Title: REED v. MILES LAND AND LIVESTOCK CO.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

REED v. MILES LAND AND LIVESTOCK CO.2001 WY 1618 P.3d 1161Case Number: 00-101Decided: 02/16/2001
 OCTOBER TERM, A.D. 2000

                                                                                             February 16, 2001 

 

BILL G. 
REED and DEBRA M. REED,

Appellants(Plaintiffs),

v.

MILES 
LAND AND LIVESTOCK CO.,

Appellee(Defendant).

 

 

Appeal 
from the District Court of Natrona County

The 
Honorable David B. Park, Judge

 

Representing 
Appellant:

Cameron 
S. Walker of Schwartz, Bon, Walker & Studer, LLC, Casper, WY.  Argument by Mr. Walker.

 Representing 
Appellee:

Kevin 
Huber of Williams, Porter, Day & Neville, P.C., Casper, WY.  Argument by Mr. 
Huber.

 Before 
LEHMAN, C.J., and THOMAS*, GOLDEN, HILL, and KITE, JJ.

 *Concurred 
prior to retirement.

            
HILL, Justice.

[¶1]      In this appeal we 
review a partial summary judgment of the district court, wherein the district 
court found that a real estate sales contract was unambiguous and did not 
entitle Appellants, Bill and Debra Reed (Reeds), to the gated pipe that formed a 
part of the irrigation system on the property which was the subject of the real 
estate transaction.  The Reeds 
contend that the agreement between them and Miles Land and Livestock Co. (MLL) 
is unambiguous in its terms that the irrigation system for the property included 
the gated pipe that was necessary to the function of that irrigation 
system.  We agree with the arguments 
propounded by the Reeds and, hence, we will reverse in part1 and remand for additional 
proceedings.

 

 

ISSUES

 

[¶2]      The Reeds pose 
these issues for our consideration:

 

I.  Did the district court err when, as a 
matter of law, it interpreted the contract to buy and sell real estate between 
Bill G. Reed and Debra M. Reed, buyers, and Miles Land and Livestock Co., 
seller, to include gated irrigation pipe only if the pipe was physically on the 
premises on June 2, 1997, the date of the agreement?

 

II.  Did the district court err when it 
interpreted the contract, which specifically provided for conveyance of gated 
pipe, in such a fashion that no gated pipe was required to be 
conveyed?

 

[¶3]      MLL summarizes 
the issue to be resolved very succinctly:  
"Was the district court correct when it ruled that Miles Land and 
Livestock was only required to convey gated pipe that was on the premises at the 
time of the contract for sale?"

 

FACTS

 

[¶4]      On April 8, 1997, 
MLL entered into an Exclusive Right to Sell Listing Contract (Farm and Ranch), 
with Pearson Real Estate Company to sell a 900-acre parcel of farmland.  Section IX of that contract indicates 
that MLL had prepared a Property Condition Statement, which described the 
"condition" of the property.  That 
property Condition Statement provided, inter alia, that the irrigation systems 
on the property were: "1 center povit [sic], Gated Pipe & 
Flood."

 

[¶5]      On April 21, 
1997, the Reeds' son and daughter-in-law (the younger Reeds) submitted an offer 
to buy that 900-acre parcel.  After 
some negotiations, which included a term that MLL was to provide the buyers with 
a Property Condition Statement, a contract was executed.  However, the younger Reeds were unable 
to obtain financing, and so that deal fell through.

 

[¶6]      On June 2, 1997, 
the Reeds entered into a Contract to Buy and Sell Real Estate with MLL.  The subject of the contract was a parcel 
of 188 acres of farmland, which was a portion of the farmland the younger Reeds 
had tried to purchase as set out immediately above.  The Reeds' contract contained this 
provision, which is set out below in pertinent part:

 

VII.  ITEMS INCLUDED IN PURCHASE 
PRICE

            
A.  Price shall include all 
fixtures currently on premises, including but not limited to, . . . 
gates, auto gates/cattle guards and irrigation/domestic water systems 
. . . and Gated Pipe.

 

[¶7]      On that same 
date, the younger Reeds entered into a virtually identical contract to purchase 
712 acres of farmland, which was the remainder of the 900 acres they had 
originally tried to purchase.  These 
agreements were finalized, and the Reeds, as well as the younger Reeds, took 
possession of the properties.

