South Carolina Nat. Bank v. Silks, 1103

• Decision Date: 26 January 1988
• Docket Number: No. 1103,1103
• Citation: 295 S.C. 107,367 S.E.2d 421
• Court: South Carolina Court of Appeals
• Parties: The SOUTH CAROLINA NATIONAL BANK, Successor By Merger To The First National Bank Of South Carolina, Respondent, v. SILKS, A South Carolina Limited Partnership, and Eric A. Brooks, W. Vaughan Davidson, and Frank E. Fowler, As A General Partner Of Silks, A South Carolina Limited Partnership, and Individually, Defendants, Of Whom Silks, A South Carolina Limited Partnership, and Frank E. Fowler, As General Partner Of Silks, A South Carolina Limited Partnership, and Individually, are Appellants. Heard

Page 421

367 S.E.2d 421

295 S.C. 107

The SOUTH CAROLINA NATIONAL BANK, Successor By Merger To The

First National Bank Of South Carolina, Respondent, v. SILKS, A South Carolina Limited Partnership, and Eric A.

Brooks, W. Vaughan Davidson, and Frank E. Fowler, As A

General Partner Of Silks, A South Carolina Limited

Partnership, and Individually, Defendants,

Of Whom

Silks, A South Carolina Limited Partnership, and Frank E.

Fowler, As General Partner Of Silks, A South

Carolina Limited Partnership, and

Individually, are Appellants.

No. 1103.

Court of Appeals of South Carolina

Heard Jan. 26, 1988.

Decided Feb. 29, 1988.

Thomas S. Tisdale, Jr., and Stephen P. Groves, of Young, Clement, Rivers & Tisdale, Charleston, for appellants.

G. Dana Sinkler, Charleston, and H. Simmons Tate, Jr., Columbia, of Sinkler & Boyd, P.A., for respondent.

GOOLSBY, Judge:

South Carolina National Bank ("SCN") brought these actions on a promissory note and for claim and delivery against the defendants Silks, a South Carolina limited partnership, and against Eric A. Brooks, W. Vaughan Davidson, and Frank E. Fowler as general partners of Silks and in their individual capacities. The defendants answered and counterclaimed for breach of contract and for violation of the South Carolina Unfair Trade Practices Act ("UTPA"). The trial judge directed a verdict for SCN on its claims and on the defendants' counterclaims. Silks and Fowler appeal. We reverse in part, affirm in part, and remand.

The issues on appeal relate to whether a written contract can be modified by a subsequent oral agreement, whether the evidence and the reasonable inferences to be drawn therefrom can support a finding that the parties entered into a subsequent oral agreement modifying the terms of the note sued on, and whether a mere breach of an oral agreement constitutes a violation of the UTPA.

On November 29, 1984, Silks and its general partners gave a note to First National Bank ("FNB") for $220,000 repayable in 10 quarterly payments of $22,000, plus interest. At the same time, Silks entered into an agreement with FNB giving it a security interest in the furniture, fixtures, and equipment used by Silks in its restaurant business at the Planter's Inn in Charleston.

SCN acquired the note when it merged with FNB.

Only one payment was made on the note and that occurred when the note was executed.

Silks and the general partners were two payments behind on the note when, on June 17, 1985, Peter B. Read, a vice-president of SCN, met with the general partners and, among others, Fowler's attorneys, J. Nelson Irvine and Thomas S. Tisdale, Jr., Silks' accountant, Timothy M. Tyler, and John B. Hipp, a partner in Littlebrook Associates, the owner of the Planter's Inn. They discussed the indebtedness represented by the note.

Following the meeting, SCN and Fowler had prepared and forwarded to each other proposed notes modifying the terms of the note given by Silks and the general partners. None of the proposed notes were ever executed.

Three months later, SCN filed these actions alleging that the defendants were in default of the note and that it was entitled to possession of the personal property held by Silks as security for the note. The defendants, however, denied they were in default, claiming that they and SCN had orally agreed during the June 17, 1985 meeting to modify the terms of the note. The defendants also counterclaimed, alleging that SCN had breached the parties' oral agreement and, in so doing, had violated the UTPA.

A jury trial commenced on November 3, 1986; however, it ended when the trial judge granted SCN's motion for directed verdict on its claims and on the defendants' counterclaims.

I.

Silks and Fowler contend that the trial judge erred in concluding as a matter of law that the written contract between the parties could not be modified orally.

The note in question expressly provided that it could not be amended or modified "except by an instrument in writing executed by the holder of [the] note."

The trial judge, in addressing the issue of a modification, stated that "[in] this case clearly the original note required that any modification had to be in writing." He went on to find "that the written contract [had] not [been] modified," thus rejecting the defendants' argument that a written contract could be modified orally.

Written contracts, however, may be orally modified by the parties, even if, as here, the writing itself prohibits oral modification. Sanchez v. Tilley, 285 S.C. 449, 330 S.E.2d 319 (Ct.App.1985). The trial judge clearly erred, therefore, in holding that the note in issue could not be orally modified.

II.

Silks and Fowler next contend that the trial judge erred in granting SCN's motion for directed verdict on its claims.

The trial judge expressly found that the parties did not enter into "another agreement."

Silks and Fowler argue that the evidence and its reasonable inferences support a finding that the parties orally agreed to modify the terms of the note.

In deciding a motion for directed verdict, the trial judge is not to weigh the evidence and determine the credibility of witnesses and of documents. Young v. Bost, 241 S.C. 289, 128 S.E.2d 118 (1962); 88 C.J.S. Trial § 257(2) and (3) at 649 and 651-52 (1955). Rather, the trial judge is to consider the evidence and all its reasonable inferences in the light most favorable to the nonmoving party and is to deny the motion if the evidence...