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2008-UP-325 - Savannah Architectural Supply v. Brady

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Savannah Architectural Supply, Inc., Respondent,

v.

James R. Brady, d/b/a Brady Builders, Appellant.


Appeal From Beaufort County
 Curtis L. Coltrane, Special Circuit Court Judge


Unpublished Opinion No. 2008-UP-325
Submitted May 1, 2008 – Filed June 27, 2008   


AFFIRMED


Thomas J. Finn, of Hilton Head Island, for Appellant.

Leo A. Dryer, Jr., of Columbia, for Respondent.

PER CURIAM:  James Brady appeals the trial court’s order finding him liable on a contract with Savannah Architectural Supply, Inc. (Savannah Architectural).  We affirm.[1]

FACTS

In 1986, Brady and another individual formed Boru Enterprises, Inc., which did business under the trade name Brady Builders.  Brady was also president of Boru Enterprises.  In 1999, Rick Bohrer, an employee of Boru Enterprises, requested a quote from Savannah Architectural on behalf of Brady Builders.  As a result, Savannah Architectural opened an account for Brady Builders. Construction materials amounting to $43,602.47,[2] were ordered on the account between June 21, 1999 and March 21, 2001.  No payment was made and Savannah Architectural brought suit against Brady personally.  Brady answered asserting he was employed by Boru Enterprises, and thus, not personally liable.  Brady also stated Boru Enterprises was no longer actively conducting business. 

At trial, Chester Gayheart, the president of Savannah Architectural, testified Brady had been a customer of Savannah Architectural since 1995.  Additionally, Gayheart testified he believed he was dealing with a sole proprietorship Brady owned and was unaware of the existence of Boru Enterprises.  As evidence, Savannah Architectural offered (1) draw requests submitted by Brady Builders and signed by Brady with no corporate designations regarding the project for which the materials Savannah Architectural provided were used; (2) copies of a cashier’s check issued jointly to Brady Builders and itself by one of Brady Builder’s customers, which did not reference Boru Enterprises; and (3) several of its invoices addressed to Brady Builders for the construction materials.  Further, Brady testified he regularly signed his name without designating himself as a corporate officer.  However, Gayheart admitted Savannah Architectural had not seen the draw requests at the time it provided the construction materials to Brady Builders.

The trial court found Boru Enterprises was an undisclosed principal, and thus, Brady was liable as an agent for the amount due and interest.  Approximately a month after the trial court issued its order, Brady filed a Rule 60(b), SCRCP, motion for relief from judgment.  Brady asserted he had newly discovered evidence in the form of a check paid to Savannah Architectural that noted Brady Builders was a division of Boru Enterprises.  The trial court denied the motion finding the check was not newly discovered evidence because it was in Brady’s own records and he was aware of its existence prior to trial.  This appeal followed.

STANDARD OF REVIEW

“An action on an open account is an action at law.”  Spartanburg Reg’l Med. Ctr. v. Bulsa, 308 S.C. 322, 323, 417 S.E.2d 648, 649 (Ct. App. 1992).  On appeal of an action at law tried without a jury, this court’s review is limited to correction of errors at law.  Epworth Children’s Home v. Beasley, 365 S.C. 157, 164, 616 S.E.2d 710, 714 (2005).  The trial court’s findings are equivalent to a jury’s findings in a law action.  King v. PYA/Monarch, Inc., 317 S.C. 385, 389, 453 S.E.2d 885, 888 (1995).  Questions regarding credibility and weight of evidence are exclusively for the trial court.  Sheek v. Crimestoppers Alarm Sys., 297 S.C. 375, 377, 377 S.E.2d 132, 133 (Ct. App. 1989).  “We must look at the evidence in the light most favorable to the respondents and eliminate from consideration all evidence to the contrary.”  Id.

LAW/ANALYSIS

I.  Liability

Brady contends the trial court erred in granting judgment against him after finding Bohrer was an agent for Boru Enterprises, an undisclosed principal.  We disagree.

