Maples Health Care, Inc. v. Firestone Building Products

M
                                                                                  FILED
                                                                          Dec 30 2020, 9:05 am

                                                                                  CLERK
                                                                              Indiana Supreme Court
                                                                                 Court of Appeals
                                                                                   and Tax Court




      ATTORNEYS FOR APPELLANT                                   ATTORNEYS FOR APPELLEE
      Michael L. Einterz, Jr.                                   Mark J. R. Merkle
      Michael L. Einterz                                        William J. Barkimer
      Einterz & Einterz                                         Krieg DeVault LLP
      Zionsville, Indiana                                       Carmel, Indiana



                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Maples Health Care, Inc.,                                 December 30, 2020
      Appellant-Plaintiff,                                      Court of Appeals Case No.
                                                                20A-PL-1095
              v.                                                Appeal from the
                                                                Hamilton Superior Court
      Firestone Building Products,                              The Honorable
      Appellee-Defendant.                                       William J. Hughes, Judge
                                                                Trial Court Cause No.
                                                                29D03-1603-PL-2240



      Kirsch, Judge.


[1]   Following the 2001 installation of its roof, Maples Health Care, Inc. (“Maples”)

      had two warranties issued to it by Firestone Building Products (“Firestone”),

      the Red Shield Roofing System Limited Warranty (“Red Shield Warranty”)

      and Roofing Membrane Limited Warranty (“Membrane Warranty”). After a

      bench trial covering both liability for breach of warranty and damages, the trial


      Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                           Page 1 of 27
      court entered a judgment in favor of Maples, finding Firestone liable for breach

      of warranty and awarding Maples damages in the amount of $9,500.00.

      Following the trial court’s denial of Maples’s request for clarification and

      motion to correct error, Maples raises the following issues for our review:


              I.       Whether the judgment finding Firestone liable for breach
                       was as to both warranties; and


              II.      Whether the damage award was supported by the
                       evidence.


[2]   We affirm in part, reverse in part, and remand with instructions.


                                  Facts and Procedural History
[3]   Maples owns an approximately one-hundred-year-old, five-story facility in

      Bluefield, West Virginia, which it operates as a nursing home, long-term care,

      and assisted living facility. Appellant’s App. Vol. 2 at 24; Tr. Vol. 2 at 19, 126.

      Maples purchased a Firestone-brand roof, which was installed by MetalTec

      Roofing, Inc. in March 2001. Appellant’s App. Vol. 2 at 24; Ex. Vol. 3 at 5-9. On

      March 10, 2001, Firestone issued two warranties for the roof installation: a

      fifteen-year Red Shield Warranty and a twenty-year Membrane Warranty. Ex.

      Vol. 3 at 11-14.


[4]   The Red Shield Warranty covers the Firestone Roofing System and provides

      that it is limited to “the Firestone brand membranes, Firestone brand

      insulations, and other Firestone brand accessories when installed in accordance

      with Firestone technical specifications.”

Id. at 14.

Under the Red Shield

      Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020         Page 2 of 27
      Warranty, Firestone agreed to repair leaks, specifying that Maples’s “sole and

      exclusive remedy and Firestone’s liability shall be limited to the repair of the

      leak.”

Id. The Red Shield

Warranty also included a provision regarding the

      parties’ obligations specifying that, if Firestone determined that the cause of the

      leak is “outside the scope of [the Red Shield Warranty],” Firestone was

      required to “advise” Maples of “the type and/or extent of repairs required to be

      made at [Maples’s] expense” to prevent the Red Shield Warranty from lapsing.

Id. [5]

  The Red Shield Warranty excluded damage occurring from, among other

      sources, “[d]eterioration or failure of building components, including, but not

      limited to, the roof substrate, walls, mortar, HVAC units, etc.” and for

      “[c]ondensation or infiltration of moisture in, through, or around the walls,

      copings, rooftop-hardware or equipment, building structure or underlying or

      surrounding materials” from warranty coverage.

Id. The Red Shield

Warranty

      also provided that neither Firestone nor Maples could “commence or prosecute

      any suit, proceeding, or claim [regarding the Red Shield Warranty] other than

      in courts of Hamilton County in the State of Indiana or the United States

      District Court, Southern District of Indiana, Indianapolis Division.”

Id. The Red Shield

Warranty also contained the following language: “THIS LIMITED

      WARRANTY SHALL BE THE OWNER’S SOLE AND EXCLUSIVE

      REMEDY AGAINST FIRESTONE AND FIRESTONE SHALL NOT BE

      LIABLE FOR ANY CONSEQUENTIAL, SPECIAL, INCIDENTAL OR

      OTHER DAMAGES INCLUDING, BUT NOT LIMITED TO, LOSS OF


      Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020      Page 3 of 27
      PROFITS OR DAMAGE TO THE BUILDING OR ITS CONTENTS OR

      THE ROOF DECK.”

Id. [6]

  The Membrane Warranty, which covers the Firestone Roofing Membrane,

      provides that it is limited to “the Firestone brand Membrane when installed in

      accordance with Firestone Technical Specifications” and is a separate warranty

      for leaks occurring through the Membrane as a result of weathering.

Id. at 11.

      The Membrane Warranty provides that Maples’s “sole and exclusive remedy

      and Firestone’s liability shall be limited to the supply of replacement membrane

      material sufficient to replace the affected area of membrane” as the remedy.

Id. The Membrane Warranty

also contains provisions requiring Firestone to notify

      Maples if the cause of a leak through the membrane is outside the scope of the

      warranty, excluding damages from certain sources, and language disclaiming

      Firestone’s liability for consequential, special, incidental, or other damages.

