993) (stating the standard of review for a directed verdict).\nSince plaintiff did not waive its right to a jury trial, defendants have misplaced their reliance on Carter for the proposition that deference is due the trial court\u2019s findings of fact in the case sub judice. Rather, the trial court\u2019s findings of fact and conclusions of law have no legal significance in an order granting JNOV. Kelly v. Harvester Co., 278 N.C. 153, 157, 179 S.E.2d 396, 397 (1971). While findings of fact in a JNOV order may assist this Court in understanding the reason that the trial judge granted JNOV, see People's Center, Inc. v. Anderson, 32 N.C. App. 746, 233 S.E.2d 694 (1977), \u201cour review of [a] motion for judgment notwithstanding the verdict is de novo . . . .\u201d N.C. Indus. Capital, LLC v. Clayton, 185 N.C. App. 356, 370, 649 S.E.2d 14, 25 (2007). Therefore, \u201cwe consider the matter anew and . . . freely substitute our judgment for that of the trial court regardless of whether the trial court made findings of fact and conclusions of law.\u201d 185 N.C. App. at 371, 649 S.E.2d at 25 (internal brackets and quotation marks omitted).\nIn fact, \u201c[t]he standard is high for the party seeking a JNOV: the motion should be denied if there is more than a scintilla of evidence to support the plaintiffs prima facie case.\u201d Cox v. Steffes, 161 N.C. App. 237, 243, 587 S.E.2d 908, 912-13 (2003) (citation, quotation marks and emphasis omitted), disc. review denied, 358 N.C. 233, 595 S.E.2d 148 (2004). Furthermore, where as here, a JNOV is granted to the defendants on the grounds of an affirmative defense, it \u201cwill be more closely scrutinized.\u201d Bryant, 313 N.C. at 369, 329 S.E.2d at 338.\nIn sum, our task is to determine if the trial court correctly concluded that this case is exclusively a matter of law, by which defendants were entitled to prevail. In making this determination, we presume that all evidence supporting plaintiffs claim is true, and draw all inferences arising from the evidence in plaintiffs favor.\nIII. Analysis\nPlaintiff contends that the trial court erred in granting defendants\u2019 motion for JNOV on the grounds that plaintiff was barred from recovery because the stated contract price exceeded $350,000.00, the maximum allowed by plaintiffs limited general contractor\u2019s license. Specifically, plaintiff argues that although the stated contract price for which plaintiff agreed to construct defendants\u2019 house was $359,620.00, that amount must be reduced by $79,389.00, the sum of the allowances over which defendants retained control and paid for. Plaintiff contends the value of the project was the net of the stated contract price and the allowances, $280,231.00, an amount within the scope of plaintiff\u2019s limited general contractor\u2019s license. Alternatively, plaintiff argues that even if the value of the contract exceeded its license limit, it is still entitled to enforce the contract up to the amount of its limited license. Defendants respond that the value of the project includes the house contract, including allowances, of $359,620.00; the amount paid pursuant to the foundation contract, $30,492.19; and the value of windows, doors, and floor and roof trusses paid for directly by defendants, $49,671.66. Adding those figures together, defendants contend that the value of the project was $439,783.85, an amount well in excess of plaintiffs limited general contractor\u2019s license at the time the house contract was executed and at all relevant times thereafter. Defendants, citing Builders Supply v. Midyette, 274 N.C. 264, 162 S.E.2d 507 (1968), concludes that plaintiff may therefore not enforce the house contract at all.\nBecause defendants alleged that more than one contract was included in a single project \u2014 the house \u2014 we must first determine the meaning of \u201cvalue of a single project\u201d for purposes of applying N.C. Gen. Stat. \u00a7 87-10. In interpreting the language of N.C. Gen. Stat. \u00a7 87-10, as with any statute, we presume \u201cthe General Assembly intended the words it used to have the meaning they have in ordinary speech. When the plain meaning of a statute is unambiguous, a court should go no further in interpreting the statute.\u201d Nelson v. Battle Forest Friends Meeting, 335 N.C. 133, 136, 436 S.E.2d 122, 124 (1993) (citation omitted).\nOur case law is not entirely clear on the meaning of \u201cvalue of a single project,\u201d but it appears to have the same meaning as \u201ccost of [an] undertaking,\u201d the operative language of N.C. Gen. Stat. \u00a7 87-1. See generally Sample v. Morgan, 311 N.C. 717, 723, 319 S.E.2d 607, 611 (1984); Spivey and Self v. Highview Farms, 110 N.C. App. 719, 431 S.E.2d 535, disc. review denied, 334 N.C. 623, 435 S.E.2d 342 (1993); Furniture Mart v. Burns, 31 N.C. App. 626, 632-33, 230 S.E.2d 609, 612-13 (1976); see also Webster\u2019s Third New Internationl Dictionary 1813 (1968) (defining \u201cproject\u201d as \u201ca planned undertaking\u201d). The cost of an undertaking is generally the value of the construction to the owner upon completion, which is again generally the same as the stated contract price for the building or other construction. Fulton v. Rice, 12 N.C. App. 669, 672, 184 S.E.2d 421, 423 (1971).