Title: KEEVER v. PAYLESS AUTO SALES, INC.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

KEEVER v. PAYLESS AUTO SALES, INC.2003 WY 14779 P.3d 496Case Number: 03-28Decided: 11/18/2003

 

                                                                                                            

 

 

LARRY 
KEEVER,

 

Appellant(Defendant),

 

v.

 

PAYLESS 
AUTO SALES, INC.,

 

Appellee(Plaintiff).

 

 

Appeal 
from the District Court of Laramie County

The 
Honorable E. James Burke, Judge

 

Representing 
Appellant:

            
Guy Cleveland, Attorney at Law, Cheyenne, Wyoming 

 

Representing 
Appellee:

            
No appearance 

 

 

Before 
HILL, C.J., and GOLDEN, LEHMAN, KITE, and VOIGT, JJ.

 

 

 

KITE, 
Justice.

 

[¶1]      Larry Keever 
purchased a car from Payless Auto Sales, Inc. (Payless) and agreed to make three 
monthly payments and a balloon payment to pay off the purchase price.  He failed to make the scheduled balloon 
payment and instead continued to make monthly payments, which Payless 
accepted.  However, he stopped 
making payments before paying the full amount required by the agreement.  Payless sued Mr. Keever for damages 
pursuant to the agreement.   
Mr. Keever argued the contract had been modified by the conduct of the 
parties, but the district court disagreed and awarded damages to Payless.  We affirm the district court's 
judgment.   

 

 

ISSUES

 

[¶2]      Mr. Keever 
presents the following issues:1

 

I.          
Whether the trial court's factual determination was clearly erroneous 
and/or contrary to the great weight of the evidence in that the contract between 
Defendant and Plaintiff was not modified by the payment and acceptance of 
monthly sums versus previously agreed lump-sum payment[?]

 

II.          
If the contract between the Plaintiff and Defendant is found modified, 
whether such modified contract needs to be reduced to writing with such writing 
or "modified contract" having to include required consumer credit 
disclosures[?]

 

III.         
If the "modified contract" between the parties needs to be in writing and 
contain the appropriate disclosures, whether the failure to do so renders the 
contract void as against public policy and/or void for 
illegality[?]

 

 

FACTS

 

[¶3]      In 1996, Mr. 
Keever purchased a 1991 Chevrolet Lumina van from Payless.  He signed a Credit Sale 
Note/Disclosure/Security Agreement for the purchase price of $13,615.92, which 
incorporated a Chevrolet Geo as collateral.  Pursuant to the contract, Mr. Keever was 
to make three monthly payments of $250.00 beginning November 1, 1996, and a 
balloon payment of $13,478.62 on or before February 11, 1997.  The annual percentage rate on the 
contract was eighteen percent (18%).  
Mr. Keever never made the balloon payment, but continued to make monthly 
payments, which Payless accepted for over three years until early 2000.  James Ditzel, owner of Payless, 
testified at trial he continued to "urge" Mr. Keever to make the balloon 
payment.  After February 3, 2001, 
Mr. Keever stopped making payments to Payless despite the fact he still owed 
money on the contract.  

 

[¶4]      On October 31, 
2001, Payless filed suit against Mr. Keever2.  In response, Mr. Keever claimed Payless' 
acceptance of his monthly payments constituted a modification to the 
contract.  Following a bench trial, 
the district court found the terms of the contract had not been modified, and 
"defendant simply chose not to make the payments as scheduled."  The court also found the terms of the 
contract were properly disclosed, including the provision that late payments 
would increase the finance charge.   

 

[¶5]      This appeal 
followed.

 

STANDARD 
OF REVIEW

 

[¶6]      Our review of 
the trial court's factual determination that the terms of the Credit Sale 
Note/Disclosure/Security Agreement had not been modified is limited.  Findings of fact will not be set aside 
unless the findings are clearly erroneous.  

"When 
a trial court in a bench trial makes express findings of fact . . . , we review 
the factual determinations under a clearly erroneous standard[.]" 
Rennard v. Vollmar, 977 P.2d 1277, 1279 (Wyo. 1999). This court does not 
weigh the evidence de novo[.]

Ruby 
Drilling Co. v. Duncan Oil Co., 2002 
WY 85, ¶ 9, 47 P.3d 964, ¶ 9 (Wyo. 2002).

