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2004-UP-059 - Burdette v. Turner

THE STATE OF SOUTH CAROLINA
In The Court of Appeals


Thomas K. Burdette and Angie Burdette,        Appellants,

v.

Carl J. Turner, Odell Short, Baron Agency, Inc., Steve Conner & Rhonda Conner,        Respondents.


Appeal From Anderson County
Alexander S. Macaulay, Circuit Court Judge


Unpublished No. 2004-UP-059
Submitted October 6, 2003 – Filed January 29, 2004


AFFIRMED


Michael F. Mullinax, of Anderson for Appellants.

Reginald M. Gay and Robert P. Lusk, both of Anderson and Rodney M. Brown, of Fountain Inn, for Respondents.

PER CURIAM:  Thomas and Angie Burdette (“Buyers”) appeal the circuit court’s grant of summary judgment to the defendants on their claims for breach of contract, violation of the Unfair Trade Practices Act (“UTPA”), violation of the covenant of good faith and fair dealing, and tortious interference with a contract.  Buyers also appeal the circuit court’s grant of a directed verdict on their claims for conspiracy and for punitive damages under Buyers’ cause of action for conversion.  We affirm. 

FACTUAL/PROCEDURAL BACKGROUND

Buyers contracted to purchase real property from Carl J. Turner (“Seller”).  The contract provided Seller would convey marketable title to Buyers at a closing to occur between October 8, 1999 and October 23, 1999.  Additionally, the contract required Buyers to deposit $500 in earnest money with Seller’s agent, the Baron Agency. 

On October 13, 1999, Seller’s broker, Odell Short (“Broker”), met with Buyers to close on the property.  However, Buyers stated they believed the adjacent landowners, Steve and Rhonda Conner (“Neighbors”), were in violation of the subdivision’s restrictive covenants.  Thus, Buyers refused to close until Broker obtained assurance from Neighbors that they would abide by the restrictive covenants.  

To accommodate Buyers, Broker offered to speak with Neighbors in attempt to obtain their written assurance.   However, Broker and Buyers did not discuss an extension of the closing deadline. 

On October 15, 1999, Broker met with Neighbors to discuss the restrictive covenants.  During the meeting, Neighbors offered to purchase the property in the event Buyers did not close.  Broker then negotiated a “back-up” contract, clearly marked as such, by which Neighbors agreed to purchase the property from Seller in the event Buyers failed to close. 

On October 23, 1999, Buyers’ contract expired.  Thereafter, the Baron Agency informed Buyers their failure to close constituted a breach of contract entitling Seller to keep the $500 earnest money.  Subsequently, Neighbors purchased Seller’s property pursuant to the back-up contract.

Buyers sued for:  1) breach of contract against Seller; 2) violation of the UTPA against Seller, Broker and the Baron Agency; 3) violation of the covenant of good faith and fair dealing against Seller, Broker, the Baron Agency, and Neighbors; 4) tortious interference with a contract against Broker, the Baron Agency, and Neighbors; 5) intentional interference with a prospective contract against Broker, the Baron Agency, and Neighbors; 6) civil conspiracy against Seller, Broker, the Baron Agency, and Neighbors; and 7) conversion against Seller and the Baron Agency. 

The circuit court granted summary judgment in favor of all of the defendants on the causes of action for breach of contract, violation of the UTPA, violation of the covenant of good faith and fair dealing, tortious interference with a contract, and intentional interference with a prospective contract. [1]    

The case proceeded to trial on the civil conspiracy claim against Seller, Broker, the Baron Agency, and Neighbors and on the conversion claim against Seller and the Baron Agency.  At the close of Buyers’ case, the circuit court granted the Baron Agency’s motion for directed verdict on the conversion action.  Thereafter, at the close of the trial, the circuit court granted Neighbors’ motion for directed verdict on the civil conspiracy action and struck the claim for punitive damages against Seller in the conversion cause of action.  The jury returned a verdict in favor of Buyers on the conversion action against Seller in the amount of $500 and found for the defendants on the remaining causes of action.  Buyers appeal. 