\nHowever, the value of the completed construction or the stated contract price are not necessarily determinative as to the cost of the contractor\u2019s undertaking, particularly when the value of the completed construction includes items over which the contractor had no control. Id.; Helms v. Dawkins, 32 N.C. App. 453, 232 S.E.2d 710 (1977) (reversing summary judgment in homeowners\u2019 favor even though the evidence showed that the value of the completed home was more than the limit of the contractor\u2019s license, because the written contract was ambiguous as to the degree of control to be exercised by the contractor), overruled on other grounds, Sample v. Morgan, 311 N.C. 717, 723, 319 S.E.2d 607, 611 (1984); Furniture Mart v. Burns, 31 N.C. App. 626, 632, 230 S.E.2d 609, 612-13 (1976) (reversing summary judgment in favor of owner, even though the value of the completed building totaled $325,000.00 and the contractor\u2019s license was limited to $75,000.00, because genuine issues of material fact existed as to the contractor\u2019s control over the undertaking where the owner \u201cselected and purchased building material, and directly employed subcontractors\u201d). Furthermore,\n[t]he provisions of a written contract may be modified or waived by a subsequent parol agreement, or by conduct which naturally and justly leads the other party to believe the provisions of the contract are modified or waived, . . . this principle has been sustained even where the instrument provides for any modification of the contract to be in writing.\nCamp v. Leonard, 133 N.C. App. 554, 562, 515 S.E.2d 909, 914 (1999) (citation, internal brackets and quotation marks omitted).\nFirst, we agree with defendants that the presence of multiple contracts for different phases of a building is not necessarily determinative as to the question of what constitutes a \u201csingle\u201d project. To hold otherwise would tend to allow general contractors to circumvent the consumer protections of Chapter 87 by stringing together piecemeal contracts for different phases of the construction of a single building. While we can envision scenarios where the existence of multiple contracts for different phases of the construction of a building might be relevant, the existence of separate contractual documents for the construction of the foundation and the construction of the rest of the house in the case sub judice is not determinative.\nAssuming all evidence in support of plaintiff\u2019s claim is true and drawing all inferences in plaintiff\u2019s favor, as we must in reviewing the JNOV granted for defendants, Bryant, 313 N.C. at 368-69, 329 S.E.2d at 337-38, the evidence in the instant case tends to show that even before the foundation was started, plaintiff was intended as the general contractor for the entire house. The foundation was constructed by plaintiff according to the plan for the entire house, rather than according to a separate foundation plan. The evidence further shows plaintiff started framing the house before he had been fully paid for the foundation and before the contract for construction of the rest of the house had been negotiated or executed. We therefore conclude that the foundation contract must be included with the house contract in determining the value of the single project for the purpose of applying N.C. Gen. Stat. \u00a7 87-10.\nWe next consider the cost of the windows, doors, and frame and roof trusses, which defendants also assert to be part of the single project. Although defendant Shirley Howard testified that plaintiff controlled the purchase and installation of the windows, doors and trusses, the record does not contain a copy of the purported window contract. Furthermore, plaintiff\u2019s testimony that he did not control this part of the construction of the house must be taken as true in reviewing the order granting JNOV, and we therefore conclude that the cost of the windows, doors and trusses paid by defendant is not to be included to determine the value of the single project.\nNext, we must add the value of the house contract and the value of the foundation contract in order to derive the value of the single project. The value of the foundation contract was disputed. The face of the foundation contract is a cost-plus contract-for an estimated cost of $42,410.00 plus 12%, a total of $47,499.20. However, plaintiff testified that defendants sought to modify the contract after it had been initially agreed to, first by reducing the amount of the percentage to 10% before construction had begun, then by hiring the block mason and his crew, without regard to plaintiff, after construction had begun. As a result, plaintiff\u2019s evidence was that the value of the foundation work which it controlled was $39,220.18.