Gilbert Const. Co. v. Gross

• Citation: 212 Md. 402,129 A.2d 518
• Decision Date: 01 March 1957
• Docket Number: No. 73,73
• Parties: The GILBERT CONSTRUCTION COMPANY, Inc. v. William A. GROSS et al.
• Court: Court of Appeals of Maryland

Page 402

212 Md. 402

129 A.2d 518

The GILBERT CONSTRUCTION COMPANY, Inc. v. William A. GROSS et al.

No. 73.

Court of Appeals of Maryland.

March 1, 1957.

Daniel B. Leonard, Baltimore (Bowie, Burke & Leonard, Baltimore, and G. Howlett Cobourn, Belair, on the brief), for appellant.

Frank H. Newell, III, Towson, and Harry E. Dyer, Jr., Belair (James C. L. Anderson, Towson, on the brief), for appellees.

Before BRUNE, C. J., and COLLINS, HENDERSON, HAMMOND and PRESCOTT, JJ.

BRUNE, Chief Judge.

This case arises from the fact that ductless furnaces installed in newly constructed suburban houses sold by the defendant (appellant) and purchased by the plaintiffs (appellees) were ill-adapted or inadequate for the purpose of heating these houses. The plaintiffs (sometimes referred to below as the 'Purchasers') brought suit for breach of contract and recovered judgment for $8,000 apportioned at the rate of $250 per plaintiff, or $500 per house, since there were two purchasers of each house (a husband and wife in each instance).

The defendant (sometimes referred to below as the 'Developer') entered into contracts for the sale of these houses to the plaintiffs between the dates of May 6, 1949 and March 21, 1950; and settlements were effected between December 1, 1949 and June 28, 1950. Protests with regard to the heating units seem to have been made with reasonable promptness after the various Purchasers took possession of their houses and discovered that the heating units did not operate satisfactorily in their homes, though suit was not filed until September 24, 1952.

A demurrer to the original declaration was sustained, and a demurrer to the amended declaration was overruled by the Circuit Court for Baltimore County. At the defendant's instance the case was later removed to Harford County for trial.

The contracts of sale were all in the same general form. Each provided for the sale of the leasehold interest under a 99-year lease (subject to an annual ground rent, to be created, of $75.00 to $81.00) in a then unimproved lot, which was to be improved by an asbestos shingle bungalow in accordance with plans and specifications attached to the contract. Most of the purchase price was to be paid out of the proceeds of a F.H.A. mortgage loan, the contract was to be void and the Purchasers' deposit returned if such a mortgage could not be obtained within forty-five days from the date of execution of the contract, and settlement was to be made within six months after the same date.

The specifications referred to in each contract were on a 4-page F.H.A. form. This form contained the following paragraph:

General.--'The construction shall equal or exceed the applicable F.H.A. Minimum Construction Requirements and shall comply with applicable codes and regulations, zoning ordinances, restrictive covenants, and the exhibits submitted with the related application, as corrected by F.H.A. The highest of all the aforegoing shall govern. Each item of material or equipment shall equal or exceed that described or indicated. All parts shall be sound and all construction free of faults. All work shall be performed in a workmanlike manner, and in accordance with the best practice. For final acceptance, all buildings shall be complete and ready for occupancy, with all equipment installed, connected, and in operating condition and all utility connections completed.'

The specifications also called for the installation of the exact make and type of pipeless furnace which was actually installed, and the plaintiffs' answer to the defendant's demand for a bill of particulars admitted as much. The concluding statement in this answer was: 'That the Plaintiffs relied upon the Defendant under the expressed warranty contained in the contract that the heating plants referred to would be properly installed as to location and that said heating plants would be sufficient to safely heat the properties in question.'

The contract, which includes the specifications, does place an obligation on the seller to install the heating unit properly, but it does not contain any express warranty of the sufficiency of that unit to heat the house safely. The plaintiffs asserted an oral warranty to that effect, alleged to have been given by an agent of the developer. However, the alleged oral warranty was said to have been given prior to the execution of the contract. Each contract not only does not contain any such warranty, but does contain a specific provision as to just what heating units were to be installed. It also contains an integration clause reading as follows: 'This Contract contains the final and entire Agreement between the parties hereto, and neither they nor their Agents shall be bound by any terms, conditions or representations not herein written * * *.' The alleged oral warranty falls squarely within the parol evidence rule, and no exception which might take it out of the operation of the rule is suggested. Accordingly, it cannot be given effect. See Brummel v. Clifton Realty Co., Inc., 146 Md. 56, 125 A. 905; Markoff v. Kreiner, 180 Md. 150, 23 A.2d 19; Trotter v. Lewis, 185 Md. 528, 45 A.2d 329; Kiser v. Eberly, 200 Md. 242, 88 A.2d 570.

Not only is there no express warranty, but in sales of real estate the rule is that there is no implied warranty. 4 Williston, Contracts, Rev.Ed., Sec. 926; Berger v. Burkoff, 200 Md. 561, 92 A.2d 376, 379. In the Berger case this Court rejected a contention that 'there was an implied warranty, not expressed, to furnish a structurally satisfactory house.' See also Milkton v. French, 159 Md. 126, 150 A. 28. Cf. Levin v. Cook, 186 Md. 535, 47 A.2d 505, where there was an express covenant that the heating system was in good condition.

There was thus no express warranty and no implied warranty. The Purchasers have not appealed from, and so far as appears, they did not even except to, an instruction included in the trial court's charge to the jury that 'the defendant, having made no warranty as to the satisfactory performance of the heating units * * * is not responsible for any failure of said heating units to operate satisfactorily and that the defendant's only obligation was to install said heating units in a good and workmanlike manner.'

Notwithstanding the absence of a warranty, the gravamen of the Purchasers' complaint, as the Developer points out, still is that a pipeless furnace should not have been put in houses of the design here involved. The testimony strongly supports the contention that this heating equipment was unsuitable for these houses. It also shows the difficulties and dangers of injury resulting from the use of this equipment, particularly because of the presence of hot grilles in the narrow hallways of these houses where the Purchasers and members of their households, including children, were compelled to cross them and where some sustained burns as the result of falls on the grilles. In the absence, however, of any warranty, the unsuitability alone of these so-called floor furnaces is not sufficient to fasten liability on the Developer.

Questions remain as to whether or not these heating units were installed in a workmanlike manner, as to whether the Purchasers can enforce claims against the Developer if they were not, and as to the measure of damages.

The Developer contends that by the acceptance of deeds to their respective properties the Purchasers are barred from maintaining any action based upon alleged non-compliance with the terms of the contracts of sale. Although the general rule is that the acceptance of a deed conveying real estate gives rise to a prima facie presumption that it is an execution of the entire contract of sale and that the rights of the parties are to be determined by the deed, the acceptance of a deed does not effect a merger of collateral agreements where it appears that the deed is only a partial...