Deer Creek Const. Co., Inc. v. Peterson

• Decision Date: 17 March 1982
• Docket Number: No. 53049,53049
• Citation: 412 So.2d 1169
• Parties: DEER CREEK CONSTRUCTION COMPANY, INC. and William F. Brown v. Jewell B. PETERSON.
• Court: Mississippi Supreme Court

Page 1169

412 So.2d 1169

DEER CREEK CONSTRUCTION COMPANY, INC. and William F. Brown v. Jewell B. PETERSON.

No. 53049.

Supreme Court of Mississippi.

March 17, 1982.

Rehearing Denied May 5, 1982.

Guy Kenner Ellis, Jr., Nathan P. Adams, Jr., Greenville, for appellants.

Robertshaw & Merideth, H. L. Merideth, Jr., Greenville, for appellee.

Before SMITH, P. J., and WALKER and DAN M. LEE, JJ.

WALKER, Justice, for the Court.

This is an appeal from the Circuit Court of Washington County wherein the dispute arose out of the construction of a home by Deer Creek Construction Company, Inc. and William F. Brown for Mrs. Jewell B. Peterson.

The contract to construct the home was entered into on or about July 18, 1977. There was no date mentioned in the contract as to when the home would be completed. The final completion date was September 28, 1978 (except minor items that were later taken care of). Mrs. Peterson immediately rented the property for the sum of $300.00 per month and continued to rent the property up to and including May 25, 1979.

The parties stipulated that $300.00 per month was the fair and reasonable rental value of the property.

Thereafter, on September 28, 1979, Jewell B. Peterson filed suit in the Circuit Court of Washington County demanding punitive damages of $20,000.00 and compensatory damages of $12,300.00 including attorney's fees. The declaration was filed in two counts:

Count I-charging that defendants breached their contract by failing to complete the house within ninety days, resulting in a loss of rental of $5,100.00.

Count II-charging that the defendants fraudulently represented to Peterson that no interest would be charged until the house was completed that defendants knowingly and willfully demanded interest notwithstanding that defendants had willfully or through gross neglect failed to complete the house; that defendants failed to cancel the deed of trust and destroyed merchantability of the property; and, finally, that defendants committed a deceptive act as defined in Mississippi Code Annotated section 75-24-5 (Supp.1981).

The defendants answered denying plaintiff's allegations of wrongdoing and denied making any representation as to when the house would be completed. The defendants filed a counterclaim against Mrs. Peterson alleging that the construction price of the house was $34,300.00, together with interest on the construction price after ninety days at the rate of nine percent per annum; that this agreement was evidenced by a note and deed of trust executed by plaintiff; that Mrs. Peterson notified defendants she intended to rent the house and made an inspection of the house on September 28, 1978; that following said inspection, she accepted the house and paid defendants a partial payment of $33,100.00; that she rented the house on October 1, 1978, and continued to rent until the summer of 1979, and on September 26, 1979, sold the house for $45,100.00. The note and deed of trust were incorporated into the counterclaim and defendants demanded the balance due them under the note of $1,200.00 and interest of $4,223.75. Defendants also claimed reasonable attorney's fees under the provisions of Mississippi Code Annotated section 75-24-15(2) (Supp.1981). ¹

The jury returned separate verdicts. One was in favor of Mrs. Peterson against Brown and Deer Creek in the amount of $2,250.00. Mrs. Peterson filed a motion for an additur of $1,200.00 which was sustained by the court, and the judgment in favor of Peterson was increased to $3,450.00. This figure represented gross rentals of $300.00 per month (stipulated as reasonable rental) for the approximate period from October 16, 1977, (ninety days after the documents were signed by Peterson) until October 1, 1978, (when the house was rented) or a period of approximately eleven and one-half months. The other verdict was in favor of Deer Creek and Brown against Mrs. Peterson in the amount of $1,200.00.