Id. Unlike the Red

Shield Warranty, the Membrane Warranty does not include a

      provision allowing for a lawsuit; instead, it provides that a dispute “shall be

      settled by final and binding arbitration in accordance with the American

      Arbitration Association’s rules for the construction industry.”

Id. [7]

  Maples first notified Firestone of a leak on June 29, 2006, and Firestone began

      a leak tracer report to track the repair. Appellant’s App. Vol. 2 at 24; Ex. Vol. 3 at

      122-30. Firestone Division Manager for Technical Services Ken Crocker

      (“Crocker”) explained that a leak tracer report is a “tracking mechanism for any

      activity on the project” that catalogues leak reports and includes the purchase

      orders that Firestone receives from the responding contractor. Tr. Vol. 2 at 134-

      Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020        Page 4 of 27
      35. From June 29, 2006 through December 8, 2015, Firestone issued a total of

      twenty-two purchase orders for the investigation and repair of leaks that Maples

      had reported pursuant to the Red Shield Warranty, and the leak tracer reports

      and purchase orders were not provided to Maples until litigation was instituted.

      Ex. Vol. 3 at 16; Tr. Vol. 2 at 21, 162. Crocker stated that the leak tracer reports

      are subject to a “not to exceed” amount, which is a cost-control mechanism but

      that “it’s a no-dollar limit warranty,” and “in some cases” Firestone had “spent

      two or three times what the original roof cost,” but the not-to-exceed amount

      “is placed on the contractor to go out with no further communication to us and

      effect a repair.”

Id. at 135. [8]

  An invoice from Dunford Roofing, the contractor Firestone sent to respond to

      the leak, that accompanied a May 4, 2009 leak repair contained a note about

      the repair, which stated, “[l]ocated opening at scupper flashing due to severe

      bridging.” Ex. Vol. 3 at 144. Crocker indicated that bridging is tied to the

      freeze/thaw cycle which puts “stress on that membrane” and over time “the

      membrane may or may not hold.” Tr. Vol. 2 at 142. Leaks continued to occur,

      but James Montgomery (“Montgomery”), a project and facility manger for

      Maples, explained that in October 2014 Maples began renovation work on its

      fifth floor for use as rooms for residents. Tr. Vol. 2 at 41-42; Appellant’s App. Vol.

      2 at 24. During the renovation, Maples’s contractor, Rick Blizzard

      (“Blizzard”), discovered areas of the ceiling, insulation, and walls in the fifth,

      fourth, and third floors of the building that were water-damaged, and he




      Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020       Page 5 of 27
       contacted Firestone on November 14, 2014, requesting an investigation of the

       roof. Tr. Vol. 2 at 43-44; Ex. Vol. 3 at 32-38.


[9]    In a November 24, 2014 email to Blizzard, Firestone representative for Quality

       and Building Services Tom Julian (“Julian”) explained that up to that point

       there had been no previous investigation of the roof, but he suspected that “the

       exterior masonry walls are a plausible and likely cause of the water penetration

       into the building.” Ex. Vol. 3 at 41. He noted that “the photos of the leak

       locations all appear to be near to [a] wall,” which is “consistent with water

       penetration through the wall.”

Id. Julian wrote that

there were “substantial

       repairs to the bridged flashing, but the bridged flashing was likely not leaking”

       because the “repairs would have eliminated any leak source in the system along

       these wall areas.”

Id. at 4

2. 
He recommended to Blizzard an evaluation of “the

       exterior masonry wall as a source or contributor to the water penetration at the

       building.”
 Id.


[10] 
  Firestone assigned Mark Christian (“Christian”) to perform the investigation in

       January 2015. Ex. Vol. 3 at 106; Appellant’s App. Vol. 2 at 26. A January 8, 2015

       email forwarded to Christian regarding the Maples investigation showed that

       Julian wanted to “keep all correspondence (including this email) confidential to

       Firestone personnel, don’t share it w/ the building owner, consultant, roofing

       contractor or sales rep.” Ex. Vol. 3 at 111. In a January 15, 2015 email to

       Dunford Roofing and Julian, Christian reported the results of his investigation,

       writing that, “[a]long the south east wall of the penthouse I found that the

       bridging EPDM has pulled the termination bar away from the masonry wall of

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020    Page 6 of 27
       the penthouse” and that “about 22 feet of wall flashing that needs to be

       repaired.”
 Id. at 106. 
He added that, if it could be repaired for “$2000.00 or

       less, (less being great for us),” Julian could approve the repair immediately, but

       if it would cost more than $2,000.00, a repair proposal would be necessary.
 Id.

       The investigation results 
were not shared with Maples. Tr. Vol. 2 at 61.


[11]   Dunford Roofing performed the repair identified in the investigation on

       January 26, 2015 for $1,972.72. Ex. Vol. 4 at 21; Appellant’s App. Vol. 2 at 26.

       Following the repair, Maples continued with the fifth-floor renovation project,

       completing the work in early March 2015 but incurring additional costs to

       address the water damage and construction delays. Tr. Vol. 2 at 63-65, 72-73.

       After the renovation was complete, another leak was reported on March 26,

       2015 and was repaired at a cost of $990.04. Ex. Vol. 4 at 24-30. Maples

       reported another leak on November 4, 2015 that was repaired by Dunford

       Roofing. Ex. Vol. 4 at 32-36. Maples approached Dunford Roofing to

       determine what needed to be done to address the leaks. Tr. Vol. 2 at 66-67.

