Opinion
No. 59851-1-I.
June 30, 2008.
Appeal from a judgment of the Superior Court for Snohomish County, No. 05-2-08891-3, Richard J. Thorpe, J., entered April 11, 2007.
Affirmed by unpublished opinion per Grosse, J., concurred in by Schindler, C.J., and Leach, J.
An action for specific performance of a real estate purchase and sale agreement will not lie where the seller is unable to deliver marketable title and the contract specifically provides that rescission is the sole remedy. Here, the agreement between the parties was negotiated and signed by the seller, who was someone other than the titled landowner and thus unable to deliver marketable title. The agreement expressly provided that an action for specific performance was not available in the event the seller was unable to deliver such title. The trial court is affirmed.
FACTS
The real property at issue was originally purchased in 1995 with title resting in Jerome St. Martin. Jerome's mother, Osa St. Martin, paid off the money owing on the property. In 1999, facing imminent foreclosure from a subsequent mortgage on the property and an arrest for felony possession of methamphetamine, Jerome quitclaimed the property to his mother. After curing the financial delinquency, Osa quitclaimed the property back to Jerome less than 30 days later.
A statutory warranty deed from William and Renea McKnight to Jerome St. Martin was properly executed, but not filed until this real estate transaction ended.
We refer to the St. Martins by their first names to avoid confusion. No disrespect is intended.
In April 2002, Jerome was again arrested and charged with a felony to which he pleaded guilty. Prior to his sentencing, Jerome filed for bankruptcy where he declared under penalty of perjury that he did not own any real property. Jerome discharged over $26,000 of debt in bankruptcy. Additionally, based on Jerome's representation of indigency in his criminal proceeding, the sentencing court waived a $3,000 fine.
From 2003 through 2005, Osa's daughter, Teresa St. Martin, managed the property on Osa's behalf, under a power of attorney executed by her mother. Teresa urged her mother to sell the property and Osa agreed. Teresa contacted Kyle Lien, an adjacent property owner, and offered to sell the property to him.
Kyle and Jolie Lien (the Liens) and Osa executed a real estate purchase and sale agreement (Agreement) on February 16, 2005. First American Title Insurance Company (First American) issued a preliminary commitment for title insurance on February 24, 2005. It showed title vested in Jerome and a third party subsequently cleared by statutory warranty deed from the title.
Teresa informed First American that Jerome would be filing another quitclaim deed to Osa to clear his name from the title. Osa requested her attorney, Victor Haglund, prepare the quitclaim deed for Jerome. On March 30, 2005, Jerome executed the quitclaim deed and tax affidavit. The documents were delivered to First American.
On April 26, 2005, First American received an e-mail from Teresa with instructions regarding the disbursement of proceeds and transmitting the closing documents for Osa's signature.
But, just prior to closing, Jerome discovered that his mother was selling the property for half of its purported value and sought to stop the sale. On May 10, Teresa e-mailed First American advising that her mother no longer wished to sell. On May 12, Jerome retrieved the quitclaim deed from First American.
The Liens brought suit seeking specific performance of the Agreement. On November 15, 2006, the Liens moved for partial summary judgment requesting the court to quiet title in Osa and to order specific performance of the Agreement. The trial court denied the motion. On December 5, Osa moved for summary judgment dismissal which the trial court granted. The Liens appeal.
ANALYSIS
Clause (e) of the Agreement provides:
Title Insurance. Seller authorizes Buyer's lender or Closing Agent, at Seller's expense, to apply for a standard form owner's policy of title Insurance. . . . The Title Insurance Company is to send a copy of the preliminary commitment to both Listing Agent and Selling Licensee. The preliminary commitment, and the title policy to be issued, shall contain no exceptions other than the General Exclusions and Exceptions in said standard form and Special Exceptions consistent with the Condition of Title herein provided. If title cannot be made so insurable prior to the Closing Date, then as Buyer's sole and exclusive remedy, the Earnest Money shall, unless Buyer elects to waive such defects or encumbrances, be refunded to the Buyer, less any unpaid costs described in this Agreement, and this Agreement shall thereupon be terminated. Buyer shall have no right to specific performance or damages as a consequence of Seller's inability to provide insurable title.
(Emphasis added.)
In construing a contract, the intent of the parties, as expressed in the plain language of the instrument, is given controlling weight. The interpretation of an unambiguous contract is a question of law and may be resolved on summary judgment. Here, the Agreement unambiguously excludes specific performance as a remedy for seller's inability to provide title. The Liens, as buyers, simply have no right to specific performance.
Corbray v. Stevenson, 98 Wn.2d 410, 415, 656 P.2d 473 (1982).
In re Estates of Wahl, 99 Wn.2d 828, 664 P.2d 1250 (1983).
Watson v. Ingram, 124 Wn.2d 845, 881 P.2d 247 (1994) (holding that a provision in a written agreement for the purchase and sale of real estate which provides for liquidated damage is valid and enforceable); RCW 64.04.005 (1).
The exclusive remedy available to the Liens is the return of their earnest money as per the Agreement's express terms contained in clause (e). Osa's not having title to transmit at the time of the closing date is dispositive. As such, we need not reach or address the contention that Jerome (who was not a signatory to the Agreement) is judicially estopped from claiming ownership in the property.
The trial court is affirmed.
We concur.