NATIVE HOMES, INC. AND SEAN WULFF, APPELLANTS,
v.
DAVID E. STAMM, APPELLEE
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Native Homes and Wulff appeal a trial court decision voiding a construction contract due to mutual mistake regarding soil conditions, despite a contract provision allocating such costs to the buyer. The appellate court affirms the contract's voidability but reverses the denial of attorney's fees to the prevailing defendants.
The contract is voidable due to mutual mistake because although the parties contemplated some additional soil preparation costs, they did not contemplate an expense of $20,000 to $46,000. Additionally, the trial court abused its discretion in denying attorney's fees and costs to the prevailing defendants in defending against unfair and deceptive trade practice claims.
[1] A contract is voidable where a mutual mistake of fact by the parties renders a fundamental assumption underlying the agreement false.
[2] A contract provision allocating responsibility for additional expenses due to subsurface conditions does not preclude a finding of mutual mistake if the contemplated expe…
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Join FLexlaw to unlock all legal intelligence“although the parties contemplated that there might be some additional costs incident to soil preparation, they did not contemplate an additional "$20,000 to $46,000" expense for that purpose”
Establishes the basis for finding mutual mistake—parties knew of soil issues but underestimated the actual cost required, making the contract voidable despite the cost allocation clause.
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Join FLexlaw to unlock all legal intelligenceStamm purchased property containing pockets of muck and hired a contractor to remove the muck and replace it with clean fill before contracting with N…
The full statement of facts, procedural history, and disposition for this case are member content.
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HARRIS, Judge.
In this construction contract, the parties were aware of a possible soil problem. Stamm purchased property that he knew contained pockets of muck. He had a contractor remove the muck and replace it with clean fill before he contracted with Native Homes to construct his new residence. The construction contract acknowledged that the fill work had previously been performed and “assumed” that the lot was buildable. This assumption proved false when it became apparent that the original contractor had not cleared and demucked the location where the residence was to be built. Although the contract provided that should subsurface conditions require additional expense it would be borne by the buyer, the court found that a mutual mistake caused the original assumption that the lot was construction ready and that the contract was thus voidable. In effect, the court determined that although the parties contemplated that there might be some additional costs incident to soil preparation, they did not contemplate an additional “$20,000 to $46,000” expense for that purpose. We find this determination within the trial court’s purview and affirm.
We agree with appellants, however, that the court erred in not awarding them attorney’s fees in successfully defending Stamm’s claims of unfair and deceptive trade practices. Although under the statute, the prevailing party may be entitled to attorney’s fees and costs, under the facts of this case to deny the prevailing appellants attorney’s fees and costs was an abuse of discretion.
AFFIRMED in part; REVERSED in part and REMANDED for imposition of attorney’s fees and costs.
DAUKSCH and PETERSON, JJ., concur.