Shay v. Austin

• Decision Date: 19 October 2006
• Docket Number: Civil Action No. 9:05-2835-PMD.
• Citation: 466 F.Supp.2d 664
• Parties: Rodger D. SHAY, Jr., Plaintiff, v. Diane AUSTIN, Defendant.
• Court: U.S. District Court — District of South Carolina

466 F.Supp.2d 664

Rodger D. SHAY, Jr., Plaintiff, v. Diane AUSTIN, Defendant.

Civil Action No. 9:05-2835-PMD.

United States District Court, D. South Carolina, Beaufort Division.

October 19, 2006.

Jeffrey S. Tibbals, Nexsen Pruet Jacobs Pollard and Robinson, Charleston, SC, for Plaintiff.

Stephen E. Carter, McNair Law Firm PA, Hilton Head. Island, SC, for Defendant.

ORDER

DUFFY, District Judge.

This matter is before the court upon Plaintiff Rodger D. Shay, Jr.'s ("Plaintiff" or "Shay") motion for summary judgment. For the reasons set forth herein, the court grants Plaintiff's motion.

BACKGROUND¹

On or around May 10, 2005, Plaintiff initialed and executed a document labeled "Contract of Sale-Offer and Acceptance" (the "Contract") for certain real property described as Lot 2. Oakridge Plantation, located at 35 Beauregard Boulevard, Daufuskie Island, South Carolina 29915 (the "Property") (Plaintiff's Exhibit A.) Plaintiff delivered the signed Contract to Tom Heffner ("Heffner"), realtor for Defendant Diane Austin ("Defendant" or "Austin"). On or about May 15, 2005, Heffner delivered the Contract executed by Plaintiff to Defendant, who initialed and signed the document. Defendant additionally wrote "Time is of the essence" and her initials in the margin next to Section 7 of the Contract, which provided for a closing date of May 25, 2005. (Plaintiff's Exhibit B.) Plaintiff did not initial the "Time is of the essence provision," but he testified he knew of Defendant's desire to close on time. (Deposition of Rodger D. Shay, Jr. at 25, lines 15-17.) The purchase price for the real estate was $840,000, and Section 13 of the Contract required Defendant to convey marketable title to the Property to Plaintiff in fee simple by proper deed. (Plaintiff's Exhibit B.)

On or before May 23, 2005, Plaintiff put his earnest money deposit of five thousand dollars in a Nexsen Pruet escrow trust. (Plaintiff's Exhibit C.) The paralegal for Defendant's attorney prepared an original deed, which the paralegal for Plaintiff s attorney received on May 26, 2005. Because of incorrect wording, a correction had to be made; the paralegal for Plaintiff's attorney received the corrected deed via e-mail on May 27, 2005. (Declaration of Margaret B. Luckey ¶¶ 8-9.) This same e-mail provided the wiring instructions for Defendant's account for the closing proceeds. (Declaration of Margaret B. Luckey ¶ 10.) May 27, 2005 was a Friday, and the following Monday, May 30, 2005, was Memorial Day.

At the time the parties entered into the Contract, the Property was encumbered by a mortgage (the "Mortgage") dated. November 29, 2004, and held by Wachovia Bank, National Association ("Wachovia") recorded in the amount of $1,000,000. The Mortgage secured the Property as well as an adjacent lot owned by Defendant. Plaintiff attempted to procure a partial release of the Mortgage in order to receive a clear title, and on May 24, 2005 at 5:20 p.m., Wachovia sent Plaintiff's paralegal a document entitled "Worksheet for Partial Releases and Related Requests" (the "Worksheet"). (Plaintiff's Exhibit G.) The Worksheet contained items that Wachovia required in order to complete a request for partial release. Plaintiff's paralegal submitted a draft of the Worksheet to Wachovia in hopes that Wachovia would sign the document and release the Mortgage. Wachovia, however, instructed. Plaintiff's paralegal to "review the form that was provided to you. The documentation for the release will need to be forwarded to the address provided." (Plaintiff's Exhibit H at 1.)

Also on May 24, 2005, Plaintiff's paralegal wrote an email to Defendant's paralegal that stated, "It is the custom in this area that the seller's attorney provide documentation for releases (as part of the delivery of good, clear title) when the mortgage is not being satisfied by the lender.... We will deliver the release amount to the lender in exchange for a signed release." (Plaintiff's Exhibit I at 1.) During a phone conversation between the two paralegals on the morning of May 25, 2005, Defendant's paralegal said she would deliver the materials to Wachovia, and the two agreed that Plaintiff would deliver the necessary funds in exchange for a commitment letter from Wachovia agreeing to partially release the Mortgage on receipt of the funds. (Declaration of Margaret B. Luckey ¶ 5.)

