Elder Construction Co. v. Ivey Lane, LLC

370 S.W.3d 861, 2010 Ark. App. 10, 2010 Ark. App. LEXIS 2
CourtCourt of Appeals of Kentucky
DecidedJanuary 6, 2010
DocketNo. CA 09-63
StatusPublished
Cited by3 cases

This text of 370 S.W.3d 861 (Elder Construction Co. v. Ivey Lane, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Elder Construction Co. v. Ivey Lane, LLC, 370 S.W.3d 861, 2010 Ark. App. 10, 2010 Ark. App. LEXIS 2 (Ky. Ct. App. 2010).

Opinion

RITA W. GRUBER, Judge.

| TThis case concerns the grant of specific performance to a vendor of land. The Washington County Circuit Court directed Elder Construction Company to specifically perform a contract between it and Ivey Lane, LLC, by purchasing three lots for a [863]*863total price of $247,300 within sixty days. Elder appeals that decision and contends that the trial court erred in ordering specific performance for three reasons: (1) the contract was not severable; (2) Ivey was not at all times prompt, ready, willing, and able to perform; and (3) equity did not support this remedy. We find no error and we affirm the circuit court’s order.

On June 18, 2003, Elder and Ivey entered into a contract pursuant to which Elder agreed to purchase and Ivey agreed to sell sixteen unimproved residential lots in the Enclave Subdivision of Springdale for a total purchase price of $1,282,400. The numbered lots were listed in the contract next to the separate price for each individual lot. The lots varied in price |2from $77,500 to $84,900 depending on the lot’s size, location, and topography. Elder was required to purchase the sixteen lots in four separate “take-downs.” The closings for the takedowns were scheduled to occur every six months until all the lots had been purchased. Elder alone determined which four lots it would purchase in each of the separate take-downs.

Elder purchased twelve lots in the first three take-downs. However, Elder did not show up on November 23, 2005, for the scheduled closing on the final take-down on Lot # 2 priced at $77,500, Lot # 9 priced at $84,900, Lot # 12 priced at $84,900, and Lot #46 priced at $77,500. Ivey filed suit seeking specific performance under the contract on the four remaining lots but later voluntarily dismissed this complaint. On April 7, 2006, Ivey sold Lot #46 to a third party for $77,500. On August 14, 2007, Ivey filed another complaint seeking specific performance for Elder’s breach of contract on each of the three remaining lots: Lot # 2, Lot # 9, and Lot # 12. Elder answered and filed a counterclaim for fraudulent inducement.

At the beginning of the trial, the circuit court found that the contract was not ambiguous. This finding is not challenged on appeal. However, the parties disputed at trial whether the contract was severable into sixteen different contracts. Ivey presented the testimony of Gary Griffin, part owner of Ivey, that the lots were not physically or topographically identical to each other and that the streets in the subdivision were not uniform. He testified that the lots described in the contract were independently priced and that some lots were more desirable than others because of their size or location or because | ^building on them took less construction work. He also testified that the three lots at issue in this case were still on the market and that the absence, or sale, of one lot from the group would not change the value of the other lots.

Chris Elder, president and co-owner of Elder Construction Company, testified at trial that he chose not to close on the last four lots because he was “frustrated” over the lack of marketing and promotion Ivey was performing for the subdivision. He testified that Enclave had not been a successful subdivision and that it would be a hardship for him to close on the remaining lots. He admitted that Elder determined which four lots to include in each take-down, that each lot was individually priced, and that each lot was different. He also admitted that the market had changed and “gone south” since he had entered the contract to purchase the lots.

The circuit court entered an order on September 4, 2008, finding that Elder had breached the contract with Ivey, that Ivey did not have an adequate remedy at law, and therefore that Ivey was entitled to the remedy of specific performance. The court ordered Elder to close on the purchase from Ivey of Lots 2, 9, and 12 for the prices established in the contract no [864]*864later than sixty days from entry of the order. The circuit court also dismissed Elder’s counterclaim with prejudice.

On appeal, Elder contends that the evidence was insufficient to support the circuit court’s order granting specific performance. Specific performance is an equitable remedy that compels performance of a contract on the precise terms agreed upon by the parties. Dossey v. Hanover, Inc., 48 Ark.App. 108, 891 S.W.2d 67 (1995). We review equity cases de novo on the record but will not reverse a finding by the circuit court unless it is clearly erroneous. O’Fallon v. O’Fallon, 341 Ark. 138, 14 S.W.3d 506 (2000). Whether specific performance should be awarded in a particular case is a question of fact for the circuit court. Dossey, 48 Ark.App. at 110, 891 S.W.2d at 69. On appeal, the question before us is whether the court’s decision to grant specific performance was clearly erroneous. Id. In reviewing the circuit court’s findings of fact, we give due deference to the judge’s superior position to determine the credibility of witnesses and the weight to be accorded to their testimony. Jennings v. Burford, 60 Ark.App. 27, 33, 958 S.W.2d 12, 15 (1997).

To support its contention that the court’s grant of specific performance was in error, Elder argues that the contract between the parties was not severable, as the circuit court had found. The supreme court in Harris Lumber Co. v. Wheeler Lumber Co., 88 Ark. 491, 496, 115 S.W. 168, 170 (1908), held that “[w]here the price to be paid is clearly and distinctly apportioned to different parts of what is to be performed, although the whole is in its nature single and entire, the contract is severable.” In Hams the court reversed the trial court’s decision refusing to treat a contract for the sale of lumber as severa-ble. Although the parties entered into one contract in Harris for the shipment of eleven carloads of lumber, each car load was to be billed separately and the price for each load was paid sixty days after the load’s delivery.

The test for determining whether a contract is entire or severable is the intention of |sthe parties to the contract. Jones v. Gregg, 226 Ark. 595, 604-05, 293 S.W.2d 545, 550 (1956). This intention is to be ascertained from the language used, the subject matter of the contract, and the circumstances of the particular transaction. Id. at 605, 293 S.W.2d at 550. The court may also look at the singleness of apportionment of consideration, the divisibility of the subject matter, and the construction given to the contract by the parties themselves. Id.

As a general rule it may be said that a contract is entire when, by its terms, nature, and purpose, it contemplates that each and all of its parts are interdependent and common to one another and to the consideration, and that it is sever-able when, in its nature and purpose, it is susceptible of division and apportionment. Acts of the parties in treating the contract as entire or severable have an important bearing on its construction.

Id. (quoting 17 C.J.S. Contracts, § 331). Determining the intention of the parties is a question of fact, and we will affirm the circuit court’s finding on this issue unless it is clearly against the preponderance of the evidence. Ellison v. Tubb, 295 Ark.

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Bluebook (online)
370 S.W.3d 861, 2010 Ark. App. 10, 2010 Ark. App. LEXIS 2, Counsel Stack Legal Research, https://law.counselstack.com/opinion/elder-construction-co-v-ivey-lane-llc-kyctapp-2010.