Case Title: Matney v. Webster

Citation: 

Docket Number: 90-202

State: wyoming

Court: Wyoming Supreme Court

Date: 1991-04-03T00:00:00Z

Document:
Matney v. Webster1991 WY 40808 P.2d 212Case Number: 90-202Decided: 04/03/1991Supreme Court of Wyoming
Linda 
MATNEY, Appellant (Plaintiff),

v.

Bruce A. WEBSTER, 
Appellee (Defendant).

Appeal from theDistrictCourtofCarbonCounty, Larry L. Lehman, 
J.

Affirmed.

Golden, J., concurred in part 
and dissented in part and filed opinion in which Urbigkit, C.J., joined. 

David E. Erickson, Brown 
& Erickson, Rawlins, for appellant.

Cary R. Alburn III, 
Laramie, for 
appellee.

Before URBIGKIT, C.J., 
THOMAS, CARDINE and GOLDEN, JJ., and KALOKATHIS, District 
Judge.

CARDINE, 
Justice.

[¶1.]     Appellant Linda Matney, 
seller, sought specific performance of a contract for the sale and purchase of 
real estate she owned in Rawlins, Wyoming. The trial court found against her 
because she had not allowed the buyer, appellee Bruce Webster, a reasonable time 
to perform a condition of the contract.

[¶2.]     We 
affirm.

[¶3.]     Matney raises these 
issues:

"I. May a standard 
purchase offer, acceptance and receipt agreement provision requiring the 
purchaser to pay any costs required to repair a home heating system be 
interpreted to allow the purchaser to replace the system, in his discretion, 
prior to closing?

"II. Was a sufficient 
time afforded to the purchaser to provide repairs under the facts and 
circumstances of this case?"

[¶4.]     On July 27, 1989, 
Matney and Webster entered into a contract for the purchase of a house Matney 
owned at 109 East Buffalo in Rawlins, Wyoming for $55,000. Under the terms of the 
contract, the purchase was to be financed with a Wyoming Community Development 
Authority (WCDA) loan, and Webster was to be responsible for any repairs 
required as a condition for the loan.

[¶5.]     A WCDA loan requires 
approval from the Federal Department of Housing and Urban Development (HUD). On 
September 11, 1989, HUD set the appraised value of the property at $50,100. HUD 
also required repairs to the heating system and improvement to the drainage 
around the house.

[¶6.]     Because the HUD 
appraisal was less than the contract's purchase price, Webster had the option, 
under HUD regulations, of cancelling the contract. That contract was cancelled, 
and Matney and Webster entered into a new contract on September 20, 1989, for 
the purchase of the property at its appraised value of $50,100. As with the 
parties' original contract, the purchase was to be financed with a WCDA loan, 
and Webster was to be responsible for the cost of the required 
repairs.

[¶7.]     Webster did get 
estimates on repairing or replacing the heating system and improving the 
drainage, but by late October the repairs had yet to be made. On October 27, 
1989, Matney's attorney sent a letter to Webster threatening a lawsuit if the 
repairs were not made. Matney filed a lawsuit demanding specific performance of 
the contract on November 13, 1989. Matney's attorney, on November 17, 1989, sent 
Webster a second letter demanding performance. Webster's answer also contained 
counterclaims asking the contract to be terminated.

[¶8.]     Both parties moved for 
summary judgment. The trial court denied both motions except to find that a 
contract existed between the parties. The contract provided no date for closing 
or for completing the repairs. Following a trial to the court on May 30, 1990, 
judgment was entered in favor of Webster, the court concluding that Webster was 
entitled to a reasonable time to complete repairs and that he had not been 
afforded that reasonable time.