LAW/ANALYSIS

Summary judgment is appropriate where there is no genuine issue of material fact and it is clear the moving party is entitled to judgment as a matter of law.  Rule 56(c), SCRCP.  If further inquiry into the facts is necessary to clarify application of the law, summary judgment is not appropriate.  Tupper v. Dorchester County, 326 S.C. 318, 325, 487 S.E.2d 187, 191 (1997).  “Summary judgment should not be granted even when there is no dispute as to evidentiary facts if there is dispute as to the conclusion to be drawn from those facts.”  Id.  The evidence and the inferences drawn therefrom must be viewed in a light most favorable to the non-moving party.  Id.

I.       Breach of Contract

Buyers argue the circuit court erred by granting summary judgment on their breach of contract claim because questions of fact exist.  We disagree.

Where a contract’s language is plain and unambiguous, the language used by the parties “determines the instrument’s force and effect.”  Jordan v. Sec. Group, Inc., 311 S.C. 227, 230, 428 S.E.2d 705, 707 (1993).  “The judicial function of a court of law is to enforce a contract as made by the parties, and not to rewrite or to distort, under the guise of judicial construction, contracts, the terms of which are plain and unambiguous.”  Hardee v. Hardee, 355 S.C. 382, 387, 585 S.E.2d 501, 503 (2003).  “It is not the province of the courts to construe contracts broader than the parties have elected to make them or to award benefits where none was [sic] intended.”  Stewart v. State Farm Mut. Auto. Ins. Co., 341 S.C. 143, 151, 533 S.E.2d 597, 601 (2000). 

The language utilized in the contract required Seller to convey marketable title at a closing to occur between October 8, 1999 and October 23, 1999, with time being of the essence.  However, at the closing scheduled pursuant to the contract, Buyers refused to complete the transaction, stating they would not close on the property without written assurance from Neighbors they would abide by the subdivision’s restrictive covenants.  Broker agreed to talk with Neighbors.  However, no evidence exists indicating Broker guaranteed he would satisfy Buyers’ concerns.  Furthermore, no evidence exists indicating the parties discussed altering provisions of Buyers’ contract with Seller.  Subsequently, the contract expired, and Seller sold the property to Neighbors.

Broker’s conversation with Buyers, indicating he would speak to Neighbors, without more, is insufficient to alter the time provisions of Buyers’ contract with Seller. See Sauner v. Pub. Serv. Auth. of South Carolina, 354 S.C. 397, 405-06, 581 S.E.2d 161, 166 (2003) (holding the necessary elements of a contract are an offer, acceptance, and valuable consideration, and a written contract may be modified by a subsequent agreement of the parties, provided the subsequent agreement contains all the requisites of a valid contract).  Thus, Buyers’ claim for breach of contract, if cognizable, must be based on the terms of the written contract. 

The written contract provided Seller must convey marketable title to Buyers at a closing to occur between October 8, 1999, and October 23, 1999, with time being of the essence.  Buyer provides no argument or authority, nor are we aware of any, to support the proposition that marketable title includes an obligation on the part of a seller to force an adjoining landowner to comply with restrictive covenants on the adjoining landowner’s property.

Additionally, Buyers claim Broker, as developer of the subdivision and in his capacity as signatory to the restrictive covenants, had a duty to enforce the covenants.  As authority supporting this claim, Buyers cite to the restrictive covenants.  However, nowhere in the covenants document is this duty imposed upon Broker, nor is the duty to enforce the covenants imposed upon any specific individual.  The covenants merely provide a legal right to enforce the restrictions against anyone violating or attempting to violate a covenant. [2]

It is undisputed that Seller was ready, willing, and able to perform in accordance with the contract at all times between October 8 and October 23.  However, Buyers, at the scheduled closing, refused to perform and attempted to unilaterally alter provisions of the contract.  Because the contract states time was of the essence, and Seller was ready, willing, and able to perform pursuant to the contract, Buyers cannot claim Seller breached the contract merely because Seller sold the property to another following the contract’s expiration.  See 17A Am. Jur. 2d Contracts § 716 (2003) (“‘[B]reach[]’ . . . [of a contract] is . . . a failure . . . to perform any promise which forms a whole or a part of a contract, including the refusal of a party to recognize the existence of the contract or the doing of something inconsistent with its existence.”); see also Stewart, 341 S.C. at 151, 533 S.E.2d at 601 (“It is not the province of the courts to construe contracts broader than the parties have elected to make them or to award benefits where none was [sic] intended.”).   Thus, the circuit court did not err by granting summary judgment.

II.      Breach of Covenant of Good Faith and Fair Dealing

Buyers argue the circuit court erred by granting summary judgment to Seller, Broker, the Baron Agency, and Neighbors on the action for breach of covenant of good faith and fair dealing.  We disagree.

