Quigley v. Jones

334 S.E.2d 664, 255 Ga. 33, 1985 Ga. LEXIS 856

• Court: Supreme Court of Georgia
• Decided: October 1, 1985
• Docket: 42413
• Status: Published

Opinions

Marshall, Presiding Justice.

This case, Quigley v. Jones, 174 Ga. App. 787 (332 SE2d 7) (1985), is here on certiorari.

In this case, Quigley, as seller, is suing Jones, as purchaser, for breach of a real estate sales contract. It has long been the rule that the measure of damages for breach of a contract to sell land is the difference between the contract price and the fair market value of the land at the time of the breach. King v. Brice, 145 Ga. 65 (3) (88 SE 960) (1916); Brooks v. Miller, 103 Ga. 712 (3) (30 SE 630) (1898); Hood v. Hallman, 143 Ga. App. 507 (3) (239 SE2d 194) (1977); City Council of Augusta v. Mertins, 46 Ga. App. 711 (168 SE 924) (1933). The trial court granted a motion in limine filed by Jones, thereby restricting the evidence of damages to the difference between the contract price and fair market value at the time of breach.

On interlocutory appeal, the Court of Appeals affirmed. The Court of Appeals recognized the general rule that, “Damages recoverable for a breach of contract are such as arise naturally and according to the usual course of things from such breach and such as the parties contemplated, when the contract was made, as the probable result of its breach.” OCGA § 13-6-2; Crawford & Assoc, v. Groves-Keen, Inc., 127 Ga. App. 646, 650 (194 SE2d 499) (1972). See also OCGA § 13-6-8. The Court of Appeals also recognized the previously discussed special rule as to damages recoverable for breach of a contract to sell land. The Court of Appeals affirmed the superior court on the basis of a clause in the parties’ contract providing that the contract itself contained the entire agreement of the parties, and “ ‘[n]o representation, promise, or inducement not included in this Contract shall be binding upon any party hereto.’ ” Quigley v. Jones, supra, 174 Ga. App. at p. 787. We affirm the trial court’s ruling, but for a somewhat different reason than the Court of Appeals.

As recognized by the Court of Appeals, the foregoing contractual clause in effect incorporated the parol-evidence rule into the parties’ contract. See OCGA § 13-2-2 (1); Kelson Cos. v. Feingold, 168 Ga. App. 391, 393 (309 SE2d 394) (1983). We do not agree that the parol-evidence rule precludes the recovery of direct or consequential damage items not mentioned in the parties’ contract. We do agree, however, that under the rule regarding recovery of damages for breach of a real estate sales contract, there can be no recovery for the damage items sought here in the absence of a clause in the parties’ contract expressly authorizing such recovery.¹

Judgment affirmed.

All the Justices concur, except Hill, C. J., Smith and Bell, JJ., who dissent.

1 The contract here contained the following language: “Purchaser agrees that, in the event the sale is not closed because of purchaser’s inability, failure or refusal to perform any of purchaser’s covenants herein, the earnest money [$6,000] is to be applied by seller to seller’s damages, but receipt of such money by seller shall not prejudice or eliminate seller’s right to obtain specific performance and/or recover additional damages under this contract.”

We interpret this to mean that should seller be entitled to damages, as measured by the difference in contract price and fair market value at the time of breach, the earnest money shall be applied to those damages. Nor does the receipt of earnest money preclude recovery of additional damages. But this language does not take the next step and expressly authorize recovery of additional damages such as are sought in this case.