Capwin 19, LLC v. Zingg, No. 2007AP950 (Wis. App. 12/13/2007)
| Decision Date | 13 December 2007 |
| Docket Number | No. 2007AP950.,No. 2007AP955.,2007AP950.,2007AP955. |
| Parties | Capwin 19, LLC, Plaintiff-Appellant, v. Michael G. Zingg and Parsons Investments LLC, Defendants-Respondents. |
| Court | Wisconsin Court of Appeals |
APPEAL from an order of the circuit court for Dane County: MARYANN SUMI, Judge. Reversed and cause remanded with directions.
Before Dykman, Vergeront and Bridge, JJ.
¶ 1
Capwin 19, LLC, appeals from an order granting summary judgment to Michael Zingg and Parsons Investments, LLC in Capwin's action against Zingg and Parsons for breach of contract. Capwin contends that the trial court erroneously granted summary judgment to Zingg and Parsons based on their affirmative defense that Capwin anticipatorily breached the contract for the sale of land from Capwin to Parsons prior to the closing date. Capwin argues that summary judgment was inappropriate because there were disputed issues of material fact as to (1) the parties' intent as to contested provisions in the contract; (2) whether Capwin clearly expressed to Parsons that it would not close under the contract absent its proposed contract modifications; and (3) whether Parsons breached its duty to use diligent efforts to bring the transaction to a timely closing. Capwin argues alternatively that it is entitled to summary judgment on these issues based on the undisputed facts in the record. We conclude that the record reveals that there are alternative reasonable inferences to be drawn from undisputed facts, preventing summary judgment. We therefore reverse and remand for trial.
¶ 2 The following facts are undisputed. In July 2004, Zingg (and/or assigns) offered to purchase six acres of land from Capwin. Capwin accepted the offer. The accepted offer set the closing date as November 30, 2004, at a title company in Dane County, "unless another date or place is agreed to in writing." An amendment to the contract states: "This agreement constitutes the entire agreement between the parties and no modification shall be binding unless in writing and signed by all parties." Over the next year, the contract was amended in writing multiple times, and a final closing date was ultimately set for May 13, 2005. Zingg assigned his buyer's interest to Parsons in April 2005.
¶ 3 During the week before the scheduled May 13 closing, counsel for Parsons (James Smith) and counsel for Capwin (A.J. Griffin III) engaged in discussions about a Closing Agreement and a Tripartite Agreement for the parties to sign at closing. The discussions included negotiations over the terms to include in the agreements concerning storm water management and whether Parsons would indemnify Capwin from the Village of DeForest's claim for Capwin's obligations to the Village, if the Village did not agree to release Capwin from its obligations by joining the Tripartite Agreement.1 Smith and Griffin failed to reach an agreement as to the terms to include in the two documents. Capwin appeared at the scheduled closing and Parsons did not.2
¶ 4 Capwin sued Parsons and Zingg for breach of contract. Both defendants denied liability and each moved for summary judgment, arguing that Capwin had anticipatorily breached the contract by demanding terms inconsistent with their contract as a condition of closing. Zingg also denied liability by virtue of his assignment to Parsons and an unfulfilled lease contingency in his original offer to purchase. Capwin opposed summary judgment as to both defendants, arguing that there were either disputed issues of material fact that precluded summary judgment or that the undisputed facts required the court to grant summary judgment for Capwin sua sponte under WIS. STAT. § 802.08(6) (2005-06).3
¶ 5 The trial court concluded that the defendants were entitled to summary judgment because the undisputed facts in the record established that Capwin had anticipatorily breached the contract prior to closing by unequivocally demonstrating that it was unwilling to close absent Parsons' consent to its proposed contract modifications. Capwin appeals.
¶ 6 Summary judgment is only appropriate where there are no genuine issues as to any material facts and the moving party is entitled to judgment as a matter of law. Driver v. Driver, 119 Wis. 2d 65, 69, 349 N.W.2d 97 (Ct. App. 1984). We follow the same methodology as the trial court, which is well established:
The court must initially examine the pleadings to determine whether a claim has been stated and whether a material issue of fact is presented. If the complaint states a claim and the pleadings show the existence of factual issues, the court examines the moving party's affidavits or other proof to determine whether the moving party has made a prima facie case for summary judgment under sec. 802.08(2). If the moving party has made a prima facie case for summary judgment, the court must examine the affidavits and other proof of the opposing party to determine whether there exist[] disputed material facts, or undisputed material facts from which reasonable alternative inferences may be drawn, sufficient to entitle the opposing party to a trial.