       Dunford Roofing provided Maples with a roof repair estimate dated November

       11, 2015, at a cost of $9,500.00, which included the removal of “280 [linear

       feet] of old bridged out EPDM wall flashing” along with installation of “new

       base tie in detail at wall perimeters” and to “[s]plice new EPDM roof

       membrane into existing roof . . . .” Ex. Vol. 3 at 116. Montgomery stated that

       Maples did not pursue this work because it “thought that the issues on the roof

       should have been covered by Firestone because of our ongoing problems with

       the roof.” Tr. Vol. 2 at 67.

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020      Page 7 of 27
[12]   Maples reported another leak on December 7, 2015, which was repaired by

       Dunford Roofing. Ex. Vol. 4 at 38-45. After this leak notification, Ronald

       Scherer (“Scherer”), Maples’s Chairman, sent Julian a letter on January 12,

       2016 regarding the leaks that had occurred since 2006.1 Tr. Vol. 2 at 122-23; Ex.

       Vol. 3 at 119-21. Scherer wrote that the issues Maples had experienced were a

       result of “improper installation” by “[Firestone’s] authorized installer

       [MetalTec Roofing, Inc.].”
 Id. at 120. 
Scherer added that the roof’s issues

       resulted in a “substantial loss of revenue,” and in the renovation of its fifth-floor

       rooms, Maples had to spend additional money to repair water-damaged areas

       because of the roof.
 Id. at 121. 
Noting that, with “only months left under

       warranty,” Scherer requested that “Firestone take steps to properly install a new

       replacement roof system to correct the failures we have experienced to date.”


       Id. Scherer acknowledged that 
“one of the two warranties either called for

       mediation or arbitration,” but Firestone did not respond to his letter. Tr. Vol. 2

       at 124.


[13]   As to the leak repairs that had occurred at Maples’s facility, Crocker explained

       that, although he had never visited the facility, “every time we did a leak, we

       may have been repairing one here, but we’re disturbing the membrane here and




       1
         Scherer’s letter begins, “[w]e have discovered yet another new failure in the roofing system. This is the 19th
       or 20th warranty claim since 2006 resulting in more than 25 individual repair areas,” and it is not clear
       whether this was reporting a new leak or if it was a reference to the December 7, 2015 leak that had been
       repaired. Ex. Vol. 3 at 120; Ex. Vol. 4 at 38-45. Scherer’s letter does not appear to have specifically requested
       either mediation or arbitration. Ex. Vol. 3 at 119-21.

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                                Page 8 of 27
       here on both sides of where we were working,” which resulted in the leaks

       “[w]alking down the wall” over time.
 Id. at 148.


[14] 
  On March 9, 2016, one day before the expiration of the Red Shield Warranty,

       Maples filed a complaint alleging that Firestone failed to repair the leaks over

       the period of 2006 through 2016 and refused “to perform necessary repairs in

       2015 and 2016” and seeking damages for the breach. Appellant’s App. Vol. 2 at 4.

       Maples’s complaint principally referred to the Red Shield Warranty but also

       mentioned the Membrane Warranty, and it attached a copy of the Red Shield

       Warranty but did not attach a copy of the Membrane Warranty.
 Id. Firestone

       filed its 
answer on May 12, 2016, in which it denied that Maples was entitled to

       the recovery of damages for the alleged breach of warranty and asserted

       affirmative defenses.
 Id. at 6-11. 
The parties filed motions for summary

       judgment, which were denied, and the case proceeded to a bench trial.

       Appellant’s App. Vol. 2 at 63, 120.


[15]   The bench trial began on February 24, 2020 and addressed both liability and

       damages. Tr. Vol. 2 at 2. As to damages, Montgomery testified that Maples

       suffered monetary damages in the amount of $308,600.00, and he provided a

       breakdown of the costs involved in that proposed award.
 Id. at 70-75.

       Regarding the value of the fifth-floor construction and renovation work,

       Montgomery stated that the amount was “roughly around $100,000[.00],”

       which included “drywall replacement . . . tearing out the walls and ceilings,

       replacing insulation[,]” rewiring damaged electrical outlets, and replacing

       “rusted out” ceiling struts.
 Id. at 72. 
The value of employing Blizzard for the

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020    Page 9 of 27
       additional time and labor was “about an additional $25,000[.00] . . . for the

       additional two months.”
 Id. at 72-73. 
Montgomery stated that the value of the

       loss of use of thirteen rooms on the fifth floor for two months was $54,600.00.


       

Id. at 73.

[16] 
  Montgomery added that Maples incurred additional labor and maintenance

       costs of $10,000.00 because its maintenance personnel “were involved,

       obviously almost continuously on the roof.”
 Id. at 73. 
He stated that, each

       time it rains, “we have to go around and reinspect all the rooms” to avoid “a

       citation from the State of West Virginia” on account of possible health issues

       and not “lose those patients, or even potentially lose our license . . . we literally

       have to go into every room, reinspect everything. We reinspect the roof every

       time it rains or snows, and we’ll have to continue doing that until this problem

       is solved.”
 Id. Montgomery based the 
$10,000.00 figure on an estimate of the

       employees’ “[n]umber of hours times their hourly rate plus incentive, plus their

       benefit” as part of the additional labor and maintenance costs.
 Id. at 74.