“Although implied covenants are not favored in the law, . . . there exists in every contract an implied covenant of good faith and fair dealing.”  Commercial Credit Corp. v. Nelson Motors, Inc., 247 S.C. 360, 366-67, 147 S.E.2d 481, 484 (1966); Williams v. Riedman, 339 S.C. 251, 267, 529 S.E.2d 28, 36 (Ct. App. 2000).  Thus,

whenever the cooperation of the promisee is necessary for the performance of the promise, there is a condition implied that the cooperation will be given. [Furthermore,] [w]hen one undertakes to accomplish a certain result he agrees by implication to do everything to accomplish the result intended by the parties . . . . Moreover, there is an implied undertaking in every contract on the part of each party that he will not intentionally and purposely do anything to prevent the other party from carrying out his part of the agreement, or do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract.

17A Am. Jur. 2d Contracts § 380 (2003).

Initially, because no evidence exists within the record indicating Neighbors had a contract with Buyers or were in privity of contract with Seller in relation to the contract with Buyers, Neighbors cannot be liable for a breach of a covenant of good faith and fair dealing.  See Commerical Credit, 247 S.C. at 368, 147 S.E.2d at 484 (holding the covenant of good faith and fair dealing is implied in contractual relationships and exists between the contracting parties).  Thus, as to Neighbors, the circuit court properly granted summary judgment.

As to Seller, Broker, and the Baron Agency, Broker told Buyers he would speak with Neighbors concerning the violation of the restrictive covenants.  However, no evidence exists indicating Broker either guaranteed he would remedy the violation or that the contract would be extended. 

Broker spoke to Neighbors and they offered to buy the property if Buyers did not close.  Seller, Broker, and the Baron Agency did not alert Buyers to the fact they signed a back-up contract.  Furthermore, they did not alert Buyers the time for performance under the contract was expiring.  Buyers’ contract expired without a closing, and, pursuant to the back-up contract, Seller sold the property to Neighbors. 

This evidence is insufficient, without more, to establish a breach of the covenant of good faith and fair dealing, as it does not indicate Seller, Broker, or the Baron Agency either:  1) engaged in some act to prevent Buyers from performing under the contract; or 2) failed to do some act, thus hindering Buyers’ ability to perform.  Consequently, the circuit court did not err by granting summary judgment.

III.    Violation of the UTPA

Buyers argue the circuit court erred by granting summary judgment to Seller, Broker, and the Baron Agency on Buyers’ claim for violation of the UTPA.  We disagree. 

Under the UTPA, “[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are . . . declared unlawful.”  S.C. Code Ann. § 39-5-20(a) (1985).  “Mere breach of contract does not constitute a violation of the UTPA.”  South Carolina Nat’l Bank v. Silks, 295 S.C. 107, 111, 367 S.E.2d 421, 423 (Ct. App. 1988).  To bring a private action under the UTPA, a party must prove “the defendant’s actions adversely affected the public interest.”  Daisy Outdoor Adver. Co. v. Abbott, 322 S.C. 489, 493, 473 S.E.2d 47, 49 (1996).  “Unfair or deceptive acts or practices have an impact upon the public interest if the acts or practices have the potential for repetition.”  Crary v. Djebelli, 329 S.C. 385, 387, 496 S.E.2d 21, 23 (1998).    The potential for repetition is demonstrated by showing: (1) the same type of actions occurred before, making it likely the actions will continue; or (2) the organization’s policies or procedures “create a potential for repetition of the unfair and deceptive acts.”  Id.  “These are not the only means of showing the potential for repetition, however, and each case must be evaluated on its own merits.”  deBondt v. Carlton Motorcars, Inc., 342 S.C. 254, 270, 536 S.E.2d 399, 407 (Ct. App. 2000).

In a light most favorable to Buyers, no evidence exists within the record indicating the actions of Seller, Broker, or the Baron Agency, if unfair or deceptive, had a public impact or a potential for repetition.  See Crary, 329 S.C. at 387, 496 S.E.2d at 23.  Thus, the circuit court properly granted summary judgment.

IV.    Tortious Interference with Contractual Relations

Buyers argue the circuit court erred by granting summary judgment on their claim for tortious interference with a contract.  We disagree. 

