Franklin v. White
| Decision Date | 18 June 1985 |
| Docket Number | No. 4-1184A305,4-1184A305 |
| Citation | 479 N.E.2d 92 |
| Parties | Doyle R. FRANKLIN, Appellant (Defendant Below), v. Thomas L. WHITE and Susan White, Appellees (Plaintiffs Below). |
| Court | Indiana Appellate Court |
Gary J. Clendening, James L. Whitlatch, Bunger, Harrel & Robertson, Bloomington, for appellant.
Lewellyn H. Pratt, Bloomington, for appellees.
Defendant-Appellant Doyle R. Franklin (Franklin) appeals a judgment of the Monroe Superior Court awarding plaintiffs-appellees Thomas L. White and Susan White (Whites) $11,433.25 with interest and ordering Affirmed.
reconveyance of certain real estate to Franklin.
This appeal presents the following issues:
1. Whether the trial court erred by admitting evidence of Franklin's oral representation to the Whites the real estate they were purchasing was suitable for a septic system made just prior to their execution of a real estate contract to purchase a lot in Franklin's subdivision.
2. Whether the evidence was sufficient to show the real estate was not suitable for a septic system.
3. Whether the contract could be rescinded for mutual mistake of the parties as to its suitability for a septic system.
The Whites signed a contract to purchase an eight acre lot from Franklin in a subdivision he was developing near Ellotsville, Indiana. The Whites intended to build a home on the real estate they were purchasing. Just prior to signing the contract, Franklin told the Whites the lot was suitable for a septic system. The written contract was silent on that subject.
Later, the Whites applied to the Monroe County Plan Commission for a building permit. It was denied because the property was not certified as suitable for a septic tank system by the county health department. The Whites hired an engineering consulting firm. It conducted percolation tests on the real estate by drilling three holes, filling them with water, and determining how long it took the water to percolate into the soil from each hole. The real estate failed these tests because of lack of proper percolation, but a letter from the firm accompanying the tests said
It should be noted, however, that the location of the test holes was not necessarily the best location on the property for perk tests, and that a test at a better location might pass.
Franklin argues the trial court erred by admitting evidence of his oral representation to the Whites the lot they were purchasing was suitable for septic because (a) as a general proposition, admission thereof violated the parol evidence rule, and (b) specifically, its integration clause makes this contract a whole, complete unto itself, and parol evidence thus is inadmissible by agreement of the parties. We disagree with both assertions.
When two parties have made a contract and have expressed it in a writing to which they have both assented as the complete and accurate integration of that contract, evidence whether parol or otherwise, as to antecedent understandings and negotiations will not be admitted for the purpose of varying or contradicting the writing. Creech v. LaPorte Production Credit Ass'n. (1981), Ind.App., 419 N.E.2d 1008, 1010; Erie Corp. v. Washington Square Restaurant, Inc. (1974), 162 Ind.App. 149, 318 N.E.2d 367, 369; American United Life Ins. Co. v. Peffley (1973), 158 Ind.App. 29, 301 N.E.2d 651, 657; Clark Mutual Life Ins. Co. v. Lewis (1966), 139 Ind.App. 230, 217 N.E.2d 853, 856-857; Bandy v. Meyers (1966), 138 Ind.App. 202, 213 N.E.2d 344, 346; 13 Ind.Law Encycl. (Evidence) Sec. 181; Corbin on Contracts Sec. 573. The written contract here, however, made no reference at all to the real estate's suitability for the installation of a septic tank system. Because the extrinsic evidence regarding Franklin's representation on that subject does not vary or contradict the terms of the written contract, admission thereof into evidence did not violate the parol evidence rule.
The second prong of Franklin's argument, however, raises a more difficult question. The contract provides at paragraph XIV
It is mutually understood and agreed that all previous communications and negotiations between the parties hereto, either verbal or written, which are not herein contained, are hereby withdrawn and annulled or merged in this agreement. The parties have read and understood the whole of this agreement and now agree and state that no representation, promise or agreement not expressed in this contract has been made to induce either party to enter into it and there have been no representations of the reasonable value of the property herein described which have been made to or by either party of this agreement and that each party is relying upon his own judgment of such value after a personal inspection of the premises. The covenants and agreements therein contained and set forth shall extend to and be binding upon the parties hereto and their respective heirs, executors, administrators and assigns.
Franklin argues because the above-quoted language creates a fully integrated contract, all preliminary verbal negotiations and agreements by way of warranty attending the sale were merged into the final document signed by the parties. Thus, extrinsic evidence regarding prior oral representations is inadmissible, Franklin opines. He cites Lewis, supra; Brown v. Russell (1886), 105 Ind. 46, 4 N.E. 428; and 6 Ind.Law Encycl. (Contracts) Sec. 195 in support of this argument. However, the oral representations made in Lewis and Brown were at variance with the terms of their written contracts. Further, neither case deals with the effect of an integration clause in a written contract on the admissibility of a prior or contemporaneous oral representation. Further, we have found no case in this state dealing with that subject. Thus, the integration clause question is one of first impression in this state. The question is whether an integration clause in a written contract precludes the admission into evidence of a prior or contemporaneous oral representation when
(a) the written contract is silent as to the representation's subject matter, and
(b) such representation is otherwise admissible under the parol evidence rule.
If given full effect, the integration clause here at issue would prohibit the admission of Franklin's oral representation the lot was suitable for a septic system, evidence which is admissible otherwise under these facts.
Agreements tending to impede the regular administration of justice are void as...
To continue reading
Request your trial
-
Franklin v. White
...therefore inadequate grounds were shown for recision based on mutual mistake of the parties. The Court of Appeals, in Franklin v. White (1985), Ind.App., 479 N.E.2d 92, affirmed the judgment of the trial court but did so on additional grounds than those used by the trial court. The Court of......