Opinion ID: 1188744
Heading Depth: 2
Heading Rank: 3

Heading: Loss of Benefit of Bargain

Text: Whether the trial court erred in awarding Lujan compensatory damages against Leon and PPI depends in part upon the interpretation of the deed of trust between Leon and PPI. Paragraph four of the deed of trust limits the property PPI may subdivide and sell until substantially all of certain lots are developed and sold. Paragraph six, however, allows PPI to obtain a release from the lien on property in order to construct amenities or other improvements. Leon claims his refusal to release the property to Lujan was justified under paragraph four of the deed to protect his security and prevent the premature development of the more desirable land. He also asserts that he was not required to grant a release under the exception of paragraph six. Leon argues that the release was not being sought for the purpose of the construction of an equestrian amenity since such facilities already existed when he sold the property. As evidence of this, Leon points out that when the property was sold, an agreement of purchase and sale was signed which required PPI to complete certain amenities within a period of three years from the date of closing. The equestrian unit was not one of the amenities listed in the agreement. However, the trial court found that when PPI purchased the property from Leon, it assured Leon that it would continue to develop Pendaries Village and construct amenities for the project, including an equestrian area offering both boarding and riding privileges to potential lot buyers and current property owners at Pendaries Village. To insure that an equestrian unit was developed, PPI constructed improvements worth $23,000. The court further found that the 19.45 acres had been used to create an amenity and should have been released from the deed of trust. On appeal, this Court will view the evidence in a light most favorable to support the findings and conclusions of the trial court. We will not reverse unless convinced that the findings and conclusions cannot be sustained either by evidence or permissable inferences therefrom. Lewis v. Barber's Super Markets, Inc., 72 N.M. 402, 384 P.2d 470, (1963). We do not weigh conflicting evidence nor determine the credibility of witnesses. Worthey v. Sedillo Title Guaranty Inc., 85 N.M. 339, 512 P.2d 667 (1973). After reviewing the transcript, we find substantial evidence to support the findings and conclusions of the trial court that Leon was required to grant a release under the provisions of the deed of trust. Neither the purchase and sale agreement nor the deed of trust limit the amenities which PPI could construct. Although the equestrian unit was not one of the amenities required to be completed by the agreement and although some facilities at the equestrian area were in existence at the time Leon originally sold the property, there is evidence to show that the expansion, construction and improvements were necessary to develop the equestrian unit into the type of amenity needed at Pendaries Village. PPI complied with the provisions of the deed of trust and was therefore entitled to a release. Leon and PPI also claim that Lujan was not entitled to compensatory damages because he could not have taken advantage of the discount for early payment even if he had obtained the release. When Lujan demanded performance under the January 14, 1975 agreement, he submitted a conditional loan commitment letter from the First Federal Savings and Loan Association of Las Vegas, New Mexico (First Federal) for $50,000.00. Both Leon and PPI point out that when the loan commitment letter was issued, First Federal was unaware of the subdivision and use restrictions on the property. First Federal's president testified that he would not have committed the loan had he known of the restrictions. Therefore, Leon and PPI argue, the loan would ultimately not have been made, and Lujan could not have taken advantage of the discount. We find this argument to be irrelevant in light of the fact that the loan commitment was made. The loan commitment letter conditioned the loan payment upon Lujan's satisfying the requirements of a title binder which accompanied the commitment letter. The title binder required a release of the property from the lien of the original deed of trust and required that a warranty deed be provided. The title binder does not require the warranty deed to be free of restrictions. The court found, and it is substantiated by the evidence, that a warranty deed was provided. The requirements of the loan commitment letter were met except for the release from the deed of trust. Therefore, Leon and PPI are liable for compensatory damages.