 

[¶8]      This controversy 
arose because when the Reeds took possession of their portion of the property, 
there was no gated pipe for the irrigation system.  Litigation was commenced and, for 
purposes of this appeal, it suffices to say that the district court determined 
that the contract was unambiguous and the Reeds were, by the terms of the 
contract, only entitled to gated pipe if there was gated pipe on the premises on 
June 2, 1997, the date on the contract the Reeds signed.  The trial court granted summary judgment 
in favor of MLL with respect to most of the Reeds' parcel.  It then heard testimony as to a 19-acre 
portion of the Reeds' 188 acres and determined that there was no gated pipe on 
that portion of the property as of June 2, 1997, and the Reeds should take 
nothing by their complaint.

 

  
STANDARD 
OF REVIEW

 

[¶9]      When we review a 
summary judgment, we have before us the same materials as did the district 
court, and we follow the same standards which applied to the proceedings 
below.  The propriety of granting a 
motion for summary judgment depends upon the correctness of the district court's 
dual findings that there is no genuine issue as to any material fact and that 
the prevailing party is entitled to judgment as a matter of law.  Mercado v. Trujillo, 980 P.2d 824, 825-26 (Wyo. 1999).

 

DISCUSSION

 

[¶10]   Our primary focus in construing or 
interpreting a contract is to determine the parties' intent, and our initial 
inquiry centers on whether the language of the contract is clear and 
unambiguous.  If the language of the 
contract is clear and unambiguous, then we secure the parties' intent from the 
words of the agreement as they are expressed within the four corners of the 
contract.  Wolter v. Equitable 
Resources Energy Company, 979 P.2d 948, 951 (Wyo. 1999).  Common sense and good faith are leading 
precepts of contract construction.  
Polo Ranch Company v. City of Cheyenne, 969 P.2d 132, 136 (Wyo. 
1998).  The interpretation and 
construction of contracts is a matter of law for the courts.  Mathis v. Wendling, 962 P.2d 160, 
163-64 (Wyo. 1998).

 

[¶11]   When we apply these principles to 
the contract dispute at hand, we conclude that the language of the contract is 
unambiguous in stating that the Reeds were to be conveyed the "irrigation 
system" on the premises, including the "gated pipe" that was a part of that 
system.  We reject the trial court's 
construction of this contract provision because it defies the purpose and intent 
of the contract, and it adds words to the critical paragraph of the contract 
which have the effect of nullifying its common sense meaning, i.e., 
"Price shall include all fixtures [if] currently on premises [as of the date of 
this contract is signed], including but not limited to, . . . gates, 
auto gates/cattle guards and irrigation/domestic water systems . . . 
and Gated Pipe."  Common sense, as 
well as the usual understanding of the words used, counsels us to conclude that 
the critical paragraph unambiguously states:  "Price shall include all fixtures 
[which] currently [are] on premises, including but not limited to, 
. . . gates, auto gates/cattle guards and irrigation/domestic water 
systems . . . and Gated Pipe."  
The district court's construction of the contract would require a 
vigilant buyer to require that closing be conducted on the situs of the real 
estate, and only after a painstaking itemization of all items which either are 
fixtures by nature, or which are made so by the contract.

 

[¶12]   The Reeds also contend that the 
district court erred in determining that it would not consider the property 
condition statement in construing the contract.  It is our conclusion that the real 
estate sales contract is clear on its face, and the property condition statement 
neither augments nor detracts from it.  
Therefore, it is unnecessary for us to decide whether the trial court 
erred in ignoring the property condition statement on the basis that it was not 
actually attached to the Reeds' contract, although it was referred to in the 
contract, and the language of that contract stated that the property condition 
statement was incorporated by reference.

 

[¶13]   For these reasons, we reverse the 
district court's order on summary judgment with respect to its conclusion that 
the unambiguous language of the contract entitled MLL to summary judgment as a 
matter of law, and remand to the district court with directions that summary 
judgment on that point be entered for the Reeds.  Further proceedings will be necessary so 
as to quantify the amount (or the dollar value) of the gated pipe and associated 
hardware that completes the irrigation system's gated pipe 
component, for the subject property, as contemplated by the terms of the 
contract.

FOOTNOTES

  1The district court's summary 
judgment and another associated order dealt with other issues, as well as that 
discussed in this opinion.  The 
other provisions of those orders are not at issue in this appeal, and are moot 
because of the result we reach.  
Thus, the district court's orders are not reversed with respect to those 
issues.