Lewis v. Roper, 4749

• Decision Date: 26 May 1978
• Docket Number: No. 4749,4749
• Citation: 579 P.2d 434
• Parties: Charles F. LEWIS and Winifred Jane Lewis, husband and wife, Appellants (Defendants below), v. Nathaniel J. ROPER and Sabrina Roper, husband and wife, Appellees (Plaintiffs below).
• Court: Wyoming Supreme Court

Page 434

579 P.2d 434

Charles F. LEWIS and Winifred Jane Lewis, husband and wife, Appellants (Defendants below), v. Nathaniel J. ROPER and Sabrina Roper, husband and wife, Appellees (Plaintiffs below).

No. 4749.

Supreme Court of Wyoming.

May 26, 1978.

Donald E. Jones, of Jones & Rogers, Torrington, for appellants.

Bob C. Sigler and Dan J. Pauli, Torrington, for appellees.

Before GUTHRIE, C. J., and McCLINTOCK, RAPER, THOMAS, and ROSE, JJ.

GUTHRIE, Chief Justice.

This is an appeal by Charles F. Lewis and Winifred Jane Lewis, husband and wife, defendants below, from a judgment rescinding a contract for the sale of their ranch and assessing damages against them for pasturing their cattle.

The primary question raised in this appeal is whether appellees were entitled to a rescission of a written land contract on the basis of the parties' failure to consummate certain oral side arrangements for the purchase of appellants' cattle and machinery. After a trial before the district court, the parties' written land contract, whereunder appellees had agreed to purchase appellants' ranch property, was rescinded and appellee-buyers were awarded a judgment for $33,948. The award represented down payments made on the ranch and certain costs incurred in the pasturing of appellants' cattle, less a reasonable rental value attributed to appellees' use of the ranch. We will reverse the judgment upon a finding that there were no grounds for rescission in this case.

In February 1975, the appellees began negotiations for the purchase of appellants' ranch, which is located in Niobrara County, Wyoming. The parties met on February 27 and 28 to inspect the ranch and discuss terms. According to the appellees, they indicated during these discussions the need to consolidate appellants' land, cattle, and machinery into a "package deal" due to appellees' financial condition. Appellees had $70,000, of which $60,000 could be invested in these three items. Appellees state that appellants said they could provide a package deal, and that appellees could purchase their equipment for $15,000 with interest at eight and one-half or nine percent, payable when calves were sold the next fall, and the balance of interest and principal payable over a period of three years. At the same meeting, the appellants allegedly agreed to sell them 400 head of cattle later reduced to 360 head for $200 to $225 a cow-calf pair and $500 for each bull. The parties completed this meeting by agreeing to reduce the cattle and machinery terms to writing.

On March 4, the parties again met to work out the purchase terms. At this meeting the proposed terms for the package deal remained essentially the same, except for the cattle purchase. Instead of the $200 per head figure, appellants allegedly agreed to sell the cattle for ten dollars less than the market price for the selected cattle on the date of acceptance. Also at this meeting appellant-sellers tendered a written land contract and requested that the appellees make certain agreed-upon changes, retype the document, and forward it to appellants for signatures. This document contained no mention of the cattle and machinery terms. Subsequently the parties decided to have appellants' attorney review their land contract, and a meeting was arranged for March 21. At this meeting the land contract was signed by both parties. The "package deal" was again discussed, but on the advice of appellants' attorney the cattle and machinery terms were not included in the land contract. Appellees state, however, that the appellants still agreed to the terms discussed on March 4. Appellants deny that there was ever an oral agreement as to the cattle and machinery prior to or on March 21, and further deny they were aware of the appellees' claimed necessity to have a "package deal."

On April 9, appellees entered into possession of the ranch, having tendered a partial down payment of $10,000. Most of the machinery which had been discussed was already on the ranch. On May 8, the cattle selected by appellees from a herd located on appellants' Goshen County ranch were delivered. Appellees tendered the remaining down payment of $60,000 on May 9. Subsequent to the cattle delivery, the parties sought to determine their market price, which appellees claim to have been $250 per head. Ropers assumed, therefore, that in accordance with the parties' previous discussions they would owe appellants $240 per head. On or about June 1, appellants tendered a written contract pertaining to the cattle and machinery. The contract provided that the cattle cost would be $300 per head, and contained terms which appellees felt were at variance with the parties' prior discussions. Appellees refused to sign the contract, and later advised appellants to remove the cattle from the ranch. Appellants did so July 9. Appellees told appellants on June 14 that if the cattle were not removed, there would be a charge of $12 per head per month for pasturing.

