Gee v. Payne

• Decision Date: 04 March 1997
• Docket Number: No. WD,WD
• Citation: 939 S.W.2d 383
• Parties: John and Malinda GEE, Appellants, v. John R. and Jean R. PAYNE, Respondents. 52332.
• Court: Missouri Court of Appeals

Page 383

939 S.W.2d 383

John and Malinda GEE, Appellants, v. John R. and Jean R. PAYNE, Respondents.

No. WD 52332.

Missouri Court of Appeals Western District.

March 4, 1997.

John E. Beetem, Jefferson City, for appellants.

William David Powell, Columbia, for respondents.

Before LOWENSTEIN, P.J., ULRICH, C.J. and LAURA DENVIR SMITH, J.

LOWENSTEIN, Judge.

This is an appeal from a judgment in favor of the sellers in a court-tried contract action for damages in the sale of real property where the sellers conveyed title to the buyers, but failed to provide timely water service and to extend a road to the property. The buyers, John and Malinda Gee ("the Gees"), allege error in 1) declaring the proper measure of damages at either the fair rental value of the residence plus interest for the period of delay in completion of the contract provisions or the reasonable cost of completing the terms of the contract, rather than the cost of providing water to the premises; 2) failing to award buyers' damages on the grounds that buyers failed to adduce any cognizable evidence of their damages in that there was uncontroverted evidence of sellers' breach of contract and buyers' damage; 3) failing to award specific performance for defendants' obligations to extend the roadway because a finding that the road, as extended, was of the same quality as the pre-existing road was against the weight of the evidence.

On May 16, 1994, the Gees entered into a contract to purchase unimproved rural land from respondents, John and Jean Payne ("the Paynes"), which required the Paynes to extend the district water line and a private road to a corner of the property. The contract indicated these additional terms were to be completed "in a timely manner at sellers' expense no later than 6/31/94." (The trial court interpreted 6/31/94 to mean "by the end of June" considering there is not a 31st day in the month of June.)

The Gees made full payment under the contract on the May closing date but the Paynes failed to extend the water line and the road by the end of June as promised. During the summer of 1994, the Gees made several unsuccessful attempts to contact the Paynes and, through investigation, discovered no action was underway to secure the extension of the waterline. In order to extend the waterline, an easement over the land of another had to be obtained. Ultimately the Gees elected to dig a well to provide water to the property. Mrs. Gee testified that her family had to take possession of the property and move from their former residence which had been sold, they were planning to build a new home on the property, and water was necessary to facilitate their building a home and to water livestock they relocated to this property. The water district line was finally extended to the property by sellers sometime in November of 1994.

The roadway was extended in late July or early August of 1994 but the Gees complain the extension was inferior to the pre-existing road in that the pavement was only one-half as thick. Mr. Gee testified that they were always able to access the property using the road, the only problem he noted was the road did not withstand bad weather as well as the pre-existing road.

The Gees filed suit seeking breach of contract damages for the failure to extend the waterline by the date specified in the contract and demanding specific performance or damages for the roadway. The trial court found in favor of the Paynes and the Gees filed this appeal.

In their first point on appeal, the Gees allege the trial court erred in finding the appropriate measure of damages for the water line was fair rental value or cost to complete rather than the cost of providing water by drilling a well. The Gees argue that they are entitled to the benefit of their bargain--water available on the property by the end of June. Once that date passed, and the sellers would not return phone calls, the Gees, having no reason to believe the Paynes would perform, drilled a well, watered their livestock, and continued with the construction of their home.

The trial court characterized the Paynes' failure to complete the terms of the contract by the end of June as "delayed performance" and found the proper measure of damages was either: 1) the fair rental value of the residence building for the period of delay and any costs incurred in obtaining an extension of loans made necessary by such delay with any additional interest paid on such loans by plaintiffs; or 2) a reasonable cost of completing the terms of the contract. The court deemed the Gees' decision to drill a well at a cost of $9,211.72 an unreasonable alternative to extension of the district water line. The court noted, if the proper measure of damages is cost to complete the contract, the contract could have been completed by much less expensive means than drilling a deep well. Ultimately, the court denied any recovery to the Gees stating they failed to present evidence of either the fair rental value or the reasonable cost to complete.

The standard of review of this court-tried case is enunciated in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). The trial court's judgment will be sustained unless there is no substantial evidence to support it, unless it is against the weight of the evidence or unless it erroneously declares or applies the law. The proper measure of damages is a question of law for determination by the trial court. Business Men's Assur. Co. v. Graham, 891 S.W.2d 438, 449 (Mo.App.1994). The particular facts and circumstances of each case dictate which measure of damages is appropriate. Kahn v. Prahl, 414 S.W.2d 269, 282 (Mo.1967); Business Men's Assur. Co., 891 S.W.2d at 450. As a general rule, in a breach of contract case, the goal in awarding damages is to put the non-breaching party in as good a position as he or she would have been in if the contract had been performed. Williams v. Hubbard, 789 S.W.2d 810, 812 (Mo.App.1990).

Before reaching the primary question of the measure of damages, this court must first recite a few additional procedural matters regarding the court and attorneys' handling of the measure of damages dispute. In Boten v. Brecklein, 452 S.W.2d 86 (Mo. banc 1970), the Missouri Supreme Court indicated that, "[i]f the attorneys disagree as to the elements of and proper measure of damages any questions raised should be settled by the court either at the instruction conference or by its rulings upon objections made during the course of the argument." Id. at 93. In the case at bar, the attorneys obviously disagreed as to the measure of damages but the court made no ruling to settle the dispute at trial, and so the disagreement continues on appeal. The record reveals that the Paynes' counsel objected to Mr. Gee's testimony as to the cost of installing the well, argued it was an inappropriate measure of damages, and referred the court to construction contract cases involving delayed performance on the part of a contractor. The court withheld a ruling on the proper measure of damages, took the objection with the case, and allowed Mr. Gee to testify to his out-of-pocket cost of drilling the well at $9,211.00. The Gees did not put on any additional or alternative evidence of damages, i.e. the reasonable cost of any method, other than a well, of bringing water to the property.

The proper measure of damages being the primary issue here, the sellers argue that the fair rental value during the delay is appropriate citing Christopher & Simpson A.I. & F., Co. v. E. A. Steininger C. Co., 200 Mo.App. 33, 205 S.W. 278 (1918) and Herbert & Brooner Construction Co. v. Golden, 499 S.W.2d 541 (Mo.App.1973). Both cases involve commercial contractors sued by commercial landowners over a delay in construction where prospective (Christopher & Simpson) and certain (Herbert & Brooner) tenants were unable to rent due to the delay. This court finds these cases are not persuasive here where unimproved property is sold for construction of a private residence and there is no contractor dispute. This is merely a case where the seller failed to complete contracted services to buyer under the contract of sale. Further, the uncontroverted evidence indicated the Gees needed water on...