“An agent is one appointed by a principal as his representative and to whom the principal confides the management of some business to be transacted in the principal’s name, or on his account, and who brings about or effects legal relationships between the principal and third parties.”  Colleton County Taxpayers Ass’n v. Sch. Dist. of Colleton County, 371 S.C. 224, 239, 638 S.E.2d 685, 693 (2006).  If an agent did not disclose his principal when making a contract with a party, the party, upon discovering the principal, may hold either the agent or the principal liable.  See Goodale v. Page, 92 S.C. 413, 416, 75 S.E. 700, 701 (1912); see also Broom v. Marshall, 284 S.C. 530, 540, 328 S.E.2d 639, 645 (Ct. App. 1984) (Gardner, J. dissenting) (quoting 3 C.J.S. Agency § 369 (1973)) (“An agent . . . if he contracts as agent for an undisclosed principal, will be personally liable unless there is a mutual intention of the parties to the contrary.”); Restatement (Third) of Agency § 6.03 (2006) (“When an agent acting with actual authority makes a contract on behalf of an undisclosed principal, (1) unless excluded by the contract, the principal is a party to the contract; [and] (2) the agent and the third party are parties to the contract . . . .”).  “A principal is undisclosed if, when an agent and a third party interact, the third party has no notice that the agent is acting for a principal.”  Restatement (Third) of Agency § 1.04(2)(b) (2006).

Brady routinely did business with Savannah Architectural as an agent of Boru Enterprises.  However, Savannah Architectural had no indication Brady was acting on behalf of a corporation.  Therefore, Boru Enterprises was an undisclosed principal, and thus, Brady can be held liable as its agent.  Accordingly, the trial court did not err in finding Brady personally liable for the debt.

II.  Rule 60(b), SCRCP, Motion

Brady maintains the trial court erred in failing to grant his Rule 60(b), SCRCP, motion.  We disagree.

The decision to deny a motion under Rule 60(b) is within the trial court’s sound discretion.  Raby Constr., L.L.P. v. Orr, 358 S.C. 10, 17, 594 S.E.2d 478, 482 (2004).  An abuse of discretion occurs when the trial court’s decision is controlled by an error of law or is based on factual findings lacking evidentiary support.  Degenhart v. Burriss, 360 S.C. 497, 500, 602 S.E.2d 96, 97 (Ct. App. 2004).

On motion and upon such terms as are just, the court may relieve a party from a final judgment, order, or proceeding for newly discovered evidence that by due diligence could not have been discovered in time to move for a new trial under Rule 59(b), SCRCP.  Rule 60(b)(2), SCRCP. 

To obtain a new trial based on newly discovered evidence, a movant must establish that the newly discovered evidence: (1) will probably change the result if a new trial is granted; (2) has been discovered since the trial; (3) could not have been discovered before the trial; (4) is material to the issue; and (5) is not merely cumulative or impeaching.

Lanier v. Lanier, 364 S.C. 211, 217, 612 S.E.2d 456, 459 (Ct. App. 2005).  When the party knew of and possessed evidence at the time of trial, it is not newly discovered for the purposes of Rule 60(b)(2).  Lanier, 364 S.C. at 218, 612 S.E.2d at 459.

“Rule 60(b)(2) allows the court to grant a new trial only if the newly discovered evidence could not have been discovered by due diligence prior to trial.”  Lanier, 364 S.C. at 220, 612 S.E.2d at 460.  Due diligence is the “diligence reasonably expected from, and ordinarily exercised by, a person who seeks to satisfy a legal requirement or to discharge an obligation.”  Id. “Diligence looks not to what the litigant actually discovered, but what he or she could have discovered.”  Id.  Accordingly, when parties could have discovered the new evidence prior to trial, they are not entitled to relief under Rule 60(b)(2).  See Raby Constr., L.L.P., 358 S.C. at 21, 594 S.E.2d at 484 (citing Bowman v. Bowman, 357 S.C. 146, 152, 591 S.E.2d 654, 657 (Ct. App. 2004)).

In the present case, the check was in Boru Enterprises’ records.  Simply because those records were in a state of disarray does not change the fact Brady had access to them before trial.  This court has previously found “[w]hen a party simply misplaces evidence at home, the court will treat the failure to discover it as a failure to exercise due diligence.”  Lanier, 364 S.C. at 220, 612 S.E.2d at 461.  Here, Brady testified as to the existence of such a check at trial.  Accordingly, he knew of the check and had access to Boru Enterprises’ records.  Therefore, the check did not constitute newly discovered evidence.  Further, because Brady could have discovered the check prior to trial, he failed to exercise due diligence.   Consequently, the trial court did not err in denying Brady’s Rule 60(b), SCRCP, motion.

CONCLUSION

Based on the foregoing, the order of the trial court is

AFFIRMED.

HEARN, C.J., and SHORT and KONDUROS, JJ., concur.


[1] We decide this case without oral argument pursuant to Rule 215, SCACR.

[2] The parties stipulated to this amount.