Case Title: Lafayette Land Acquisitions II, LLC v. Walls

Citation: 

Docket Number: 2022-0765

State: alabama

Court: Alabama Supreme Court

Date: 2023-04-21T00:00:00Z

Document:
Rel: April 21, 2023 
 
 
 
 
 
 
 
Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern 
Reporter.  Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 
300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-0650), of any typographical or other 
errors, in order that corrections may be made before the opinion is printed in Southern Reporter. 
 
 
SUPREME COURT OF ALABAMA 
 
OCTOBER TERM, 2022-2023 
 
_________________________ 
 
SC-2022-0765 
_________________________ 
 
Lafayette Land Acquisitions II, LLC  
 
v.  
 
Steven L. Walls 
 
 
 
Appeal from Baldwin Circuit Court 
(CV-21-900417) 
 
MITCHELL, Justice. 
 
 
Whenever possible, we interpret a written contract based on the 
language contained within the four corners of the document.  Here, a 
SC-2022-0765 
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purchase agreement provided that the parties were obligated to close a 
real-estate sale unless the buyer -- Lafayette Land Acquisitions II, LLC 
("Lafayette Land") -- rejected the deal in writing before the end of the 
due-diligence period.  Although the parties dispute when that period 
began, and how long it lasted, it is undisputed that Lafayette Land never 
rejected the deal.  Therefore, the parties are obligated to close.  Because 
the Baldwin Circuit Court held otherwise, we reverse and remand. 
Facts and Procedural History 
Lafayette Land offered to buy Steven L. Walls's property in Orange 
Beach.  Walls accepted the offer, and the parties entered into a purchase 
agreement that became effective on February 26, 2021.  The purchase 
agreement provided, in part, that "Seller will provide and Buyer will 
accept an existing survey or plat."  It set a closing date of April 26, 2021, 
and stated that "[t]ime is of the essence."     
Two addenda -- Addendum #1 and Addendum #2 -- followed the 
purchase agreement.  Only Robert Isakson, Sr., the owner and manager 
of Lafayette Land, accepted Addendum #1.  Addendum #1 contained 
Walls's signature at the bottom, but he did not check the "accepted" box 
associated with the signature line.  Instead, he checked the "countered" 
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box and indicated that a counter-addendum was attached as "Addendum 
#2."   
Addendum #2, which both parties signed and accepted, contains 
two clauses that lie at the heart of this dispute.  The first clause defines 
the length of the due-diligence period, stating: "Buyer shall have a period 
of sixty (60) days subsequent [to] the date in which Buyer is in receipt of 
Seller's Due Diligence materials ('Due Diligence Period') to determine 
whether or not to purchase the 'Property.'"  The second clause contains 
key language on the role of silence during the due-diligence period:  
"If Buyer does not give written notice to Seller of its election 
to not purchase the property prior to the expiration of the Due 
Diligence Period, then it is agreed that the Buyer shall be 
deemed to have approved the Property and the parties shall 
proceed to Closing subject to the provisions set forth herein."   
 