Id. (citation omitted).
¶ 7 On a summary judgment motion, a court does not decide issues of fact. Fortier v. Flambeau Plastics Co., 164 Wis. 2d 639, 665, 476 N.W.2d 593 (Ct. App. 1991). Thus, "[t]he court does not decide issues of credibility, weigh the evidence, or choose between differing but reasonable inferences from the undisputed facts." Id.
¶ 8 "It is a well-settled principle of law that a repudiation of the terms of a contract, and demand for performance substantially different from that provided for in such contract, constitutes an anticipatory breach which entitles the other contracting party to rescind." Morn v. Schalk, 14 Wis. 2d 307, 316, 111 N.W.2d 80 (1961). However, "[i]n order to constitute an anticipatory breach of a contract based upon a request for a modification of terms, such request must be coupled with an absolute refusal to perform unless such request is granted." Stolper Steel Prods. Corp. v. Behrens Mfg. Co., 10 Wis. 2d 478, 488-89, 103 N.W.2d 683 (1960). Thus, to justify a party's right to rescind a contract based on the other party's anticipatory breach, the breaching party's "refusal to perform must be distinct, unequivocal, and absolute." Id. at 490 (citation omitted). A request that is not accompanied by a threat of nonperformance if not granted does not amount to an anticipatory breach. See id. at 488-89.
¶ 9 Parsons4 argues that Capwin anticipatorily breached the contract because it demanded that Parsons sign the Closing Agreement and Tripartite Agreement in order to close as scheduled, and that both documents contained terms modifying the parties' contract. Capwin responds that the record establishes that it only proposed the Closing and Tripartite Agreements and did not demand either as a condition of closing, and that extrinsic evidence establishes that both agreements memorialized the intent of the parties under the contract rather than introducing new obligations. Thus, to sustain the court's ruling on summary judgment in favor of Parsons and Zingg on grounds that Capwin anticipatorily breached the contract, the record must establish both that Capwin's proposed terms sought to modify the contract and that Capwin manifested its intent not to close absent Parsons' consent to those agreements.
¶ 10 We first address Capwin's argument that the parties' contract was ambiguous, and that the court improperly construed the parties' intent under the contract on summary judgment. The disputed provision states as follows: "Buyer will be responsible for and pay for all storm water detention improvements on its site and any related storm water costs west of its site." The parties dispute whether this provision obligated Parsons to accommodate post-development storm water runoff from the lots east of Parsons' site. Capwin argues that the provision clearly obligates Parsons to do so, and if not, the provision is ambiguous and requires a factual determination of the parties' intent. Parsons argues that Capwin has only advanced an argument that the contract is indefinite (and therefore unenforceable) rather than ambiguous, under Management Computer Services, Inc. v. Hawkins, Ash, Baptie & Co., 206 Wis. 2d 158, 178, 557 N.W.2d 67 (1996). Parsons contends that if enforceable, the contract is unambiguous, and does not impose on Parsons the obligation to accommodate storm water runoff from the lots to the east. Finally, Parsons contends that any ambiguity in the contract must be construed against Capwin because Capwin drafted the contract, citing Converting/Biophile Laboratories, Inc. v. Ludlow Composites Corp., 2006 WI App 187, ¶23, 296 Wis. 2d 273, 722 N.W.2d 633.
¶ 11 Parsons' first argument, that Capwin's ambiguity argument establishes indefiniteness rather than ambiguity, is unavailing. Parsons does not develop this argument further than to say that Capwin's argument that "the language paints with a broad brush" does not establish ambiguity, and that Capwin confuses ambiguity with indefiniteness.5 Because neither party has developed an argument that the contract is unenforceable based on indefiniteness, we decline to address this issue further. See State v. Pettit, 171 Wis. 2d 627, 646, 492 N.W.2d 633 (Ct. App. 1992). Rather, we will address whether the contract is ambiguous and whether the court properly construed the contract on summary judgment.
¶ 12 "A contract provision is ambiguous if it is fairly susceptible of more than one construction." Management Computer Servs., Inc. 206 Wis. 2d at 177. "Whether a contract is ambiguous is ... a question of law which an appellate court decides independently of the trial court's decision." Energy Complexes, Inc. v. Eau Claire County, 152 Wis. 2d 453, 467, 449 N.W.2d 35 (1989) (citation omitted). Here, the disputed provision states that Parsons "will...
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