[¶9.]     In her first issue, 
Matney claims the trial court incorrectly held that Webster could have replaced 
as well as repaired the heating system even though the contract only provided 
that Webster was responsible for repairs. Repair in this context means "to 
restore to a sound or good state after decay, injury, dilapidation, or partial 
destruction." Wyoming Coal Mining Co. v. Stanko, 22 Wyo. 110, 128, 138 P. 182, 183 (1914) (quoting Webster's New International Dictionary). Replacement of 
the heating system would have certainly restored it to "a sound or good state." 
We find no error in the trial court recognizing that Webster could have met the 
repair requirement by replacing the heating system. See Hawkeye Casualty Co. v. 
Frazier, 183 F.2d 465, 467 (10th Cir. 1950).

[¶10.]  Matney's second issue challenges the 
finding that Webster had not been afforded a reasonable time to perform his 
repair obligation.

     "Where no time for 
performance is specified, the law implies performance must be within a 
reasonable time and what is a reasonable time depends upon the circumstances of 
each case." Zitterkopf v. Roussalis, 546 P.2d 436, 439 (Wyo. 
1976).

What constitutes a 
reasonable time in any particular case is a question of fact. Mott Equity 
Elevator v. Svihovec, 236 N.W.2d 900, 907 (N.D. 1975).

[¶11.]  The contract for purchase was entered 
into September 20, 1989. The suit demanding specific performance was filed on 
November 13, 1989. The rights of the parties to an action are determined as of 
the time the action is commenced. 1A C.J.S. Actions § 234 (1985). Thus, we 
examine the record to determine whether the evidence is sufficient to support a 
finding that the 54-day period between the signing of the contract and 
commencement of suit did not afford Webster a reasonable time to perform. In 
considering the sufficiency of the evidence, this court assumes that the 
evidence in favor of the successful party is true, leaves out of consideration 
entirely the evidence presented by the unsuccessful party that conflicts with 
the successful party's evidence and gives the evidence of the successful party 
every favorable inference that may be reasonably and fairly drawn from it. Goss 
v. Goss, 780 P.2d 306, 315 (Wyo. 1989).

[¶12.]  One of Matney's witnesses was Lynda 
Klouda, assistant vice president of commercial and real estate loans at the 
Rawlins National Bank. Klouda worked with Webster in his effort to finance the 
purchase of the property. Klouda's testimony demonstrated a familiarity with 
these types of real estate transactions. She testified that Webster met with her 
four or five times during September and October; that he obtained estimates from 
a number of contractors for replacing or repairing the heating system and 
correcting the drainage problem, and discussed the alternatives and cost with 
her. She stated Webster never indicated a desire to not complete the purchase 
but always acknowledged his obligation and desire to proceed. In October, 
Webster advised Klouda that Matney was pressuring him to close because she had 
signed a contract to purchase another property and needed the money. He asked if 
they could close before repairs were complete, and Klouda started to work on 
getting permission from HUD to allow Webster and Matney to close completing firm 
commitments for the repairs. Before that process could be completed, Matney 
brought her suit.

[¶13.]  Another of Matney's witnesses was the 
real estate salesman who was handling the purchase of the other property Matney 
contracted to purchase. He testified that some closings take longer than others 
and when that happens closing dates are changed. He testified that the closing 
date on the new property was changed to accommodate 
Matney.

[¶14.]  HUD's commitment upon the loan to Webster 
did not expire until March 11, 1990. Webster had until that date to satisfy 
HUD's requirements and qualify for the loan. Matney sued Webster in November, 
three and one-half months before HUD's loan commitment expired. Although the 
record demonstrates Matney's eagerness to close, nothing suggests that a 
reasonable time for Webster to perform had passed. The evidence was sufficient 
to support the trial court's finding that a reasonable time had not been 
afforded Webster to perform and that he did not breach the 
contract.

[¶15.]  The trial court entered judgment in favor 
of Webster which included judgment in his favor upon the counterclaim asking 
termination of the contract. As a result of the judgment, the contract is 
terminated and no longer of force or effect. See 6A Corbin, Corbin on Contracts 
§ 1318 (1962).