The second clause further states that "Seller agrees to provide one 30-
day extension to the Due Diligence Period to extend the closing for the 
deposit of the sum of $5,000 paid directly to Seller."  
In the months that followed, the parties engaged in an extended 
back-and-forth about whether each party was meeting the requirements 
of the purchase agreement.  First, they disagreed about whether Walls 
had provided documents that Lafayette Land said that it had requested.  
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Next, the parties disagreed about when the due-diligence period had 
begun and ended.  Finally, after  Walls received multiple additional offers 
for the property, including one that was $100,000 more than what 
Lafayette Land had agreed to pay, Walls asked Lafayette Land to sign 
an agreement releasing both parties from the deal.  Lafayette Land 
refused and proposed an amendment that would maintain the closing 
date set out in the purchase agreement.  Walls did not agree and insisted 
that Lafayette Land sign the release.  Sue Ginter, Walls's real-estate 
agent, summarized the selling side's unwillingness to close the deal when 
she told Isakson's paralegal that "[w]e all need to move on."   
But Lafayette Land wanted to close.  In an effort to protect its 
rights, Lafayette Land filed a complaint in the Baldwin Circuit Court 
several days before the closing date.  In the complaint, it asked for a 
judgment declaring that the purchase agreement was "valid and 
binding."  Lafayette Land also filed a notice of lis pendens in the Baldwin 
Probate Court referencing the declaratory-judgment action and noting 
that it was seeking a court order requiring Walls to convey the property.  
Walls represented himself in the declaratory-judgment action and filed 
an answer in which he asked the circuit court to declare the purchase 
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agreement void.  After conducting a bench trial, the circuit court entered 
a declaratory judgment in favor of Lafayette Land.  Walls then obtained 
counsel and filed a motion to alter, amend, or vacate the judgment, which 
the circuit court granted.   
The circuit court conducted a second bench trial, at which it heard 
testimony from Isakson, Walls, and Ginter.  During the trial, Isakson 
testified that he never rejected the deal in writing.  Neither Walls nor 
Ginter refuted that testimony.  At the conclusion of the trial, the circuit 
court issued a final judgment in favor of Walls.  In doing so, it made three 
factual findings.  First, it determined that "the Purchase Agreement that 
was entered into between the parties ... expired … and the Court finds 
that [Lafayette Land] failed to exercise it's [sic] option to extend the due 
diligence period of 30 days."  Second, it reasoned that "no due diligence 
materials were specified in the contract, therefore no due diligence 
materials were due from [Walls] to [Lafayette Land]."  Finally, it found 
that Lafayette Land had received either a survey or a plat from Walls as 
provided in the purchase agreement.  It concluded by stating that "[t]here 
are no remaining duties owed [Lafayette Land] or [Walls] under the 
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Purchase Agreement."  After the circuit court issued its judgment, 
Lafayette Land appealed. 
Standard of Review 
 
When a trial court hears ore tenus testimony, "'its findings on 
disputed facts are presumed correct and its judgment based on those 
findings will not be reversed unless the judgment is palpably erroneous 
or manifestly unjust.'"  Fadalla v. Fadalla, 929 So. 2d 429, 433 (Ala. 2005) 
(citation omitted).  But " 'the ore tenus rule does not extend to cloak with 
a presumption of correctness a trial judge's conclusions of law or the 
incorrect application of law to the facts.'"  Id. (citation omitted).  Further, 
"[i]f a contract can be interpreted without going beyond the four corners 
of the document, the trial court's resolution of the question of law is 
accorded no presumption of correctness, and this Court's review is de 
novo."  Exxon Mobil Corp. v. Alabama Dep't of Conservation & Nat. Res., 
986 So. 2d 1093, 1101 (Ala. 2007). 
Analysis 
 
Lafayette Land makes one dispositive argument on appeal -- that 
the circuit court erred by failing to give effect to the provision in 
Addendum #2 that directed the parties to close if Lafayette Land did not 
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provide a written rejection before the due-diligence period ended.  We 
agree with that argument. 
 
When the language of a written agreement is unambiguous, we 
confine our review to the four corners of the document.  See Kershaw v. 
Kershaw, 848 So. 2d 942, 955 (Ala. 2022).  Language is unambiguous 
when it leads to only one reasonable interpretation.  Ex parte Warren 
Averett Cos., [Ms. 1210010, June 17, 2022] __ So. 3d __ (Ala. 2022).  And 
in that instance, we must accept that language for what it says and may 
not "twist the plain meaning of the terms in a contract to create an 
ambiguity under the guise of interpretation."  Southland Quality Homes, 
Inc. v. Williams, 781 So. 2d 949, 953 (Ala. 2000).   
 
