Adams v. Kerr

655 S.W.2d 49, 1983 Mo. App. LEXIS 3336
CourtMissouri Court of Appeals
DecidedMay 17, 1983
Docket45308, 45365
StatusPublished
Cited by11 cases

This text of 655 S.W.2d 49 (Adams v. Kerr) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Adams v. Kerr, 655 S.W.2d 49, 1983 Mo. App. LEXIS 3336 (Mo. Ct. App. 1983).

Opinion

KAROHL, Judge.

Plaintiff Robert M. Adams, as purchaser, petitioned for specific performance of a real estate sales contract and damages. Co-plaintiff Red Carpet Mehler Co., Ltd. (Red Carpet) sued for a real estate commission based on a listing contract entered into with defendants Mr. and Mrs. Kerr, as sellers. Defendants filed a counterclaim and third party petition against plaintiff Red Carpet and three individual Red Carpet real estate agents for breach of fiduciary duty.

On March 4, 1980, the Kerrs, an elderly couple, listed their four-family flat with Red Carpet. The listing price was $118,000. Third party defendants Jen McCann, as agent, and Richard Birner, as broker, obtained the listing contract on behalf of Red Carpet. Birner persuaded the Kerrs to accept $110,000, if offered, and to consider financing the sale by accepting a cash down payment and a purchase money note and deed of trust.

On March 23, 1980, plaintiff Robert Adams submitted a sale contract for defendants’ property for $110,000, offering $22,000 cash and a note for $88,000 secured by a first deed of trust. Robert Adams and Donald Erhardt, through their partnership A & E Associates, bought, managed and sold real estate. Unknown to the Kerrs at the time, Red Carpet, and principally third party defendant Kathryn Brethold, as agent, had represented A & E Associates for several years. Adams communicated the offer to Brethold, Brethold gave it to McCann, and McCann obtained the Kerrs’ approval. At the Kerrs’ request, the $88,-000 note was to be amortized over thirty years but payable in full in five years.

The sale contract was signed by Adams individually as the purchaser. The Kerrs had no knowledge of A & E Associates at the time they signed the contract. The grantee on the deed was to be “as directed” by purchaser. The sale contract contained a special condition relating to a credit report, which stated:

This sale contract is subject to purchaser, at his expense, delivering to seller a credit report satisfactory to seller within ten (10) working days of the acceptance of this contract by seller. If such credit report is not satisfactory to seller, this contract shall be null and void, and earnest deposit returned to purchaser less any expense incurred by or in behalf of purchaser.

On March 29, 1980, Adams furnished the Kerrs with a net worth analysis of A & E Associates, which stated assets, liabilities and net worth as of August 1, 1979. The one page “analysis” gave no phone number for A & E Associates, account numbers, or any specific details concerning the properties owned by the business. The Kerrs took the report but were unable to locate and identify A & E Associates, although by this time they were told that Red Carpet managed property for A & E Associates. They asked for, but did not receive, a certified credit report.

On April 9, 1980, Mr. Kerr and his son, Leland, went to Red Carpet’s office and informed Birner that they had decided not to go through with the contract. The Kerrs offered to reimburse Birner for his expenses. Birner left the meeting without giving a definite response. The Kerrs then received a letter dated April 10, 1980, from *52 Red Carpet’s attorney, threatening suit on behalf of Red Carpet and the proposed purchaser.

The Kerrs and Leland attended the closing on April 18,1980. They discovered that the grantees on the warranty deed were Robert Adams and his wife, and Donald Erhardt and his wife. The note the purchasers were to sign did not contain the five year balloon provision. Leland Kerr, speaking for his parents, requested a credit report. The Red Carpet agent, Brethold, responded, “Well, you don’t need one.” Bret-hold threatened suit if they did not close but the Kerrs refused to close without an adequate credit report. This suit followed.

At the close of all the evidence, the trial court sustained plaintiffs’ and third party defendants’ motions for “directed verdict” on the Kerrs’ counterclaim. The counterclaim and third party petition, in Count I, alleged that Red Carpet represented both the Kerrs and Adams without the Kerrs’ knowledge and breached its fiduciary duty. Count II charged that Red Carpet and its individual agents conspired to cheat and defraud defendants. In its findings of fact and conclusions of law, the trial court found that all matters concerning the sale had not been fully and adequately explained to the Kerrs, that the net worth analysis of A & E Associates was clearly unsatisfactory, making the contract void. The court entered judgment for the Kerrs on plaintiffs’ petition. Both sides appealed.

On plaintiffs’ appeal, the trial court’s judgment must be affirmed unless it erroneously declares or applies the law, is unsupported by substantial evidence, or is against the weight of the evidence. Murphy v. Carron, 586 S.W.2d 30, 32 (Mo. banc 1976).

We first consider plaintiff Adam’s appeal. He contends that the trial court erred in finding that the contract was void, by its terms, for failure to produce a credit report satisfactory to the sellers. The court’s finding is against the weight of the evidence and a misapplication of contract law, plaintiff argues, because defendants made no objection to the A & E credit report, he was given no opportunity to cure any defects, and the credit report was immaterial because the value of the property was sufficient security for the note.

Adam’s argument, however, ignores the clear and unambiguous language of the contract. The sale was subject to purchaser delivering to seller a credit report “satisfactory to seller.” Defendants were entitled to receive and approve a credit report of the purchaser, who on the deed was Adams and his wife and Erhardt and his wife. They never received such a credit report. Without a report there was no enforceable contract. Where the language of a contract is plain, there can be no construction by the court since there is nothing to construe. Grantham v. Rockhurst University, 563 S.W.2d 147, 150 (Mo.App.1978).

Further, the credit report was a material part of the contract, as the Kerrs were taking a sizeable purchase money note secured by a first deed of trust. The purchaser’s credit was a significant factor in the contract. When the Kerrs told Birner they did not wish to go through with the contract Birner did not ask why. Moreover, when the Kerrs asked for a satisfactory credit report at the closing, Brethold refused, telling them it was unnecessary. Adams thus refused to comply with the contract provision.

As there was no valid contract between the parties, a court cannot grant the equitable remedy of specific performance, Keller v. Reich, 646 S.W.2d 141, 143 (Mo.App.1983); McKenna v. McKenna, 607 S.W.2d 464, 467 (Mo.App.1980), and the trial court’s judgment was supported by substantial evidence.

We also affirm the denial of plaintiff Red Carpet’s petition for its sales commission. The question of when and how a broker becomes entitled to a commission depends on the contract. Perkinson v. Burford,

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Bluebook (online)
655 S.W.2d 49, 1983 Mo. App. LEXIS 3336, Counsel Stack Legal Research, https://law.counselstack.com/opinion/adams-v-kerr-moctapp-1983.