Court Opinion

ID: 9659698
Source: CourtListenerOpinion
Date Created: 2023-08-23 21:52:55.43733+00
Date Added: 2024-06-11T18:14:10.911030
License: Public Domain

Supplemental Opinion on Denial of Rehearing June 12, 1985 Melvin Mayfield, Judge. One of the grounds urged for rehearing in this case is that we erred in holding inadmissible the evidence that appellees lost three weeks of working time as a result of a claim by a third party to the timber cut by appellees. This evidence was offered to support the claim that appellees did not complete their written contract by the agreed date because the appellant had given them the right to sell the timber, but a third party made claim to it, and appellant took too long to resolve the matter. We agreed with the appellant that this evidence was inadmissible because it violated the parol evidence rule. Our opinion pointed out that the written contract provided that the timber cut by the appellees should be burned. We cited the case of Sterling v. Landis, 9 Ark. App. 290, 658 S.W.2d 429 (1983), and recognized its holding that the parol evidence rule is not violated by proof of a subsequent oral agreement modifying the terms of a written contract; but we said appellees’ evidence about their right to sell the timber cut by them was concerned with discussions made prior to the signing of the written contract. In the brief in support of appellees’ petition for rehearing, it is said there was testimony concerning conversations about the timber rights that took place both prior and subsequent to the signing of the written contract. The parol evidence rule is actually a rule of substantive law which provides that all antecedent proposals and negotiations are merged into the written contract. City of Crossett v. Riles, 261 Ark. 522, 549 S.W.2d 800 (1977). We have carefully examined appellees’ references to the transcript and find that the record simply will not support the contention that there was a subsequent agreement modifying the terms of the written contract as to disposition of the timber cut from the land being cleared. In addition to the contention that the trial court erred in admitting evidence that violated the parol evidence rule, the appellant contended that the judgment in this case should be reversed because the trial court should have granted appellant’s motion for a directed verdict, and because the trial court erred in giving a certain jury instruction. We agreed as to the instruction since it allowed the jury to find that the appellant breached the contract when there was no evidence properly in the record from which that finding could be made. We did not agree that the appellant was entitled to a directed verdict. In that regard, we said the evidence raised a question of fact as to whether the appellees had substantially performed their contract and, even if they had not substantially performed, they were “still entitled to recover on a quantum meruit basis for any time, labor, and materials they may have expended on any work performed for appellant for which they have not been paid.” In the latter event, we said the "basis of their recovery is the benefit conferred upon the appellant.” In our discussion of the measure of damages where there has been substantial performance, we referred to the case of Royal Manor Apts. v. Powell Const. Co., 258 Ark. 166, 523 S.W.2d 909 (1975). However, in their rehearing argument the appellees state that Royal Manor did not involve the question of substantial performance. They are obviously correct as the opinion in that case clearly states that the appellee there was not in default; that the general contractor had prevented the appellee from completing the work and, therefore, the appellee could elect to rely upon the contract and claim the full amount due, less what it would have cost to complete the job, or could recover the reasonable value of its performance on a quantum meruit basis. Since Royal Manor was not a substantial performance case, the rule of damages in that case which allowed a quantum meruit recovery will not apply where the right to recovery is based upon substantial performance. In'that situation the measure of recovery is the contract price, less the difference in value between the work as done and as contracted to be done, or less the cost of correcting defective work where this is a reasonable alternative. See Carter v. Quick, 263 Ark. 202, 563 S.W.2d 461 (1978) and Taylor v. Richardson Const. Co., 266 Ark. 447, 585 S.W.2d 934 (1979), cited in our original opinion. See also 5 Corbin, Corbin on Contracts § 1110 (1964) (explaining why quantum meruit recovery is not allowed a plaintiff who has substantially performed). Cooper and Glaze, JJ., agree.