Price v. Taylor

Present: Carrico, C.J., Compton, Stephenson, Lacy, Hassell,
and Keenan, JJ., and Whiting, Senior Justice

JOYCE C. PRICE, EXECUTRIX, ETC.

v.   Record No. 950802       OPINION BY JUSTICE ELIZABETH B. LACY
                                         January 12, 1996
KYLE R. TAYLOR, ET AL.

          FROM THE CIRCUIT COURT OF THE CITY OF NORFOLK
                     John E. Clarkson, Judge


      This appeal arises out of a contract for the sale of land

between Kyle R. Taylor and Fay L. Mirman, the buyers, and Joyce

C. Price, executrix of the Wallace V. Lankford Estate, the

seller.   Taylor and Mirman filed a motion for judgment seeking

damages for Price's alleged failure to perform the contract for

sale dated April 2, 1993.   Price filed a response asserting

that the contract was invalid because it was procured by fraud,

because it was subject to a condition precedent, and because it

lacked consideration.    Following a two-day hearing, the trial

court entered judgment on a jury verdict awarding the buyers

$35,000 in damages.
      On appeal, Price assigns error to the trial court's

rulings (1) holding that, as a matter of law, the contract on

its face recited sufficient consideration; (2) excluding jury

instructions on fraud in the procurement of a contract; (3)

admitting certain expert testimony; and (4) prohibiting parol

evidence that the contract was subject to a condition

precedent.   For the reasons set out below, we will reverse the

judgment of the trial court and remand the case for a new

trial.

                                I.
        Price first assigns error to the trial court's ruling that

the contract recited consideration on its face. 1      The relevant

portion of the contract states:

        WITNESSETH:    That for and in consideration of the sum

        of N/A Dollars ($N/A) by N/A in hand, paid receipt of

        which is hereby acknowledged, the Buyer agrees to buy

        and the Seller agrees to sell for the sum of Twenty

        thousand Dollars xx/100 Dollars ($20,000), all that

        certain piece, parcel or lot of land . . . .
The italicized portions were handwritten insertions made by

Taylor in blanks on a prepared form.      Price argues that the

language "in consideration of the sum of N/A Dollars" clearly

and unambiguously states that the contract required a payment

in cash as a form of consideration and that no such cash was

tendered by the buyers or received by the seller.       Thus, Price

concludes, the contract did not recite consideration on its

face.       We disagree.

        First, the terms of the contract do not require that

consideration be paid in cash to create the agreement.       More

        1
      Price's assignment of error also stated that the trial
court held that the contract was "valid and enforceable."
However, the trial court's order does not contain that
determination. The record further reflects that the trial
court refused to grant a motion for summary judgment filed by
Price on the validity and enforceability of the contract
because evidence on that issue was "anticipatory evidence as to
one of the issues of the case," and therefore, the motion was
"premature." The validity and enforceability of the contract
remained a subject for trial.




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importantly, it is well established that mutual promises in a

contract constitute valuable consideration.     Adams, Payne &

Gleaves, Inc. v. Indiana Wood Preserving Co., 155 Va. 18, 29,

154 S.E. 558, 562 (1930); Bernstein v. Bord, 146 Va. 670, 677,

132 S.E. 698, 699-700 (1926); see also Brewer v. First Nat'l

Bank of Danville, 202 Va. 807, 815, 120 S.E.2d 273, 279 (1961).

The contract recites that "the Buyer agrees to buy and the

Seller agrees to sell for the sum of Twenty thousand Dollars."

This language reflects the mutual exchange of promises and

alone is sufficient to constitute consideration for the

contract.   Accordingly, the trial court's ruling on this issue

was not erroneous.
                                 II.

     Price submitted five jury instructions which addressed her

contention that the contract was obtained by fraud.    Price

asserts that there was sufficient evidence to support

instructions on this issue and that the trial court erred in

refusing to give them.

     A litigant is entitled to jury instructions supporting his

theory of the case if sufficient evidence is introduced to

support that theory.     Bowers v. May, 233 Va. 411, 413-14, 357

S.E.2d 29, 30 (1987).    While a litigant must carry his burden

to show fraud in the procurement of the contract by clear and

convincing evidence, the trial court must give the jury

instruction on fraud unless the evidence is "clearly




                                - 3 -
insufficient to support the theory."     Provident Life & Accident

Ins. Co. v. Walker, 190 Va. 1016, 1028, 59 S.E.2d 126, 131

(1950). 2

     Price testified that she signed a contract on January 9,

1993, agreeing to sell the property to Taylor and Troy M.

