Capital Management Co. v. Brown

813 A.2d 1094, 2002 Del. LEXIS 763, 2002 WL 31854961
CourtSupreme Court of Delaware
DecidedDecember 18, 2002
Docket129,2002
StatusPublished
Cited by31 cases

This text of 813 A.2d 1094 (Capital Management Co. v. Brown) is published on Counsel Stack Legal Research, covering Supreme Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Capital Management Co. v. Brown, 813 A.2d 1094, 2002 Del. LEXIS 763, 2002 WL 31854961 (Del. 2002).

Opinion

STEELE, Justice:

In September 2001, a civil jury in the Superior Court returned a verdict in the favor of the plaintiff, Charles A. Brown and against both co-defendants Capital Management Company and Cathedral Community Services, Inc. This is Capital’s appeal of several of the trial judge’s rulings.

I.

On June 1, 1994, Cathedral entered into a written contract with Capital, whereby Capital agreed to manage and maintain certain properties owned by Cathedral. The properties included three apartment *1096 units at 2001 N Market Street. The original one year contract expired in 1995.

Although the ■written contract expired in 1995, Capital continued to manage Cathedral’s property located at 2001 N. Market Street. Gary Hayman, President of Capital, testified that Capital continued to manage Cathedral’s property because Cathedral “didn’t have the capacity they needed to do some of those things” required to manage the property. Capital wanted to “help the Church,” so Capital continued to manage the property without a written contract.

According to Hayman, after the contract expired, Capital’s management duties included pre-rental inspections, advertising for tenants, maintenance work on the apartments (painting, plumbing, and electric), collection of rents, and filing legal actions. Capital paid itself a management fee and reimbursed itself for maintenance and repair from rental fees.

On August 23, 1999,. the plaintiff, Charles Brown was standing underneath an exterior fire escape attached to the side of 2001 N. Market Street. Brown touched the bottom step of the fire escape ladder, and the ladder section fell striking Brown on the head. He suffered a compound, comminuted, depressed skull fracture. The ladder section fell because a supporting metal cable, which was severely corroded, broke, releasing the ladder and a counterweight.

On October 21, 1999, Brown filed a damage action against Cathedral and Capital. Capital answered the complaint, and asserted a cross-claim against Cathedral for contribution and indemnification. Brown settled his claim against Cathedral and signed a joint tortfeasor release. Although Capital continued to maintain its cross-claim against Cathedral, Cathedral chose not to contest the cross-claim, and ceased participating in the litigation. The case went to trial on September 10, 2001.

At trial, Capital offered into evidence an admission made by Cathedral in the pleadings that it was “in control of the premises located at 2001 N. Market Street.” The trial judge permitted the admission, but stated in an earlier colloquy that he was going to instruct the jury, and later did instruct the jury, that Cathedral’s “admission of ‘control’ of the property does not equate to or is it the same as an admission as to responsibility for maintenance of the property.”

The trial judge also refused to instruct the jury that Cathedral was not represented at trial because it had settled its claim with the plaintiff. Shortly into the jury’s deliberations, the jury submitted a question asking why Cathedral was not present at trial. The trial judge explained that Cathedral chose not to participate, but he did not disclose that Cathedral had settled with Brown.

On September 14, 2001, the jury returned a verdict in favor of Brown. The jury apportioned liability 60% against Capital and 40% against Cathedral, and awarded Brown damages in the amount of $2,250,000. Capital moved unsuccessfully for a new trial. This appeal followed.

II.

Capital first alleges that the trial judge improperly submitted the question of whether Capital owed contractual duties to Cathedral, a purely legal issue, to the jury. Second, Capital alleges that the trial judge erred by not ruling as a matter of law that it had no duty to maintain the exteriors of Cathedral’s properties, including the fire escape causing Brown’s injuries. Third, Capital alleges that the trial judge imper-missibly commented on the evidence when he told the jury that admitting “control” of the premises did not mean “responsibility *1097 for maintenance of the property.” Finally, Capital alleges that the trial judge erred when he refused to tell the jury that Cathedral did not appear at trial because it had settled with Brown. Because we believe the trial judge acted correctly in each cited instance, we affirm.

III.

The first issue on appeal is whether the trial judge improperly submitted to the jury the question of Capital’s duties under the parties’ agreement. Capital argues that the trial judge abdicated his required role to interpret the legal meaning of the contract and improperly imposed this obligation on the jury.

Capital argues that its contract with Cathedral was ambiguous and that the following compelled the trial judge to determine the legal duties each party owed the other:

If a contract is unambiguous, extrinsic evidence may not be used to interpret the intent of the parties, to vary the terms of the contract or to create ambiguity. But when there is uncertainty in the meaning and application of contract language, the reviewing court must consider evidence offered in order to arrive at a proper interpretation of contractual terms. 1

While Capital’s counsel correctly states this general rule of contract interpretation, the rule does not apply here because an ambiguity in written contract terms was not in issue. The issue to be resolved here was a factual one — what were the terms of the agreement between Capital and Cathedral? Or, put another way — did the parties contract for the maintenance of the exterior of 2001 N. Market Street? ■

The terms of Capital and Cathedral’s agreement are composed of more than just the writing that expired in 1995. If the contract had not expired, and was still in effect the day Brown suffered his injury, the trial judge should have determined whether the terms in that contract were ambiguous, and if they were, heard extrinsic evidence to determine what the parties intended those terms to mean. 2 However, because there was no written contract in effect between the parties, the issue submitted to the jury was this: What is the agreement between the parties based on their relationship and their conduct regarding maintenance of the property? The jury was asked to determine what duties Capital had based on its relationship with Cathedral. They were not asked to determine the meaning of the expired contract because the actual terms of the agreement and° relationship between the parties were in dispute and not simply the meaning of those terms. The very terms of the contract, what they were, not what they meant, were at issue and were, therefore, properly submitted to the jury as a question of fact.

IV.

The next issue is whether Capital had assumed a duty to maintain the exterior of Cathedral’s properties, including the fire escape. Or, in the alternative, whether Capital, regardless of its contractual relationship with Cathedral, had a duty under *1098 the Wilmington City Code to maintain the fire escape.

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Bluebook (online)
813 A.2d 1094, 2002 Del. LEXIS 763, 2002 WL 31854961, Counsel Stack Legal Research, https://law.counselstack.com/opinion/capital-management-co-v-brown-del-2002.