 

[¶7]      We do not 
substitute ourselves for the trial court as a finder of facts; instead, we defer to those 
findings unless they are unsupported by the record or erroneous as a matter of 
law.  Life Care Centers of 
America, Inc. v. Dexter, 2003 WY 38, ¶ 7, 63 P.3d 385, ¶ 7 (Wyo. 2003).  We affirm the trial court's findings if 
there is any evidence to support them.  
Id.  We accept the 
evidence of the prevailing party as true and give that party the benefit of all 
favorable inferences that can fairly be drawn from the evidence, while 
disregarding conflicting evidence.  
Narans v. Paulsen, 803 P.2d 358, 360 (Wyo. 1990).  A reviewing court will not set aside 
the court's findings merely because it might have reached a different result. 
 Conner v. 
Board of County Commissioners, Natrona County, 2002 WY 
148, ¶ 23, 54 P.3d 1274, ¶ 23 
(Wyo. 
2002).  A finding can be "clearly erroneous" 
even though there is evidence to support it, if after a review of the entire 
record, the court "is left with the definite and firm conviction that a mistake 
has been committed."  Hammons v. 
Table Mountain Ranch Owners Association, Inc., 2003 WY 85, ¶ 12, 72 P.3d 1153, ¶ 12 (Wyo. 2003).  

 

 

DISCUSSION

 

[¶8]      Mr. Keever 
asserts the Credit Sale Note/Disclosure/Security Agreement he signed was 
modified by the subsequent conduct of the parties.   The conduct he relies upon is 
Payless' acceptance of his monthly payments after he failed to make the 
scheduled balloon payment.  However, 
Mr. Keever chooses to ignore the evidence at trial that demonstrated Payless had 
no intention of modifying the contract, but instead, was simply accepting the 
late payments upon Mr. Keever's continued promises to make the balloon 
payment.  On direct examination, Mr. 
Ditzel testified:

 

Q.        
Looking at this, in February, Mr. Keever was supposed to make that large 
balloon payment. . . . [D]id he actually make that payment in 
February?

 

A.        No, 
he didn't.

 

Q.        What 
did he do?

 

A.        Just 
continue[d] to make payments looks like 250, 250, 250, then went to 
300.

 

Q.        So 
instead of making the balloon payment, he continued to make payments in the 
amount of $300 a month?

 

A.        
Yes

 

Q.        And 
those payments continued to accrue interest at the note 
rate?

 

A.        
Correct.

 

Q.        And 
you accepted those payments?

 

A.        I 
did.

 

Q.        Why 
did you do that?

 

A.        
That's all I could get.  In 
fact, we urged him to make that balloon payment but we were always given several 
excuses:  the bonus check never came 
in; the refund check never came in, etcetera, etcetera.  So over time, we just accepted what we 
could get.

 

Q.        So 
that was a business decision you had to make?

 

A.        
Yes.

 

 

[¶9]      Following his 
direct examination, Mr. Ditzel testified to the following on 
cross-examination:

 

A.        . . . 
I know that in my notes I continued to try to get the balloon payment and that 
he had made several promises on his  that when he got his bonus check, that he 
would pay the account off.

 

Q.        And 
when it became, as you basically stated earlier, that it was apparent that that 
wasn't going to happen, did you feel compelled at that time to maybe have Larry 
come in and enter into a new contract?

 

A.        
No.

 

. 
. .

 

Q.        Was 
there a reason why you did not? When it became apparent that Mr. Keever was not 
making that balloon payment, why did you not have him come in and execute a new 
contract?

 

A.        We 
had a contract.

 

 

[¶10]   Mr. Keever did not rebut Mr. 
Ditzel's testimony and provided no explanation for his failure to comply with 
the contract.  He 
testified:

 

Q. 
       Isn't 
it true you didn't comply with the terms of this note?

A. 
       He 
wrote  yes.

 

Q.        You 
didn't make the required payment of $13,000 and change in February, did 
you?

 

A.        
That's correct.

 

[¶11]   Following the trial, the district 
court took the matter under advisement, and on November 19, 2002, issued a 
Decision Letter making the following findings:

 

            
Defendant argues that the contract . . . was modified to include the $300 
monthly payment term.  Defendant 
asserts that the new terms should have been in writing and that he should have 
been given the finance disclosures required by law concerning the total amount 
he would have to pay.  

