Donavan v. Ivy Knoll Apartments Partnership, No. 06A04-8803-CV-99

• Docket Nº: No. 06A04-8803-CV-99
• Citation: 537 N.E.2d 47
• Case Date: April 26, 1989
• Court: Court of Appeals of Indiana

Page 47

537 N.E.2d 47 Christina DONAVAN, Martha Vanstone, Mary Males, Lucille
Manship, and Mary Males, As Trustee Under The Last
Will and Testament Of Paul K. Manship,
Deceased, d/b/a Paul-Lu Acres,
Appellants,
v.
IVY KNOLL APARTMENTS PARTNERSHIP, An Indiana Limited
Partnership, Appellee. No. 06A04-8803-CV-99. Court of Appeals of Indiana,
Fourth District. April 26, 1989.

Page 48

Jack N. Vanstone, Vanstone & Krochta, Evansville, for appellants.

Page 49

David B. Hughes, Indianapolis, Peter L. Obremskey, Parr Richey Obremskey & Morton, Lebanon, for appellee.

MILLER, Judge.

Christina Donovan, Martha VanStone, Mary Males, Lucille Manship, and Mary Males, as trustee under the will of Paul K. Manship, deceased. D/B/A Paul-Lu Acres (Sellers) appeal a judgment after a bench trial ordering them to specifically perform a purchase agreement to sell certain real estate in the Fishers. Indiana area to the Ivy Knoll Apartments Partnership (Buyer). We affirm.

Issues

I. Whether the trial court erred in finding time was not of the essence in the performance of the purchase agreement?

II. Whether the trial court erred in finding notice of Buyer's waiver of the zoning condition given to attorney, Doug Floyd, was notice to the Sellers of the zoning condition waiver?

III. Whether the trial court erred in finding the condition precedent of acquiring R-7 zoning was for the sole benefit of--and therefore could be unilaterally waived by--the buyers?

IV. Whether the trial court erred in finding Sellers had waived any benefit of the zoning condition precedent by failing to make a reasonable or good faith effort to cause the zoning conditions to be satisfied?

V. Whether specific performance was the appropriate remedy under the circumstances?

Facts

Ivy Knoll Apartments Partnership (Buyer), a limited partnership whose sole general partner is Thomas P. Murphy, entered into a Purchase Agreement in late November of 1985 with the defendants (Sellers) in this action who are the owners of certain real property in Fishers, Indiana. Ivy Knoll wishes to develop this property, which consists of approximately 57 acres, into apartment projects. This purchase agreement provided the price of the property at $10,000.00 per acre and contained various conditions precedent to closing the sale. These conditions included written assurance the real estate was not in a flood plain, approval of existing farming agreements, satisfactory feasibility studies by its engineers, annexation of the real estate to the Town of Fishers, ree-zoning of the real estate to the Town of Fisher's "R-7" category, and written assurance from the Town of Fishers as to sewer and water availability and cost.

The annexation and re-zoning was to be applied for immediately upon acceptance of the offer and accomplished within ninety (90) days from date of application. Douglas B. Floyd, an attorney specializing in metropolitan development, was hired to obtain the annexation and re-zoning. The Sellers and Ivy Knoll agreed to split the expenses of annexation and re-zoning. Floyd recommended any re-zoning for the property not be pursued immediately because of the generally unfavorable political climate regarding development in Fishers, the existence of undeveloped land in Fishers already zoned R-7, and because he was representing others in a substantial R-7 project located across the street from the property in question. Floyd chose to pursue a "planned development" or "PD" zoning category that would permit a mixture of commercial, light industrial, and multi-family uses. The Sellers have contended they had no knowledge until late in this saga Floyd intended to pursue PD zoning instead of R-7. They have contended PD zoning is unacceptable to them because they do not wish commercial or industrial uses to be developed on the land which will adjoin land they will continue to own.

Floyd did not promptly file or prosecute either the proposed annexation or the re-zoning petition. The ninety (90) day period in which the annexation and re-zoning conditions were to be satisfied elapsed. On March 27, 1986, the parties executed an Amendment to the Purchase Agreement which provided for an additional one-hundred twenty (120) days to achieve the annexation and re-zoning conditions.

On July 2, 1986, Floyd filed a petition for annexation to the Town of Fishers. The local paper described the proposed mixture

Page 50

of commercial, industrial, and multi-family uses. Males, one of the Sellers, telephoned Floyd to express displeasure with the mixed-use approach to re-zoning.

On or about July 7, 1986, a second Amendment to the Purchase Agreement was proposed to provide for additional time, until October 24, 1986, within which to satisfy the annexation and re-zoning conditions. Males stated the Sellers might not consent to the extension and that "the family" would meet to consider it. July 21, 1986, one day before the one-hundred twenty day extension expired, Murphy, of Ivy Knoll, telephoned Floyd and informed him that Ivy Knoll was waiving all remaining conditions and desired to proceed to closing. On July 25, 1986, Murphy called Males and reconfirmed to Males that Ivy Knoll had waived its remaining conditions and wanted to close the transaction. Males indicated to Murphy she was aware of Ivy Knoll's waiver of the conditions, and that "the family" would meet over the weekend to discuss the Purchase Agreement.

Ivy Knoll obtained a binder for title insurance and prepared a proposed draft of the land contract and sent a letter to the Sellers advising them it was ready, willing, and able to proceed with the closing. The Sellers met on or about August 7, 1986 and decided they would not close the transaction. The trial court found that this decision was "no doubt derived at least in part from the fact that Manship [one of the Sellers] had decided by February, 1986 that the Defendants had agreed to an inadequate purchase price for the Real Estate." On or about August 13, 1986, Sellers sent Ivy Knoll a letter which provided the following in pertinent part:

The owners of Paul-Lu Acres met last Saturday and decided not to accept your offer to purchase the property without any conditions.... Since the original purchase agreement has expired, I believe this terminates our relationship.

The sale has never closed. Ivy Knoll's $10,000.00 in earnest money is still being held in escrow. Ivy Knoll has expended approximately $9,100.00 in land planning and engineering expenses in connection with its proposed project.

Decision

I. Whether the trial court erred in finding time was not of

the essence in the performance of the purchase agreement?

Ivy Knoll filed a written request for findings by the court pursuant to Ind.Rules of Procedure, Trial Rule 52. When the trial court is required to make special findings because of the request of a party, the court's failure to find upon a material issue shall not be resolved by presumption and may be challenged as lacking, incomplete or inadequate in form or content. T.R. 52(B)(2) and (D). Our standard of review in this event is well settled. We may not affirm the trial court's judgment on any ground which the evidence supports but must determine if the specific findings are adequate to support the trial court's decision. Orkin Exterminating Co., Inc. v. Walters (1984). Ind.App., 466 N.E.2d 55 (trans. denied ).

However, the Sellers, appellants in this case, have not challenged any finding as lacking, incomplete or inadequate in any way, but, have challenged many findings as being erroneous. We will not reverse a trial court's judgment based on findings of fact and conclusions of law unless the findings or the conclusions drawn therefrom are clearly erroneous. Rose Acres Farms, Inc. v. Greemann Real Estate (1987), Ind.App., 516 N.E.2d 1095 (trans. denied ). A judgment is clearly erroneous when it is unsupported by the conclusions of law, and the conclusions of law are clearly erroneous when they are unsupported by the findings of fact. Findings of fact are clearly erroneous when the record lacks any facts or reasonable inferences to support them. Northwest Calf Farms, Inc. v. Poirier (1986), Ind.App., 499 N.E.2d 1165 (trans. denied )...