Panfel v. Boyd, 75696

• Decision Date: 12 February 1988
• Docket Number: No. 75696,75696
• Citation: 367 S.E.2d 54,186 Ga.App. 214
• Parties: PANFEL et al. v. BOYD et al.
• Court: Georgia Court of Appeals

Page 54

367 S.E.2d 54

186 Ga.App. 214

PANFEL et al. v. BOYD et al.

No. 75696.

Court of Appeals of Georgia.

Decided Feb. 12, 1988.

Rehearing Denied March 4, 1988.

Certiorari Denied April 7, 1988.

Glenn S. Bass, Atlanta, for appellants.

Jay M. Barber, Richard P. Decker, Frederick G. Boynton, Edward H. Wasmuth, Jr., Harold L. Russell, Atlanta, for appellees.

BIRDSONG, Chief Judge.

This is an appeal from the order of the trial court, granting and denying various motions for summary judgment by appellants and appellees. Appellants, Mark Panfel and Scott Roberts, were potential purchasers of the Anderson Park Apartments, which were owned by appellees James Boyd, Boyd Properties, and Anderson Park Apartments, Ltd.

Appellees contracted with Michael Callahan, a real estate agent, and Northside Realty Associates, his employer, to sell the apartment complex. Roberts saw the advertisement and made an inquiry which led to the tender of a contract by Panfel and Roberts who were jointly involved in other real estate ventures. The first contract was refused, but Boyd and his partners made suggestions which were accepted by Panfel and Roberts and a second contract was tendered. Appellants' second contract offered a purchase price of $1,490,000, contingent upon the buyers obtaining a new first mortgage "of not less than $1,140,000, with an interest rate not to excede [sic] 13%." Sellers were to receive $400,000 at closing and carry a second lien security deed in the approximate amount of $406,265 at 11 percent for 4 years and 12 percent for the remainder of the period. The buyers were to deposit $10,000 "to be used as earnest money, to be applied as part payment of the purchase price ... and if sale, due to Buyer's default, willful or otherwise, is not consummated, then said earnest money shall be refunded." (Emphasis supplied.) Sellers were responsible for a 5 percent brokerage commission to Northside Realty. The sales contract was drafted by Panfel and Roberts on May 14, 1985, and required that the "[s]ale shall be closed on or before July 1, 1985." The contract was accepted by Boyd and his partners and appellants' check for $10,000 was deposited by Northside into its escrow account.

Panfel testified that the property appraisers were behind schedule and it became apparent that appellants could not complete arrangements for their loan before the July 1 closing date. Appellants verbally requested Callahan to obtain an extension of time for closing and confirmed the request with a letter, dated June 27, 1985, in which they cited their "due diligence in attempting to close title by July 1st and would appreciate you[r] efforts in procuring a reasonable extension." Callahan gave the letter to Boyd, who polled his partners and reached an agreement to extend closing to July 19 because appellants' letter stated they "should be able to close the loan by mid-month." (Emphasis supplied.) Callahan said he verbally advised Panfel and Roberts of the July 19 deadline, but that the sale did not close on that date. Panfel stated that he talked to Callahan almost on a daily basis and "we understood that we had obtained our requested extension. There was no writing confirming the extension." Appellants denied they were informed of a definite date for closing in response to their request, only that they had obtained an extension.

Callahan said that at some time before July 26, Panfel told him that the appellants had received a mortgage commitment from their bank for $1,100,000, which was $40,000 short of the contract condition, and appellants "asked [him] to ask Mr. Boyd whether the partnership would be willing to increase the amount of the loan the partnership intended [to] make to the purchasers as a part of the sale. [He] passed that request along to Mr. Boyd, and he rejected it."

Panfel's affidavit shows that the appellants received their loan commitment on July 26, one week after the extended closing date, and that he called Callahan on that date telling him of the loan and Callahan asked him when closing would be. Following that statement, Panfel said: "In a prior conversation, Mr. Callahan was asked by Mr. Roberts to approach the seller regarding the potential of including an additional $40,000 in the secondary financing.... At all times Mr. Roberts and I had the additional $40,000 at our disposal and, from July 26, 1985 on, were ready, willing and able to close the sale...." Callahan informed Panfel that Boyd was considering appellants' request for additional financing of $40,000 as a counter offer.

