HARVEY FERTILIZER AND
GAS COMPANY,
Plaintiff,
v
.
Lenoir County
No. 02 CVS 1255
COASTAL PLAINS RESTAURANTS,
LLC, and WOOTEN & BROCK, PLLC,
Defendants.
Harrison & Simpson, P.A., by William F. Simpson, Jr., for
defendants-appellants.
White & Allen, P.A., by Richard J. Archie, for plaintiff-
appellee.
ELMORE, Judge.
This appeal arises from a dispute concerning an agreement
between Harvey Fertilizer and Gas Company (plaintiff) and defendant
Coastal Plains Restaurants, LLC (Coastal), whereby plaintiff agreed
to sell, and Coastal agreed to purchase, certain real property.
Coastal appeals from entry of summary judgment in favor of
plaintiff, by which judgment defendant Wooten & Brock, PLLC (Wooten
& Brock) was ordered to disburse to plaintiff the earnest money
deposited into Wooten & Brock's trust account by Coastal. For the
reasons stated herein, we affirm. The relevant facts are as follows: on 12 April 2002, plaintiff
and Coastal executed an Agreement for Purchase and Sale of Real
Property (the contract) wherein plaintiff agreed to sell and
Coastal agreed to purchase, for $500,000.00, certain real property
located in Lenoir County, North Carolina (the subject property).
Pursuant to the contract's terms, Coastal deposited earnest money
in the amount of $15,000.00 with attorney Dal F. Wooten, III, a
principal in Wooten & Brock. The contract specified that the
earnest money was to be held in Dal Wooten's escrow account, and
that it would either be applied as part payment of the purchase
price at closing or “disbursed as agreed upon under the provisions
of Section 9 herein.” Section 9 of the contract provides, in
pertinent part, as follows:
Section 9. Earnest Money Disbursement: In the event this
offer is not accepted, or in the event that any of the
conditions hereto are not satisfied, or in the event of
a breach of [the contract] by Seller, then the Earnest
Money shall be returned to Buyer . . . . In the event
this offer is accepted and Buyer breaches this
[Contract], then the Earnest Money shall be forfeited .
. . .
Section 1(c) of the contract provides that “'[c]losing' shall
occur on or before May 31, 2002 with time of the essence[.]”
Section 6 of the contract provides that the contract, and the
rights and obligations of the parties thereunder, “are hereby made
expressly conditioned upon fulfillment (or waiver by Buyer) of the
following conditions[,]” the following two of which are relevant to
the present appeal:
(a) New Loan: . . . Buyer must be able to obtain a firm
commitment for [a] loan on or before May 25, 2002,
effective through the date of closing. Buyeragrees to use its best efforts to secure such
commitment and to advise Seller immediately upon
receipt of lender's decision.
. . .
(f) Inspections: Buyer, its agents or representatives .
. . shall have the right to enter upon the [subject
property] for the purpose of inspecting, examining,
performing soil boring and other testing . . . .
Buyer shall have from the date of acceptance
through the end of the Examination Period to
perform the above inspections, examinations and
testing to determine if the [subject property] is
suitable for the Intended Use. If, prior to the
expiration of the Examination Period, Buyer
determines that the [subject property] is
unsuitable . . . and provides written notice to
Seller thereof, then this [contract] shall
terminate, and Buyer shall receive a return of the
Earnest Money. (Emphasis added)
Section 1(e) of the contract defines “examination period” as
“the period beginning on [12 April 2002] and extending through May
25, 2002[.]” Finally, Section 11 provides that any notice required
under the contract must be given as follows:
Section 11. Notices: Unless otherwise provided herein,
all notices and other communications which may be or are
required to be given by or made by any party to the other
in connection herewith shall be in writing and shall be
deemed to have been properly given and received on the
date delivered in person or deposited in the United
States mail, registered or certified, return receipt
requested, to the addresses set out in Section 1(g) as to
the Seller and in Section 1(h) as to the Buyer . . . .
(Emphasis added)
Because underground storage tanks (USTs) were located on the
subject property, plaintiff and Coastal executed, concurrently with
the contract, an Environmental Remediation and Indemnity Agreement
(the remediation agreement) on 12 April 2002. Under the
remediation agreement, plaintiff agreed to remove the USTs within
30 days after closing and to “be responsible for all costs,expenses, damages, and penalties relating” to environmental
contamination on the subject property, until such time as Coastal
receives “an acknowledgment from [the North Carolina Department of
Environment and Natural Resources (DENR)] that no further action is
or will be required on the [subject property] with respect to the
Contamination.” The remediation agreement provides that if Coastal
does not obtain the DENR acknowledgment by the closing date of 31
May 2002, the closing is to occur in escrow, with the deed and
either the balance of the purchase price or a letter of credit to
be held in escrow by Dal Wooten. Plaintiff would then have until
31 October 2002 to obtain the DENR acknowledgment, with the balance
of the purchase price or letter of credit to be returned to
Coastal, and the deed returned to plaintiff, if plaintiff fails to
secure the DENR acknowledgment by that date.
On 28 May 2002, three days after the end of the examination
period set forth in Section 1(e) of the contract, Coastal's
manager, Robert L. Henkle, faxed to plaintiff a statement
purporting to withdraw on Coastal's behalf from the contract to
purchase the subject property “based upon the inability to receive
certification that the [subject property] is environmentally fit
for construction.” Henkle's purported notice also stated that the
$15,000.00 earnest money was not to be disbursed to plaintiff and
requested that it instead be returned to Coastal. On 31 May 2002,
the closing date as provided in Section 1(c) of the contract,
Coastal failed to tender payment of the purchase price. On 3 October 2002, plaintiff filed suit against Coastal and
Wooten & Brock, seeking entry of judgment requiring Coastal to
authorize Wooten & Brock to disburse the earnest money to
plaintiff. On 19 February 2003, plaintiff filed its motion for
summary judgment. Plaintiff's motion was heard at the 7 April 2003
term of Lenoir County Superior Court. On 10 April 2003, the trial
court granted plaintiff's motion for summary judgment against
Coastal and ordered Wooten & Brock to disburse the $15,000.00
earnest money to plaintiff. From this judgment, Coastal now
appeals.
