Opinion ID: 2545615
Heading Depth: 1
Heading Rank: 3

Heading: Summary Judgment as to Breach-of-Contract Claims

Text: In McLemore v. Hyundai Motor Manufacturing, LLC, supra, we dealt with option agreements identical to the option agreements executed in the underlying case. The IDB argued in McLemore, as do the project participants here, that the 2002 amendment to the option agreement waived the most-favored-nation clause in the original option agreement. Southdale and Wheeler/Phillips argue, as did the Russells, that the amendment of the option agreements did not waive the most-favored-nation clause. Southdale and Wheeler/Phillips contend that the sole purpose of the amendment to the option agreement was to extend the date of the option 120 days past the February 2002 expiration date of the original option agreement. Because the amendment to the option agreement did not specifically delete or waive the most-favored-nation clause, they argue, the clause remained in effect. Southdale and Wheeler/Phillips rely on language in the amended option agreement providing that, [e]xcept as amended hereby, the Option is in all other respects ratified and confirmed, and language in the original option agreement providing that no waiver of any of [the] terms and conditions [of the option agreement] shall be effective unless made in writing and duly executed by the parties to the option agreement. They insist that because the amendment to the option agreement did not specifically delete or waive the most-favored-nation clause, that clause remains enforceable. The project participants contend that because the language in the amendment to the option agreement as to the purchase price is unambiguous and establishes a definite purchase price of $4,500 per acre, the most-favored-nation clause was eliminated from the option agreements between the IDB and Southdale and between the IDB and Wheeler/Phillips. We reversed the summary judgment for the IDB as to the Russells' breach-of-contract claim in McLemore, stating: We hold that the terms of the amendment to the option agreement are not `definite and certain' as to waiver of the most-favored-nation clause in the original option agreement. The language of the original option agreement specifically provided that for a waiver of a term of the agreement to be effective, the waiver must be in writing and executed by both parties. Although the language in the amendment to the option agreement sets forth the price per acre at $4,500, we cannot conclude that the language in the amended option as a matter of law modified or waived the most-favored-nation clause in the Russells' original option agreement. Therefore, a question for the jury exists as to whether the amended option agreement modified or waived the most-favored-nation clause in the Russells' original option agreement, and a summary judgment for the IDB and against the Russells on this ground is not proper. 7 So.3d at 334. Based on our holding in McLemore, we likewise hold in this case that whether the amendment to the option agreements modified or waived the most-favored-nation clause in Southdale's and Wheeler/Phillips's original option agreements is a question to resolved by the jury, and a summary judgment on this ground was error. We also addressed in McLemore arguments made by the Russells and the McLemore group that the trial court erred in entering a summary judgment on their breach-of-contract claim because, they said, a genuine issue of material fact exists as to the meaning and application of the most-favored-nation clause in the option agreements. In McLemore, the IDB argued that under the doctrine of merger the option agreements had no effect once the deeds were executed and delivered. We stated in McLemore: Thus, the mere execution and delivery of a deed does not merge the consideration in the contract of sale into the deed. As we stated in Lipscomb v. Tucker, 294 Ala. 246, 256, 314 So.2d 840, 848 (1975): `If the receipt of valuable consideration is recited in a deed, the recital is merely prima facie evidence of the full agreed consideration and parol evidence is admissible to show that other and additional valuable consideration was to be received by the grantor such as additional money or credit on a pre-existing debt or mortgage.' Here, the deeds in question provide that the consideration is `$10.00 and other valuable consideration.' This recitation of consideration permits inquiry into like consideration for the sale of the properties, and the Russells' and the McLemore group's breach-of-contract claims are not barred by the doctrine of merger. 7 So.3d at 336. Based on our holding in McLemore, we likewise hold in this case that Southdale's and Wheeler/Phillips's breach-of-contract claims are not barred by the doctrine of merger, and a summary judgment on this ground was error. Finally, we examined the language of the option agreements in McLemore to determine whether they are ambiguous and whether a genuine issue of material fact exists for the jury as to whether the Shelton property was part of `the project planned for this Property' and, if the Shelton property is part of the project, whether, like Shelton, the Russells and the McLemore group should have been paid $12,000 per acre. 7 So.3d at 337. After reviewing the evidence presented, the vast majority of which is identical in this case, we concluded in McLemore: We agree with the Russells and the McLemore group that the language in the option agreements is ambiguous, that it cannot be resolved by rules of contract construction, and that they presented substantial evidence creating a genuine issue of material fact for the jury as to the meaning and application of the most-favored-nation clause in the option agreements. Specifically, the provisions, `[i]f Purchaser elects to exercise this Option the purchase price for the Property shall be determined as follows' and `the purchase price shall in no event be less than the price per acre paid to any other landowner included in the project planned for the Property' are ambiguous because reasonable persons could differ on whether `the price per acre paid to any other landowner included in the project' refers to a purchase price paid only by the IDB or to a purchase price paid by any purchaser for property included in the project. If the implication is that the language refers to payments only by the IDB, then the most-favored-nation clause is triggered only if the IDB paid other landowners more than it paid the sellers the Russells and the McLemore group. If the language refers to a purchase price paid by any purchaser on property for the project, then the most-favored-nation clause is triggered regardless of whether the purchase price was paid by the IDB or another entity. Reasonable persons could differ over whether the reference to 'price per acre paid to any other landowner' includes by implication the interlineation of the phrase `by the IDB' so that the contract means that the most-favored-nation clause is triggered only when the purchase price paid by the IDB to any other landowner exceeds the price paid to the seller. Thus, a jury question is presented. Additionally, depending on resolution of the above ambiguity, the evidence is in conflict as to whether Shelton was a `landowner included in the project.' Because reasonable persons can differ on the meaning of the clause, i.e., whether the language `price per acre paid to any other landowner included in the project' obligated the IDB to pay the Russells and the McLemore group $12,000 per acre and whether the Shelton property was included as part of the project site, the evidence presents questions for the jury to resolve, and the summary judgment for the IDB is reversed. 7 So.3d at 338-39. Based on our holding in McLemore, we likewise hold in this case that the language in the option agreements is ambiguous and that the evidence presents questions for a jury to resolve. Therefore, the summary judgment in favor of the remaining project participants as to Southdale's and Wheeler/Phillips's breach-of-contract claims must be reversed.