Callahan admitted receiving a letter from Panfel on July 30 stating appellants would be ready to close on July 31, but on July 30, he told Roberts and Panfel the seller would not close on July 31, but he would poll his partners regarding an extension to August 2, and "that Mr. Boyd was not inclined to extend the closing deadline." Appellants admitted they were told Boyd was not inclined to extend the deadline but Callahan asked them to put their proposal in writing "and that closing would be extended until August 2, 1985." Panfel placed appellants' proposal in a letter and gave it to Callahan. The letter was delivered to Boyd. On August 2, 1985, Boyd had a letter hand-delivered to appellants rescinding the contract for failure of the purchasers to close "on or before the time set forth in the contract, as extended...."

At some time after August 2, Panfel asked Callahan for a return of the $10,000 earnest money and confirmed his request in writing by a letter dated August 6, 1985, demanding return of the money. Callahan forwarded the letter to Boyd with an additional line typed thereon which included the consent of Boyd to return the earnest money. Subsequently, Boyd informed Callahan he would consent to a return of the earnest money and would reimburse appellants for their expenses in return for appellants' agreement "not to sue him or his partners." Callahan confirmed this verbal offer in a letter to Boyd and sent a copy to Panfel. Appellants rejected the offer and Panfel responded with a letter, dated September 4, to Callahan again demanding return of the earnest money under the terms of the contract. In the interim, appellants forwarded a letter to the head of Northside's escrow accounts demanding return of the money in accordance with the contract, within three days, or that a lawsuit would be filed for the money and damages.

The earnest money was not returned and this action followed alleging: (1) breach of the sales contract, (2) a request for specific performance, (3) negligence on the part of Callahan for "failing to obtain an extended closing date from seller ... [and] in not obtaining a written extension for this closing date," (4) that Callahan wilfully, wantonly and intentionally represented that the sale would be closed on a date certain with actual or implied knowledge that the sellers intended not to perform, which amounted to fraud, and (5) that Callahan and Northside wrongfully refused to return the earnest money in accordance with the terms of the contract and wrongfully conspired to withhold the money.

Northside answered and filed a counterclaim against Panfel and Roberts, and a cross-claim against Anderson Park Apartments, alleging that because appellants demanded specific performance and the "[s]eller has not authorized the release of the ... earnest money," Northside was interpleading the funds into the registry of the court because it was "in great doubt as to whether defendants-in-counterclaim [Panfel and Roberts] or defendant-in-cross-claim [Anderson Park Apartments] is entitled to said funds."

Boyd, Boyd Properties and Anderson Park Apartments answered and filed a counterclaim to recover fees, expenses and damages incurred when its attempt to refinance the apartment complex was turned down by the bank, ostensibly because of a lis pendens filed by appellants. A consent order was entered directing the interpleaded funds to be returned to appellants. The trial court granted summary judgment to Northside Realty, Callahan, Boyd, Boyd Associates, and Anderson Park Apartments on their motions. The court denied appellants' motion for summary judgment against Boyd, Boyd Associates and Anderson Park Apartments on appellees' claims for damages based on the lis pendens filing. Panfel and Roberts appeal from this order. Held:

1. Appellants allege error of the trial court "in failing to support its [summary judgment] Order with findings of fact and conclusions of law...." Our Code requires in actions "tried upon the facts without a jury ... [that] the court shall find the facts specially and shall state separately its conclusions of law thereon.... [However,] [f]indings of fact and conclusions of law are unnecessary on ... motions under Code Section ... 9-11-56 [summary judgment] ... except as provided in subsection (b) of Code Section 9-11-41." OCGA § 9-11-52 (a). OCGA § 9-11-41 (b) deals with involuntary dismissal of a complaint for failure of the plaintiff to prosecute or comply with an order of the court and is inapplicable to this case. The court did not err in failing to make findings of fact and conclusions of law.

2. It is contended that the court erred in granting summary judgment to Callahan and Northside because there remain questions of fact regarding: (a) Callahan's breach of legal duties to appellants, (b) Callahan's promises and representations to appellants which would support their claim of fraud, and (c) the withholding of the earnest money.

(a) Appellants were experienced real estate investors, and knew Callahan was an agent for the seller, and they had dealt with him in that capacity from the beginning of the negotiations until the final letter of rescission. All terms of the contract had been determined by Boyd and appellants, Panfel and Roberts. All requests for modification of the contract had been transmitted through Callahan to the seller. It was clearly understood by all par...