Peruzzi Brothers, Inc. v. Contee

POLLITT, Judge. Appellees, George H. Contee, Jr., and his wife, sued appellant, Peruzzi Brothers, Inc., in the Circuit Court for Calvert County. The appellees sought an injunction prohibiting appellant from entering on appellees’ property, an order quieting title to the property, and general relief. After trial without a jury, Judge Perry G. Bowen, Jr., ORDERED that Pearl H. Morsell and her successors in title [appellant] are permanently estopped from claiming any ownership interest in .93 acres as shown on the attached plat and which was intended to be conveyed in whole to the Plaintiffs herein by Milton Gordon, et al. in 1965.

From that order, Peruzzi Brothers, Inc., appeals. We shall affirm, with slight modification, the order of the Circuit Court for Calvert County. The facts of the case are virtually undisputed. In July of 1965 one Milton Gordon and others were the owners of a tract of land on Horace Ward Road in Calvert County.

Mr. Gordon, who managed the property for himself and the other owners, approached Mr. Contee about selling the Contees a small house on the property with supporting lot. Both Gordon and Contee intended the conveyance to be approximately one acre. On July 12, 1965, Gordon requested J.R. McCrone, Jr., Inc., professional surveyors, to prepare a plat of approximately one acre. In August, the surveyors prepared a plat and metes and bounds description showing .93 of an acre.

For some reason now unknown to anyone, a plat and description showing 0.344 acres were prepared at the same time. Despite the expressed intentions of both sellers and buyers to convey approximately one acre, a deed was executed and recorded in October of ¹²¹ 1965, conveying from Gordon et al. to the Contees a tract described by metes and bounds and containing 0.344 acres, more or less. The description in the deed followed the description of the plat of 0.344 acres, but the plat was not specifically referenced in the deed and, apparently, was not recorded. Pipes were set in the ground showing the boundaries of the .93 acre site.

When Contee saw the deed, he told Gordon, “I need one acre more or less for my septic tank and my dry well.” Gordon replied, “Okay. I will have McCrone come back. I will have McCrone come back and put some pipes in it.” Although he never received another deed, Contee believed the presence of the pipes identified the boundary of his property. As Judge Bowen found: Now, as the years pass, Contee used the property, cleaned it up to the stakes.

The evidence shows he filled it with fill dirt, established a parking lot on it, septic tank and leaching well on it when he put plumbing in his house and a well when he put water in his house. Now, all of these uses are pretty high visibility uses. Difficult to drive down the road and not see a man's parking lot, picnic table, people out there drilling wells—and from the testimony this is a drilled well. And although it isn’t so obvious once that thing is in where it is, it is pretty obvious when the well drilling is going on.

All of these uses are consistent with a claim of ownership of the land and inconsistent in the extreme with somebody else’s ownership of the land. If you think you own a piece of land, I think the least likely thing that you are apt to let somebody else do is establish a sewage disposal system on it. There may be other things that would be a little more apt to arouse the interest of the true owner than that, but right offhand, I can’t think of one. About two years later, in October of 1967, Gordon et al. sold the adjoining parcel to Pearl H. Morsell et al., appel ¹²² lant’s predecessors in title.

That deed, without metes and bounds description, described the property conveyed as bounded by the land of appellees and containing one acre, more or less. In 1983, appellant entered into a contract to purchase this property. Upon discovery of the discrepancy in the boundary, and without any discussion with the Con-tees, Peruzzi employed a surveyor to survey the area outside the Contees’ deed description, which disclosed an area of 1.39638 acres. Peruzzi then obtained a confirmatory deed from Gordon, which included approximately .59 acre of the land intended to have been conveyed to Contee.

Gordon was told the confirmatory deed was necessary to clarify the boundaries, but was not told that any dispute existed. After purchasing the 1.39638 acres, Peruzzi began site work preparatory to construction on its lot. Contee’s first notice of any problems was when the earth moving machinery commenced work on what he had thought was a part of his property. These proceedings followed.

The trial court found that Gordon intended to sell and Contee intended to buy approximately one acre; that the deed between them was based on a mutual mistake of fact; that Contee used the property by “high visibility uses” obviously apparent to the adjoining owners for nearly twenty years, with no protest from those owners; and that appellant purchased the adjoining lot with knowledge of those uses. Judge Bowen pointed out: Now, if we adopt the Defendant’s position, we are confirming the fact that Morsell, who bought an acre, more or less, and paid only for that, winds up with an acre and roughly 4/ioths—roughly a third more than she bought and paid for. Whereas Contee, who bought and paid for an acre, more or less, winds up with roughly a third of an acre. Now, we don’t have a situation here where you have a bona fide purchaser for value or any sort of an argument of that sort.

The present owner of the Morsell tract bought into the situation with a knowledge that Contees were asserting a claim to this property and were going to ¹²³ maintain it or attempt to elaim it against everybody. He has secured what appears to be good paper legal title to this property. But he has secured it with the knowledge and after seeing that there was a use to which it was being put totally adverse to anything other than the claimed ownership. The trial judge ruled: What we say is that Morsell and all persons claiming through and under Morsell are estopped from asserting a claim to this property.

They are estopped, as I see it, on the legal principle of estoppel in pais. We have sat by for almost 20 years, watched this man improve the property, place this utility—sources of utility service on it, use it, claim it. And the fact that he did not get legal title to it originates in a mistake. Everybody cannot help but know that.