[¶16.]  Affirmed.

GOLDEN, J., files an opinion 
concurring in part and dissenting in part, in which URBIGKIT, C.J., 
joins.

GOLDEN, Justice, concurring in 
part and dissenting in part, in which URBIGKIT, Chief Justice, 
joins.

[¶17.]  I agree with that portion of the majority 
opinion which holds that the buyer, appellee Bruce Webster, was entitled to a 
reasonable time to perform and did not breach his contract with the seller, 
appellant Linda Matney. However, I disagree with the result reached by the 
majority affirming termination of the contract based on appellee's 
counterclaim.

[¶18.]  A careful reading of the trial court's 
judgment and decision letter reveals that it never made a specific finding as to 
why the contract should be terminated. Its judgment merely stated that the 
defendant/appellee was entitled to a reasonable time in which to perform, that 
reasonable time was not accorded him, and that therefore he did not breach the 
contract.

[¶19.]  The trial court's judgment does state 
that the matter came before the court on the complaint of the plaintiff and 
the counterclaim of the defendant and that the court found generally 
in favor of the defendant. The majority adopts this finding, without 
analyzing it, to hold that "the contract is terminated and no longer of force or 
effect." In view of its prejudicial effect in this case, this implicit result of 
the trial court's decision deserves a more searching review than it was given by 
the majority.

[¶20.]  Appellant's complaint requested specific 
performance of the contract, or in the alternative, damages for breach. 
Appellee's counterclaim requested that

[t]he Court * * * declare 
the aforesaid document [the contract] to be terminated, because a material 
condition of the document cannot be fulfilled.

[¶21.]  The material condition which "could not 
be fulfilled" was that "the property does not meet the standards required for a 
WCDA loan" despite appellee's having "in good faith applied for and attempted to 
comply with all requirements" to obtain that loan. Webster had the burden of 
proving any excuse for nonperformance of his contractual obligations. See 
Sturgeon v. Phifer, 390 P.2d 727, 729-30 (Wyo. 1964).

[¶22.]  Bruce Webster testified at trial that he 
was familiar with the heating system of the Matney property before he ever 
signed the contract to purchase it. He was aware, at the time he signed the 
agreement, that he was required to pay any repair costs required by WCDA or FHA. 
The plain language of the contract required him to do so. On the loan papers he 
signed, Webster listed an annual income of $25,000 and assets of $4,000 cash. He 
received various estimates for the required repairs, including one of $1,570 
total cost for repairing the drainage system and heating system and bringing the 
house "up to code."

[¶23.]  I see no reason why Webster could not 
have paid to have the work done and then closed the loan according to his 
agreement. Webster's testimony at trial certainly does not establish that it 
would be impossible for him to make the required repairs.

[¶24.]  There was no material condition which 
could not be fulfilled by Webster. To allow rescission under these circumstances 
would be to allow him to take advantage of his own failure to perform his 
contractual duties to escape liability on the contract. This we should not 
allow. See Reed v. Wadsworth, 553 P.2d 1024, 1034 
(Wyo. 
1976).

[¶25.]  It is also possible that the majority 
accepts appellee's argument that he was precluded from performing by appellant's 
suit for specific performance. A party to a contract may be excused from 
performance by unwarranted interference from the other party. Concrete 
Specialties v. H.C. Smith Construction Co., 423 F.2d 670, 672 (10th Cir. 1970). 
However, if the "interference" is caused by an act which is neither wrongful nor 
in excess of the interfering party's rights, it does not provide an excuse for 
nonperformance. Whitt v. Godwin, 205 Va. 797, 139 S.E.2d 841, 844 (1965); 17A 
C.J.S. Contracts § 468 (1963). 

[¶26.]  I would hold that Matney's suit here, 
while premature, was not wrongful or in excess of her rights under the contract. 
She was seeking to compel performance, not to interfere with it. The contract 
should not be terminated because of the suit's being 
filed.