BAYCO DEVELOPMENT COMPANY, APPELLANT,
v.
BAY MEDICAL CENTER AND DELTA FLORIDA PROPERTIES, APPELLEES
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Bayco Development Company challenged summary judgment favoring Delta Florida Properties in a dispute over whether Delta, as purchaser of a nursing home facility, was required to assume Bayco's Patient Transfer Agreement with a third party. The court reversed, finding the purchase contract contained a latent ambiguity requiring parol evidence to determine the parties' intent regarding assumption of the material contract.
The contract contains a latent ambiguity regarding Delta's obligation to assume the Patient Transfer Agreement. Because the parties' intent on this material question is a question of fact, summary judgment was inappropriate and the case must be remanded for trial consideration of parol evidence.
[1] A latent ambiguity exists in a contract when the contract fails to specify the rights or duties of the parties under certain conditions or in certain situations, and this…
[2] The intent of parties regarding the assumption of existing third-party contracts in a purchase agreement is a question of fact.
Previewing 2 of 5 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“If a contract fails to specify the rights or duties of the parties under certain conditions or in certain situations, then the occurrence of such condition or situation reveals an insufficiency in the contract not apparent from the face of the document. This insufficiency is called a latent ambiguity...”
Establishes the legal definition of latent ambiguity and how it differs from patent ambiguity
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Join FLexlaw to unlock all legal intelligenceBayco sold a nursing home facility to Delta pursuant to an Agreement for Purchase and Sale. Bayco was required to disclose all contracts materially af…
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POLSTON, J.
Appellant Bayco Development Company (“Bayco”) argues that because their contract at issue is ambiguous and parol evidence is required to ascertain the intent of the parties, the trial court erroneously granted final summary judgment in favor of Appellee Delta Florida Properties (“Delta”). We agree and therefore reverse.
The parties dispute whether their Agreement for Purchase and Sale of Nursing Home Facility requires Delta, the purchaser, to assume the Patient Transfer Agreement, a contract that Bayco, the seller, had with a third-party. Bayco was required by the purchase agreement to disclose all contracts that materially affect the business or operations of the nursing home facility. The Patient Transfer Agreement was disclosed to Delta as one of the material contracts. However, the purchase contract does not state whether these material existing contracts will be assumed by Delta. Therefore, there is a latent ambiguity in the contract.1 See Centennial Mortgage, Inc. v. SG/SC, Ltd., 772 So. 2d 564, 565 (Fla. 1st DCA 2000)(holding that the contract had a latent ambiguity needing parol evidence to determine the parties intent; “If a contract fails to specify the rights or duties of the parties under certain conditions or in certain situations, then the occurrence of such condition or situation reveals an insufficiency in the contract not apparent from the face of the document. This insufficiency is called a latent ambiguity ...,” quoting from Hunt v. First National Bank of Tampa, 381 So. 2d 1194, 1197 (Fla. 2d DCA 1980)).2
The parties’ intent regarding Delta’s assumption of the Patient Transfer Agreement through the purchase agreement is a question of fact. Therefore, final summary judgment was entered in error. See Centennial Mortgage, Inc., 772 So. 2d at 566. On remand, the trial court should consider parol evidence, including the parties’ conduct regarding the Patient Transfer Agreement, to determine the parties’ intent. Id.
REVERSED and REMANDED.
DAVIS and BENTON, JJ., concur. . Moreover, paragraphs 5(22) and 15 of the purchase contract indicate that some obligations or liabilities will be created pursuant to the contract, but it is silent as to what those obligations or liabilities are and therefore ambiguous as to whether they include assumed third-party contracts.
. The existence of an ambiguity in a contract is a question of law, therefore our review is de novo. Centennial Mortgage, Inc., 772 So. 2d at 565-66.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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Jenkins v. Eckerd Corp., 913 So. 2d 43 (Fla. 1st DCA 2005)…pa, 381 So. 2d 1194, 1197 (Fla. 2d DCA 1980). A latent ambiguity arises when a contract on its face appears clear and unambiguous, but fails to specify the [*53] rights or duties of the parties in certain situations. Bayco Dev. Co. v. Bay Med. Ctr., 832 So. 2d 921, 922 (Fla. 1st DCA 2002). Sandhill submits that, while the reference in article 2B of the K & B Lease to the Delchamps lease may be “unambiguous” when read literally, this reference was not “clear” or “complete” with regard to the operation of the l…1 / 2
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Escobar v. United Auto. Ins. Co., 898 So. 2d 952 (Fla. 3d DCA 2005)…on of- whether the contract term is ambiguous is a question of law for the court, and, if the facts of the case are not in dispute, the court will also be able to resolve the ambiguity as a matter of law.”). See also Bayco Dev. Co. v. Bay Med. Ctr., 832 So. 2d 921 (Fla. 1st DCA 2002); Lab. Corp. of Amer. v. McKown, 829 So. 2d 311 [*955] (Fla. 5th DCA 2002); North Star Beauty Salon, Inc. v. Artzt, 821 So. 2d 356 (Fla. 4th DCA 2002). The circuit court’s determination that this was an issue of fact for the jury…
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Haroldo J. Montealegre v. Banco de Credito Centro-Americano, S.A., 895 So. 2d 1097 (Fla. 3d DCA 2004)…considered, and apparently relied upon, parol evidence before granting summary judgment. Use of parol evidence to determine either the intent of the parties or the terms of a contract precludes summary judgment. See Bayco Dev. Co. v. Bay Med. Ctr., 832 So. 2d 921, 922 (Fla. 1st DCA 2002) (summary judgment not appropriate when parol evidence is required to ascertain intent of the parties).…
Authorities Cited
- Hunt v. First Nat'l Bank OF Tampa, 381 So. 2d 1194 (Fla. 2d DCA 1980)
- Centennial Mortg., Inc. v. SG/SC, Ltd., 772 So. 2d 564 (Fla. 1st DCA 2000)