This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2004).
IN COURT OF APPEALS
Sara L. Chechik, et al.,
Beth Lindahl-Urban, et al.,
Filed July 12, 2005
Gordon W. Shumaker, Judge
Hennepin County District Court
File No. 03-11936
Grell, RICOACT.COM LLC,
Considered and decided by Klaphake, Presiding Judge; Shumaker, Judge; and Poritsky, Judge.*
U N P U B L I S H E D O P I N I O N
GORDON W. SHUMAKER, Judge
On appeal from a jury’s award of money damages for breach of contract in a residential real-estate sale, appellant Terrence Brayboy alleges that the district court erred in certain evidentiary rulings, erred in failing to apply the doctrine of merger, and erred in ruling that respondents proved their alleged damages. Respondents filed a notice of review regarding a credit the court awarded against the damages. Because respondents failed to carry their burden of proving damages, we reverse.
On May 11, 2002, appellant Terrence
Brayboy agreed to sell to respondents Joel C. Chechik and Sara L. Chechik a
single-family dwelling in
Informational and marketing documents that the Chechiks received before agreeing to buy the house indicated that it had a “slate” roof. To satisfy an inspection contingency in the purchase agreement, the Chechiks retained the Lash Inspection Company and Dennis Lash to inspect the house. Lash’s inspection report listed the roof composition as slate.
After the sale was closed, the Chechiks determined that the roof was not slate but was a cement-asbestos shingle roof. They then sued Brayboy, Coldwell Banker Burnet, Lindahl-Urban, and Powers, alleging breach of contract, fraud, negligent misrepresentation, and unjust enrichment. The real-estate broker and the sales agents settled with the Chechiks for $10,000 in return for a Perringer release.
Prior to trial, the Chechiks and Brayboy brought cross-motions for summary judgment. The district court granted Brayboy’s motion for summary judgment on the fraud, unjust-enrichment, and negligent-misrepresentation claims and dismissed them. The court granted the Chechiks’ motion for summary judgment on the breach-of-contract claim. As to that claim, the court ruled that the parties were mutually mistaken as to the composition of the roof and found that “the contract has been breached due to mutual mistake.” In granting summary judgment to the Chechiks, the court rejected Brayboy’s argument that the doctrine of merger applied and foreclosed any claim for breach of contract based on representations made prior to the delivery of the deed. The district court held that the parties’ mutual mistake of fact prevented merger. The court then held that the remedy for breach of contract is damages as measured by “the difference between the market value of the property at the time of sale and the contract price.” The court also ruled that the Chechiks were entitled to litigate “benefit of the bargain damages,” and it set the matter for trial on that issue.
In the jury trial on damages, Joel Chechik testified that he would not have paid $508,000 for the house had he known it did not have a slate roof, but, rather, he would have considered abatement costs, which his research showed would be $33,000, and “probably would have reduced our bid by $40,000 . . . .” He also testified that he believed that the asbestos-tile roof would affect the resale value of the house. The Chechiks’ roofing contractor testified that it would cost $33,485 to replace the roof with an asphalt-shingle roof. Brayboy testified that the home was worth the selling price of $508,000 when the Chechiks bought it.
The district court instructed the jury that “[t]he measure of damages, if any, in this case is the difference in the value of the house with and without a slate roof.” The jury returned its special verdict awarding damages in the sum of $30,000 for “Brayboy’s breach of the contract due to the mutual mistake of fact between the parties.”
Brayboy moved for judgment notwithstanding the verdict or, in the alternative, a new trial, contending that the court made evidentiary errors, that merger barred the Chechiks’ claims, that the Chechiks are not entitled to damages when there has been a mutual mistake of fact, and that there was no testimony adduced at trial to prove damages as defined in the jury instructions.
In its memorandum denying Brayboy’s motion, the district court stated that there was sufficient proof of damages at trial and summarized the evidence:
At trial Mr. Chechik testified that his realtor suggested that the slate roof added $40,000-$60,000 to the value of the property. He also indicated that he would not have paid $508,000 for the property had he known the roof was made of asbestos and concrete. David Karel of Garlock-French Roofing testified that it would cost $33,475 to remove the asbestos concrete tiles and replace them with an asphalt roof. Mr. Chechik testified that he would have reduced his bid by that sum to remove the concrete and asbestos tiles and install the asphalt roof. Defendant’s realtor, John Powers, stated that he believed the house had a value of $508,000 with the concrete asbestos roof. Brayboy also testified at trial that he believed the house had a value of $508,000 with the concrete asbestos roof . . . .
Brayboy appealed from the summary-judgment rulings and the judgment entered on the verdict and denying his motion for judgment notwithstanding the verdict or, in the alternative, a new trial.
D E C I S I O N
Brayboy argues that the district
court erred in ruling that the merger doctrine did not apply because the
parties made a mutual mistake of fact.
But Brayboy did not appeal from the district court’s determination that
a mutual mistake of fact prevents merger.
We cannot address the issue of merger in the abstract but rather must
relate it to the facts of the case and to the district court’s ruling. The undisputed facts are that representations
that the roof was slate were made before the sale and that the parties closed
the sale and Brayboy delivered a deed to the Chechiks. The facts also show that all of the parties
thought the roof was slate. The merger
doctrine creates a presumption that all contracts and agreements preceding the
delivery of the deed are merged into that deed.
The district court held that, because the parties were mutually mistaken as to the composition of the roof and because the value of the roof was a significant component of the sale, merger did not apply.
Brayboy argues that merger applies
and that the doctrine is not meant to govern mistakes such as the parties made
but rather applies to “mechanical” failures in the deed. But the court held that the doctrine does not
apply to the type of mistake at issue, and Brayboy has not appealed from that
ruling. Therefore, this issue is
waived. See Melina v. Chaplin, 327 N.W.2d 19, 20 (
2. Proof of Damages
Brayboy argues that the court should
have granted his motion for judgment notwithstanding the verdict because the
Chechiks failed to prove their alleged damages.
The denial of a motion for a JNOV “must be affirmed, if, in the record,
there is any competent evidence reasonably tending to sustain the verdict.” Pouliot
v. Fitzsimmons, 582 N.W.2d 221, 224 (
The district court instructed the jury that the measure of damages is “the difference in the value of the house with and without a slate roof.” No one challenges this definition on appeal. The court did not define “value,” and no party raises that omission as error.
The Chechiks concede on appeal that
there was no expert testimony as to the value of the property with a slate roof
or without a slate roof. Thus, we
examine the testimony of Joel Chechik, as owner of the property, on the issue
of damages. See LaValle v. Aqualand Pool Co., Inc., 257 N.W.2d 324, 328 (
The district court noted, and the Chechiks agree, that Joel Chechik’s testimony of value was limited to what he would have paid for the house had he known about the true composition of the roof. He testified to his reasons for making a lower bid than the sale price, those having to do with abatement of the roof problems and replacement of the roof. Ostensibly, the house with the cement-asbestos roof was worth less personally to the Chechiks than $508,000, but the record is entirely devoid of evidence adduced by the Chechiks as to the market value of the house with or without a slate roof. The only arguably competent testimony as to market value was Brayboy’s indication that the house was worth $508,000 even with its cement-asbestos roof.
Thus, the Chechiks failed to carry their burden of proving damages, and the district court erred when it denied Brayboy’s motion for judgment notwithstanding the verdict.
3. Respondents’ Notice of Review
The district court granted a credit in favor of Brayboy against the jury’s award. The Chechiks claim that the credit was improper. Because of our holding regarding the proof of damages, we need not address this issue.
* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.