       Montgomery also proposed a figure of $50,000.00 for the value of “additional

       employee time,” which included his own time and that of “the owner, his wife,

       the nursing home, nursing director, housekeeping . . . to go in there . . . to

       reclean all those rooms and everything and the LPN.”
 Id. He also testified 
that

       the quote for Maples to get a new roof was $69,000.00, which was included in

       the proposed damage award.
 Id. at 75. 
He also added that the damages could

       be much more than that because Maples did not yet know the “damage to the

       roof deck itself cause until we remove that membrane, we don’t even know

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020      Page 10 of 27
       what’s under there due the extensive damage from water constantly going

       through our roof deck itself.”
 Id. Maples did not 
submit any documentation,

       invoices, or estimates or otherwise provide any additional evidence as to its

       damages.
 Id. at 70-75.


[17]   On cross-examination, Montgomery acknowledged having received the

       $9,500.00 repair estimate from Dunford Roofing.
 Id. at 76. 
In response to

       whether its claims “relating to lost use of the premises on the fifth floor would

       have been alleviated” if Maples had done the repairs identified in the $9,500.00

       repair estimate from Dunford Roofing, Montgomery stated “[t]hat’s what they

       were presenting. I do not know that.”
 Id. at 76. 
Firestone also elicited

       testimony from Montgomery that no expert had ever determined that the

       membrane was defective and that no masonry repairs such as tuckpointing or

       caulking around windows had occurred.
 Id. at 78-80. 
In response to a question

       about whether the damages that Montgomery had proposed in his direct

       testimony were excluded under the language in the Red Shield Warranty,

       which disclaimed Firestone’s liability for “any consequential, special, or

       incidental or other damages, including, but not limited to loss of profits or

       damage to the building or its contents or the roof deck,” Montgomery

       responded “[o]kay. I, again, that’s a legal area. I’m not a lawyer, so I, I

       couldn’t tell you.”
 Id. at 80-81.


[18] 
  In closing, as to damages, counsel for Maples stated that Firestone had an

       “obligation under the warranty to fully repair this leak when they first found it”

       but that they did not do it and it caused Maples “[$308,600.00] in damages and

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020    Page 11 of 27
therefore that award of damages to Maples is proper here.”
 Id. at 157.

Firestone’s counsel argued that “as a matter of mitigation of damages, [Maples]

had known back in November of ’14 [sic] that Dunford Roofing would have

allegedly completed the total repair for [$9,500.00]. So, at that point in time,

[Maples] could have gone forward and made the repairs and mitigated the

damages.”
 Id. at 167-68. 
Firestone’s counsel engaged in the following

exchange with the trial court over the matter of the warranty’s exclusions for

lost profits and damages to the building:

         THE COURT: Doesn’t that only apply if you comply with the
         warranty and breach of warranty includes consequential
         damages, even if it’s a breach of a specific warranty[?]


         ....


         MR. MERKLE: Actually the law is, is, is quite explicit that you
         can have both . . . that just because, even if you were to fail to
         make the repair warranty, that does not exclude or, or invalidate
         the ah, claims for the ah, inconsequential, the disclaimer of
         inconsequential and [sic] incidental damage. That’s the Rheem
         versus Phelps Heating case, 
746 N.E.2d 941 
by our Supreme
         Court on May 9, 2001.[2]




2
 Rheem Mfg. Co. v. Phelps Heating & Air Conditioning, Inc., 
746 N.E.2d 941
, 948 (Ind. 2001) (explaining that
with respect to an exclusion of incidental and consequential damages in a limited warranty that even where a
remedy in a limited warranty fails of its essential purpose that such an exclusion is valid unless the exclusion
is unconscionable).



Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                             Page 12 of 27
               THE COURT: Okay.


               MR. MERKLE: So, what we have here . . . Your Honor, is that
               . . . there’s no determination [the] disclaimers of the damages that
               are at the bottom of the warranty should not be enforced and so,
               if ah, if the Court were to even determine that there was a breach
               of the repair under the warranty, the disclaimers is still valid and
               would be ah, ah, and would keep out any of these claims over
               and above the $9500[.00] which is what has been the evidence
               shows as the cost of the repair.



       Id. at 168-69. 
In reply, as to the disclaimer of consequential damages and

       Rheem, Maples’s counsel was “not familiar with the Rheem case” but

       contended that Firestone was arguing “if we don’t do what we’re supposed to

       and fix the leak, you can’t do anything except ask us to fix it later. Well, the

       problem is if you don’t fix a leak, you get water damage.”
 Id. at 171. 
Maples

       further contended that it should be awarded the full $308,600.00 in damages

       because Firestone did not “appropriately respond” to the report of the roof’s

       bridging in 2009 that it “can’t now come back and claim defense of the contract

       when they are the ones in breach,” and that Maples “incurred a whole slew of

       damages solely because of [Firestone’s] breach.”
 Id.


[19] 
  After the bench trial, the trial court issued a judgment “in favor of [Maples] and

       against [Firestone] on [Maples’s] complaint for breach of warranty” and that

       Maples had “proved damages in the sum of $9,500[.00] as a result of

       [Firestone’s] breach of warranty.” Appellant’s App. Vol. 2 at 146-47. Maples

       then filed a request for clarification and motion to correct errors, seeking to

       clarify whether the trial court’s order finding Firestone in breach extended to
       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020     Page 13 of 27
       both the Red Shield Warranty and the Membrane Warranty and the proper

       measure of damages for the breach.
 Id. at 148-57. 
Firestone responded,

       arguing that Firestone was in breach only as to the Red Shield Warranty, which

       it maintained was the sole warranty claim Maples alleged in its complaint, and

       that the trial court correctly determined Maples’s damages.
 Id. at 159-65.


