Opinion ID: 901347
Heading Depth: 1
Heading Rank: 2

Heading: Expiration/ Extension of the Initial Agreement

Text: [¶ 22.] The Initial Agreement was executed on April 16, 1997. It provided that the agreement would expire 90 days after execution and that closing was to occur by June 30, 1997. It also provided that the [b]uyer may extend this date by up to 30 days on account of title, environmental, survey, or appraisal matters and receipt of government approvals. The actual closing took place on July 24, 1997, after the scheduled closing and after the stated expiration date, but within the time permitted for extensions. [¶ 23.] Behrens argue that because closing took place after the initial expiration date, the Initial Agreement had expired, and therefore, Wedmore was free to obtain better terms of financing. Behrens raise a number of factual and legal points in support of this argument. Behrens contend that factually, Wedmore's conduct in negotiating major changes ... after July 15 belies his recent claim that the Initial Agreement did not expire. They also point out that as late as September 1997, Wedmore had argued to Loewen that the Initial Agreement had expired. [4] Behrens finally contend that they never authorized Wedmore to extend the Initial Agreement. Behrens ultimately argue the legal point that if the ensuing negotiations significantly altered the original agreement, the original agreement was not a `final and complete' contract. [¶ 24.] Wedmore concedes that closing occurred after the expiration date, but he points out that regardless of Behrens' current contentions, they had always indicated that they had negotiated a binding contract. Wedmore further contends that Behrens never indicated that they did not want to close the Initial Agreement, and the parties never extinguished ( see SDCL 53-11-1) or rescinded ( see SDCL 53-11-2) the Initial Agreement. [¶ 25.] These arguments (and the record) demonstrate the existence of disputed issues of material fact concerning the expiration or extension of the Initial Agreement. While Behrens have identified evidence of negotiations and term changes after the expiration date that could suggest that the Initial Agreement may have expired, Wedmore has identified evidence that an extended closing date was legally authorized and factually agreed to by Behrens. In light of this dispute of fact, the trial court correctly denied summary judgment and instructed the jury on contract formation. Those instructions specifically included directions on the requisites of binding initial agreements, and the fact that ensuing negotiations may be evidence of the absence of a binding agreement. ( See Instructions 48d and 48e at n3, supra ).