Kincaid v. Kingham

CONNOR, Justice,

concurring separately.

I agree with reversal and remand of this case, but not with the reasons relied upon in the majority opinion.

In my view the term “net flat price” is not ambiguous.1 It refers to the amount of money for which Kingham will part with title to her property. There is nothing about that term which implies that King-ham shall receive $14,000 after all liens thereon have been discharged. It was not *1048Kingham’s equity which was to be sold. Rather it was her entire interest in the property. Paragraph 1 refers to a sale of “said property,” and not a fractional interest therein.

This reading of the agreement is reinforced by the language of paragraph 2 whereby Kingham agrees to deliver the property to the purchaser free and clear of all liens.. This is an act which Kingham cannot perform unless the $8,463.12 mortgage indebtedness is first discharged. It means that Kingham will accept a price of $14,000 for her property, that she will deliver an unencumbered title, and that the broker will be compensated solely by any amount paid by the purchaser in excess of $14,000.

I cannot read the second clause of paragraph 2, “. . . and that said property is free and clear of all personal property judgments or encumbrances, other than indicated herein,” as modifying the term “net flat price” so that any encumbrances noted in the other parts of the agreement must be deducted from the $14,000 price term.

In my view paragraph 2 contains two distinct features. The first is a promise to deliver the property free of all liens. The second is in the nature of a warranty that the property is free of encumbrances other than those noted in the agreement. Though the language is inartful, its intention is clear. What it says in effect is: “Owner agrees (1) to deliver . . . and (2) that [the property is clear of liens other than those noted].”

The first clause of paragraph 2 states an obligation on the part of the owner. The second clause states a condition or attribute of the property. To me these are quite different things, with quite different consequences. Undoubtedly the reason for having the second clause of paragraph 2 in the agreement is to guard the broker or a purchaser against having to absorb a loss caused by unforeseen and unknown liens against the property. Otherwise such liens could eliminate the broker’s profit or commission altogether or could require the purchaser to pay more than the agreed-upon price.

A case which exemplifies my interpretation of “net flat price” is Schneidau v. Manley, 131 Conn. 285, 39 A.2d 885, 888 (1944), in which an agreement to sell a parcel of realty for “$8500 net” was held to require the seller to extinguish inchoate dower rights worth $3000 out of the $8500 proceeds, without collecting an additional $3000 from the buyer.

“As the agreement is silent as to any qualifications or limitations upon the title to be conveyed, it means a title free and clear of all encumbrances. The price agreed upon means the sum to be paid for such a title; and the obligation is upon the [seller] to discharge any encumbrance there may be on the property before conveying it.” Id. (citations omitted)

It is hard to conceive of a broker undertaking a sale in these circumstances when numerous liens, including taxes, assessments, license fees, etc., might exceed even the price, here $19,000, for which the broker is able to negotiate a sale with the purchaser. Yet that seems to be the result if the agreement is read as Kingham contends it should be read.

In short, I can find nothing in the agreement which implies that Kingham was to receive $14,000 for her equity in the property. Everything points toward her receiving $14,000 for parting with clear title to the whole property. For these reasons I would reverse and remand with instructions to enter judgment for appellants.

. The question whether a contract is ambiguous is one of law, to be decided by the court. If it is held not to be ambiguous, its construction also is a matter of law for the court. Day v. A & G Constr. Co., 528 P.2d 440, 443 (Alaska 1974); Gardiner v. Gaither, 162 Cal.App.2d 607, 329 P.2d 22, 27 (1958); May v. Chicago Insurance Co., 260 Or. 285, 490 P.2d 150, 153-54 (1971); 4 Williston on Contracts § 616 at 649 (3d ed. 1961). Hence on appeal we are not required to give the superior court’s conclusion on this issue the great deference which we give findings of fact. See Civil Rule 52(a).