352 P.3d 128
Utah Ct. App.2015Background
- UDOT negotiated a Right of Way Contract to buy multiple parcels from several trusts in connection with the Legacy Parkway Project; Parcel 173C contained the only dirt-road access serving the trusts' remaining lands.
- During negotiations UDOT repeatedly represented it planned a frontage road on Parcel 173C; the trusts conveyed the parcels by warranty deeds that described Parcel 173C as conveyed "for a frontage road."
- The final Contract referenced the warranty deeds only to describe the land and contained an integration clause and a provision limiting work to that provided in the agreement; the Contract did not explicitly require UDOT to construct a frontage road.
- The planned frontage road was later removed from project plans and never built.
- Hillcrest (successor to the trusts) sued UDOT for breach of contract and unjust enrichment, claiming UDOT had agreed to pay for and construct the frontage road; the district court granted summary judgment for UDOT, and the court of appeals affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Contract requires UDOT to build/pay for a frontage road on Parcel 173C | The warranty deeds (incorporated by reference) state the parcel was conveyed "for a frontage road" and, with extrinsic evidence of intent, the Contract can be read to obligate UDOT to build the road | The Contract references the deeds only to identify land; no clear incorporation of deed terms and the integration clause bars extra obligations | Court held the Contract is unambiguous: the deeds merely identify parcels and do not impose a frontage-road obligation on UDOT |
| Whether extrinsic evidence creates facial ambiguity permitting parol evidence of intent | Extrinsic negotiation communications and representations show parties intended UDOT to construct the frontage road, creating ambiguity | The plain language of the integrated Contract controls; extrinsic evidence cannot alter an unambiguous written agreement | Court held that, after considering extrinsic evidence, the Contract’s language does not reasonably support Hillcrest’s interpretation, so no facial ambiguity and parol evidence is excluded |
| Whether Hillcrest may pursue unjust enrichment despite an express Contract | UDOT was unjustly enriched by obtaining the property at a reduced price based on representations it would build the road; that representation is separate and supports equitable relief | The Contract governs the transaction; absent a separate actionable misrepresentation, unjust enrichment is precluded by the existence of an express agreement | Court held unjust enrichment claim barred because the parties’ rights are governed by the Contract and Hillcrest failed to identify a separate independent basis for equitable recovery |
| Whether the court should rewrite or reform the Contract because the final writing omitted the parties' prior intent | Hillcrest asks equity to remedy the allegedly unfair bargain and restore the intended obligation | UDOT contends courts may not rewrite an arm’s-length, negotiated, integrated contract; parties were represented by counsel | Court declined to reform/replace the parties’ bargained-for integrated agreement and refused to "make a better contract" for the parties |
Key Cases Cited
- Daines v. Vincent, 190 P.3d 1269 (Utah 2008) (facial ambiguity is a question of law; if facially ambiguous, parol evidence may be admitted to determine intent)
- Winegar v. Froerer Corp., 813 P.2d 104 (Utah 1991) (contractual ambiguity exists when a provision reasonably supports more than one interpretation)
- Ward v. Intermountain Farmers Ass'n, 907 P.2d 264 (Utah 1995) (courts should consider relevant evidence before determining ambiguity and admit extrinsic evidence only if interpretations are reasonably supported by the contract language)
- Hall v. Hall, 316 P.3d 970 (Utah Ct. App. 2013) (after considering evidence, court must ensure contended interpretations are reasonably supported by contract language)
- Consolidated Realty Group v. Sizzling Platter, Inc., 930 P.2d 268 (Utah Ct. App. 1996) (requirements for incorporation by reference into a contract)
- Housing Auth. v. Snyder, 44 P.3d 724 (Utah 2002) (specific language is required to incorporate another document’s terms into a contract)
- Ashby v. Ashby, 227 P.3d 246 (Utah 2010) (recovery for unjust enrichment presupposes absence of an enforceable contract governing the dispute)
- E & M Sales W., Inc. v. Diversified Metal Prods., Inc., 221 P.3d 838 (Utah Ct. App. 2009) (equitable claims may survive where based on separate representations independent of the contract)
- Ted R. Brown & Assocs. v. Carnes Corp., 753 P.2d 964 (Utah Ct. App. 1988) (courts should not rewrite contracts or make better bargains for parties)
- Dalton v. Jerico Constr. Co., 642 P.2d 748 (Utah 1982) (court may not reform an improvident arm’s-length contract on equitable grounds)