Opinion
44269, 44270.
ARGUED FEBRUARY 3, 1969.
DECIDED JUNE 12, 1969.
Action on contract. Rockdale Superior Court. Before Judge Guess.
Alston, Miller Gaines, Ronald L. Reid, for appellant.
Ballard Thigpen, Troy Thigpen, Smith, Cohen, Ringel, Kohler, Martin Lowe, Meade Burns, Robert W. Beynart, for appellee.
1. In the case sub judice a contract for the sale of land contained a provision that the parties "agree that such papers as may be legally necessary to carry out the terms of this contract shall be executed and delivered by such parties at time sale is consummated." Thus, absent any other evidence as to what the parties intended, another contractual provision for the payment of $59 a year for recreational facilities did not survive the execution and delivery of the deed.
2. In actions for fraud, actionable representations must relate to past or existing facts and cannot consist of mere broken promises, unfulfilled predictions, or erroneous conjectures as to future events.
3. Any error in the exclusion of certain evidence was harmless where a verdict was demanded and the evidence offered could not have changed the result.
ARGUED FEBRUARY 3, 1969 — DECIDED JUNE 12, 1969.
Georgia Mobile Home Development Corporation filed its complaint against G. S. Kuter in the Rockdale Superior Court. The claim sought to recover from the defendant $59 due under a sale contract signed by the defendant. The portion of the contract in issue provided that: "Purchaser agrees to the payment of an annual sum in addition to the purchase price in the amount of $59. Said sum together with a like sum to be paid by all other purchasers in this subdivision is to be used for the establishment, maintenance, operation and upkeep of the recreational facilities provided, or to be provided, in this subdivision and purchaser further agrees at closing to subscribe to the articles and bylaws of a property owners' association which has been created for the joint benefit of all the owners in this subdivision for the maintenance and operation of said park and recreational facilities through the management contract existing between the owners' association and seller." The sale contract was signed before the plaintiff corporation changed its name from Georgia Co-operative Trailer Parks, Inc., to its present name. The plaintiff was obligated under the sale contract to convey certain real estate to the defendant by warranty deed.
The defendant answered denying the material allegations of the plaintiff's complaint and setting out that he was not liable because the plaintiff had not signed the sale contract and had failed to perform certain obligations under it. By counterclaim the defendant alleged he was induced to sign the sale contract by false and fraudulent representations on the part of the plaintiff, including failure to enforce certain restrictions, which resulted in damages to him in the amount of $10,000. The case came on for trial before a jury. On motions for directed verdict by the respective parties, the trial judge directed a verdict against the defendant on his counterclaim and against the plaintiff on his claim. In case No. 44269, plaintiff appeals from the judgment adverse to it. In case No. 44270, the defendant appeals from the judgment adverse to him.
The evidence adduced on the trial is as follows. The defendant testified that he entered into the sale contract with the plaintiff, and received a deed to the property described in it. He further testified that he knew the obligation to pay $59 a year was for recreation and maintenance and that he had no complaint about such recreational facilities. He admitted that in 1966, he was billed for $59 and did not pay that bill. There was evidence that the facilities were not completed until 1965 and during the interim period, from 1963 to 1965, the defendant was not billed in the amount of $59 per year.
The defendant testified that a representative of the plaintiff, at the time of the purchase, explained that upon the purchase of the property the defendant would become a member of the property owner's association and would be billed by that association for the $59 referred to in the contract. Based on these representations, defendant bought a lot. In regard to the property owners' association, a witness for the plaintiff admitted that it was a nonfunctioning entity in 1963, at the time of the execution of the contract.
The conveyance of this lot was subject to restrictive covenants and certain rules and regulations which were introduced into evidence. In this regard, the defendant testified that the plaintiff had failed to enforce the restrictive covenants, rules and regulations. Specifically, defendant testified that a majority of the lot owners in the plaintiff's subdivision failed to comply with the rules and regulations which required trailers to be under-skirted; that there was water pollution in the lake, despite representations made to him as to the clear quality of the water. The defendant further testified that the plaintiff did not require lot purchasers to assume the $59 obligation but that plaintiff had waived this in making certain sales. A witness for the plaintiff testified that all buyers were charged $59 a year for the lot but if they owned a second lot without a trailer on it, they were only charged $24.
1. The language quoted in the statement of facts relative to the actual payment, relied upon by the plaintiff to enforce such provision, appears in the contract of sale of land but does not appear in the warranty deed by which the land was conveyed. The defendant, therefore, contends that the general rule as to merger of antecedent agreements into a subsequent warranty deed must apply; since the clause was not reiterated in the deed it did not survive the execution thereof, citing Postell v. Hearn, 104 Ga. App. 765 ( 123 S.E.2d 13); Cox v. Wilson, 109 Ga. App. 652 ( 137 S.E.2d 47).
