Title: Kinderknecht v. Poulos

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Kinderknecht v. Poulos1985 WY 169707 P.2d 184Case Number: 85-44Decided: 10/17/1985ROBERT L. KINDERKNECHT AND SHERILL D. KINDERKNECHT, APPELLANTS (DEFENDANTS), 

v. 

HARRY POULOS AND MARY POULOS, APPELLEES (PLAINTIFFS).
Supreme Court of Wyoming
ROBERT L. KINDERKNECHT 
AND SHERILL D. KINDERKNECHT, APPELLANTS (DEFENDANTS), 

v. 

HARRY POULOS AND MARY 
POULOS, APPELLEES (PLAINTIFFS).

 
 
Appeal from the District 
Court, LaramieCounty, Paul T. Liamos, Jr., 
J.

 
 
Don W. Riske of 
Riske, Edmonds & Darrow, P.C., Cheyenne, for appellants.

Charles E. 
Graves and George Santini of Charles E. Graves & Associates, Cheyenne, for appellees.

Before THOMAS, C.J., and 
ROSE, ROONEY, BROWN and CARDINE, JJ.

CARDINE, 
Justice.

[¶1.]     This appeal is from a 
judgment declaring the appellants in default on a contract for the purchase of 
real estate and ordering them to pay the remaining balance of $155,951.68 plus 
accrued interest, as well as attorney's fees in the amount of $3,187. Appellants 
allege that the district court erred in its construction of the applicable 
contracts.

[¶2.]     We 
affirm.

[¶3.]     On June 7, 1978, the 
parties entered into a contract titled "Agreement for Warranty Deed." Pursuant 
to this contract, the appellants agreed to purchase from the appellees a 
four-story office building located in downtown Cheyenne. This building is commonly known as 
the BellBuilding. The total 
purchase price for it was $201,000. The contract provided that $25,000 was to be 
paid immediately and that the balance was to be paid in monthly installments 
over a period of ten years. The installments were in the amount of $1,416.15 and 
applied first towards interest, set at 9% per annum, and then towards the 
principal. In addition, the appellants were required to pay all taxes and 
assessments on the building from the date of the 
agreement.

[¶4.]     The contract further 
provided that if the appellants breached the agreement, the appellees could 
choose whether

"to maintain an action 
for specific performance of this contract; or to declare the entire amount of 
principal and interest remaining unpaid hereunder due and payable immediately 
and to maintain an action to collect said balance; or to declare this contract 
void, and thereupon to recover by distress upon the premises or otherwise all 
the interest which shall have accrued upon this contract up to the day of 
declaring it void, as rent for use and occupation of said premises, to hold and 
retain all monies paid on this contract by said parties of the second part, as 
liquidated damages, and to take immediate possession of the premises, to regard 
the person or persons in possession on such termination of the contract as 
tenant or tenants holding over without permission, and to recover all damages 
sustained by holding over without permission, or by reason of any waste or 
damage committed or suffered on said premises. * * *

"In the event of default 
in the payment of the amounts due hereunder, or the performance of any other 
covenants and promises by parties of the second part, resulting in filing an 
action for specific performance by the parties of the first part, or in filing 
of an action by them to collect the entire balance due, it is agreed that a 
reasonable attorney's fee and all other costs of collection shall be added to 
the amounts due under this agreement."

[¶5.]     On March 12, 1980, 
appellants sold the BellBuilding to Platte Valley Land & 
Cattle Company and a second contract was entered into, it being entitled 
"Contract for Sale of Real Estate for Delivery of Deed and for Assignment of 
Prior Agreement for Warranty Deed." The appellants, the appellees, and 
PlatteValleyLand 
and Cattle Company (PlatteValley hereinafter), all signed this 
contract as parties. This contract provided in pertinent 
part:

"NOW, THEREFORE, for and 
in consideration of their mutual covenants and agreements herein contained and 
Five Thousand Dollars ($5,000.00) paid in hand by Platte Valley to Brokers, 
pending final exchange, the parties hereto have agreed as 
follows:

"1. Kinderknechts 
[appellants] shall assign and Pouloses [appellees] consent and agree to the 
assignment of their obligations and rights to that Agreement for Warranty Deed 
(Attachment A) to PlatteValley, subject to the terms and 
conditions contained herein and in Attachment A. It is expressly understood and 
agreed that Kinderknechts shall remain liable to Pouloses pursuant to their 
obligations contained in the Agreement for Warranty Deed. (Attachment A). 
[Emphasis supplied.]

"2. Pouloses formally 
waive and hereafter terminate that requirement under the Agreement (Attachment 
A) that their permission in writing be had and obtained prior to this transfer 
and any subsequent transfers by PlatteValley, their assigns or successors in 
interest. In the event of a subsequent conveyance, PlatteValley agrees to promptly notify Pouloses 
and Kinderknechts of the names of the new assignee.

* * * * * 
*

"17. In the event that 
Platte Valley shall become in default of any of the terms and conditions of this 
Contract, Kinderknechts shall, AT THEIR SOLE OPTION, HAVE THE RIGHT TO 
EITHER:

"(a) seek specific 
performance of this Contract and the terms contained herein; or 
to

"(b) Declare this 
Contract terminated and/or rescinded by PlatteValley;

"PROVIDED, HOWEVER, that 
Kinderknechts shall first give to Platte Valley written notice of such default 
by Certified Mail, Return Receipt Requested (or by other provable means of 
service) and allow the Purchasers ninety (90) days after the receipt of said 
notice within which to cure and correct such default.

"18. In the event of such 
default and Kinderknechts' election to proceed under Paragraph 17(b) above, by 
declaring this Contract rescinded or terminated, Platte Valley shall, within 
ninety (90) days after receipt of such notice, promptly vacate the premises and 
Kinderknechts shall be entitled to retain as liquidated damages the Forty 
Thousand Dollars ($40,000.00) down payment as set forth in Paragraphs 3(a) and 
(b) above, plus a sum equal to all monthly payments made to the date of the 
declared default as compensation for Platte Valley's actual time of occupancy, 
which sum Platte Valley recognizes and admits to be a reasonable sum in lieu of 
the payment of rent and loss of revenue. The default provisions contained herein 
shall replace those contained in the Agreement for Warranty Deed (Attachment 
A)." (Emphasis in original except specifically where 
noted.)

[¶6.]     Subsequently, 
PlatteValley sold the property to 
another party. In the fall of 1983 payments to appellees became delinquent. The 
appellees notified the appellants that the payments were in default. Thereafter, 
on February 29, 1984, appellants and appellees agreed to list the property for 
sale with a real estate agent. The parties stipulated that the net proceeds from 
any sale of the building were to be first applied to paying off the remaining 
indebtedness on the 1978 agreement and the balance, if any, given entirely to 
appellants. When no buyer was found, appellees filed suit. They claimed that 
under the 1978 contract they were entitled to payment of the outstanding 
balance. Appellants responded that the 1980 contract had superseded the 1978 
contract and that under the 1980 contract acceleration was not a remedy for 
default.

[¶7.]     The matter proceeded to 
trial on December 18, 1984. After taking the matter under advisement, the trial 
court found in its opinion letter: "[T]he 1980 contract for sale was not 
intended to nor did it alter or extinguish any rights the Pouloses had by virtue 
of the 1978 agreement for warranty deed * * *." From the wording of the trial 
judge's letter, we conclude that he considered the contract ambiguous and 
resolved the parties' intent as a question of fact. Judgment was formally 
entered on January 4, 1985.

[¶8.]     We have previously held 
that the construction of a contract is a question of law when its terms are 
plain and unambiguous, and a question of fact when the contract is unclear and 
extrinsic evidence is admissible to establish the parties' intent. Meuse-Rhine-Ijssel Cattle Breeders v. Y-Tex 
Corp., Wyo., 590 P.2d 1306 
(1979).