By its lone assignment of error, Coastal contends the trial
court erred because genuine issues of material fact existed
regarding the timeliness of Coastal's notification of its intent to
withdraw from the contract. We disagree.
Summary judgment is to be granted “if the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show there is no genuine
issue as to any material fact and that any party is entitled to a
judgment as a matter of law.” N.C. Gen. Stat. § 1A-1, Rule 56(c)
(2003). The party moving for summary judgment has the burden of
showing that no material issue of fact exists. Lexington State
Bank v. Miller, 137 N.C. App. 748, 751, 529 S.E.2d 454, 455-56,
disc. review denied, 352 N.C. 589, 544 S.E.2d 781 (2000). Once the
moving party has met its burden, “the nonmoving party may not rely
on the mere allegations and denials in his pleadings but must by
affidavit, or other means provided in the Rules, set forth specificfacts showing a genuine issue of fact for the jury; otherwise,
'summary judgment, if appropriate, shall be entered against [the
nonmoving party].'” In re Will of McCauley, 356 N.C. 91, 101, 565
S.E.2d 88, 95 (2002) (quoting N.C. Gen. Stat. § 1A-1, Rule 56(e)
(2003)).
The litigation underlying the present appeal arises from the
parties' dispute over a contract for the purchase of real property.
It is well-settled in North Carolina that, if the language of a
contract is clear and free from ambiguity, “'the courts must
enforce the contract as written' and cannot, under the guise of
interpretation, 'rewrite the contract or impose [terms] on the
parties not bargained for and found' within the contract.” State
ex rel. Utils. Comm'n v. Thrifty Call, Inc., 154 N.C. App. 58, 63,
571 S.E.2d 622, 626 (2002), disc. review denied, 357 N.C. 66, 579
S.E.2d 575 (2003) (quoting Woods v. Insurance Co., 295 N.C. 500,
506, 246 S.E.2d 773, 777 (1978)).
Applying these principles to the present case, Sections 6(a)
and 6(f) of the contract clearly and unambiguously provided that
Coastal had until 25 May 2002 to obtain its financing commitment
and complete its inspection of the subject property. Section 6(a)
expressly required Coastal to “advise [plaintiff] immediately upon
receipt of lender's decision” regarding financing for Coastal.
Section 6(f) expressly required that if Coastal determined the
subject property was unsuitable for its intended use, Coastal must
provide written notice thereof to plaintiff on or before 25 May
2002 in order to terminate the contract and have the earnest moneyreturned. Section 11 provided that any notices required under the
contract “shall be in writing and shall be deemed to have been
properly given and received on the date delivered in person or
deposited in the United States mail[.]” Section 1(c) of the
contract states that closing shall occur on or before 31 May 2002
with time of the essence. Finally, Section 9 expressly provided
“the Earnest Money shall be forfeited” if Coastal breached the
contract.
In support of its motion for summary judgment, plaintiff
submitted the affidavit of M. Todd Howard, an employee of
plaintiff. Howard states in his affidavit that he “was in charge
of making sure that [plaintiff] performed its obligations under
[the contract]” and he was “familiar with both [plaintiff's] and
Coastal's obligations under the [contract].” Howard states in his
affidavit that “Coastal did not provide [plaintiff] any notice that
the [subject] property was unacceptable on or before May 25,
2002[,]” and that “Coastal did not provide [plaintiff] any notice
that it could not obtain financing on or before May 25, 2002.”
Finally, Howard avers in his affidavit that “Coastal did not tender
payment of the $500,000.00 [purchase price] on May 31, 2002 as
required by the [contract].”
In opposition to plaintiff's motion for summary judgment,
Coastal submitted the affidavit of its manager, Henkle, wherein
Henkle stated that on 28 May 2002 he “faxed” notice to plaintiff of
Coastal's intent to withdraw from the contract “because the
property was not environmentally satisfactory . . . This sameinformation had been orally given to Plaintiff on prior occasions.”
Because we conclude that these statements actually support
plaintiff's showing that Coastal failed to comply with the
contract's unambiguous provisions regarding the time and manner of
giving notice, we are unable to discern any genuine issue of
material fact created by the contents of Henkle's affidavit.
We conclude that plaintiff has carried its burden of showing
that no genuine issue of material fact exists regarding Coastal's
failure to notify plaintiff by 25 May 2002 of its determination
that the subject property was unsuitable and its resulting
intention to terminate the contract. By failing to do so, and then
failing to tender the balance of the purchase price on or before 31
May 2002, Coastal breached the clear and unambiguous terms of the
contract. Accordingly, by showing that there is no genuine issue
as to any material fact and that plaintiff is entitled to judgment
as a matter of law, we conclude that plaintiff has met the two-
prong test required for a grant of summary judgment. Joines v.
Anderson, 161 N.C. App. 321, 323, 587 S.E.2d 926, 927-28 (2003),
disc. review improvidently allowed, 358 N.C. 154, 592 S.E.2d 559
(2004).
Affirmed.
Judges MCCULLOUGH and BRYANT concur.
Report per Rule 30(e).
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