Williаm E. HAND and Jane L. Hand, Appellants/Cross-Appellees,
v.
GROW CONSTRUCTION, INC., a Florida Corporation, Appellee/Cross-Appellant.
District Court of Appeal of Florida, First District.
*685 Michael F. Coppins of Coppins Monroe Adkins Dincman & Spellman, P.A., Tallahassee, for Appellants/Cross-Appellees.
Fred M. Johnson and William D. Horgan of Johnson, Farrell & Mabile, LLC, Tallahassee, for Appellee/Cross-Appellant.
LEWIS, J.
In this action for breach of a real estate contract, William and Jane Hand, Appellants, seek review of a final order of summary judgment issued in favor of Grow Construction, Inc., Appellee, together with an order taxing costs and attorney's fees in Appellee's favor. On cross-appeal, Appellee seeks review of the portion of the final judgment dеnying its request for enforcement of the contract's liquidated damages provision. Appellants argue that the trial court erred, as a matter of law, in interpreting the contract and, alternatively, that even under the trial court's interpretation of the contract, genuine issuеs of material fact remained, rendering summary judgment improper. Because we hold that the trial court interpreted the contract incorrectly, the remaining issues in this case are moot. We reverse the Summary Final Judgment, together with the Final Judgment Taxing Costs and Attorneys' Fees, and remаnd the case for further proceedings consistent with this opinion.
Under the parties' contract, Appellee had a duty to construct a building free from defects, and Appellants had a duty *686 to pay, at closing, a specified base price for the building and the real property on which it was to be constructed, along with a price for any applicable options or exceeded allowances. The issue before the trial court was whether Appellee's promise to construct a building free from defects and Appellants' prоmise to pay the purchase price constituted dependent or independent covenants. The following contract provisions were pertinent to this determination:
5. IMPROVEMENTS. Seller agrees to provide the labor, services and materials necessary to complete the improvements to the Property in a workmanlike manner free from defects. The improvements are specifically described, and will be made in accordance with the plans and specifications attached hereto as Exhibit B and by reference made а part hereof, hereinafter collectively referred to as the Plans and Specifications.
. . . .
11. CLOSING DATE. This transaction shall be closed and Seller shall deliver title to the Property within ten (10) days after the issuance of a certificate of occupancy for the improvеments to be made by [Seller].
The contract also provided for an award of attorneys' fees and costs to the prevailing party in the event of any litigation arising from a contract dispute.
After the parties executed the contract, a closing date was establishеd, and the parties appeared for the transaction, but the transaction was not finalized. Thereafter, Appellants filed suit, alleging that Appellee had breached the contract by failing to tender a building free from defects on the closing date and refusing to take сorrective measures to bring itself into compliance with the contract. Appellee counterclaimed, alleging that Appellants had breached the contract by refusing to pay the entire purchase price at closing. Subsequently, Appellee moved for summary judgment, arguing that, under paragraph eleven, Appellants had a unilateral obligation to close the transaction once a certificate of occupancy was obtained, irrespective of any defects in construction. For purposes of summary judgment, Appellee admitted that the building contained at least one defect. In response, Appellants argued that paragraphs five and eleven contained dependent covenants, such that Appellants' duty to deliver the remainder of the purchase price depended on Appellee's duty to deliver a building in compliance with the contract specifications and free from material defects, and vice-versa. They agreed that there was no dispute over whether a certificate of occupancy was issued but argued that the issuance of a certificate of occupancy simply established a timeline for scheduling a closing date and did not trigger any unilateral obligations.
The trial court agreed with Appellee, holding that Appellants' "contractual obligation to closе arose upon issuance of the certificate of occupancy" and that "this obligation was not dependent upon the building being free from defects." Accordingly, the trial court ruled that Appellants breached the contract and entered final summary judgment for Appеllee. The propriety of the trial court's order of final summary judgment depends on whether it correctly concluded that paragraphs five and eleven contained independent covenants, such that Appellants' duty to close the transaction after issuance of the certificate of occupancy was unconditional. Our review is de novo. See Fernandez v. Homestar at Miller Cove, Inc.,
Whenever possible, a contract must be construed according to its plain language. Khosrow Maleki, P.A. v. M.A. *687 Hajianpour, M.D., P.A.,
In Reider v. P-48, Inc.,
Here, the meaning of paragraph eleven clearly and unambiguously sets a date for closing and requires Appellee to deliver title to the real property on that date, but it does not clearly and unambiguously state that Appellants' duty to deliver the purchаse price was independent of any other duties in the contract. Paragraph eleven is titled "CLOSING DATE" and begins, "This transaction shall be closed. . . ." Although the trial court and Appellee have read this paragraph as imposing a unilateral "duty to close" on Appellants, the рlain language of the paragraph refers passively to the closing of the transaction, not to a specific duty imposed upon a specific party. The natural reading of the first sentence of paragraph eleven is that it sets up a time-frame during which closing was to occur: within ten days of the issuance of a certificate of occupancy. Furthermore, a closing necessarily requires the willing participation of both parties to the transaction. Thus, Appellants' "duty to close," as used by the parties, more specifically means Appellants' duty to provide the purchase price. Nothing in the contract indicates that paragraph eleven should be given a reading other than *688 this natural reading. Moreover, under paragraph eleven, Appellants were to provide the purchаse price "for the improvements," which are defined in paragraph five. According to the definition in paragraph five, the improvements Appellants agreed to purchase were to be free from defects.
Appellee argues that the issuance of the certificate of occupancy triggered Appellants' unconditional duty to purchase the building, regardless of whether it had defects. However, if the parties had wanted to use the certificate of occupancy in this way, they could have more clearly articulаted that intention. Cf. Fernandez,
The trial court interpreted the contract to mean essentially that Appellants agreed to purchase any building Appellee constructed, irrespective of whether Appellee had performed its duty to construct a building that matched the contract specifications and was free from defects. To reach this interpretation, the trial court relied on Fernandez v. Homestar at Miller Cove, Inc.,
This Court's opinion in Reider is more helpful to the resolution of this issue. Although the Reider Court did not reproduce the contract language in its opinion, so as to provide an exact basis for comparison, the concept of dependent covenants, as explained in Reider, is useful. Under Reider, the central question in determining whether Appellants' duty to supply the purchase price was dependent on Appellee's duty to supply a building free of defects depends on whether the accomplishment of defect-free construction was an essential part of the considerаtion for *689 the contract. See Reider,
We reject the trial court's holding that Appellants had an unconditional obligation to pay the entire purchase price. A genuine issue of material fact remains as to which party materially breached the contract. Accordingly, we reverse the final order of summary judgment and remand the case for further proceedings consistent with this opinion. Because the contract authorized attorneys' fees and costs only for the prevailing party, the award of fees and costs is also reversed.
REVERSED and REMANDED.
BENTON and ROBERTS, JJ., concur.
