MERA RUBELL, TRUSTEE, APPELLANT,
v.
NATHAN FINKELSTEIN, ETC., ET AL., APPELLEES
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A trustee-buyer sued sellers for breach of contract after they executed a new lease without her approval, contrary to the sale contract's terms. The trial court dismissed based on the merger doctrine, but the appellate court reversed, holding that the parties' express contractual language that representations and warranties would survive closing precluded application of the merger rule.
The merger doctrine does not apply to provisions of a sale contract that the parties expressly intended not to be extinguished or incorporated in the deed. Here, the contract's explicit provision that the sellers' representations and warranties regarding leases would survive closing means those representations were not merged and the buyer may pursue her breach of contract claim.
[1] The merger rule, which extinguishes preliminary agreements upon acceptance of a deed, does not apply to provisions of a sale contract that the parties did not intend to b…
[2] Contractual representations and warranties made by a seller regarding existing leases survive closing if the contract expressly states that such representations and warra…
Previewing 2 of 4 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“Generally, the acceptance of a deed tendered in performance of a contract to convey land merges or extinguishes the preliminary agreements and understandings contained in the contract. The rule does not apply, however, to provisions of the sale contract not intended by the parties to be extinguished or incorporated in the deed.”
Establishes the fundamental merger doctrine and its exception for provisions parties intended to survive.
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Join FLexlaw to unlock all legal intelligenceThe buyer and sellers entered into a contract for the sale of real property encumbered by existing leases. The contract required sellers to provide co…
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FLETCHER, Judge.
Appellant, Mera Rubell, trustee [Buyer], appeals from an order dismissing her complaint and the subsequent judgment entered in favor of appellees, Nathan Finkelstein, etc., et al. [Sellers], in an action for breach of a contract for the sale and purchase of real estate. For the reasons which follow, we reverse the final judgment entered in favor of the Sellers.
The Buyer entered into a contract for sale and purchase of real property that was encumbered by existing leases. According to the contract, the Sellers were to furnish the Buyer with copies of all existing leases, which the Buyer then had an opportunity to review and either accept or terminate the contract. The contract also provided that any new lease entered prior to closing required approval by the Buyer. Notwithstanding this provision, the Sellers executed a new lease without the Buyer’s approval (indeed, over her objection). Following closing, the Buyer negotiated a release from the offending lease and filed suit against the Sellers to recover her damages. The Sellers successfully moved to dismiss the complaint based on the merger rule.
Generally, the acceptance of a deed tendered in performance of a contract to convey land merges or extinguishes the preliminary agreements and understandings contained in the contract. The rule does not apply, however, to provisions of the sale contract not intended by the parties to be extinguished or incorporated in the deed. American Nat’l Self Storage, Inc. v. Lopez-Aguiar, 521 So. 2d 303 (Fla. 3d DCA), rev. denied, 528 So. 2d 1182 (Fla.1988); Sager v. Turner, 402 So. 2d 1282 (Fla. 4th DCA 1981); Campbell v. Rawls, 381 So. 2d 744 (Fla. 1st DCA 1980); Milu, Inc. v. Duke, 204 So. 2d 31 (Fla. 3d DCA 1967); 19 Fla. Jur.2d Deeds § 145 (1980). Here, an addendum to the contract between the parties states that the Sellers represent and warrant to the Buyer that the leases provided to her prior to closing constitute all of the leases and that there are no understandings or agreements except as set forth in those leases. More importantly, the contract expressly provides that these “representations and warranties made by the Seller[s] ... shall survive closing.” The execution of the new lease breached the parties’ agreement as to the lease representations, which representations survived the closing. The trial court, therefore, erred in applying the merger rule.
Accordingly, the judgment in favor of the Sellers is hereby reversed and the cause is remanded for further proceedings consistent with this opinion. Our decision renders moot the issue raised on cross-appeal.
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Golden v. Davey L. Woodward, Jr., 15 So. 3d 664 (Fla. 1st DCA 2009)…the 2003 Agreement. “The general rule is that all preliminary agreements and understandings relative to the sale of land usually merge into the deed of conveyance.” Opler v. Wynne, 402 So. 2d 1309, 1311 (Fla. 3d DCA 1981); see Rubell v. Finkelstein, 679 So. 2d 889 (Fla. 3d DCA 1996). However, this rule is not absolute. The rule that acceptance of a deed tendered in performance of a contract to convey land merges or extinguishes the covenants and stipulations contained in the contract does not apply to those…
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Engle Homes, Inc. v. Jones, 870 So. 2d 908 (Fla. 4th DCA 2004)…e not necessarily performed or satisfied by the execution and delivery of the stipulated conveyance.” Duke, 204 So. 2d at 33; see also Sager v. Turner, 402 So. 2d 1282, 1283 (Fla. 4th DCA 1981) (citing Duke, 204 So. 2d at 33); Rubell v. Finkelstein, 679 So. 2d 889, 889 (Fla. 3d DCA 1996); Am. Nat’l Self Storage, Inc. v. Lopez-Aguiar, 521 So. 2d 303, 305 (Fla. 3d DCA 1988). Here, based on the language in the arbitration provision of the Purchase Agreement, which specifically states “[t]his provision shall surv…
Authorities Cited
- Ervin M. Smith, Jr. v. State, 204 So. 2d 31 (Fla. 3d DCA 1967)
- Campbell v. Rawls, 381 So. 2d 744 (Fla. 1st DCA 1980)
- Am. Nat'l Self Storage, Inc. v. Lopez-Aguiar, 521 So. 2d 303 (Fla. 3d DCA 1988)
- Sager v. Turner, 402 So. 2d 1282 (Fla. 4th DCA 1981)