Evenson.    She then testified that sometime in late February or

early March, Evenson approached her and asked her to sign three

blank contracts because coffee had been spilled on the January

contract.    Price stated that she did not sign a contract dated

April 2, 1993, and that her signature on that contract was

forged.     Finally, Price testified that she never negotiated

with Mirman for the sale of the property.
     Applying the principles set out above, we conclude that

the evidence produced by Price to show fraud was sufficient to

support jury instructions on the issue.    Therefore, we hold

that the trial court erred in refusing to instruct the jury on

Price's theory of fraud in the procurement of the contract. 3
                                III.

     Over Price's objection, Taylor and Mirman introduced

testimony of three attorneys as rebuttal witnesses.    Each of
     2
      Taylor and Mirman did not move to strike Price's evidence
on fraud as insufficient as a matter of law.
     3
      Price also complained of the submission of an instruction
to the jury stating that the mutual exchange of promises
constituted legal consideration for a contract. Because the
issue of the contract validity and enforceability remained a
jury issue, see supra note 1, submission of an instruction on
this issue was not reversible error.




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these attorneys testified that the contract was valid on its

face because it recited legally adequate consideration.     Price

assigns error to the admission of this evidence, claiming that

the testimony was improper because the attorneys' statements

were conclusions of law prohibited by Code § 8.01-401.3(B).     We

agree.   This testimony that a contract was valid on its face is

not evidence regarding the existence of an offer, acceptance,

or consideration, but purports to state the legal consequences

of those factual predicates.   Thus, the testimony of these

three witnesses was improper because it constituted conclusions

of law in violation of Code § 8.01-401.3.
                               IV.

     Our conclusions regarding instructing the jury on

fraudulent procurement and admission of the attorneys'

testimony require reversal of the judgment of the trial court

and remand of the case.   We note that one of the issues at

trial, the admissibility of parol evidence to show a condition

precedent, may arise again on remand.

     The general rule in Virginia is that parol evidence of

prior stipulations or oral agreements is inadmissable to vary,

contradict, or explain the terms of a complete, unambiguous,

unconditional written contract.      Shevel's, Inc. v. Southeastern

Assocs., 228 Va. 175, 182, 320 S.E.2d 339, 343 (1984).     When a

claim is made under an unambiguous written instrument, however,

a signatory to the instrument may introduce parol evidence to



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establish a defense based on such doctrines as partial

integration, collateral contract, fraudulent procurement,

mutual mistake, or condition precedent.       Id. at 182-83; 320

S.E.2d at 343-44; J.E. Robert Co. v. J. Robert Co., 231 Va.

338, 343, 343 S.E.2d 350, 353 (1986); Walker & LaBerge Co. v.

First Nat'l Bank of Boston, 206 Va. 683, 688, 146 S.E.2d 239,

244 (1966); Meadows v. McClaugherty, 167 Va. 41, 45, 187 S.E.

475, 477 (1936); Whitaker & Fowle v. Lane, 128 Va. 317, 345-46,

104 S.E. 252, 262 (1920).
       Not all evidence alleged to establish a condition

precedent is admissible, however.      As we stated in Walker &

LaBerge, the alleged "condition precedent must be neither

inconsistent with the instrument itself, nor of such a

character that its performance would render the instrument

wholly ineffective or nugatory."       206 Va. at 690, 146 S.E.2d at

244.   Thus, in litigation involving the enforcement of an

agreement by a general contractor to waive its mechanic's lien,

evidence of an alleged condition precedent that the agreement

was effective only if the contractor had been paid in full was

inadmissible because a contractor has no mechanic's lien if he

has been fully paid; therefore, the condition of payment made

the agreement to waive the lien a legal impossibility, a

nullity.    Id. at 692, 146 S.E.2d at 246.     Payment under these

circumstances would negate any ability or need to waive the

lien because there would be no lien.



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     On the other hand, in Whitaker & Fowle v. Lane, parol

evidence was properly admitted to show an alleged condition

precedent requiring certain action by a third party before a

contract for the sale of a residence was enforceable.    The

buyer, a bank, was allowed to introduce parol evidence that the

purchase contract was conditioned on the amendment of a banking

charter and subscription of bank stock which would allow the

bank to move its headquarters.     Whitaker & Fowle, 128 Va. at

346, 146 S.E.2d at 263.   The terms of this alleged condition

precedent were not inconsistent with the terms of the purchase

contract, did not vary the terms of that contract, and the

performance of the condition precedent did not render the

contract "wholly ineffective or nugatory."    These general

principles would be applicable if, on remand, Price seeks to

offer parol evidence of a condition precedent to the April 3,

1993 contract.
     Accordingly, for the reasons stated, we will reverse the

judgment of the trial court and remand the case for a new trial

in accordance with this opinion.
                                            Reversed and remanded.




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