LaGrave v. Jones

• Decision Date: 20 August 1976
• Citation: 336 So.2d 1330
• Parties: Carlos LaGRAVE and Catherine W. LaGrave v. George JONES and Richard Grogan. SC 1667.
• Court: Alabama Supreme Court

Page 1330

336 So.2d 1330

Carlos LaGRAVE and Catherine W. LaGrave v. George JONES and Richard Grogan.

SC 1667.

Supreme Court of Alabama.

Aug. 20, 1976.

Vincent F. Kilborn, Mobile, for appellants.

Tonsmeire, McFadden & Riley and J. H. Fernandez, Mobile, for appellees.

SHORES, Justice.

In May, 1975, the LaGraves (hereinafter sellers) executed an instrument and delivered the same to Jones and Grogan (hereinafter buyers), which provided:

'. . . I hereby grant to you (buyers) the option to purchase that certain real property situated in the City and County of Mobile, Alabama described as Lot(s) 5 and 6, Block 4, of Pinehurst Subdivision . . .

'This purchase agreement is granted on the following terms and conditions:

'1. The agreement to purchase the said property shall expire at mindnight on the 10th day of July, 1975, unless prior to such expiration time you have exercised the said agreement as hereinafter provided.

'2. This agreement is subject to purchaser being able to secure the zoning classification change for subject property to provide the erection of an office building whose purpose it is to conduct Insurance business.

'3. The purchase price shall be ELEVEN THOUSAND FIVE HUNDRED AND NO/100 ($11,500.00) DOLLARS at closing.

'If the zoning of the aforementioned property is not accomplished during the option period, then the option monies shall be refunded. If the zoning is accomplished, a warranty deed will be issued and the option monies will apply to the purchase price and the down payment at closing.'

On May 5, 1975, the buyers applied to the Board of Adjustment of the City of Mobile for a use variance 'To erect oa one story office building of approx 1000 to 1200 sq ft to be used as an insurance office.' At the time of the option, the lots were zoned R--1, Residential.

On June 2, 1975, the Board of Adjustment denied the application for a use variance and notified the buyers of that fact on June 3rd. The buyers appealed the denial of the use variance and notified the sellers on June 9th that they were thereby exercising the option to purchase the lots. By letter of July 10th, the buyers again notified the sellers that the option was being exercised and that the buyers were willing to accept the property under the existing zoning classification, 'since they have taken a formal appeal from the adverse decision rendered by the Board of Adjustment.'

The sellers refused to convey the property and returned the $1,000 down payment to the buyers on July 10th, the last day for exercising the option. The buyers refused the refund and brought this suit for specific performance.

The buyers filed motion for summary judgment based on the pleading. The sellers filed a motion for summary judgment supported by an affidavit, which was countered by the buyers by affidavit. The trial court granted summary judgment in favor of the buyers and the sellers appealed.

The sellers' affidavit asserted that '. . . The change in zoning classification mentioned in Paragraph 2 of the agreement if accomplished by the (buyers) would have permitted commercial usage, to-wit, an insurance office building and would have materially benefited me, as it would have changed the character of the area from residential to commercial and would have made it easier for me to commercially develop my nearby property. This benefit to me in changing the zoning of Lots 5 and 6 was one of the inducements in the signing of the agreement by myself and my wife.'

The buyers' counter-affidavit stated in part:

'. . . Prior to May, 1975, we had negotiated with Mr. Carlos LaGrave . . . to purchase lots five and six of the Pinehurst Subdivision. During these nogotiations we were aware that the (sellers) owned other nearby lots, in fact, the defendant Carlos LaGrave told us he had sold some nearby property to a dentist who wanted to build an office in the area. Nothing was said by either of the defendants before, during, or at the time of their presentation to us of the option to purchase which is the subject matter of this suit to indicate that the defendants were at all interested in the zoning variance being obtained. At all times it was our understanding that the clause allowing the return of the option monies in the event a variance wasn't obtained and making the option subject to obtaining such a variance was for our exclusive benefit because we would have no use for the property if we could not construct thereon an insurance office. In fact, Richard Grogan specifically requested of defendant Carlos LaGrave that such a clause be included in the option. When the initial request for a variance was denied, we decided to exercise the option and purchase the property hoping to secure such a variance in the future. We are presently attempting to secure such a variance.'

The sellers concede that if the condition for securing a zoning variance was for the exclusive benefit of the buyers, then they have the right to waive such a condition, and, of course, that is true.

'While a party to a contract may not waive stipulations in favor of the other party, or rights to which the other party is entitled, he may waive contractual provisions for his benefit. . . .' 17A C.J.S. Contracts § 491.

But, the sellers contend that the condition was for the benefit of both the buyers and the sellers, which assertion they make in their affidavit. This, they say, presents a genuine issue of a material fact, making the ruling of the trial court in granting the buyers' motion for summary judgment erroneous.

Whether such conditions are for the benefit of the buyer, or the seller, or both, must be determined under the facts and circumstances of each case and, of course, by the language of the agreement entered into between them.

We think it is clear from the language of the agreement and the undisputed facts presented by the respective affidavits that this provision was inserted in the contract for the benefit of the buyers. The Supreme Court of Pennsylvania, presented with an argument similar to that advanced by the sellers here, i.e., that the provision was intended for the mutual benefit of the parties, said in Funke v. Paist, 356 Pa. 594, 52 A.2d 655, 656 (1947):

". . . it seems clear that the contingency clause was included in the agreement of sale solely at the suggestion and for the benefit and protection of the plaintiff (buyer) . . . It was only natural that he did not desire to bind himself to purchase a property of which he could make no use. On the other hand, it is difficult...