Appellees pursued alternative cattle and machinery financing, and attempted to negotiate a settlement or adjustment with the appellants through September. On October 13, appellees gave notice of their intention to rescind the land contract, offering to restore the property upon receipt of their down payment and certain damages.

On December 16, appellees filed an action against appellants, asserting fraud and misrepresentation as to matters not relevant to this appeal, and asserting breaches of both written and oral agreements. Appellants answered, admitting that there had been an agreement to purchase appellants' cattle but there had been no agreement as to the price or other terms, and alleging that there had been no agreement as to the machinery. Appellants also counterclaimed, demanding forfeiture under the land contract and liquidated damages. During the course of pleading, appellees were not allowed to amend their complaint to allege that the oral agreements as to cattle and machinery were conditions precedent to their obligations under the land contract. At the trial, appellants objected to testimony concerning the oral side deals as being violative of the parol evidence rule. The trial court, however, allowed the testimony on the basis that it did not and would not consider such evidence as altering the terms of the land contract. Upon completion of the trial, the district court entered judgment, which states in relevant part:

"THE COURT FURTHER FINDS that at the time the parties entered into the Purchase Agreement dated March 21, 1975, for the sale of the ranch presently in issue, it was the intent and belief of Plaintiffs that there was an agreement existing between the parties which covered and included side deals on the sale of cattle and machinery to Plaintiffs as well as the sale of land, whereas it appears from the evidence that Defendants Charles F. Lewis and Winifred Jane Lewis had different thoughts and beliefs regarding the sale of the cattle and machinery believing that discussions thereto were just agreements to agree. The Court further finds that the cattle and machinery portion of the transaction were material items to the entire transaction of the parties. The Court therefore concludes that there was never here a meeting of the minds between the parties on a material portion of their agreement, and for that reason the Court further concludes that the aforesaid contract dated March 21, 1975, must be declared void and held for naught and a recission (sic) of said contract should be awarded to Plaintiffs."

The district court also found that appellees were entitled to recover $3,948 for the pasturing of appellants' cattle which were delivered in May 1975.

On appeal, appellants raise four issues which can be stated as follows:

1. Whether the written land contract can be rescinded because of the failure to consummate oral arrangements for the purchase of cattle and machinery.

2. Whether appellees waived their right to rescind the land contract.

3. Whether there was a sufficient offer to restore the ranch property to appellants.

4. Whether there was sufficient evidence as to the award for pasturing appellants' cattle.

Since we will answer the first question in the negative, we need not respond to the second and third questions.

The district court concluded that "there was never a meeting of the minds between the parties on a material portion of the transaction." Appellants contend first that the court committed error in allowing testimony to be given relative to the alleged oral agreements in violation of the parol evidence rule. Second, appellants contend that even if such testimony was admissible, appellees failed to show a binding agreement as to the cattle and machinery items which would act as a condition precedent to the effect of the land contract. Inherent in appellants' second contention is a view that the cattle and machinery items, not being conditions precedent to the land contract, were not material to the land transaction.

We disagree with appellants' first contention, and find there was no error in admitting testimony relative to the alleged oral agreements. This court has recognized the principle that parol evidence is admissible to show a condition precedent, National Union Fire Insurance Company of Pittsburgh, Pa. v. Studer Tractor and Equipment Co., Wyo., 527 P.2d 820, 827; North American Uranium, Inc., v. Johnston, 77 Wyo. 332, 316 P.2d 325; and McClintock v. Ayers, 36 Wyo. 132, 253 P. 658, rehearing denied 36 Wyo. 156, 255 P. 355. In addition, we have embraced the so-called partial integration rule which would allow parol evidence with respect to a part of a whole transaction not reduced to writing, where such evidence does not contradict or vary the terms of the instrument, Allen v. Allen, Wyo., 550 P.2d 1137, 1141; and North American Uranium, Inc. v. Johnston, supra. See, Cody Community Television Corp. v. Way, Wyo., 356 P.2d 1113, 1117, and 3 Corbin on Contracts, §...