Extrinsic Evidence Allowed Where Boxes Weren't Checked on Printed Form
When using a contract on a printed form, make sure you fill in all of the blanks. Otherwise, you may be creating a question of fact regarding the meaning of your agreement.
That is the lesson from the Washington Supreme Court’s recent unanimous opinion in Brogan & Anensen LLC v. Lamphiear. The court ruled that extrinsic evidence should be allowed to interpret a real estate contract where the form agreement set forth alternatives on the point in dispute, and none of the alternatives was checked.
The transaction was between two restaurant acquaintances, one an elderly man, the other a real estate developer. The elderly man/seller allegedly was told that he would have one year after the sale to stay on the property where his home was located. The developer gave a real estate sales agreement to the seller, which did not mention that the seller could remain on the property for a year. The seller was supposedly reassured that it was not necessary for the agreement to have that provision included. Six months later, the purchaser listed the property for twice his purchase price, and told the elderly gentleman to vacate the property.
The trial court granted summary judgment to the developer on the ground that the agreement was complete and extrinsic evidence could not be admitted to alter its terms, and the Court of Appeals affirmed. The Supreme Court disagreed (maybe because this fact pattern doesn’t score very well on the smell test) because the form agreement contained choices for when the property was to be possessed by the purchaser, and next to each of the choices was a box to be checked. None of the boxes was checked; therefore, the date of possession was ambiguous, and extrinsic evidence should be admitted to define the possession date.
Whatever the reasoning behind the opinion, it illustrates that filling in the key terms on any form agreement is important.
