Bonds v. Littrell, 5--5040

• Decision Date: 10 November 1969
• Docket Number: No. 5--5040,5--5040
• Citation: 247 Ark. 577,446 S.W.2d 672
• Parties: James A. BONDS, Appellant, v. Clint LITTRELL et al., Appellees.
• Court: Arkansas Supreme Court

Page 672

446 S.W.2d 672

247 Ark. 577

James A. BONDS, Appellant, v. Clint LITTRELL et al., Appellees.

No. 5--5040.

Supreme Court of Arkansas.

Nov. 10, 1969.

Putman, Davis & Bassett, Fayetteville, for appellant.

W. Q. Hall, Huntsville, for appellees.

GEORGE ROSE SMITH, Justice.

On June 13, 1967, the appellant Bonds signed an offer-and-acceptance contract by which he agreed to buy a farm from the appellees Littrell for $50,000, payable as follows: $5,000 earnest money upon the signing of the contract; $20,000 upon approval of the title; and $25,000 in ten equal annual installments. With the execution of the contract Bonds deposited his $5,000 earnest-money check with the sellers' real estate agent, the appellee Carr.

Before the title had been approved Bonds stopped payment on the $5,000 check. The Littrells and Carr then brought this action upon the contract and check, asserting that under the contract they were entitled to retain the earnest money as liquidated damages. This appeal is from a summary judgment in their favor. For reversal Bonds contends that the motion for summary judgment should have been denied, because there were two issues of fact for the jury: One, the purchase was contingent upon the defendant's obtaining the purchase money from Houston Milk Producers Credit Union; and, two, the contractual provision for a forfeiture of the earnest money was actually a stipulation for a penalty rather than for liquidated damages.

Upon the first point the trial court held that the parol evidence rule would eventually prevent Bonds from proving a collateral oral agreement by which the purchase was contingent upon his ability to obtain financing. We hold that the court's ruling was reversible error.

At the outset the appellees insist that Bonds cannot rely upon the asserted collateral agreement, because he failed to plead that defense in his answer. It is true that Bonds' answer to the complaint was merely a general denial, plus special pleas not now relevant. But in response to the plaintiffs' requests for admissions of fact Bonds made this statement under oath: 'Defendant admits that a written memorandum of said agreement was made and that a copy is attached to the complaint * * *. Defendant states, however, that said agreement was contingent upon the defendant's obtaining the purchase money from the Houston Milk Producers Credit Union.' In the face of that assertion, and without rebutting it, the plaintiffs filed their motion for summary judgment.

Ever since the adoption of our Civil Code a century ago it has been a basic and wholesome rule in civil cases that amendments to the pleadings are to be liberally allowed in furtherance of justice, that the court must disregard any defect not affecting the substantial rights of the adverse party, and that no variance between the pleadings and the proof is material unless it has actually misled the adverse party to his prejudice. Ark.Stat.Ann. §§ 27--1155 and --1160 (Repl.1962). In harmony with those principles we have held that the trial court may permit the pleadings to be amended after the filing of a motion for summary judgment. Montgomery v. First Nat. Bank of Newport, 242 Ark. 329, 414 S.W.2d 109 (1967).

Under the Federal Rules of Civil Procedure, from which our summary judgment statute (§ 29--211) was copied, the better view is that affirmative defenses may, at least in some situations, be raised by affidavit as well as by answer. We agree with Moore's statement of the two views: 'There is authority that defenses not pleaded in defendant's answer may not be raised by affidavits on his motion for summary judgment. This is highly technical and illiberal. Either the answer should be deemed...