To sustain an action for tortious interference with a contract, a party must show “(1) a contract; (2) the wrongdoer’s knowledge thereof; (3) his intentional procurement of its breach; (4) the absence of justification; and (5) the damage resulting therefrom.”  Kinard v. Crosby, 315 S.C. 237, 240, 433 S.E.2d 835, 837 (1993).  A third party is liable for tortious interference with a contract where one intentionally induces a party to the contract not to perform.  Threlkeld v. Christoph, 280 S.C. 225, 227, 312 S.E.2d 14, 16 (Ct. App. 1984).  “Generally, there can be no finding of intentional interference with . . . contractual relations if there is no evidence to suggest any purpose or motive by the defendant other than the proper pursuit of its own contractual rights with a third party.”  United Educ. Distrib., LLC, v. Educ. Testing Serv., 350 S.C. 7, 14, 564 S.E.2d 324, 328 (Ct. App. 2002).

As the circuit court properly held there was no breach of contract in this case, there can be no “intentional procurement” of a breach on the part of Neighbors, Broker, or the Baron Agency.  Thus, the circuit court properly granted summary judgment.

V.               Civil Conspiracy

Buyers argue the circuit court erred by granting a directed verdict to Neighbors on the civil conspiracy cause of action. [3]   We disagree.

In reviewing a denial of motions for directed verdict, the evidence and reasonable inferences that can be drawn therefrom must be viewed in the light most favorable to the non-moving party.  Brady Dev. Co. v. Town of Hilton Head Island, 312 S.C. 73, 78, 439 S.E.2d 266, 269 (1993);  Evans v. Taylor Made Sandwich Co., 337 S.C. 95, 99, 522 S.E.2d 350, 352 (Ct. App. 1999).  The motion should not be granted where the “evidence yields more than one inference or its inference is in doubt.”  Evans, 337 S.C. at 99, 522 S.E.2d at 352.  When considering the motion, neither the appellate court nor the circuit court has authority to “decide credibility issues or to resolve conflicts in the testimony and evidence.”  Reiland v. Southland Equip. Serv., Inc., 330 S.C. 617, 634, 500 S.E.2d 145, 154 (Ct. App. 1998).

In order to establish a claim for civil conspiracy, a plaintiff must demonstrate “a combination of two or more persons joining for the purpose of injuring the plaintiff and causing special damage to the plaintiff.”  LaMotte v. Punch Line of Columbia, Inc., 296 S.C. 66, 69, 370 S.E.2d 711, 713 (1988).  “Lawful acts may become actionable as a civil conspiracy when the ‘object is to ruin or damage the business of another.’”  Gynecology Clinic, Inc., v. Cloer, 334 S.C. 555, 556, 514 S.E.2d 592, 592 (1999).

The evidence within the record indicates Neighbors were unaware Buyers’ adjacent lot was for sale until they received a telephone call from Broker concerning the violation of the restrictive covenants.  Furthermore, the evidence indicates that even after creating the back-up contract with Seller, Neighbors had no expectation the contract would become effective.   Moreover, entering into a “backup” contract does not infer the parties conspired to “ruin or damage” Buyers’ opportunity to close.  As no other evidence exists within the record indicating Neighbors acted in conjunction with any party to interfere with Buyers’ contract, the circuit court properly granted Neighbors’ motion for directed verdict.

CONCLUSION

Based on the foregoing, the circuit court’s decision is

AFFIRMED.

STILWELL, HOWARD, and KITTREDGE, JJ., concurring.


[1] Appellants did not appeal the grant of summary judgment on the claim for intentional interference with a prospective contract.

[2] Additionally, Buyers failed to provide any legal authority supporting this position.  Therefore, we deem it abandoned.

[3] Additionally, Buyers argue the circuit court erred by granting a directed verdict to Neighbors and Broker on the issue of punitive damages after raising the issue on its own motion.  However, Buyers failed to object to the circuit court’s sua sponte ruling on punitive damages, and therefore, this issue is not preserved for appellate review.  See Bryant v. Waste Mgmt, Inc., 342 S.C. 159, 172, 536 S.E.2d 380, 387 (Ct. App. 2000) (holding appellant must object on contested ground during trial to preserve the ground for appellate review); see also Staubes v. City of Folly Beach, 339 S.C. 406, 412, 529 S.E.2d 543, 546 (2000) (holding that issues not raised and ruled upon by the circuit  court will not be considered on appeal).