Court Opinion

ID: 5159368
Source: CourtListenerOpinion
Date Created: 2022-01-02 02:32:44.457917+00
Date Added: 2024-06-11T08:25:33.515629
License: Public Domain

KIRSHBAUM, Judge,
concurring in part and dissenting in part.
I concur with the majority opinion insofar as it reverses the trial court’s judgment. I dissent, however, from the majority’s conclusion that on remand the trial court should enter judgment for seller on seller’s counterclaim.
The majority concludes, as the trial court did, that the term “seller’s cost” is “clear and unambiguous.” In the context of the clause in which it appears in this agreement, I find the term ambiguous.
The contract in question is a purchase and sale agreement respecting specific real property. By its terms, the seller granted the buyer a number of easements, rights of access, and other rights for use in connection with the subject property, including the following:
“The right to connect for water usage to the existing water line owned by Seller located on the east side of the property without payment of a tap fee therefor to Seller (it is understood however that the hookup and meter installation charges shall be at Buyer’s expense and that water usage by Buyer shall be metered and the charges of water so used shall be paid to Buyer, its successors or assigns or designee at Seller’s cost) .... ” (emphasis added)
The evidence at trial established that the buyer installed a water meter on the subject property at the juncture of water pipelines owned by buyer and by seller. Other property owners sharing seller’s pipeline system also installed individual meters on their property.
In essence, the parties dispute which meter in the system is to be used to measure the water subject to the “seller’s cost” provision. Such dispute arises because the agreement specifically refers to “metered” water as the only water subject to the “seller’s cost” reimbursement language. As argued at trial, the question was whether buyer is responsible for a formula-based pro rata share of seller’s cost of water measured at the main meter, prior to any distribution of water to buyer and other users, or whether buyer is responsible only for the amount of water actually used by it, as measured by the meter it installed on its property. Either interpretation is reasonable, practical, and supported by the disputed words in context. Therefore, I deem the phrase ambiguous. See Fenimore v. Stauder, 34 Colo.App. 309, 527 P.2d 943 (1974).
Both the trial court, in its final order, and the majority opinion referred to billing practices of the seller in reaching opposite resolutions of this contract dispute. Resort to such parol evidence and the practices of the parties is essential for the just resolution of the issue. Other evidence elicited at trial indicated that for two years after the signing of the agreement the parties’ billing practices reflected buyer’s interpretation of the contract. However, the trial court prohibited seller from introducing additional parol evidence respecting business practices. I agree with seller’s alternate argument that this ruling was erroneous and prejudicial. Hence, on remand, I would direct the trial court to conduct a new trial, permitting the introduction of parol evidence by seller as well as by buyer to determine the intent of the parties in adopting the ambiguous clause requiring buyer to reimburse seller for metered water at seller’s cost.