\nThe amount of the house contract was also disputed. On its face the value of the house contract is $359,620.00. However, plaintiff\u2019s evidence was that, after deducting allowances of $79,389.00, plaintiff controlled only $280,231.00 worth of the work on the house.\nTaking all evidence which supports plaintiff\u2019s claim as true, and drawing all reasonable inferences in plaintiff\u2019s favor, the amounts over which plaintiff had control in the construction of the house were: (1) on the foundation contract, $39,220.18, and (2) on the house contract, $280,231.00. The sum of those numbers, $319,451.18, is the value of the single project for the purpose of applying N.C. Gen. Stat. \u00a7 87-10(a). This amount was within the $350,000.00 limit of plaintiffs general contractor\u2019s license.\nTaking all evidence which supports plaintiffs claim as true, and drawing all reasonable inferences in plaintiffs favor, we conclude that plaintiff did not exceed the scope of its limited general contractor\u2019s license in the construction of defendants\u2019 house. Therefore the trial court erred when it concluded that the question in this case was exclusively a matter of law which entitled defendants to prevail, and set aside the jury verdict in plaintiff\u2019s favor. Accordingly, this case is remanded for reinstatement of the jury verdict for plaintiff, and entry of judgment for plaintiff.\nRemanded for entry of judgment on the verdict.\nJudges ELMORE and STEELMAN concur.\n. Defendants\u2019 answer did not plead plaintiffs limited license as an affirmative defense, and \u201c[failure to be properly licensed is an affirmative defense which ordinarily must be specifically pleaded.\u201d Barrett, Robert & Woods v. Armi, 59 N.C. App. 134, 137, 296 S.E.2d 10, 13, disc. review denied, 307 N.C. 269, 299 S.E.2d 214 (1982). However, defendants did raise this defense in their motion to dismiss, and because defendants submitted affidavits in support of the motion to dismiss, the motion was actually treated as a motion for summary judgment. Helms v. Holland, 124 N.C. App. 629, 633, 478 S.E.2d 513, 516 (1996). \u201c[T]he nature of summary judgment procedure (G.S. 1A-1, Rule 56), coupled with our generally liberal rules relating to amendment of pleadings, require that unpleaded affirmative defenses be deemed part of the pleadings where such defenses are raised in a hearing on motion for summary judgment.\u201d 59 N.C. App. at 137, 296 S.E.2d at 13 (citation and quotation marks omitted). Therefore defendants\u2019 affirmative defense was properly raised to the trial court.\n. Our careful scrutiny of the contract reveals only $61,624.00 in allowances, but both sides agree in their respective briefs that the allowances totaled $79,389.00.\n. \u201c[T]he holder of a limited license shall be entitled to act as general contractor for any single project with a value of up to three hundred fifty thousand dollars ($350,000)_\u201d N.C. Gen. Stat. \u00a7 8740(a) (2005).\n. \u201c[A]ny person or firm or corporation who . . . undertakes to . . . construct. . . any building . .. where the cost of the undertaking is thirty thousand dollars ($30,000) or more... shall be deemed to be a \u2018general contractor\u2019 engaged in the business of general contracting in the State of North Carolina.\u201d N.C. Gen. Stat. \u00a7 87-1 (2005).",
        "type": "majority",
        "author": "STROUD, Judge."
      }
    ],
    "attorneys": [
      "Vannoy, Golvard, Triplett & Vannoy, P.L.L.C., by Daniel S. Johnson, for plaintiff-appellant.",
      "McElwee Firm, PLLC, by John M. Logsdon, for defendant-appellees.'"
    ],
    "corrections": "",
    "head_matter": "HODGSON CONSTRUCTION, INC., Plaintiff v. RONALD WALLACE HOWARD and wife, SHIRLEY ANN HOWARD, Defendants\nNo. COA06-1414\n(Filed 4 December 2007)\nConstruction Claims\u2014 limited contractor\u2019s license \u2014 multiple contracts for one building \u2014 judgment notwithstanding the verdict\nThe trial court erred when it concluded that the question in this case was exclusively a matter of law and granted judgment notwithstanding the verdict for defendants. Taking all of the evidence which supports the claim as true, and drawing all reasonable inferences in plaintiffs favor, plaintiff did not exceed the scope of its limited general contractor\u2019s license in the construction of defendants\u2019 house.\nAppeal by plaintiff from judgment entered 23 May 2006 by Judge Catherine C. Eagles in Superior Court, Wilkes County. Heard in the Court of Appeals 7 June 2007.\nVannoy, Golvard, Triplett & Vannoy, P.L.L.C., by Daniel S. Johnson, for plaintiff-appellant.\nMcElwee Firm, PLLC, by John M. Logsdon, for defendant-appellees.'"
  },
  "file_name": "0408-01",
  "first_page_order": 438,
  "last_page_order": 446
}