The separate verdicts were based on Count I of plaintiff's declaration and on Deer Creek's counterclaim. The court had earlier directed a verdict in favor of Deer Creek against Mrs. Peterson as to Count II of Mrs. Peterson's declaration which was based on fraud. The parties stipulated that the court could take up the question of attorney's fees under section 75-24-15(2) without the assistance of a jury, but with the stipulation that Mrs. Peterson did not admit that this section of the Code was applicable to the facts of the case. The court heard evidence as to what would be reasonable attorney's fees and granted Brown and Deer Creek attorney's fees under the above section in the amount of $2,500.00.

A net judgment was entered by the court, after all offsets, in favor of Deer Creek and Brown against Peterson in the amount of $484.00.

The appellants assign the following as error:

The appellants contend that the court erred in considering the testimony of Mrs. Peterson, the effect of which was to alter or vary the terms of the note and deed of trust (by parol evidence.).

The deed of trust and note executed by Mrs. Peterson to Deer Creek and Brown were in the principal sum of $34,300.00 and provided "Note payable ninety days from date, with interest after maturity at 9% per annum until fully paid." The deed of trust and note by Mrs. Peterson were to secure Brown and Deer Creek during the construction period of the house.

Mrs. Peterson was allowed to testify, over the objections of Brown and Deer Creek who invoked the parol evidence rule, that Mr. Brown told her the house would be finished within ninety days and that no interest would be due on the note until such time as the house was finished. It is evident from this record that Mrs. Peterson was ready, willing and able to pay for the house upon its completion and that she did in fact pay the same, less $1,200.00 and interest allegedly due when the house was completed (except for a few minor items) on September 28, 1978.

The construction proposal of Brown, accepted by Mrs. Peterson, dealing with the specifications and price contains no provision with reference to time of completion. However, a note and deed of trust executed by Mrs. Peterson for the purpose of securing Deer Creek and Brown for the construction price provided "Note payable ninety days from date, with interest after maturity at 9% per annum until fully paid." These three instruments represent all of the written agreement with respect to the construction of this house. Therefore, they must be read together in order for us to determine whether there is an ambiguity as to when the house would be completed. Williams v. Batson, 186 Miss. 248, 187 So. 236 (1939); Wilson Industries, Inc. v. Newton County Bank, 245 So.2d 27 (Miss.1971). When a contract for the construction of a house contains no specific time in which the construction is to be completed, the general rule is that a reasonable period of time for construction is inferred. Smith v. Mavar, 198 Miss. 170, 21 So.2d 810 (1945); Boyd Construction Co. v. T. L. James & Co., Inc., 477 F.2d 34 (5th Cir. 1973).

However, where the contract is ambiguous or indefinite as to the construction period, then parol evidence is admissible for clarification. In the case sub judice, the proposal for building the home submitted by Deer Creek and Brown to Mrs. Peterson and accepted by her must be read together with the note and deed of trust which she executed to Deer Creek and Brown for the purpose of securing the construction price in order to determine the intent of the parties. When this is done, a clear ambiguity appears as to the length of time for construction because the proposal submitted by Deer Creek and Brown to Mrs. Peterson was silent as to when the construction would be completed. Yet, the note and deed of trust given to secure Deer Creek and Brown during the construction period clearly states that it was due and payable in ninety days. That provision in a deed of trust and note would not necessarily mean, in every instance, that the construction would be completed by that time. However, it reflects a strong probability in this case that such was the agreement. Therefore, it was not error for the trial court to allow parol evidence, i.e., Mrs. Peterson's testimony, that Brown told her that the house would be completed within ninety days, in order to shed light on the ambiguity. Clow Corp. v. J. D. Mullican, Inc., 356 So.2d 579 (Miss.1978). Brown testified that he did not make such a representation. The jury was properly allowed to resolve the question.

Appellants next contend that the court erred in granting Instruction No. P-4 to the plaintiff.

We have carefully considered this assignment of error and are of the opinion that when all of the instructions are read together that the jury was properly instructed as to the law.

We are of the opinion that the court did not err in not granting defendants' motion The appellants' further assign as error that...