[20] 
  On May 5, 2020, the trial court held a hearing on Maples’s request for

       clarification and motion to correct error and heard argument from the parties.

       Tr. Vol. 2 at 173. At that hearing, Maples’s counsel first argued that

       clarification as to which warranty was breached was necessary because it

       believed it had argued at trial that the Membrane Warranty had also been

       breached but that it was “not sure if the [Membrane Warranty]” was included

       in the judgment.
 Id. at 176. 
As to damages stemming from the breach, Maples

       maintained that “[t]he question is not ah, whether or not the warranty failed in

       its essential purpose for whether or not the warranty was unconscionable” but

       that Firestone did not comply with its obligations to repair the leaks and that

       when there is a “breach of contract, the appropriate measure of damages are

       those that are reasonably foreseeable consequences of not performing your

       obligations under the contract.”
 Id. at 177. 
Maples argued that Firestone’s

       failure to fix the bridging, the underlying problem, caused water damage and

       delays in construction resulting in damages of $308,600.00 from Firestone’s

       failure to fix those leaks.
 Id. at 178. 
It contended that the award of $9,500.00

       was not supported by the evidence, that the water damage was not disputed,

       and that it should have been awarded the full $308,600.00.
 Id.


       Court of Appeals 
of Indiana | Opinion 20A-PL-1095 | December 30, 2020    Page 14 of 27
[21]   Firestone argued that the only competent evidence to support the measure of

       damages was the $9,500.00 estimate from Dunford Roofing to repair the roof

       and that the Red Shield Warranty provides “for the repairs of leaks, not the

       repair of other items, so until the bridging actually exhibited a leak, ah there

       would not be a necessity to actually complete a repair,” and the trial court’s

       damage award reflects this consideration in its use of the $9,500.00 repair

       estimate.
 Id. at 178-79. 
It also argued that Rheem provided a guide to the trial

       court’s award of damages because the parties’ dispute, like the dispute in

       Rheem, involved “a [sale] of goods between merchants,” keeping it within the

       ambit of the sales provisions of the Indiana Uniform Commercial Code

       (“UCC”).
 Id. at 179. 
It further argued that, under Rheem, when a limited

       warranty of repair fails, that a disclaimer of consequential or incidental

       damages is not invalidated unless the disclaimer is unconscionable and that

       unconscionability was not raised by Maples.
 Id. at 179-80. 
Firestone noted that

       there was a breach but that the “remedy is the damages resulting from that

       exact breach of the repair,” which was the $9,500.00 that the trial court

       awarded.
 Id. at 181. 
Finally, Firestone’s counsel stated that Rheem “stands on

       all fours with our case” because “there was no failure in essential purpose of the

       limited remedy and also even if there had been, it would not disclaim, it would

       not result in the, the other [consequential] damages being allowed to be

       recovered by [Maples.]”
 Id.


[22] 
  Counsel for Maples disagreed with the applicability of Rheem and the UCC to

       the dispute over damages, countering that “our claim is that Firestone breached

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020     Page 15 of 27
       its obligations under the warranty, therefore the UCC is not applicable here.”


       Id. at 183. 
Counsel maintained that, because the trial court determined

       Firestone “failed to carry” its “obligations under the warranty . . . the

       consequential damages here include all of the water damages, all of the lost

       employee time, all of the delays” and should be reflected in the damage award.


       Id.


[23] 
  At the conclusion of the hearing, the trial court orally denied Maples’s request

       for clarification and motion to correct errors.
 Id. at 183-84. 
The trial court

       entered a written order on its oral denial of the request for clarification and

       motion to correct errors, stating that its judgment finding breach was “as to all

       claims made by [Maples] in its complaint” and that the damages entered were

       “the maximum damages supported by competent evidence.”
 Id. at 166-

       67. 
Maples now appeals.


                                        Discussion and Decision
[24]   Maples appeals following the denial of its request for clarification and motion

       to correct error, seeking to clarify whether the finding of breach was as to both

       the Red Shield Warranty and the Membrane Warranty and arguing that the

       damage award was not supported by the evidence.3 We review a trial court’s

       denial of a motion to correct error for an abuse of discretion. Allstate Ins. Co. v.




       3
        To the extent Firestone contends that Indiana Trial Rule 52(A) represents the standard of review in this
       case, we note that while this is an appeal from a bench trial the trial court made no findings and conclusions.

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                             Page 16 of 27
       Hammond, 
759 N.E.2d 1162
, 1165 (Ind. Ct. App. 2001). We reverse only when

       “the trial court’s decision was against the logic and effect of the facts and

       circumstances before it, together with the inferences that can be drawn

       therefrom.” Hockema v. J.S., 
832 N.E.2d 537
, 541 (Ind. Ct. App. 2005), trans.

       denied.


             I.      Did the Judgment Cover Breach of Both Warranties?
[25]   Maples maintains that the judgment of breach extends to both the Red Shield

       Warranty and the Membrane Warranty. It argues that the trial court’s

       statement in its order on Maples’s request for clarification and motion to correct

       error, which stated that the judgment was “as to all claims made by [Maples] in

       its complaint,” amounts to a conclusion by the trial court that it was entitled to

       the relief it sought in the complaint, specifically for water damages and the cost

       of repairs to its facility due to breach of both warranties. Appellant’s Br. at 12

       (quoting Appellant’s App. Vol. 2 at 166-67).