Plaintiff asserts that Wachovia did not sign a partial release for the Mortgage, "nor provide a commitment to release the Mortgage on May 25 or at any time thereafter." (Plaintiff's Mem. at 6.) In her Memorandum in Opposition to Plaintiff s Motion for Summary Judgment, Defendant does not appear to contradict this fact, as the memorandum does not indicate that Wachovia ever signed a partial release. On Friday, May 27, 2005, Defendant requested that the proceeds for the transaction be wired to her account, and on Tuesday, May 31, 2005, Plaintiff wired the funds necessary to close the transaction to his attorney's escrow account. (Plaintiff's Exhibit J.) Defendant, however, never received these funds, and Plaintiff never received a commitment letter regarding release of the Mortgage from Wachovia.

On Wednesday, June 1, 2005, Defendant's attorney sent a letter to Plaintiff's attorney via facsimile. This letter informed Plaintiff's attorney that Defendant was cancelling the contract because the deed had been delivered but funds had not been received. (Plaintiff's Exhibit K.) Plaintiff's attorney responded that same day, saying Plaintiff had not received the letter from Wachovia agreeing to a partial release from the Mortgage. (Plaintiff's Exhibit L.) When Defendant's attorney indicated he believed the Worksheet constituted a commitment from Wachovia to provide a partial release, Plaintiff's attorney again responded by facsimile, stating Defendant bore the responsibility of providing documentation to Wachovia. (Plaintiff's Exhibit M.) This facsimile further provided, "Your offer to call this transaction off is equally unacceptable. [Plaintiff] intends to move forward with this transaction and acquire this property." (Plaintiff's Exhibit M.)

On August 24, 2005, Defendant sold the lot adjacent to the Property to another buyer. The Defendant testified that she made this sale after the sale to Plaintiff "did not close because I wouldn't have sold both of my lots." (Deposition of Diane Austin p. 41, lines 4-5.) Plaintiff filed suit for breach of contract on September 30, 2005, seeking specific performance and attorney's fees. (Complaint at 5.)

STANDARD OF REVIEW

To grant a motion for summary judgment, the court must find that "there is no genuine issue as to any material fact." Fed.R.Civ.P. 56(c). The judge is not to weigh the evidence but rather must determine if there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). All evidence should be viewed in the light most favorable to the nonmoving party. Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 123-24 (4th Cir.1990). "[W]here the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, disposition by summary judgment is appropriate." Teamsters Joint Council No. 83 v. Centra, Inc., 947 F.2d 115, 119 (4th Cir.1991). "[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The "obligation of the nonmoving party `is particularly strong when the nonmoving party bears the burden of proof.'" Hughes v. Bedsole, 48 F.3d 1376, 1381 (4th Cir.1995) (quoting Pachaly v. City of Lynchburg, 897 F.2d 723, 725 (4th Cir.1990)). Summary judgment is not "a disfavored procedural shortcut," but an important mechanism for weeding out "claims and defenses [that] have no factual basis." Celotex, 477 U.S. at 327, 106 S.Ct. 2548.

DISCUSSION

A. Specific Performance

Generally speaking, "[s]pecific performance should be granted only if there is no adequate remedy at law and specific enforcement of the contract is equitable between the parties." Ingram v. Kasey's Assocs., 340 S.C. 98, 105, 531 S.E.2d 287, 291 (2000). For specific performance to be an appropriate remedy, a court of equity must find the following:

(1) there is clear evidence of a valid agreement; (2) the agreement had been partly carried into execution on one side with the approbation of the other; and (3) the party who comes to compel performance has performed his or her part, or has been and remains able and willing to perform his or her part of the contract.

Ingram, 340 S.C. at 106, 531 S.E.2d at 291. Although a decree of specific performance rests with the discretion of the court, this discretion is "to be exercised in accordance with the special rules and practices of equity, and with regard to the facts and circumstances of the particular case." Humble Oil & Refining Co. v. DeLoache, 297 F.Supp. 647, 651 (D.S.C.1969). Indeed,

[w]here the agreement, be it an option lease or contract of sale, is unobjectionable and is regular and valid, it, as the Court remarked in Sims v. Nidiffer, [127 S.E.2d 85 (Va.1962)], `is much a matter of course for a court of equity to decree specific performance of it as it is for a court of law to award damages for its breach.'

Humble Oil & Refining Co., 297 F.Supp. at 651 (quoting Sims, 127 S.E.2d at 87).

Plaintiff has demonstrated he is entitled to specific performance pursuant to the factors listed in Ingram. See Ingram, 340 S.C. at 106, 531 S.E.2d at 291. Plaintiff alleges a valid agreement exists, and in her Memorandum in Opposition to Plaintiff's Motion for Summary Judgment, Defendant does not appear to dispute this allegation.² Moreover, Plaintiff...