Title: Sharpsburg Farms, Inc. v. Williams

State: mississippi

Issuer: Mississippi Supreme Court

Document:

363 So. 2d 1350 (1978) SHARPSBURG FARMS, INC. v. Melvin WILLIAMS et al. No. 50404. Supreme Court of Mississippi. October 4, 1978. Rehearing Denied November 29, 1978. *1351 Case, Montgomery & Smith-Vaniz, S.F. Stater, III, C.R. Montgomery, William Larry Smith-Vaniz, Canton, for appellant. James H. Herring, Canton, for appellees. Before ROBERTSON, P.J., and LEE and BOWLING, JJ. ROBERTSON, Presiding Justice, for the Court: On April 8, 1977, the Circuit Court of Madison County entered a judgment in favor of plaintiffs, Melvin Williams and Van Stewart, doing business as S & W Farms, a partnership, against defendant, Sharpsburg Farms, Inc., a Mississippi corporation, for $35,200 ($32,000 actual damages and $3,200 attorneys' fees). On April 14, 1977, the trial court entered a remittitur of $3,000, which remittitur was accepted by the plaintiffs, thus reducing the judgment to $32,200. Defendant appeals. In their Declaration, plaintiffs claimed that on February 23, 1976, they had advanced $400 on the annual rental of $10,000 due November 1, 1976, under the terms of a written lease contract, and that this advance extended for one more year the lease of 532 acres of land, that the defendant "breached the covenants" of the written lease when it sold 428 acres of the leased land in late October, 1976. Defendant answered that the $400 was a personal loan to James and Marjorie Duncan, that the sale was made under the express authority of the written lease, and that due and timely oral and written notice of the sale was given plaintiffs. The written lease of November 1, 1973, was entered into It provided in pertinent part: A written amendment entered into some time in 1976 by the lessor and lessee provided that the leased lands could also be used for the raising of cattle. The court sustained a motion to dismiss James H. Duncan as a party defendant because the allegations of the declaration were against the corporation alone. On February 23, 1976, Duncan asked Melvin Williams to lend him $400. Duncan and his wife, Majorie, being friends of long standing with Williams and his wife, Charlotte, the loan was closed informally on a fishing trip. At Williams' instance, his wife filled out the blank check form, as follows: Only "S & W Farm Melvin Williams" was written by Williams. According to Mrs. Williams, the additional words "Portion of Rent for 1977" were added in the lower lefthand corner of the check because of this colloquy: Williams testified that it happened in this way: Duncan testified that rent wasn't mentioned when the loan was closed and that he didn't see the notation "Portion of rent for 1977" on the check when it was handed him. The check was to pay personal debts. Mrs. Marjorie Duncan testified: The proceeds of the loan were to pay personal debts, according to Mrs. Duncan. This $400 check was not mentioned again by the Duncans or Williams until Sharpsburg Farms, Inc., on October 4, 1976, entered into a written contract to sell approximately 428 acres of the 532 acres leased, to W.B. Patterson. A day or so later, Duncan told Williams that the lands were being sold. When Mrs. Williams phoned Mrs. Duncan, Mrs. Duncan verified the proposed sale. On October 12, 1976, C.R. Montgomery, attorney for Sharpsburg Farms, Inc., wrote James H. Herring, attorney for S & W Farms, Van Stewart and Melvin Williams: On October 28, 1976, a check filled out, as follows, was tendered Sharpsburg Farms, Inc.: On October 29, 1976, Montgomery wrote Herring: On October 29, 1976, a warranty deed was executed by Sharpsburg Farms, Inc. to W.B. Patterson conveying approximately 428.3 acres of the 532 acres leased. On December 30, 1976, Melvin Williams and Van Stewart, doing business as S & W Farms, a partnership, filed their declaration against Sharpsburg Farms, Inc., a Mississippi corporation, and James H. Duncan, stating among other things: Plaintiffs closed Count I of their Declaration with this statement as to damages suffered: Although there are seven assignments of error, in view of our decision on assignment of error number 5, it will be unnecessary to discuss the other assignments of error. Number 5 is: *1354 In Stuart v. McCoy, 163 Miss. 551, 141 So. 899 (1932), this Court said: There is no ambiguity in section 6 of the written lease; it is couched in clear, positive and express language: The contracting parties recognized that the written lease represented their intentions because even when the only change was to allow the use of the land for cattle farming, a written amendment was executed in 1976 to express this rather insignificant change. In 51C C.J.S. Landlord and Tenant § 232(2) (1968), we find this language: The principal purpose of the Statute of Frauds [Miss. Code Ann. § 15-3-1 (1972)] is to require the contracting parties to reduce to writing the specific terms of their contract, especially an agreement affecting lands for more than one year, and thus to avoid dependence on the imperfect memory of the contracting parties, after the passage of time, as to what they actually agreed to some time in the past. Section 15-3-1, in pertinent part, provides: This case is a classic example of the great need for such a law. The plaintiffs' case depends on the memories of four people as to what was said and done as they traveled to a fish pond. As could be expected, Mr. and Mrs. Williams remembered the transaction one way, and Mr. and Mrs. Duncan the diametrically opposed way. The plaintiffs' contention, and the heart of their case, is that the specific terms of their written lease contract, can be and were varied by a casual conversation on their way to the fish pond. The gist of their argument is that by the payment of $400.00 *1355 on February 23, 1976, to "James & Margie Duncan" on an annual rental of $10,000 due to Sharpsburg Farms, Inc., that thereby the written lease was extended from November 1, 1976, to November 1, 1977, and the specific written provision that the Lessor, Sharpsburg Farms, Inc., could sell by November 1st, 1976, was somehow stricken from the lease. According to the plaintiffs, this would all come about because in the lower lefthand corner of the $400 check Mrs. Williams had written, at her husband's instance, the words "Portion of rent for 1977." The plaintiffs' argument in the lower court was that the court should infer that this notation had reference to the rental of lands by Sharpsburg Farms, Inc. to S & W Farms by a written lease entered into on November 1, 1973, and that because Duncan was the president and Mrs. Duncan the secretary, and the sole stockholders in Sharpsburg Farms, Inc., that the trial court should also infer that Duncan was acting for and by authority of the corporation when he accepted the $400 check. This was the plaintiffs' argument, in spite of the fact that the uncontradicted testimony was that this was a personal loan to the Duncans to pay off personal debts. It all boils down to the fallacious argument that one of the contracting parties can unilaterally vary the terms of a written contract by parol evidence. The plaintiffs did not charge fraud or mistake. This case would thus appear to fit under the parol evidence rule that: In Fuqua v. Mills, 221 Miss. 436, 73 So. 2d 113 (1954), this Court, in again defining the parol evidence rule, quoted with approval from Kendrick v. Robertson, 145 Miss. 585, 111 So. 99 (1927): There was no evidence of agency or authority from the corporation, Sharpsburg Farms, Inc., to Duncan to negotiate a loan for it. The allegation in the declaration "that defendant Duncan in his capacity as agent and within his authority as President of defendant corporation accepted the aforesaid $400 advance payment, thereby altering the terms and conditions of the lease aforesaid," is thus a conclusion of the pleader and nothing more. Yet this conclusion is refuted by the undisputed testimony of the Duncans that it was a personal loan to pay off personal debts and not debts of the corporation. In some respects, Stilley v. Illinois Central R.R. Co., 209 Miss. 414, 47 So. 2d 840 (1950), is similar to the case at bar. In Stilley the Court said: For the reasons stated, we are compelled to hold that the trial court erred in not sustaining the motion of the appellant for a peremptory instruction at the close of the case. The judgment of the lower court is, therefore, reversed and judgment rendered here for the appellant. REVERSED AND RENDERED. PATTERSON, C.J., SMITH, P.J., and SUGG, WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.