Rainbo Baking Company of Louisville, a Delaware Corporation, v. Release Coatings of Tennessee, Inc.

Rainbo Baking Company of Louisville (“Rainbo”) filed suit in the Chancery Court of Shelby County against Release Coatings of Tennessee, Inc. (“Release”) seeking compensatory damages from Release for damages allegedly sustained by Rainbo as a result of the improper straightening of a large quantity of baking pans used by it in its bakery business. The suit contained a count in negligence and a count in breach of contract. Release filed a counter-claim seeking to recover from Rainbo the balance due it for work performed. Following a bench trial, the court issued an opinion from the bench. In this opinion the court found that upon the evidence presented, Release was liable to Rainbo. However, the court specifically stated that it did not find that Rainbo had carried its burden of proof as to damages. The court ordered a reference to the Master to give Rainbo an opportunity to present additional proof as to damages, with Release being given an opportunity to present countervailing proof if desired. Following the Master’s hearing, a report was submitted to the chancellor in which the value of Rainbo’s pans was stated. The Master’s report was affirmed and judgment entered thereon in favor of Rainbo. The chancellor dismissed the counterclaim of Release against Rainbo. Release has raised three issues on appeal: did the 2 chancellor err in: (1) awarding a judgment against Release when Rainbo failed to prove its case; (2) the manner of determining the amount of damages sustained by Rainbo; and (3) failing to find for Release on its counter-claim. For the reasons hereinafter stated, we modify and affirm the trial court.