Van-Go Transp. , 254 N.C. App. 836 ( 2017 )

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA16-849
Filed: 1 August 2017
Sampson County, No. 15 CVS 688
VAN-GO TRANSPORTATION, INC., Plaintiff,
v.
SAMPSON COUNTY, SAMPSON COUNTY BOARD OF COMMISSIONERS and
ENROUTE TRANSPORTATION SERVICES, INC., Defendants.
Appeal by plaintiff from order entered 12 May 2016 by Judge Gale M. Adams
in Sampson County Superior Court. Heard in the Court of Appeals 9 February 2017.
The Charleston Group, by R. Jonathan Charleston, Jose A. Coker, and Quintin
D. Byrd, for plaintiff-appellant.
Daughtry Woodard Lawrence & Starling, by W. Joel Starling, Jr., for
defendant-appellee Sampson County.
Crossley McIntosh Collier Hanley & Edes, PLLC, by Norwood P. Blanchard,
III, for defendant-appellee EnRoute Transportation Services, Inc.
DAVIS, Judge.
This appeal requires us to once again examine the issue of when a defendant
is entitled to recover on an injunction bond previously posted by the plaintiff after the
plaintiff voluntarily dismisses the lawsuit. Plaintiff Van-Go Transportation, Inc.
(“Van-Go”) appeals from the trial court’s order awarding damages to Sampson County
(the “County”) and EnRoute Transportation Services, Inc. (“EnRoute”) (collectively
“Defendants”). Because we conclude that the trial court properly ruled that Van-Go’s
VAN-GO TRANSP., INC. V. SAMPSON CTY.
Opinion of the Court
voluntary dismissal was equivalent to an admission that it wrongfully enjoined
Defendants, we affirm.
Factual and Procedural Background
From 1997 until 2013, the County contracted with EnRoute for the
transportation of area Medicaid patients to and from appointments for medical
services. During the period from July 2013 to June 2015, the County contracted with
Van-Go to provide these transportation services. In February 2015, the County
issued a Request for Proposals (“RFP”) seeking bids from vendors to provide these
services for the period between July 2015 and June 2017.
Among other requirements, the RFP instructed each bidder to (1) identify its
insurer and show that it possessed a certain amount of insurance coverage; and (2)
state the fixed cost per mile that it would charge the County for provision of the
transportation services. Van-Go and EnRoute each submitted proposals that the
County deemed timely and responsive to the RFP.
Van-Go’s bid identified its insurer and level of coverage and stated that its
fixed cost per mile of service was $1.74. EnRoute’s proposal did not identify its
insurance carrier but stated that it would obtain the required insurance coverage if
awarded the contract. In addition, it stated that its cost per mile of service was $1.54
“[p]lus a fuel surcharge of $.01 per mile for each $.05 increase over $3.95 per gallon
(based on average daily price at Go Gas-Clinton).” On 6 April 2015, the Sampson
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Opinion of the Court
County Board of Commissioners voted to award the Medicaid transportation services
contract (the “Contract”) to EnRoute based upon the terms specified in its bid.
On 29 June 2015, Van-Go filed its initial complaint against Defendants in
which it requested monetary damages and injunctive relief for alleged violations of
N.C. Gen. Stat. § 143-129 (which governs the procedure for awarding public
contracts); 5 C.F.R. §§ 2635.101 and 2635.702 (which address conflicts of interest in
contracts involving federal monies); and the due process clauses of the federal and
state constitutions. These claims were premised upon Van-Go’s contentions that the
Contract should not have been awarded to EnRoute because (1) EnRoute’s proposal
was not responsive to the RFP in that it both failed to demonstrate that EnRoute had
procured the required insurance coverage and did not provide a fixed cost per mile;
and (2) a conflict of interest existed between the owners of EnRoute and the Director
of the Sampson County Department of Social Services, who participated in the
County’s consideration of the bids.