 

            
The Court finds that the terms of the contract were not modified.  Defendant simply chose not to make the 
payments as scheduled.  The Court 
also finds that the required finance terms were disclosed, and the contract 
states that late payments will increase the finance charge that is 
paid.

 

            
Accordingly, the Court finds that Plaintiff should prevail . . . and will 
be awarded the stipulated amount of $12,039.89.

 

[¶12]   This Court has previously 
acknowledged that the parties to a written agreement may orally waive or modify 
their rights under the agreement.  
Shauers v. Board of County Commissioners of County of Sweetwater, 
746 P.2d 444, 448 (Wyo. 1987).  They 
may do so even when the agreement contains a clause prohibiting non-written 
modifications.  Id. at 448 n. 
3.   However, Mr. Keever does 
not contend the parties orally modified the contract.  Rather, he argues the parties modified 
the contract through their course of conduct.  

 

[¶13]   Wyoming law is clear that the party 
asserting a written agreement was modified by the subsequent expressions or 
conduct of the parties must prove so by clear and convincing evidence.  Ruby Drilling Co., ¶ 11.  The question of whether the alleged 
modification 
of the written agreement has been proved by the required quantum of evidence is 
one to be decided by the trier of fact.  
Id.  

 

[¶14]   In order to prevail on appeal, Mr. 
Keever must overcome the onerous burden of persuading this Court that the 
district court's findings are clearly erroneous.  Maycock v. Maycock, 2001 WY 103, 
¶ 11, 33 P.3d 1114, ¶ 11 (Wyo. 2001).   Mr. Keever's only support for his 
argument that the trial court's findings were clearly erroneous is his version 
of the facts, which was soundly rejected by the district court.  Simply reiterating those facts on appeal 
does not meet the clearly erroneous standard of review mandated by our 
jurisprudence.  We understand that 
standard of review is a difficult one to meet; however, that is not without 
reason.  The trial court had the opportunity to 
assess the witnesses' credibility.  
Rossel v. Miller, 2001 WY 60, ¶ 16, 26 P.3d 1025, ¶ 16 (Wyo. 
2001).   While the record 
indicates some evidence did exist regarding the parties' course of conduct which 
was inconsistent with the terms of the contract, other evidence clearly 
indicated Payless had no intention of modifying the contract.  We must defer to the trial court's 
conclusion regarding the credibility of the witnesses and the persuasiveness 
of the evidence.  Id at ¶ 
18.   The trial court heard testimony from 
three witnesses, admitted ten exhibits into evidence, and took the case under 
advisement for careful consideration.  
Mr. Keever presented no evidence to rebut Mr. Ditzel's affirmative 
testimony that Payless continued to urge Mr. Keever to make the balloon 
payment.  Further, nothing else 
about the conduct of the parties indicates mutual assent to a new agreement, as 
Mr. Keever asserts.  

 

[¶15]   A contract modification requires 
the same mutual assent necessary for the formation of the initial contract.  As stated by the Kansas Supreme 
Court:

 

It 
is well settled that the terms of a written contract may be varied, modified, 
waived, annulled or wholly set aside by any subsequently executed contract, 
whether such subsequently executed contract be in parol or in writing. Gibbs 
v. Erbert, 198 Kan. 403, 424 P.2d 276; Bailey v. Norton, 178 Kan. 
104, 283 P.2d 400. One party to a contract cannot unilaterally change the 
terms thereof.  Modification 
requires the assent of all the parties to the contract.  Their mutual assent is as much a requisite 
in effecting a modification as it is in the initial creation of a contract. 

 

Fast 
v.Kahan, 481 P.2d 958 (Kan. 1971) (emphasis added).  In 
this case, the trial court's finding that no such mutual assent existed is not 
clearly erroneous.  Accepting as 
true the evidence of Payless, giving to Payless all favorable inferences and 
disregarding Mr. Keever's evidence as we are required to do, we find no 
error.  Having failed to meet his 
burden, Mr. Keever must live with the bargain he struck.  Because we find the contract was not 
modified, we do not consider the remaining two issues presented by Mr. 
Keever.    

 

[¶16]   Affirmed.

 

 

FOOTNOTES

 

1The 
appellee did not file a brief in this matter.

 

2The 
original complaint asked for judgment in the amount of $6,615.67; however, the 
complaint was later amended and requested judgment in the amount of 
$12,300.51.  During the bench trial, 
the parties agreed on a stipulated amount of 
$12,039.89.