Zukel v. Great West Managers, LLC

78 P.3d 480, 31 Kan. App. 2d 1098, 2003 Kan. App. LEXIS 920
CourtCourt of Appeals of Kansas
DecidedOctober 24, 2003
Docket90,310
StatusPublished
Cited by16 cases

This text of 78 P.3d 480 (Zukel v. Great West Managers, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals of Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Zukel v. Great West Managers, LLC, 78 P.3d 480, 31 Kan. App. 2d 1098, 2003 Kan. App. LEXIS 920 (kanctapp 2003).

Opinions

Greene, J.:

Robert and Darlene Zukel brought this action against both a limited liability company, Great West Managers, LLC (GWM) and its managing member Jerry Avery to enforce a contract to purchase the Zukels’ business. After default judgment was taken against GWM, the district court conducted a bench trial and held that Avery was not liable because he executed the purchase contract solely in his representative capacity for GWM and that the statute of frauds, K.S.A. 33-106, barred enforcement. We reverse the district court and find that, based on the particular facts of this case, Avery should be held individually liable.

Factual and Procedural Overview

After negotiations among the parties, Robert and Darlene Zukel, together with their corporation, Mid-America Ham Sales, Inc., entered into a contract on April 25, 1998, to sell their store “Heavenly Ham” in Overland Park to GWM, a limited liability company formed by Avery and Leslie Snell. The purchase contract required an early cash payment, followed by regular scheduled payments over 5 years by GWM to the Zukels.

The purchase contract contained the following provision: “14. The members of [GWM], hereby personally guarantee the fulfillment of this agreement to purchase the business.” An addendum to the purchase contract provided: “15. Members as indicated in paragraph 14 above, as of the closing date, shall be Les Snell and Jerry Avery.” Both the contract and the addendum were executed on behalf of sellers by Robert J. Zukel, as president of Mid-America Ham Sales, Inc., and Robert J. Zukel and Darlene M. Zukel, shareholders and “individuals”; both instruments were executed on behalf of buyer by Jerry Avery, and below his signature was stated: “Great West Managers, 11c, By Jerry Avery, Managing Member.”

After 3 years, GWM defaulted under its obligations pursuant to the purchase agreement, and the Zukels brought this action against GWM, Avery, and Snell for breach of contract. Snell was never [1100]*1100served, and default judgment was entered against GWM. Avery denied individual liability under the purchase contract, asserting affirmative defenses including the statute of frauds. After denying the Zukels’ motion for summary judgment against Avery, the district court conducted a bench trial in the matter.

The district court announced its findings of fact and conclusions of law from the bench and incorporated them into its journal entry of judgment. In these findings and conclusions, the court analyzed the case under the statute of frauds and then addressed the “element of intent.” The findings and conclusions included the following:

“The first question the Court must analyze is whether there is (1), a writing that (2), is signed by the party to be charged, Jerry Avery, promising to pay the debt of [GWM] to Zukel. The Court does not have before it any writing signed by Jerry Avery in his individual capacity promising to pay the debt of [GWM] to Zukel.
“The Court finds that (1), there is in fact a writing . . . and (2), it is signed by Jerry Avery as managing member of [GWM], The issue then arises as to whether or not Jerry Avery as managing member of [GWM] has authority. In other words, does [GWM] have authority to bind its members and is that authority in writing.
“The testimony of Jerry Avery is that there is no such authorization given to the limited liability company to bind its members. The Court finds it has no evidence in the record to support the fourth element of K.S.A. 33-106, that being lawful authority in writing. There is no evidence in the record to support such a finding.
“Therefore, tire Plaintiffs have not met their burden of proof or burden of producing evidence on dais element. The Court is now going to address the element of intent.
“It is generally held that where it is uncertain on tire face of an instrument whether such instrument was intended to bind a person in his individual or in his representative capacity, parol evidence is admissible to explain the latent ambiguity and to aid in tire interpretation of the instrument.
“On that basis that the Court has allowed tire parol evidence. The Court was hopeful that the testimony would clarify what was meant by the parties.
“The Court finds that intent cannot be clearly ascertained. The Plaintiffs have the burden of proof. They have not met their burden of proof. Secondly, this matter is for lack of a better term trumped by tire statute of frauds. It says re[1101]*1101gardless of what you agree to orally, your agreement has to be in writing and signed by the party to be charged. I do not find those two elements present.”

Standard of Review

On appeal, a written instrument or contract may be construed and its legal effect determined by the appellate court regardless of the construction made by the trial court. Dougan v. Rossville Drainage Dist., 270 Kan. 468, 486, 15 P.3d 338 (2000). Whether a written instrument is ambiguous is also a matter of law subject to de novo review. Investcorp, L.P. v. Simpson Investment Co., L.C., 267 Kan. 840, 847, 983 P.2d 265 (1999). To the extent that this appeal requires the construction and application of the statute of frauds, our review is unlimited. See Williamson v. City of Hays, 275 Kan. 300, 305, 64 P.3d 364 (2003). To the extent that this appeal may turn on disputed facts, our function is to determine whether the district court’s findings are supported by substantial competent evidence and whether the findings are sufficient to support the trial court’s conclusions of law. Unrau v. Kidron Bethel Retirement Services, Inc., 271 Kan. 743, 747, 27 P.3d 1 (2001).

The District Court Erred in Concluding that the Purchase Agreement was Ambiguous

If the language of a written instrument is clear and can be carried out as written, there is no room for rules of construction. KPERS v. Russell, 269 Kan. 228, 236, 5 P.3d 525 (2000). Where contract terms are plain and unambiguous, the intention of the parties and the meaning of the contract are determined from the contract itself. Gray v. Manhattan Med. Center, Inc., 28 Kan. App. 2d 572, 580, 18 P.3d 291 (2001).

The district court concluded that an ambiguity was created by the apparent inconsistency between the language of the contract and the form of execution. We disagree. First, we observe that the language of paragraph 14 of the contract is clear and not subject to alternative interpretation: “The members of [GWM] hereby personally guarantee the fulfillment of this agreement . . . .” Unless the language of a contract may be understood to reach two or more possible meanings, it is unambiguous. See

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Zukel v. Great West Managers, LLC
78 P.3d 480 (Court of Appeals of Kansas, 2003)

Cite This Page — Counsel Stack

Bluebook (online)
78 P.3d 480, 31 Kan. App. 2d 1098, 2003 Kan. App. LEXIS 920, Counsel Stack Legal Research, https://law.counselstack.com/opinion/zukel-v-great-west-managers-llc-kanctapp-2003.