The complaint included a request for a temporary restraining order (“TRO”)
pursuant to Rule 65 of the North Carolina Rules of Civil Procedure to enjoin EnRoute
from performing under the Contract and to allow Van-Go to extend its then-existing
contract with the County by continuing to provide transportation services at the cost-
per-mile rate of $1.85 as specified in that agreement. A TRO hearing was held in
Sampson County Superior Court on 29 June 2015 after which Judge W. Allen Cobb,
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Jr. issued a TRO granting Van-Go its requested relief pending the outcome of a
preliminary injunction hearing. The TRO further directed Van-Go to post an
injunction bond in the amount of $25,000.
Defendants subsequently filed a motion to dissolve the TRO on 13 July 2015.
Following a hearing, Judge Charles H. Henry issued an order on 20 July 2015 denying
Van-Go’s request for a preliminary injunction and granting Defendants’ motion to
dissolve the TRO. In its order, the court determined that Van-Go had not shown a
likelihood of success on the merits because, inter alia, (1) EnRoute’s bid substantially
conformed to the specifications of the RFP; and (2) Van-Go failed to show that a
conflict of interest had tainted the bidding process.
Following the entry of this order, Defendants removed the case to the United
States District Court for the Eastern District of North Carolina based upon the
federal questions presented in Van-Go’s complaint. Van-Go subsequently filed an
amended complaint that did not contain any claims arising under federal law. Based
upon the lack of a federal question in the amended complaint, the federal court
granted Van-Go’s motion to remand the case to Sampson County Superior Court on
29 July 2015.
On 17 August 2015, EnRoute filed a motion to dismiss Van-Go’s amended
complaint in Sampson County Superior Court. On 10 December 2015 — while
EnRoute’s motion to dismiss was pending — Van-Go filed a voluntary dismissal of its
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lawsuit without prejudice pursuant to Rule 41 of the North Carolina Rules of Civil
Procedure. Van-Go subsequently filed a motion on 1 February 2016 requesting the
release of the $25,000 injunction bond it had posted in connection with the TRO. On
4 February 2016, EnRoute submitted an objection to Van-Go’s motion along with a
motion of its own seeking an award of damages in the full amount of the bond on the
ground that EnRoute had been wrongfully enjoined. On 18 March 2016, the County
filed a similar motion.
A hearing was held before the Honorable Gale M. Adams on 21 March 2016.
Judge Adams issued an order on 12 May 2016 denying Van-Go’s motion for release of
the bond and awarding Defendants the proceeds of the bond. In its order, the trial
court allocated $15,993.57 of the $25,000 to EnRoute and $9,006.43 to the County.
Van-Go filed a timely notice of appeal from this order.
Analysis
Van-Go raises several issues on appeal. First, it asserts that the $25,000
injunction bond should have been released to Van-Go. Alternatively, it asserts that
even if EnRoute was entitled to recover some portion of the bond, EnRoute failed to
provide sufficient evidence of the damages it had incurred so as to warrant the trial
court’s award of $15,993.57. Finally, Van-Go argues that the trial court erred in
awarding any amount of damages to the County because all monies at issue belonged
to the State rather than the County.
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I. Determination that Defendants Were Wrongfully Enjoined
Pursuant to Rule 65(c), a party who obtains a TRO or preliminary injunction
must post a security bond. See N.C. R. Civ. P. 65(c) (providing that, with limited
exceptions, “[n]o restraining order or preliminary injunction shall issue except upon
the giving of security by the applicant, in such sum as the judge deems proper, for the
payment of such costs and damages as may be incurred or suffered by any party who
is found to have been wrongfully enjoined or restrained.”). In reviewing a trial court’s
judgment concerning the disposition of an injunction bond, “[w]e consider whether
the trial court’s findings of fact and conclusions of law are sufficient to support the
judgment.” Allen Indus., Inc. v. Kluttz, __ N.C. App. __, __ 788 S.E.2d 208, 209 (2016).
In its 12 May 2016 order, the trial court made the following findings of fact in
determining that Van-Go was not entitled to the return of its $25,000 injunction bond:
26. On December 10, 2015, [Van-Go] filed a Notice
of Voluntary Dismissal without prejudice pursuant to Rule
41(a) of the North Carolina Rules of Civil Procedure. The
Notice of Dismissal was unconditional, in that it was not
stipulated as pursuant to Rule 41(a)(1)(ii) of the North
Carolina Rules of Civil Procedure.
....
30. The Court finds that, as a result of the TRO
entered on June 29, 2015, the County and Enroute were
restrained from performing under the Contract, which
would have taken effect on July 1, 201[5], for a period of
twenty (20) days.
The trial court proceeded to enter the following pertinent conclusion of law:
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4. The Notice of Voluntary Dismissal without
prejudice filed by [Van-Go] in this matter on or about
December 10, 2015, which was unstipulated, is equivalent
to a finding that the County and Enroute were wrongfully
restrained by the entry of the TRO on June 29, 2015.
(Citation omitted.)
In determining whether a party has been wrongfully enjoined, courts must
analyze the issue in a manner “consistent with the very purpose of the bond[,] which
is to require that the plaintiff assume the risks of paying damages he causes as the
price he must pay to have the extraordinary privilege of provisional relief.” Indus.
Innovators, Inc. v. Myrick-White, Inc., 99 N.C. App. 42, 50, 392 S.E.2d 425, 431
(citation and quotation marks omitted), disc. review denied, 327 N.C. 483, 397 S.E.2d
219 (1990); see also Leonard E. Warner, Inc. v. Nissan Motor Corp. in U.S.A., 66 N.C.
App. 73, 76, 311 S.E.2d 1, 3 (1984) (“The purpose of the security requirement is to
protect the restrained party from damages incurred as a result of the wrongful
issuance of the injunctive relief.” (citation omitted)).
It is well established that “no right of action accrues upon an injunction bond
until the court has finally decided that plaintiff was not entitled to the injunction, or
until something occurs equivalent to such a decision.” M. Blatt Co. v. Southwell, 259
N.C. 468, 471, 130 S.E.2d 859, 861 (1963) (citation and quotation marks omitted).
The defendant has the burden of proof on the issue of whether it is entitled to recover
under the bond. Id. at 473, 130 S.E.2d at 862.
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In the present case, Defendants do not contend that the trial court expressly
determined that Van-Go had not been entitled to the 29 June 2015 TRO.1 Rather
they contend that Van-Go’s voluntary dismissal of its lawsuit was equivalent to a
decision by the trial court that Van-Go was not entitled to the TRO.
The seminal case on this issue is Blatt, in which our Supreme Court articulated
the following rule:
[T]he voluntary and unconditional dismissal of the
proceedings by the plaintiff is equivalent to a judicial
determination that the proceeding for an injunction was
wrongful, since thereby the plaintiff is held to have
confessed that he was not entitled to the equitable relief
sought.
When, however, the dismissal of the action is by an
amicable and voluntary agreement of the parties, the same
is not a confession by the plaintiff that he had no right to
the injunction granted, and does not operate as a judgment
to that effect.
Id. at 472, 130 S.E.2d at 862 (internal citations and quotation marks omitted and
emphasis added). Thus, Blatt distinguished between, on the one hand, a plaintiff’s
voluntary dismissal of an action without conditions and, on the other hand, a
plaintiff’s voluntary dismissal that is conditioned upon an agreement between the
plaintiff and the defendant. Blatt makes clear that the former category of voluntary
1 We note that a trial court’s subsequent refusal to grant a preliminary injunction to a plaintiff
does not, in itself, constitute a determination that the defendant was wrongly enjoined by the earlier
issuance of a TRO. See Blatt, 259 N.C. at 471, 130 S.E.2d at 861 (holding that trial court’s
determination that plaintiff was not entitled to continuation of TRO did not constitute ruling that TRO
had been wrongfully issued given that trial court failed to make any “recital, finding or adjudication
that plaintiff was not entitled to the temporary restraining order during the period it was in effect”).
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dismissals entitles the defendant to recovery on the injunction bond whereas the
latter category does not.
Here, there was no “amicable” or “voluntary” agreement between Van-Go, the
County, and EnRoute at the time Van-Go dismissed its lawsuit. Instead, Van-Go
voluntarily, without any promise, consideration, or involvement of Defendants,
dismissed its lawsuit “as to all defendants” on 10 December 2015. Due to the
voluntary, unilateral dismissal of its lawsuit, Van-Go “is held to have confessed that
[it] was not entitled to the equitable relief sought” by the 29 June 2015 TRO. Id.
North Carolina courts have recognized one narrow exception to Blatt’s general
rule that a voluntary and unconditional dismissal is deemed to be an admission by
the plaintiff that it wrongfully enjoined the defendant. This exception applies in
instances in which a plaintiff dismisses a claim that has become legally moot. In
Democratic Party of Guilford County v. Guilford County Board of Elections, 342 N.C.
856, 467 S.E.2d 681 (1996), the plaintiffs filed suit to compel the Guilford County
Board of Elections to extend voting hours on Election Day in November 1990. The
trial court issued a TRO directing the board to keep polling places open for an
additional hour. Id. at 858, 467 S.E.2d at 682-83. Approximately one month later,
the board moved to vacate the TRO and sought damages for having been wrongfully
enjoined. Id. at 858, 467 S.E.2d at 683. A few hours later, the plaintiffs filed a
voluntary dismissal of the action. The trial court denied the board’s request for
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damages on the grounds that the TRO was no longer in existence and the board had
failed to demonstrate that it was wrongfully enjoined. Id. at 859, 467 S.E.2d at 683.
On appeal to the Supreme Court, the board cited Blatt to support its contention
that the plaintiffs’ dismissal of their action “constituted a per se admission of wrongful
restraint which automatically entitled [the board] to damages.” Id. at 861, 467 S.E.2d
at 684. The Court rejected this argument, explaining that the plaintiffs’ dismissal of
their action was in effect a “legal nullity” given that their complaint “sought no relief
other than the temporary restraining order, and that order expired, at the latest, ten
days after [the trial court] entered it.” Id. at 862, 467 S.E.2d at 685.
Another application of the mootness exception occurred in Allen Industries. In
that case, the plaintiff employer sued a former employee for breaching a covenant not
to compete contained in her employment contract by working for a direct competitor
and by improperly using the plaintiff’s customer data in that new position. Allen
Indus., __ N.C. App. at __, 788 S.E.2d at 209. The trial court granted the plaintiff’s
motion for a preliminary injunction prohibiting the defendant from working for the
competitor through March 2014 — the end of the noncompetition period specified in
the agreement. Id. at __, 788 S.E.2d at 209.
The defendant appealed the preliminary injunction order to this Court, and we
dismissed the appeal as moot because the period of the covenant not to compete had
expired. Id. at __, 788 S.E.2d at 209. Following our remand to the trial court, the
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plaintiff voluntarily dismissed its action. The defendant then moved for damages on
the ground that she had been wrongfully enjoined. The trial court denied the motion
on the basis that the defendant’s actions had, in fact, violated the covenant not to
compete. Id. at __, 788 S.E.2d at 209.
On a second appeal to this Court, the defendant argued that the trial court
should have treated the plaintiff’s voluntary dismissal as an admission that it had
wrongfully enjoined her. Id. at __, 788 S.E.2d at 209. We disagreed, explaining that
“the dismissal was taken only after there was no longer any need to maintain the case
because the covenant not to compete had expired by its own terms.” Id. at __, 788
S.E.2d at 210 (emphasis added). Therefore, based on the fact that the case had
become moot before the voluntary dismissal was taken, we affirmed the trial court’s
ruling. Id. at __, 788 S.E.2d at 211.
Here, the trial court specifically concluded that “[t]he Notice of Voluntary
Dismissal without prejudice filed by [Van-Go] in this matter on or about December
10, 2015, which was unstipulated, is equivalent to a finding that the County and
Enroute were wrongfully restrained by the entry of the TRO on June 29, 2015.”
(Citation and quotation marks omitted.) Van-Go does not dispute the trial court’s
finding that its dismissal of this action was voluntary and without conditions.
However, Van-Go argues that the mootness exception to the Blatt rule is applicable
here on the theory that its lawsuit had effectively become moot once its request for a
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preliminary injunction was denied. To support this position, Van-Go’s president,
Azzam Osman, testified as follows in an affidavit submitted by Van-Go to the trial
court:
Van-Go’s decision to discontinue the present litigation was
consistent with its responsible financial business practices,
taking into consideration the cost of further litigation, the
profit that would be gained on the remainder of the
contract, and the time that would be remaining on the
contract by the time that the case would come to a final
resolution.
Essentially, Van-Go asks us to recognize a “constructive mootness” doctrine
premised upon its assertion that it dismissed its lawsuit based upon a “fiscally sound
business decision.” Recognition of such an exception, however, would be inconsistent
with both our precedent and the purpose of Rule 41. Unlike in Allen Industries, where
“the dismissal was taken only after there was no longer any need to maintain the
case[,]” id. at __, 788 S.E.2d at 210, or in Democratic Party of Guilford County, where
the plaintiffs’ dismissal came after receiving the only relief they sought, 342 N.C. at
862, 467 S.E.2d at 685, Van-Go does not actually assert that its claims were legally
moot at the time it dismissed its lawsuit. Rather, as Osman’s above-quoted testimony
demonstrates, Van-Go is making the qualitatively different argument that the value
of the case going forward would have been diminished in comparison to the costs of
litigation.
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Van-Go points to no North Carolina legal authority — nor are we aware of any
— holding that the enjoining party may avoid operation of the Blatt rule simply by
asserting that the voluntary dismissal of the action was a business decision. Indeed,
the adoption of such an exception would swallow the general rule articulated in Blatt
as virtually any plaintiff in this procedural posture could claim its voluntary
dismissal was motivated by a cost-benefit analysis. Moreover, in addition to being
unworkable, such an exception would not be “consistent with the very purpose of the
bond[,] which is to require that the plaintiff assume the risks of paying damages he
causes as the price he must pay to have the extraordinary privilege of provisional
relief.” Indus. Innovators, 99 N.C. App. at 50, 392 S.E.2d at 431 (citation and
quotation marks omitted).
Thus, the general rule articulated in Blatt is controlling on the present facts.
Accordingly, the trial court did not err in holding that Defendants had been
wrongfully enjoined by Van-Go.
II. Award of Damages to Defendants
In its alternative argument, Van-Go contends that the specific awards to
EnRoute and the County were improper albeit for different reasons. We address each
of Van-Go’s arguments in turn.
A. EnRoute’s Damages
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Van-Go asserts that the trial court’s award of $15,993.57 to EnRoute was not
supported by proper evidence. “According to well-established North Carolina law, a
party seeking to recover damages bears the burden of proving the amount that he or
she is entitled to recover in such a manner as to allow the finder of fact to calculate
the amount of damages that should be awarded to a reasonable degree of certainty.”
Lacey v. Kirk, 238 N.C. App. 376, 392, 767 S.E.2d 632, 644 (2014) (citation omitted),
disc. review denied, __ N.C. __, 771 S.E.2d 321 (2015). In so doing, “absolute certainty
is not required but evidence of damages must be sufficiently specific and complete to
permit the [fact finder] to arrive at a reasonable conclusion.” Fortune v. First Union
Nat’l Bank, 323 N.C. 146, 150, 371 S.E.2d 483, 485 (1988) (citation and quotation
marks omitted).
We have specifically applied this rule to the calculation of damages for lost
profits. See Supplee v. Miller-Motte Bus. Coll., Inc., 239 N.C. App. 208, 223, 768
S.E.2d 582, 594 (2015) (“To recover lost profits, the claimant must prove such losses
with ‘reasonable certainty.’ Although absolute certainty is not required, damages for
lost profits will not be awarded based on hypothetical or speculative forecasts.”
(citation omitted)). “The amount of damages is generally a question of fact, but
whether that amount has been proven with reasonable certainty is a question of law
we review de novo.” Plasma Ctrs. of Am., LLC v. Talecris Plasma Res., Inc., 222 N.C.
App. 83, 91, 731 S.E.2d 837, 843 (2012).
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Here, the owner of EnRoute, Ricky Nelson Moore, submitted an affidavit to the
trial court in which he set forth the basis for EnRoute’s damages claim resulting from
the TRO. Moore testified that EnRoute incurred revenue losses in the amount of
$44,741.62 while the TRO was in effect. This figure was reached by multiplying the
actual number of miles (29,053) for which Van-Go billed the County in connection
with Medicaid transportation services provided during the time period in which the
TRO was in effect by the rate ($1.54) to which EnRoute and the County agreed in the
Contract.
Moore’s affidavit then stated that EnRoute was able to avoid $20,918.00 in
“variable costs (such as fuel and labor expenses)” that it would have incurred had the
TRO not been in place and EnRoute actually performed the Contract during that time
period. To support this figure, Moore explained that he “calculated that EnRoute’s
total fuel and labor expenses amount to approximately $.72 per mile, based on
historical data (namely, our costs per mile during the past few months).” Moore then
subtracted these avoided costs ($20,918.00) from the lost revenue ($44,741.62) to
arrive at a lost profits figure of $23,823.00.2
In response to Moore’s affidavit, Van-Go filed the affidavit of Osman stating
that, based upon Van-Go’s operating costs during the month of July, “[i]t is very
unlikely that EnRoute could provide 29,053 service miles at a rate of $1.54 per mile
2 Moore rounded down to the nearest dollar in arriving at this figure.
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over [the period during which the TRO was in effect] and realize a profit in excess of
ten thousand dollars[.]”
After holding a hearing on 21 March 2016, the trial court issued its order
awarding damages in the amount of $15,993.57 to EnRoute. The trial court’s order
contained the following pertinent findings of fact:
30. [A]s a result of the TRO entered on June 29,
2015, the County and Enroute were restrained from
performing under the Contract, which would have taken
effect on July 1, 201[5], for a period of (20) days.
31. According to the Affidavit of Ricky Nelson
Moore, which relies in part upon information that is also
contained in the Affidavit of Azzam Osman, Enroute
incurred lost profits of $23,823.00 during the period from
July 1, 2015 to July 20, 2015 as a result of the TRO.
....
35. The Court finds that, but for the issuance of
the TRO, Enroute would have been able to perform its
duties under the Contract beginning on July 1, 2015.
Accordingly, Enroute has demonstrated, to the satisfaction
of the Court, that it has sustained substantial lost revenues
and profits as a result of the issuance of the TRO. The
Court finds the affidavit testimony of Mr. Ricky Nelson
Moore credible as to the amounts of lost revenues and
profits.
The trial court then entered the following conclusion of law: “Enroute ha[s]
established that, by reason of said wrongful restraint, [it has] incurred actual and
substantial damages and, accordingly, [EnRoute is] entitled to a distribution of the
bond proceeds.” The trial court proceeded to award the sum of $15,993.57 to EnRoute.
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On appeal, Van-Go contends that EnRoute failed to adequately support its
calculation that its costs would have amounted to $0.72 per mile. Specifically, Van-
Go faults EnRoute for failing to provide evidence other than Moore’s affidavit that
would support this figure and for basing the amount upon fuel and labor “costs per
mile during the past few months” rather than costs during the time period covered
by the TRO. Van-Go points out that Moore’s affidavit was executed on 4 February
2016, meaning that the avoided costs figure was derived from costs incurred during
the latter part of 2015 and early 2016 whereas the TRO was in place during July
2015. Van-Go states in its brief that “Moore’s calculation does not take into account
the difference in fuel price in July 2015 and the ‘past few months.’ ”
As noted above, damages for lost profits may not be speculative. See, e.g.,
Weyerhaeuser Co. v. Godwin Bldg. Supply Co., 292 N.C. 557, 560, 234 S.E.2d 605, 607
(1977) (holding that party’s mere statement of amount of losses “provides no basis for
an award of [the party’s] damages for lost profits, since any estimate of [the party’s]
expected profits must on the evidence presented be based solely upon speculation”);
Rankin v. Helms, 244 N.C. 532, 538, 94 S.E.2d 651, 656 (1956) (ruling that party’s
bald statement of damages amount was “if not a mere guess, a statement of his mere
opinion or conclusion as to the amount of damages he has suffered, where no proper
basis for the receipt of such evidence had been shown”); Iron Steamer, Ltd. v. Trinity
Rest., Inc., 110 N.C. App. 843, 847, 431 S.E.2d 767, 770 (1993) (“North Carolina courts
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have long held that damages for lost profits will not be awarded based upon
hypothetical or speculative forecasts of losses.”).
The risk of speculative lost profits calculations is greatest in situations where
parties must estimate revenues that they likely would have earned in an uncertain
industry with numerous variables. See, e.g., id. at 849, 431 S.E.2d at 771 (“[I]n an
unestablished resort restaurant context, the relationship between lost profits and the
income needed to generate such lost profits is peculiarly sensitive to certain variables
including the quality of food, quality of service, and the seasonal nature of the
business. Therefore, proof of lost profits with reasonable certainty under these
circumstances requires more specific evidence and thus a higher burden of proof.”).
The present case, however, deals not with an inherently uncertain forecast of
profits but rather with known historical facts. Here, the expected revenue was both
precise and undisputed as it was based upon the per-mile rate ($1.54) set forth in the
Contract and the actual number of miles (29,053) Van-Go billed to the County during
the TRO period. Moreover, Moore specified his basis for the other key variable, the
avoided costs figure, stating that EnRoute’s records reflected a cost-per-mile rate
during “the past few months” of $0.72, which included fuel and labor costs. We are
not convinced that the discrepancy in time frames Van-Go attempts to rely upon is
material under the facts of this case given (1) the relatively close proximity of these
two time frames; and (2) the fact that although the total amount of damages for lost
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profits stated in Moore’s affidavit was $23,823.00, the trial court awarded EnRoute
only $15,993.57.
We have never held that a party is required to meet a formulaic standard in
order to satisfy its burden of affixing damages with reasonable certainty. Rather, we
have previously explained that generally “[e]xpert testimony and mathematical
formulas are not required to meet the burden of proof concerning damages.” Hudgins
v. Wagoner, 204 N.C. App. 480, 492, 694 S.E.2d 436, 446 (2010), appeal dismissed and
disc. review denied, 365 N.C. 88, 706 S.E.2d 250 (2011).
Our decision in United Leasing Corp. v. Guthrie, 192 N.C. App. 623, 666 S.E.2d
504 (2008) is instructive. In that case, the damages issue concerned the value of
merchandise in a large box truck that was being transferred from one store to
another. At trial, a witness testified that the aggregate value of this merchandise
was $150,000. The witness based this assessment upon his professional background,
which included moving similar inventory during the process of setting up new stores
and his “familiarity with the inventory at the various store locations and its pricing.”
Id. at 628, 666 S.E.2d at 508. On appeal, we held that his testimony was properly
admitted lay opinion testimony as it “tended to show that he had knowledge of the
property and some basis for his opinion regarding the value of said property at the
time of its conversion.” Id. at 629, 666 S.E.2d at 508 (citation, quotation marks, and
brackets omitted). We then determined that this “lay opinion testimony was
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sufficient to establish the aggregate value of the converted inventory.” Id. at 631-32,
666 S.E.2d at 510.
Here, we conclude that Moore’s testimony provided a sufficient basis from
which the trial court could assess EnRoute’s damages with a reasonable degree of
certainty. In fixing the specific amount of damages, the trial court was permitted to
determine the appropriate weight to be accorded to the evidence before it. See CDC
Pineville, LLC v. UDRT of N.C., LLC, 174 N.C. App. 644, 655, 622 S.E.2d 512, 520
(2005) (“If there is a question regarding the reliability of the evidence presented to
support an award of damages, the questions should go to the weight of the
evidence[.]”), disc. review denied, 360 N.C. 478, 630 S.E.2d 925 (2006). Accordingly,
we are unable to conclude that the trial court committed reversible error in its award
of damages to EnRoute.
B. Damages Awarded to County
Finally, Van-Go argues that the trial court erred in awarding damages under
the injunction bond to the County because the issuance of the TRO did not actually
cause the County to suffer any damages. Instead, Van-Go contends, any additional
monies paid by the County during the period in which the TRO was in effect belonged
to the State given the manner in which funding for local Medicaid programs is
administered. This argument lacks merit.
In its verified response in opposition to Van-Go’s motion for return of the bond,
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Opinion of the Court
the County stated that during the TRO period, it paid Van-Go a total of $53,748.05
for Medicaid transportation services. This figure was based on a total of 29,053 miles
driven under the then-existing contract rate of $1.85 per mile. The County’s response
also stated that had the TRO not been in place and EnRoute been permitted to
perform the Contract, the County would have paid EnRoute $1.54 per mile for these
29,053 miles, resulting in a total of $44,741.62. Therefore, according to the response,
the County was damaged in the amount of $9,006.43 — the difference between the
amount it actually paid Van-Go and the amount it would have paid EnRoute to
perform the same services had the TRO not been issued.
The trial court made the following pertinent findings of fact on this issue:
32. [T]he verified Opposition submitted by the
County and Board clearly establishes that the County was
required to pay [Van-Go] a rate of $1.85 per mile, which
was the rate under the prior Medicaid Transportation
Contract, as opposed to the $1.54 per mile rate that the
County would have been required to pay Enroute for the
same number of miles.
33. It is undisputed based upon the Affidavits and
other filings before the Court that [Van-Go] billed the
County, through its DSS, for 29,053 miles during the
period from July 1, 2015 to July 20, 2015 and that these
miles were billed at the prior contract rate of $1.85 per
mile.
34. Accordingly, the County incurred $9,006.43 in
Medicaid Transportation costs that it would not otherwise
have had to pay as a result of the TRO. The fact that the
funds originated with DHHS does not alter this fact, and
the Court finds that the County has a duty to seek to
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Opinion of the Court
recover the above amount, despite the fact that the funds
may have originated with DHHS.
The trial court therefore awarded the County the full $9,006.43 it sought. On
appeal, Van-Go does not challenge the calculation of this figure but rather asserts
that the County was not damaged by paying out the extra funds because (1) the
County is “simply a conduit for the State” in that the State provided the County the
funds to pay Van-Go for the transportation services; and (2) the County does not
possess a legal duty to recoup the funds on behalf of the State.
Van-Go has failed to cite any legal authority showing that the County — after
being sued, wrongfully enjoined, and forced to pay out funds to Van-Go — had no
right to collect from Van-Go the monetary damages that Van-Go caused to the
County’s Medicaid transportation program. Pursuant to applicable law, counties bid
out, award, and administer contracts for Medicaid transportation services and cause
public monies to be paid to vendors performing those contracts. The existence of any
obligation that the County may ultimately have to reimburse the State for the
$9,006.43 it was awarded is not relevant to the question of whether the County was
entitled to seek recovery of taxpayer funds that were wrongfully expended due to the
actions of Van-Go. Accordingly, Van-Go has failed to show that the award of damages
to the County was improper.
Conclusion
For the reasons stated above, we affirm the trial court’s 12 May 2016 order.
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Opinion of the Court
AFFIRMED.
Chief Judge McGEE and Judge MURPHY concur.
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