223 So. 3d 54
La. Ct. App.2017Background
- In May 2013 Ditta (seller) and Scurlock (buyer) entered an all-cash agreement for 3711 St. Charles Ave.; purchase price allocated $1,800,000 to the immovable (including fences) and $1,600,000 to movables; Scurlock deposited $100,000 in escrow with Latter & Blum.
- A July 2013 survey disclosed fence encroachments/misalignment; buyer invoked the contract’s 30‑day extension and closing was rescheduled to August 26, 2013.
- Ditta executed three boundary agreements with adjacent owners and recorded them days before closing; buyer’s counsel still raised unresolved title/fence issues (including an earlier 2005 boundary suit).
- On August 18 Scurlock emailed that he would not attend the closing; thereafter both parties exchanged texts indicating Scurlock still wanted to buy; he did not appear at closing but his attorney attended and refused to accept title as unmerchantable.
- Ditta sold the property to a third party in September 2013; Latter & Blum filed a concursus and deposited the $100,000 with the court; Ditta and Latter & Blum sued Scurlock for damages/commission; bench trial found title unmerchantable and awarded return of the deposit to Scurlock.
Issues
| Issue | Ditta/Latter & Blum (Plaintiff) | Scurlock (Defendant) | Held |
|---|---|---|---|
| Whether Scurlock’s August 18 email was an anticipatory breach excusing his performance | Email was an unequivocal repudiation of the contract; Ditta could treat it as anticipatory breach and recover deposit/damages | Email was not an unequivocal refusal; performance was conditioned on seller delivering merchantable title (a suspensive condition); any repudiation was retracted before Ditta relied on it | Court held email did not effect final anticipatory breach — any repudiation was retracted before seller materially changed position, so no breach by Scurlock |
| Whether Ditta delivered merchantable title on closing date | Boundary agreements cured defects; title was merchantable and buyer wrongfully refused to close; Ditta entitled to deposit/damages | Title was unmerchantable due to fence encroachments, a prior unresolved boundary suit, defective/insufficient boundary agreements, and outstanding mortgages on adjacent parcels suggesting future litigation | Court held title was not merchantable: encroachments, unresolved prior litigation, deficiencies in boundary agreements and encumbrances made title reasonably suggestive of litigation; Scurlock entitled to return of deposit |
Key Cases Cited
- Stobart v. State through Dept. of Transp. & Dev., 617 So.2d 880 (La. 1993) (standard for reviewing factual findings; manifest error analysis)
- Hall v. Folger Coffee Co., 874 So.2d 90 (La. 2004) (manifest error standard reiterated)
- Bart v. Wysocki, 558 So.2d 1326 (La. App. 4th Cir. 1990) (defines merchantable title standard and reasonable‑litigation test)
- Young v. Stevens, 209 So.2d 25 (La. 1967) (title unmerchantable when reasonably suggestive of litigation)
- Langford Land Co. v. Dietzgen Corp., 352 So.2d 386 (La. App. 4th Cir. 1977) (merchantable title defined; record title must be free of substantial doubt)
- Bodcaw Lumber Co. v. White, 46 So. 782 (La. 1908) (classic articulation of merchantability requiring title free from reasonable suggestion of litigation)