We think, therefore, that Morsell and her successors in title are estopped from claiming that he no longer has the right to use or possess this property. Peruzzi appeals, contending that: 1. The trial court erred in admitting testimony from Contee and Gordon as to their intent, in contradiction of the written deed between them. 2. The trial court erred in applying equitable estoppel in favor of the appellees against the appellant. 3.

The trial court erred in failing to grant the appellant’s Motion to Dismiss. I Appellant first asserts the court erred in permitting the parties to establish their intentions by parol evidence. Preliminarily, we note that Judge Bowen found the appellant was not a bona fide purchaser without notice of appellees’ claims. Considering the “highly visible uses” of the property by appellees, under claim of right, that finding is not clearly erroneous.

Generally, one who is not a bona fide purchaser may not invoke the parol evidence rule. ¹²⁴ In Kolker v. Gorn, 193 Md. 391 , 67 A.2d 258 (1949), in a suit by a judgment creditor against the husband, a wife was permitted to testify that a conveyance of property to a third person, her husband and herself as joint tenants, was actually intended to convey a half interest to her husband and herself as tenants by the entireties. After finding that a judgment creditor is not a bona fide purchaser, the Court held that a stranger to the transaction, who is not in the position of a bona fide purchaser, cannot invoke the parol evidencé rule to prevent a party to the deed from showing a mutual mistake by the parties, in the absence of facts raising an estoppel. Since there was no evidence that the wife, by misrepresentation or otherwise, had induced the creditor to give credit on the assumption that the record showed the true state of the title, the Court found no basis for an estoppel. We think the same can be said of this case.

There is no evidence that either appellees or Gordon misrepresented anything to appellant, or that appellant did anything in reliance on any conduct of appellees, who were not even consulted, despite their obvious use of the property in question. There is no basis for an estoppel prohibiting them from offering the parol evidence. Even if the appellant were in a position to invoke the rule against parol evidence, the trial court’s finding of a mutual mistake by the parties, which is not clearly erroneous, permits the introduction of parol evidence to ascertain intent. In Ray v. Eurice, 201 Md. 115 , 93 A.2d 272 (1952), the Court said one may not vary a clearly expressed written -contract by parol, absent fraud, duress or mutual mistake.

In that case, there was no contention of fraud or duress and, the Court said, if there was a mistake, it was unilateral. One party intended the contract to be as clearly written, any misconception being only in the mind of the other party. Judge (later Chief Judge) Hammond, for the Court, held: ¹²⁵ An integrated agreement may not be varied by parol where there is no mutual mistake, nor may the parties place their own interpretation on its meaning or intended meaning. 201 Md. at 125 , 93 A.2d at 278 (emphasis added). We find nothing to the contrary in any of the cases cited by appellant.

Gilchrist v. Chester, 307 Md. 422 , 514 A.2d 483 (1986), says: Thus, if the deed in question was clear and unambiguous, in the absence of fraud and mistake, there was no need to construe it through the use of extrinsic evidence. 307 Md. at 425 , 514 A.2d at 484 (emphasis added). In Gilchrist , there was no allegation of fraud or mistake and no evidence thereof. Board of Trustees v. Sherman, 280 Md. 373, 380 , 373 A.2d 626, 630 (1977), quoted in Gilchrist , cites as authority for the passage quoted the case of Billmyre v. Sacred Heart Hosp., 273 Md. 638, 642 , 331 A.2d 313, 316 (1975), and cases there cited. In Billmyre, 273 Md. at 643 , 331 A.2d at 317 , the Court quotes from Slice v. Carozza Properties, Inc., 215 Md. 357, 368 , 137 A.2d 687, 693 (1958): “As we turn to the authorities, we may note first that the theory of ‘objective law' of contracts has been almost universally adopted by this time.

The written language embodying the terms of an agreement will govern the rights and liabilities of the parties, irrespective of the intent of the parties at the time they entered into the contract, unless the written language is not susceptible of a clear and definite understanding, or unless there is fraud, duress or mutual mistake. Ray v. Eurice, 201 Md. 115 , 93 A.2d 272 . ‘ * * * where there has been an integration of an agreement, those who executed it will not be allowed to place their own interpretation on what it means or was intended to mean. The test in such case is objective and not subjective. * * * Williston * * * Sec. 94, page 294, says: “It follows that the test of a true interpretation of an offer or acceptance is not what the party making it thought it meant or intended it to mean, ¹²⁶ but what a reasonable person in the position of the parties would have thought it meant.” ’ Ray v. Eurice, supra, p. 127 [ 93 A.2d 272 ].” Where the uncontradicted evidence revealed that all parties to the Gordon-Contee deed intended that deed to convey approximately one acre of land, and in fact the deed conveyed only .344 acres, it was not error to allow proof of the parties’ intention by parol evidence. Relying on Annapolis Mall v. Yogurt Tree, 299 Md. 244 , 473 A.2d 32 (1984), appellant asserted at oral argument that parol evidence of mutual mistake may be admissible in a suit in equity for reformation of a deed but it cannot be used in a suit to quiet title.

The Court there did say that mutual mistake is not available as a defense in an action at law, without the written instrument having been first reformed in equity. However, the Court further said: