Summary
noting that a party's alleged lack of authority to sign a contract was a matter to be specifically pleaded as an affirmative defense
Summary of this case from Soicher v. State Farm Mut. Auto. Ins. Co.Opinion
July 16, 1974.
Editorial Note:
This case has been marked 'not for publication' by the court.
Bruno & Bruno, Frank A. Bruno, Louis B. Bruno, Denver, for plaintiffs-appellants.
Reidy & Kerwin, A. Thomas Elliott, Jr., Denver, for defendant-appellee.
COYTE, Judge.
The plaintiffs-appellants, Graham and Connie L. Haney, brought suit against the defendant-appellee, Charter Homes, Inc., for damages for breach of contract. The district court granted the defendant's motion to dismiss the complaint for failure to state a claim upon which relief can be granted. We reverse.
Plaintiffs alleged in their complaint that they had entered into a written contract with defendant to purchase a lot and house, to be constructed thereon; that they had complied with all terms of the contract; and that defendant had failed and refused to comply with the terms of the contract. Plaintiffs prayed for damages for breach of contract and the return of their earnest money down payment. Attached to the complaint, as an exhibit, was a copy of the agreement signed by the plaintiffs and by one Teaney. The agreement was on a printed form, the second paragraph of which read:
'Upon written approval hereon by the seller, this agreement shall become a contract between Seller and Purchaser and shall inure to the benefits of their respective heirs, successors and assigns.'
The signatures on the contract appear as follows:
"Accepted:
By s/ Gary M. Teaney s/ Connie L. Haney
----------------
Sales agent Purchaser
Approved by:__________, s/ Graham Haney
Purchaser
By____________________ "
Seller
The defendant moved to dismiss the complaint for failure to state a claim contending that the exhibit attached to plaintiff's complaint made it clear that the parties never entered into the alleged contract, and that the agreement standing by itself does not bind the seller. After argument, the district court dismissed the complaint with prejudice.
On appeal, plaintiffs contend that the complaint stated a cause of action and that they are entitled on trial to show that Teaney had either express, implied or apparent authority to sign the contract. In Denver & Rio Grande Western R.R. v. Wood, 28 Colo.App. 534, 476 P.2d 299, the correct rule is set forth for the court to apply when considering a motion to dismiss:
'Pleadings must be construed in favor of the pleader. Spomer v. City of Grand Junction, 144 Colo. 207, 355 P.2d 960. Upon a motion to dismiss for failure to state a claim, the facts of the complaint should be taken as true, and then the trial court must determine if under any theory of law plaintiff would be entitled to relief. If relief could be granted under such circumstances, then the complaint is sufficient. Regennitter v. Fowler, 132 Colo. 489, 290 P.2d 223.'
Defendant contends that there is a conflict between the allegations contained in the complaint (stating that the parties entered into a contract), and the provisions of the exhibit attached to the complaint (which do not show execution of the contract by defendant), and that the provisions in the exhibit control. These instruments are not in conflict because the contract does not show on its face that Teaney did not have authority to sign it, and the exhibit does not bar plaintiffs from attempting to prove the contract.
Plaintiffs' complaint states a cause of action. The factual issue remains to be determined as to whether Teaney had either express, implied or apparent authority to execute the contract on behalf of defendant. If defendant contends that there is an issue involving the statute of frauds in the determination of the authority for Teaney to sign the contract, this is a matter to be specifically pled as an affirmative defense. C.R.C.P. 8(c). In any event, if it is determined that there is no contract, then the issue remains as to whether plaintiffs are entitled to a refund of their down payment. Such issues could not be resolved on a motion to dismiss.
Accordingly, the judgment is reversed and the cause remanded with directions to reinstate the plaintiffs' complaint.
ENOCH and RULAND, JJ., concur.