We recognize the well established rule of merger; however, the courts of this state have engrafted an exception to this general principle. "When it is contemplated by the parties that certain duties and obligations contained in an executory contract for the conveyance of land are to be performed after the delivery of possession of the property, and the warranty deed thereto, these duties and obligations are not merged in the deed and the acceptance of delivery of possession. `Where there are stipulations in the preliminary contract or contracts of which the conveyance is not a performance, the question whether such stipulations are merged in the deed depends upon the intent of the parties. . . The evidence of such intention may exist in or out of the deed. . .'" Knight v. Hedden, 112 Ga. App. 847, 848 ( 146 S.E.2d 556), citing McKee v. Cartledge, 79 Ga. App. 629 ( 54 S.E.2d 665); Kollen v. High Point Forrest, Inc., 104 Ga. App. 713 ( 123 S.E.2d 10).
Here the language contained in the sale contract that the "purchaser agrees to the payment of an annual sum in addition to the purchase price in the amount of $59," standing alone, could be construed as evidencing the intent of the parties that this provision exist independently and not be merged into the deed. However, the contract also provided: "Seller and purchaser agree that such papers as may be legally necessary to carry out the terms of this contract shall be executed and delivered by such parties at time sale is consummated." In Postell v. Hearn, 104 Ga. App. 765, supra, this court held, on demurrer, without allegations that the parties intended the contract provisions to survive, the quoted provision was controlling and merger occurred. Since this case is considered on directed verdict, absent evidence of the intention of the parties, extrinsic to the contractual provisions, the Postell case, supra, is controlling.
Here the only evidence adduced was testimony by the defendant that he was dubious about the provision in question. He related a conversation with Harris, a salesman for the defendant: "A. He said when I bought a piece of property there, I would then become a member of the Property Owners Association which had been formed. I would receive a share of stock and I would be billed at a later date when they sold some three hundred lots. That I would be billed for $59 by that Property Owners Association. He even went so far as to explain it in detail, because I objected a little bit to this. He said, well, look at it this way. You are taking that $59 out of one pocket, and putting it in another, because you are going to be a part of this Property Owners Association. Q. Did those statements have any effect on you when you signed the contract? A. Well, I looked at the conditions and the way everybody painted it, Mr. Thigpen, and I thought that since this going for recreation; and I did want to move into a place that would have such recreational facilities and be interesting to live in, I'd pay it; since I'll be a part of it and own a share of some of it."
This can not be construed as showing an intention that the obligation survive the deed so as to avoid the application of the merger doctrine. Thus, the rule in the Postell case is determinative of the issue here presented and the trial judge did not err in directing a verdict for the defendant on the plaintiff's claim.
2. In considering the defendant's counterclaim the following principles are applicable: "In actions for fraud, actionable representations `must relate to past or existing facts and cannot consist of mere broken promises, unfulfilled predictions, or erroneous conjectures as to future events.'" Rogers v. Sinclair Refining Co., 49 Ga. App. 72, 73 ( 174 S.E. 207). A mere breach of a contract is not fraud. Snow's Laundry c. Co. v. Ga. Power Co., 61 Ga. App. 402, 405 ( 6 S.E.2d 159). Fraud cannot be predicated upon statements promissory in nature as to future actions. Jackson v. Brown, 209 Ga. 78 (2) ( 70 S.E.2d 756); Beach v. Fleming, 214 Ga. 303, 306 ( 104 S.E.2d 427); Crozier v. Provident Life c. Ins. Co., 53 Ga. App. 572, 574 ( 186 S.E. 719).
In this case the fact that the lake water might have subsequently become polluted or the fact that various lot owners failed to comply with the rules and regulations or the restrictive covenants did not give rise to a showing of fraud. Nor did the fact that the company failed in some instances to enforce the restrictive covenants show an actionable misrepresentation. It should be noted that paragraph 19 of the restrictive covenant recites: "The failure by any landowner or the company to enforce any restrictions, conditions, covenant or agreement herein contained shall in no event be deemed a waiver of the right to do so thereafter as to the same breach or as to one occurring prior or subsequent thereto, nor shall such failure give rise to any claim or cause of action against the company or such owner." Since the acts above set out were the only grounds for showing any damage to the plaintiff through loss of value of his mobile home and lot, the trial judge did not err in directing a verdict against the defendant on his counterclaim.
3. The defendant contends that the trial court erred in excluding his testimony as to the value of his real estate. The rule is well settled that the exclusion of evidence is harmless where the verdict was demanded and the evidence offered could not have changed the result. Green v. Atlanta Joint Stock Land Bank, 182 Ga. 172, 174 (3) ( 185 S.E. 342); Gilmore v. Smith, 213 Ga. 780 (3) ( 102 S.E.2d 32).
In view of the rulings herein made any remaining questions presented by the enumeration of errors are nugatory.
Judgments affirmed. Felton, C. J., and Pannell, J., concur.