[¶9.]     Appellants contend that 
the sentence found in the 1980 contract which states, "[t]he default provisions 
contained herein shall replace those contained in the Agreement for Warranty 
Deed (Attachment A)," unambiguously amends the 1978 contract. However, the 1980 
contract also provides, "[i]t is expressly understood and agreed that 
Kinderknechts shall remain liable to Pouloses pursuant to their obligations 
contained in the Agreement for Warranty Deed. (Attachment A)." Ambiguity arises 
as to whether the 1980 contract intended to change the remedies available to the 
appellees in case of default. Thus, it was a question of fact as to the parties' 
intention.

[¶10.]  When presented with a challenge to a 
trial court's finding of fact, we accord considerable deference to that court's 
conclusions and will reverse only if the findings are clearly erroneous or 
against the great weight of the evidence. Sanford v. Arjay Oil Co., Wyo., 686 P.2d 566 
(1984). Here the evidence does not establish that the findings of the trial 
court were clearly erroneous in concluding that the 1980 contract neither 
altered, nor was intended to alter, the appellees' remedies for default under 
the 1978 contract. On the contrary, the court's decision is significantly 
supported by the express written agreement of the parties that appellants are to 
remain liable to appellees as provided in the 1978 agreement for warranty 
deed.

[¶11.]  On the record before us, we cannot 
conclude that the trial court clearly erred in finding that the parties did not 
intend to alter appellees' remedies against appellants in case of a default. It 
is reasonable to believe that the 1980 contract sought only to make clear that 
as between appellants and PlatteValley the default provisions of that 
contract controlled.

[¶12.]  Affirmed.

THOMAS, Chief Justice, specially 
concurring.

[¶13.]  I concur in the result in this case 
reached by the majority opinion. In my judgment, however, there is no ambiguity 
with respect to the rights of the Pouloses in this instance. I am not sure that 
the district court really found ambiguity, but if it did that finding is fully 
reviewable by this court because "[w]hether ambiguity exists is a question of 
law. Redding Foods, Inc. v. Berry, Tex.Civ.App., 361 S.W.2d 467 (1962); Bosler v. Coble, 14 Wyo. 428, 84 P. 895 
(1906)." Amoco Production Company v. 
Stauffer Chemical Company of Wyoming, 
Wyo., 612 P.2d 463, 465 (1980).

[¶14.]  In this instance the two contracts 
disclose clearly that the Kinderknechts remained liable to the Pouloses 
according to their original contract. The Kinderknechts however, have an option 
to seek specific performance or rescind the contract with respect to any failure 
on PlatteValley to perform the terms 
of the second contract. I cannot discern how the second proposition creates 
ambiguity with respect to the first. For me the contract is in writing and the 
language is clear and unambiguous, and the intention of the parties that the 
Pouloses would continue to enjoy their rights under the 1978 contract is 
unequivocal. See Guynn v. Holst, 
Wyo., 696 P.2d 632 (1985); Cheyenne 
Mining and Uranium Company v. Federal Resources Corporation, Wyo., 694 P.2d 65 (1985); Salt River Enterprises, Inc. 
v. Heiner, Wyo., 663 P.2d 518 (1983); Busch Development, Inc. v. City of Cheyenne, 
Wyo., 645 P.2d 65 (1982); Amoco 
Production Company v. Stauffer Chemical Company of Wyoming, Wyo., 612 P.2d 463 (1980); Wyoming Bank and Trust 
Company v. Waugh, Wyo., 606 P.2d 725 (1980); Hollabaugh v. Kolbet, Wyo., 604 P.2d 1359 (1980); Pilcher v. Hamm, Wyo., 
351 P.2d 1041 (1960); Fuchs v. Goe, 
62 Wyo., 134, 163 P.2d 783 (1945).