[26]   We disagree that Maples made a separate claim under the Membrane Warranty

       in its complaint. First, the Membrane Warranty expressly provided that “any

       dispute, controversy, or claim” between Maples and Firestone concerning the

       Membrane Warranty “shall be settled by final and binding arbitration in

       accordance with the American Arbitration Association’s rules for the

       construction industry.” Ex. Vol. 3 at 11. The dispute resolution provision of the

       Membrane Warranty called for arbitration and did not authorize the filing of a




       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020      Page 17 of 27
lawsuit in the event of a dispute, controversy, or claim between the parties.

Second, paragraph 4 of Maples’s complaint alleged as follows:


        Firestone granted Maples a 15-year Roofing System Limited
        Warranty and a 20-year Roofing Membrane Warranty. A copy
        of the Roofing System Limited Warranty (“Warranty”) is
        attached as exhibit A. By the terms of the Warranty, the 15[-
        ]year period began March 10, 2001 and had not yet expired on
        the date this Complaint was filed. As required by the Warranty,
        Maples has requested that Firestone mediate this dispute.


Appellant’s App. Vol. 2 at 2. It is clear that the complaint mentioned the

existence of the Membrane Warranty, but it did not otherwise specifically raise

a claim under the Membrane Warranty and did not attach a copy of the

Membrane Warranty. See Ind. Trial Rule 9.2(A) (“When any pleading allowed

by these rules is founded on a written instrument, the original, or a copy

thereof, shall be included in or filed with the pleading.”). In the complaint,

Maples used the defined term “Warranty” in reference to the 15-year Roofing

System Limited Warranty, attached that warranty to the complaint, and

referred throughout the complaint to the “Warranty” which, as noted, referred

only to the 15-year Roofing System Limited Warranty.
 Id. at 2-4. 
In particular,

Maples’s complaint alleged that it had requested Firestone “pursuant to the

Warranty, complete the full repairs, but Firestone failed and refused to perform

any additional repairs.”
 Id. at 3 
(emphasis added). Similarly, in paragraph 12

of the complaint, Maples contended that “Firestone’s insufficient repairs from

2006 until 2016 constitute a breach of the Warranty with Maples” entitling it to

“damages incurred as a consequence of the breach, including water damage

Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020    Page 18 of 27
       suffered to its property.”
 Id. (emphasis added). Similarly, 
paragraph 13, the

       complaint’s other request for relief, stated that “Firestone’s failure and refusal to

       perform necessary repairs in 2015 and 2016 constitutes [an] additional Breach

       of the Warranty with Maples,” entitling it to “recover damages incurred as a

       consequence of breach, including the cost to perform the necessary repairs by a

       contractor of Maples’[s] choice.”
 Id. at 4 
(emphasis added). Thus, the

       complaint is best read as encompassing only the Red Shield Warranty, and, as

       noted, the proper venue for a dispute under the Membrane Warranty was an

       arbitral panel and not the trial court. Ex. Vol. 3 at 11. Therefore, the trial

       court’s judgment finding Firestone liable for breach extends only to the Red

       Shield Warranty as it was the sole claim alleged in the complaint that was

       properly before the trial court, and we affirm that judgment only as to breach of

       the Red Shield Warranty.4


             II.      Was the Damage Award Supported by the Evidence?
[27]   We next address whether the damage award was supported by the evidence.

       Maples argues that the damage award is unsupported by the evidence because it

       does not take into account Montgomery’s testimony, which estimated Maples’s

       damages at $308,600.00. The computation of damages for a breach of contract

       is a matter within the sound discretion of the trial court. City of Jeffersonville v.

       Env’t Mgmt. Corp., 
954 N.E.2d 1000
, 1015 (Ind. Ct. App. 2011). We will not




       4
        On remand, we order the trial court to refer any dispute, claim, or controversy arising under the Membrane
       Warranty to arbitration.

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                         Page 19 of 27
       reverse a damage award upon appeal unless it is based on insufficient evidence

       or is contrary to law.
 Id. In determining whether 
an award is within the scope

       of the evidence, we may not reweigh the evidence or judge the credibility of

       witnesses.
 Id. A factfinder may 
not award damages on the mere basis of

       conjecture and speculation. Sheek v. Mark A. Morin Logging, Inc., 
993 N.E.2d

       280
, 287 (Ind. Ct. App. 2013) (citing Indianapolis City Mkt. Corp. v. MAV, Inc .,

       
915 N.E.2d 1013
, 1024 (Ind. Ct. App. 2009)), trans. denied. Instead, the award

       must be supported by probative evidence.
 Id. (citing Four Seasons 
Mfg., Inc. v.

       1001 Coliseum, LLC, 
870 N.E.2d 494
, 507 (Ind. Ct. App. 2007)). “Accordingly,

       a damage award must reference some fairly defined standard, such as cost of

       repair, market value, established experience, rental value, loss of use, loss of

       profits, or direct inference from known circumstances.” Farah, LLC v. Architura

       Corp., 
952 N.E.2d 328
, 337 (Ind. Ct. App. 2011) (quoting Coffman v. Olson & Co.,

       P.C., 
906 N.E.2d 201
, 210 (Ind. Ct. App. 2009), trans. denied.). In a breach of

       contract action, the measure of damages is the loss actually suffered by the

       breach. Sisters of St. Francis Health Servs., Inc. v. EON Props., LLC, 
968 N.E.2d

       305
, 313 (Ind. Ct. App. 2012). That said, the non-breaching party is not

       entitled to be placed in a better position than it would have been if the contract

       had not been broken.
 Id.


