Terry Cove North, Inc. v. Baldwin County Sewer Authority, Inc.
| Decision Date | 30 August 1985 |
| Citation | 480 So.2d 1171 |
| Parties | TERRY COVE NORTH, INC., a corporation v. BALDWIN COUNTY SEWER AUTHORITY, INC. 84-196. |
| Court | Alabama Supreme Court |
James L. Shores, Jr. of Shores & Booker, Fairhope, for appellant.
James B. Newman and Richard E. Davis of Coale, Helmsing, Lyons & Sims, Mobile, for appellee.
This is an appeal from an order granting a Rule 54(b), A.R.Civ.P., partial summary judgment in favor of plaintiff, Baldwin County Sewer Authority, Inc. (Sewer Authority).
This action arose out of the following facts: Terry Cove North, Inc., planned to develop some residential property in Baldwin County. In order to meet its sewage disposal needs, Terry Cove North and five other developers entered into an agreement with the Sewer Authority, a private corporation, for the construction and operation of a sewage treatment facility. This agreement, dated November 14, 1980, provides that the Sewer Authority "shall acquire a site and construct and operate a sewage treatment plant thereon." The developers, Terry Cove North, Inc., East Beach, Inc., Ono Development Co., Ono East Inc., Sunshine Joint Venture, and Frank J. Caron, each agreed to initially contribute a certain amount of money, totaling $800,000.00, to cover the cost of construction of the first phase of the system. In return, each developer was entitled to the service of the facility up to and including a certain designated number of the initial 1200 sewer hook up units. The units were apportioned among the developers on the basis of their respective investments. The agreement also provided that the developers would have certain designated preemptive rights, based upon their respective percentages, to additional units to be added through future expansion. There was attached to the agreement an "Exhibit B," which sets forth the number of initial units and the number of future units to which each developer was entitled, the total being an anticipated capacity of 3600 units (see appendix).
Upon completion of the three phases each developer received its proportional share or its preemptive right to its share of the 3600 units. Apparently the capacity of the sewage treatment facility was in excess of the 3600 units, and thereafter the Sewer Authority began contracting with other developers, who were not originally involved in the agreement, to make available certificates for use of the treatment plant.
On October 21, 1983, and again on November 18, 1983, Terry Cove North, Inc., wrote to the Sewer Authority, claiming that the developers were entitled to benefits from any expansion and requesting its pro-rata share of any additional sewer units.
Thereafter, on December 6, the Sewer Authority brought a declaratory judgment action in the Mobile Circuit Court, seeking, inter alia, a determination by the court that any capacity of the treatment plant in excess of 3600 sewer hook-up units is the sole and exclusive property of the Sewer Authority, and that the developers are entitled to no more than their designated hook-ups as set forth in the agreement.
Terry Cove North, Inc., thereafter made a motion for change of venue to the Baldwin County Circuit Court. After a denial of that motion, Terry Cove North, Inc., instituted a declaratory judgment action in Baldwin County against the Sewer Authority, the developers, and several other developers who had contracted for sewer hook-up units from the Sewer Authority. This cause was eventually transferred and consolidated with the Mobile County action.
Subsequently, the Sewer Authority moved for partial summary judgment declaring that "the total number of Baldwin County Sewer Authority's sewer units to which defendants are entitled is the number set forth on attached 'Exhibit B.' " On November 14, 1984, the trial court granted the Sewer Authority's motion for partial summary judgment. In its order dated November 16, 1984, the court found no just reason for delay, and entered its judgment pursuant to Rule 54(b).
Defendant, Terry Cove North, Inc., appeals, raising several issues. The primary issue for our consideration is whether the trial court properly granted the Sewer Authority's partial summary judgment.
The crux of the issue before the Court is whether, based upon the materials on file before the trial court, a genuine issue of material fact existed as to the terms of the subject agreement. Rule 56, A.R.Civ.P.
The position of Terry Cove North, Inc., on appeal is that the contract is ambiguous and, therefore, extrinsic evidence is necessary to ascertain the intent of the parties. Terry Cove North, Inc., apparently contends that the parties intended that any expansion of the sewage treatment facility would be limited to those developers who were parties to the agreement. We disagree and affirm.
The construction of a written instrument is a function of the court. Federal Land Bank of New Orleans v. Terra Resources, Inc., 373 So.2d 314 (Ala.1979). Whether an agreement is ambiguous is a question of law for the trial court. When its terms are clear and certain, the court, and not the jury, has the duty to determine the meaning of the agreement. Haddox v. First Alabama Bank of Montgomery, N.A., 449 So.2d 1226 (Ala.1984). In order to ascertain the intention of the parties, the clear and plain meaning of the terms of the agreement are to be given effect, and the parties are presumed to have intended what the terms clearly state. Id. Extrinsic evidence may be admitted to interpret a contract only if the court finds that the contract is ambiguous. Coosa Valley Youth Services Corp. v. Etowah County, 460 So.2d 1232 (Ala.1984).
Upon review of the agreement, we find that the trial judge correctly concluded as a matter of law that the agreement was unambiguous. We also cannot accept the contention of Terry Cove North that the developers are entitled to a pro rata share of the...
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