Court Opinion

ID: 9849324
Source: CourtListenerOpinion
Date Created: 2023-09-24 04:38:24.413107+00
Date Added: 2024-06-11T09:19:17.135815
License: Public Domain

COCHRAN, J.,
dissenting.
My reading of the record leads me to the opposite conclusion from that reached by the majority.
I agree with the trial judge that the contract in controversy is not free from ambiguity. The majority are of opinion that the contract is clear and unambiguous and that extrinsic evidence, under familiar principles, was improperly admitted. Although the parties appeared to shift their positions on this question at trial, it appears that both adduced extrinsic evidence that was properly admitted. Thus, the Sellers proffered a 1975 letter written by counsel for Lerner, the Purchaser, to the County Executive stating that the estimated cost of development of an extended highway plan was in excess of $10 million. Lerner’s counsel objected on the ground of relevancy but later said, “I have no objection to the letter.” The court thereupon admitted the letter into evidence as an exhibit.
Subsequently, Lerner’s counsel asked his client his understanding of the provisions of Paragraph 6(c) of the contract. Over objection by counsel for the Sellers, the court permitted the witness to answer that it provided a maximum of $2 million increase in cost if there was a change in the proffer. It thus appears that from time to time each side felt the necessity of adducing extrinsic evidence to assist in construing an unclear contract.
Moreover, the full memorandum of a meeting held on February 22, 1980, characterized by one witness as “Ted Lerner’s bombshell,” and attended by Lerner and his counsel, was admitted without objection. As the trial judge stated in his letter opinion, the memorandum showed that Lerner was on notice that there would be problems with the State Department of Highways and Transportation (the Department) over the cost and timing of highway development for the project.
The evidence admitted without objection fully justifies the trial court’s conclusions. This evidence established certain facts deemed significant by the trial court: that Lerner or his attorney had dealt with the Department for years concerning the development of the *135property; that in 1975 Lerner’s attorney knew that cost to the landowner of development of highways serving the property would exceed $10 million; that Lerner and his attorney were on notice that substantial commitments would be required of a developer to construct highways; and that the memorandum of the meeting on February 22, 1980, shows that Lerner was on notice that there would be problems with the Department over the cost and timing of road construction.
The court also relied on the contents of Exhibit 5 admitted into evidence over Lerner’s objection. This exhibit, a letter whose contents were made known to Lerner, showed that the Sellers were concerned with the expense not only of compliance with the terms of the proffer but of other requirements for construction of roads, bridges and other improvements. In admitting this evidence, the trial court stated that the letter was attached to an earlier contract identical to the present contract, was made available to Lerner, and had some bearing on the meaning of certain portions of the contract, about which the testimony of two witnesses “unobjected to” had been received.
The trial court resolved ambiguities in the contract against Lerner because his counsel drafted it. Although it appears that some of the language in controversy had been selected by the Sellers for inclusion in earlier contracts, Lerner acknowledged that the contract under which he claims was prepared by his attorney. Under these circumstances, I conclude that the trial court ruled properly in resolving ambiguities against Lerner.
The trial court analyzed the language in Paragraphs 6(c) and 7(c). The court pointed out that 6(c) provided for two contingencies, first, amendment and modification of the proffer, which the Department and others intended to seek, and second, payment by the Purchaser of substantial contributions toward the cost of roads and other improvements. The cap of $2 million applied only to the additional cost incident to amendment and modification of the proffer if approved by the Sellers, either with or without the consent of the Purchaser. The court properly rejected Lerner’s contention that the cap provided a maximum increase in cost for improvements and that 6(c) should be construed to mean “amendments and modifications resulting in substantial sums.”
The court considered the Department’s rejection of the proffer in conjunction with the testimony of the Department witness and concluded that the Department’s requirements were negotiable. *136The court further was not persuaded that the requirements of the Department prevented or impeded development within the meaning of the contract. Obviously, the change in requirements would make development more expensive and less timely. But I agree with the trial court that the Department’s rejection of the proffer did not relieve Lerner. The majority conclude that the Sellers had the burden of showing that all conditions precedent had been met and that the Sellers did not and could not carry this burden because of the Department’s action. I disagree with this conclusion.
Under Paragraph 7(a) it was provided that the Sellers had no knowledge or information of any “administrative action” which would “prevent or impede” the Purchaser from developing and constructing office and hotel buildings on the land. I construe this provision as a promise not to withhold relevant information from the Purchaser. The Sellers were informed by Lerner’s counsel, after the contract had been executed, of the Department’s change of plans. The Sellers, therefore, were not withholding information. There was no provision that a change of plans by the Department or other governmental agency, if known to Sellers and Purchaser, would relieve the Purchaser from all liability. Rejection of the proffer did not activate the provisions of Paragraph 7(c).
Lerner was not a novice, but an experienced business man thoroughly familiar with this property and with the risks inherent in dealing with the Department, an agency allocating limited funds to meet the most meritorious requests for highway improvements. He and his counsel and others undoubtedly were surprised when the Department rejected the proffer. Disappointment, however, does not justify a breach of contract. Lerner and his counsel had been conducting the extended negotiations with the Department with confidence that favorable action would result. This was a business risk, however, that, contrary to all expectations, proved to be unsound. I read the contract to protect the Sellers in the event of additional financial demands by the Department, as one of the Sellers testified, without objection, it was intended to do. In my view, the trial court did not err and its judgment should be affirmed.
STEPHENSON, J., joins in dissent.