[28] 
  Here, without any explanation, the trial court’s order awarded damages to

       Maples in the amount of $9,500.00. Appellant’s App. Vol. 2 at 146. Similarly, in

       denying Maples’s request for clarification and motion to correct error, the trial

       court’s order again stated, without further explanation, that the amount of

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020     Page 20 of 27
       damages was “the maximum damages supported by competent evidence.”
 Id.

       at 167. 
Neither the trial court’s damage order, nor its denial of Maples’s request

       for clarification and motion to correct error, expressly state what the damage

       award was based upon or the method used to determine that $9,500.00 was an

       appropriate measure of Maples’s damages and neither contains any findings or

       conclusions.
 Id. at 146, 166-67.


[29] 
  Maples bases its proposed damage award principally on the testimony of

       Montgomery, who explained that the $308,600.00 covered Maples’s costs for

       construction and renovation, including additional contractor time, additional

       labor and maintenance expenses to monitor the roof, additional employee time

       to monitor the rooms, and the cost of a replacement roof, and contending that

       Montgomery’s figures were not questioned or refuted on cross-examination,

       that his testimony was not based on speculation, and that Firestone did not

       propose any alternative figures. Appellant’s Br. at 14-17. Maples asserts that the

       damage award is an “all-or-nothing proposal: either Firestone is not liable, or,

       if Firestone is liable, they are responsible for the ‘loss actually suffered’ by

       Maples -- the $9,500[.00] figure does not correspond to any evidence regarding

       the losses suffered by Maples.”
 Id. at 18.


[30] 
  Here, the $9,500.00 repair quote from Dunford Roofing appears to have been

       the trial court’s evidentiary basis for the damage award. Ex. Vol. 3 at 116. The

       trial court was not required to accept Maples’s much higher figure as the

       amount of its damages, see 
Farah, 952 N.E.2d at 339-40
, but it is unclear

       whether the trial court concluded that the $9,500.00 in fact reflected the cost of

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020       Page 21 of 27
repair as the measure of Maples’s damages, as it stated only that Maples

“proved damages of $9,500[.00]” and in the order on Maples’s request for

clarification and motion to correct error that the damage award reflected “the

maximum damages supported by competent evidence.” Appellant’s App. Vol. 2

at 146, 166-67; Tr. Vol. 2 at 67, 78; Ex. Vol. 3 at 116. We agree with Maples that

the record also shows a history of spot-repairs to address recurrent leaks that

had the effect of “[w]alking [the leaks] down the wall” over time. Tr. Vol. 2 at

148. Maples raises a number of other arguments that are connected with the

trial court’s basis for its damage award. Specifically, that the duty to mitigate

its damages5 does not support the trial court’s $9,500.00 award and that neither

the UCC’s sales provisions6 nor the holding of Rheem regarding the validity of

limitations on incidental or consequential damages 7 in a limited warranty under



5
  Generally, the non-breaching party to a contract has a duty to mitigate damages that stem from the breach.
Fischer v. Heymann, 
12 N.E.3d 867
, 871 (Ind. 2014) (citations omitted). Regarding mitigation, we note that a
discussion about the possibility of water infiltration into the facility through the exterior masonry walls
occurred with Blizzard, but there is no indication that Maples was directly informed of the possible masonry
issues. Tr. Vol. 2 at 61, 102; Ex. Vol. 3 at 41-42. Likewise, the roof investigation and leak tracer reports were
also not provided to Maples until litigation ensued, and it is unclear whether any of the recommendations in
those reports were stated verbally to Maples personnel. Tr. Vol. 2 at 61, 162; Ex. Vol. 3 at 111.
6
  We note that the UCC provides “[u]nless the context requires otherwise, IC 26-1-2 applies to transactions in
goods.” Ind. Code § 26-1-2-102. It defines “goods”, in pertinent part, as “all things (including specially
manufactured goods) which are movable at the time of identification to the contract for sale, other than the
money in which the price is to be paid, investment securities (IC 26-1-8.1), and things in action.” Ind. Code §
26-1-2-105. The Indiana Supreme Court has noted that “[m]any modern commercial transactions cannot be
classified as transactions purely for goods or for services, but are ‘mixed,’ involving both goods and services.”
Insul-Mark Midwest, Inc. v. Mod. Materials, Inc., 
612 N.E.2d 550
, 553-54 (Ind. 1993). In such situations, courts
typically require the application of the predominant thrust analysis to determine whether the UCC is
applicable to a transaction.
 Id. at 556. 
The record shows that MetalTec Roofing, Inc. installed the roof in
March 2001, and that Firestone sold the two warranties to Maples. Ex. Vol. 3 at 5-9.
7
  Generally, consequential damages may be awarded for breach when the non-breaching party’s loss flows
naturally and probably from the breach and was contemplated by the parties when the contract was made.
Johnson v. Scandia Assocs., Inc., 
717 N.E.2d 24
, 31 (Ind. 1999). The UCC also allows for the recovery of
incidental or consequential damages upon breach and for limitations on remedies and damages. See Ind.

Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                               Page 22 of 27
Indiana Code section 26-1-2-719(3) apply to the present dispute. Although the

parties argued below about these topics, the trial court’s orders regarding

damages were silent as to whether it concluded the parties’ dispute was subject

to the UCC’s sales provisions or governed by the common law of contracts,

whether the $308,600.00 in damages that Maples sought were incidental or

consequential damages unavailable to it pursuant to Rheem, or whether Maples

failed to mitigate its damages. To the extent the trial court’s damage award is

based on the $9,500.00 repair invoice, it is within the evidence presented, but

we cannot say that the $9,500.00 award is based on probative evidence in light

of the record of spot-repairs as to the measure of Maples’s damages. See

Whitaker v. Brunner, 
814 N.E.2d 288
, 296 (Ind. Ct. App. 2004) (“The damage

award cannot be based on speculation, conjecture, or surmise, and must be

supported by probative evidence.”) (emphasis added), trans. denied. We,

therefore, reverse the damage award and the order on the request for

clarification and motion to correct error as to damages. We remand with

instructions to hold another hearing on damages that addresses: (1) the

appropriate measure of damages, including (if necessary) the use of a third-

party expert to review the pleadings and evidence and render an opinion on the

calculation of damages; (2) whether Maples failed to mitigate its damages; and




Code § 26-1-2-715 (providing for the recovery incidental and consequential damages on breach); Ind. Code §
26-1-2-316(4) (“Remedies for breach of warranty can be limited in accordance with the provisions of IC 26-1-
2-718 and IC 26-1-2-719 on liquidation or limitation of damages and on contractual modification of
remedy.”) In addition, “[c]onsequential damages may be limited or excluded unless the limitation or
exclusion is unconscionable.” Ind. Code § 26-1-2-719(3); see also 
Rheem, 746 N.E.2d at 948
.

Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                          Page 23 of 27
       (3) whether the UCC applies and if Rheem limits Maples’s proposed damage

       award; with an order containing findings and conclusions that explain the

       damage award.


[31]   Affirmed in part, reversed in part, and remanded with instructions.

       Pyle, J. concurs.


       Tavitas, J., concurs in part and dissents in part with separate opinion.




       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020      Page 24 of 27
                                                   IN THE
           COURT OF APPEALS OF INDIANA

       Maples Health Care, Inc.,                                 Court of Appeals Case No.
                                                                 20A-PL-1095
       Appellant-Plaintiff,

               v.

       Firestone Building Products,
       Appellee-Defendant.




       Tavitas, Judge, concurs in part and dissents in part.


[32]   I respectfully concur in part and dissent in part. I agree with the majority’s

       determination affirming the trial court as to breach of the Red Shield Warranty.

       I dissent, however, regarding the majority’s reversal of the damage award. I

       conclude that the trial court’s damage award is supported by the evidence, and I

       would affirm.


[33]   The majority notes that the trial court awarded $9,500.00 in damages to Maples

       without any explanation. The parties, however, did not request findings of fact

       and conclusions thereon pursuant to Indiana Trial Rule 52, and the trial court

       did not issue findings of fact and conclusions thereon. “In the absence of

       special findings, we review a trial court decision as a general judgment and,
       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020                 Page 25 of 27
       without reweighing evidence or considering witness credibility, affirm if

       sustainable upon any theory consistent with the evidence.” Baxendale v. Raich,

       
878 N.E.2d 1252
, 1257 (Ind. 2008). “In reviewing a general judgment, we must

       presume that the trial court correctly followed the law.” Perdue Farms, Inc. v.

       Pryor, 
683 N.E.2d 239
, 240 (Ind. 1997).


[34]   The computation of damages is a matter within the discretion of the trial court.

       Ponziano Const. Servs. Inc. v. Quadri Enterprises, LLC, 
980 N.E.2d 867
, 873 (Ind.

       Ct. App. 2012). Mathematical certainty is not required, but the amount

       awarded must be supported by evidence in the record and may not be based on

       mere conjecture, speculation, or guesswork.
 Id. “When the specific 
issue on

       review relates to a question of inadequate or excessive damages, we will not

       reverse a damage award if it is within the scope of the evidence before the trial

       court . . . .”
 Id.


[35] 
  Here, the Red Shield Warranty provided that Maples’s “sole and exclusive

       remedy and Firestone’s liability shall be limited to the repair of the leak.” Ex. Vol.

       III p. 13 (emphasis added). The Red Shield Warranty excluded damage

       occurring from “[d]eterioration or failure of building components, including,

       but not limited to, the roof substrate, walls, mortar, HVAC units, etc.” and for

       “[c]ondensation or infiltration of moisture in, through, or around the walls,

       copings, rooftop-hardware or equipment, building structure or underlying or

       surrounding materials” from warranty coverage.
 Id. The Red Shield 
Warranty

       also provided: “THIS LIMITED WARRANTY SHALL BE THE OWNER’S

       SOLE AND EXCLUSIVE REMEDY AGAINST FIRESTONE AND

       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020       Page 26 of 27
       FIRESTONE SHALL NOT BE LIABLE FOR ANY CONSEQUENTIAL,

       SPECIAL, INCIDENTAL OR OTHER DAMAGES INCLUDING, BUT

       NOT LIMITED TO, LOSS OF PROFITS OR DAMAGE TO THE

       BUILDING OR ITS CONTENTS OR THE ROOF DECK.”
 Id.


[36] 
  Pursuant to the Red Shield Warranty, Firestone’s liability was limited to the

       repair of the leak and excluded consequential damages. James Montgomery

       testified that Dunford Roofing gave him an estimate of $9,500.00 to repair the

       roof. The trial court found that Maples proved damages in the amount of

       $9,500.00. The trial court’s damage award was within the scope of the

       evidence, and I would affirm. Accordingly, I dissent from the majority’s

       reversal and remand of the damage award.




       Court of Appeals of Indiana | Opinion 20A-PL-1095 | December 30, 2020   Page 27 of 27

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