Here, the relevant language in Addendum #2 is unambiguous.  It 
states: "If Buyer does not give written notice to Seller of its election to not 
purchase the property prior to the expiration of the Due Diligence Period, 
then it is agreed that the Buyer shall be deemed to have approved the 
Property ...."  If no written rejection occurs, "the parties shall proceed to 
Closing subject to the provisions set forth herein."  We agree with the 
circuit court's determination that the due-diligence period has ended.  
Thus, all that had to be determined was whether Lafayette Land had 
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provided written notice to Walls before the due-diligence period ended 
that it elected not to purchase the property. 
A review of the record shows that Lafayette Land never provided 
any written rejection to Walls.  The communications before Lafayette 
Land filed suit reflect a continuous effort by Isakson to obtain more 
information about the property to determine whether to continue with 
the transaction; but there is no indication that Isakson, or any 
representative of Lafayette Land, ever rejected the deal.  On the contrary, 
Isakson gave unrebutted testimony during the trial that he never 
rejected the property as unsatisfactory.  Walls neither cross-examined 
Isakson on this point nor presented any evidence of his own indicating 
that Isakson had rejected the deal.  And, once Walls demonstrated an 
unwillingness to fulfill his obligations under the purchase agreement, 
Lafayette Land commenced this action, which further demonstrates its 
good-faith intent to close.  Because we agree with the circuit court's 
finding that the due-diligence period ended, the parties were obligated to 
close the deal.   
Walls makes two arguments in an effort to avoid closing.  First, he 
points to a provision in the purchase agreement that addresses his 
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options in the event Lafayette Land defaulted on the agreement.  One of 
those options gave Walls the "right to terminate this Agreement."  But 
Walls does not point to any facts or offer any sort of argument 
demonstrating that Lafayette Land ever defaulted on the purchase 
agreement.  So his first argument fails.  
Second, Walls contends that Lafayette Land waived the dispositive 
issue outlined above by failing to cite proper authority.  But Lafayette 
Land cited our cases stating the longstanding rule that we give effect to 
the plain language of written agreements.  See, e.g., Shoney's, LLC v. 
MAC East, LLC, 27 So. 3d 1216, 1223 (Ala. 2009) ("[W]e maintain our 
long-held position that a contract, under Alabama law, should be 
construed as written."); Reeves Cedarhurst Dev. Corp. v. First AmFed 
Corp., 607 So. 2d 184, 186 (Ala. 1992) ("In interpreting a contract, the 
'"words of the agreement will be given their ordinary meaning."'" 
(citations omitted)).  And it pointed us to the operative language of 
Addendum #2, which states that the parties "shall proceed to Closing."  
Accordingly, Walls's second argument fails as well. 
 
 
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Conclusion 
 
Because Lafayette Land never rejected the deal to purchase the 
property in writing and was willing to close on the date specified in the 
purchase agreement, the parties are obligated to close.  The circuit court 
erred when it concluded that the purchase agreement had "expired" and 
that, as a result, neither party owed a duty to the other.  We therefore 
reverse and remand. 
 
REVERSED AND REMANDED. 
 
Parker, C.J., and Mendheim, Stewart, and Cook, JJ., concur. 
 
Shaw, J., concurs in the result, with opinion, which Wise and 
Bryan, JJ., join. 
 
Sellers, J., concurs in the result, without opinion. 
 
 
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SHAW, Justice (concurring in the result). 
I concur in the result.  The "due-diligence period" referenced in 
Addendum #2 to the purchase agreement must begin before the 
language of that provision controls the outcome of this case.  If it began, 
there was no written notice of a refusal to purchase the property, as the 
main opinion notes.  But, if the period did not begin, which the parties 
dispute in this appeal, the provision providing for written notice of a   
refusal to purchase did not apply.  Nevertheless, there was still no 
refusal of the purchase of the property preventing the transaction's 
closing. 
Further, I see nothing supporting the trial court's separate 
holding that the purchase agreement "expired" because of a purported 
lapse of the due-diligence period.  Addendum #2 indicates that a failure 
to refuse to purchase of the property, in writing, during the due-
diligence period amounted to an acceptance of the sale and that the 
parties would proceed to the transaction's closing.  As noted above, no 
refusal took place.   
Wise and Bryan, JJ., concur.