O.W.O. Investments, Inc. v. Stone Investment Company, Inc. ( 2008 )

IN THE SUPREME COURT OF MISSISSIPPI
NO. 2008-CA-01620-SCT
O.W.O. INVESTMENTS, INC.
v.
STONE INVESTMENT COMPANY, INC.
DATE OF JUDGMENT: 08/14/2008
TRIAL JUDGE: HON. D. NEIL HARRIS, SR.
COURT FROM WHICH APPEALED: STONE COUNTY CHANCERY COURT
ATTORNEY FOR APPELLANT: NICHOLAS VAN WISER
ATTORNEYS FOR APPELLEE: JACK PARSONS
TADD PARSONS
NATURE OF THE CASE: CIVIL - TORTS - OTHER THAN PERSONAL
INJURY & PROPERTY DAMAGE
DISPOSITION: AFFIRMED - 04/08/2010
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
EN BANC.
CHANDLER, JUSTICE, FOR THE COURT:
¶1. O.W.O. Investments, Inc., commenced a lawsuit against Stone Investments, Inc.
(Stone Investments); John Diamond, individually, John Diamond; d/b/a Stone Ready Mix,
LLC; and Diamond Disposal, Inc. (collectively, “Diamond”). The action involved a contract
and an amended contract providing for O.W.O.’s purchase from Diamond of three hundred
acres of land for a landfill in Stone County. O.W.O. alleged that Diamond had
misrepresented that he owned the entire three-hundred-acre parcel when, in fact, 40.05 acres
of the land were owned by Stone Investments. O.W.O. alleged that attorney Jack Parsons 1
had represented Diamond at the execution of the contract. O.W.O. further alleged that
Parsons also was the attorney for Stone Investments, and that Parsons had known, when the
contract and the amended contract were executed, that the 40.05 acres were owned by Stone
Investments, not Diamond. O.W.O. asserted claims for seller’s breach of warranties and
representations, misrepresentation and fraud, imposition of a construction lien, and damages
in the amount of $115,034, plus punitive damages. O.W.O. later filed a second amended
complaint asserting a claim for tortious interference with contract.
¶2. The Chancery Court of Stone County denied Diamond’s motion for summary
judgment and granted Stone Investments’s motion for summary judgment. O.W.O.
voluntarily dismissed Diamond and pursued this appeal against Stone Investments, arguing
that summary judgment was improper. Stone Investments argues that summary judgment
was appropriate because, prior to O.W.O.’s execution of the amended contract, O.W.O. was
placed on notice by a November 9, 2006, title opinion that the 40.05 acres were not included
in Diamond’s real estate holdings. Stone Investments also argues that O.W.O. incurred no
damages because O.W.O. never elected to purchase the property pursuant to the amended
contract.
FACTS
¶3. On September 20, 2006, O.W.O. and Diamond executed a statement of intent to enter
into a contract to purchase real estate. On September 28, 2006, O.W.O. and Diamond
1
Parsons represented Diamond and Stone Investments before the chancery court and
he represents Stone Investments on appeal.
2
entered into a “Preliminary Contract for Purchase and Sale of Real Estate, Personal Property
& Equipment.” The subject property included three hundred acres of real estate in Stone
County, free and clear of all liens and encumbrances. In the contract, Diamond represented
and warranted that he had title to the three hundred acres. The acreage included a sixty-acre
landfill, only ten acres of which had been approved by the Mississippi Department of
Environmental Quality (MDEQ). The contract placed the responsibility upon O.W.O. to
obtain MDEQ approval. The purchase was to include all the assets of John Diamond’s two
businesses, Stone County Mix, LLC, and Diamond Disposal, Inc. The contract provided for
a nonrefundable earnest-money deposit of $50,000 payable from O.W.O. to Diamond on or
before September 28, 2006, to be credited against the purchase price. Diamond represented
that all permits, licenses, zoning, and other authorizations to conduct business as a concrete
plant and disposal site were “fully and completely transferrable or assumable by Purchaser
in their present form and condition and without condition or modification.”
¶4. On November 17, 2006, O.W.O.’s attorney, David Wheeler, sent Diamond’s attorney,
Parsons, a letter concerning the transaction. Wheeler stated that his review of the title had
revealed that Diamond actually had title to only 259.05 acres, not the full three hundred acres
under contract. The missing acreage, consisting of a 40.05-acre parcel, was owned by Stone
Investments. Wheeler believed that Stone Investments had agreed to sell Diamond the 40.05-
acre parcel for $160,000 so that Diamond could include it in the sale to O.W.O. Wheeler
further stated that title to the 40.05 acres was not insurable and that a title-confirmation suit
would be required to satisfy the title insurance company. Wheeler proposed that the parties
take the following steps: (1) Stone Investments convey the property to Diamond in exchange
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for a deed of trust on the property for $160,000, payable on demand within ninety days; (2)
Stone Investments and Diamond provide a signed letter of instruction to Wheeler to disburse
$160,000 from the closing proceeds to Stone Investments, and an executed release of the
deed of trust; (3) Diamond and O.W.O. execute a modification to the contract providing for
two closing dates, the first for the 259.05 acres, and the second for the 40.05 acres, to take
place after resolution of the title issues; (4) Wheeler prepare a suit to confirm title to the
40.05 acres in the name of Diamond.
¶5. Accordingly, on November 20, 2006, the parties entered into an amended contract that
superceded the September 28, 2006, contract. The amended contract provided for O.W.O.’s
purchase of the three hundred acres in two parcels, Parcel A-1 for $1,620,000, and Parcel A-
2 for $80,000. Parcel A-2 comprised the 40.05-acre parcel. The amended contract stated that
O.W.O. had paid Diamond the $50,000 nonrefundable earnest-money deposit on or before
September 28, 2006, to be credited against the purchase price of Parcel A-1.2 Diamond both
represented and warranted he had merchantable title to the three hundred acres and that he
would commence a suit to confirm title to Parcel A-2 “in order to obtain insurable and good
and merchantable title to said Parcel A-2.” The amended contract provided for a closing date
on Parcel A-1 of on or before January 3, 2007, with O.W.O. to give Diamond seven days’
written notice of the time and place of closing. The contract provided for a closing date on
Parcel A-2 to be within fourteen days of the entry of a final, nonappealable order of the
chancery court confirming fee simple title to Parcel A-2 in John Diamond.
2
The $50,000 was not held in escrow, but was paid directly to John Diamond.
4
¶6. On December 28, 2006, Wheeler sent a letter to Parsons requesting an extension of
the closing date due to two problems. First, O.W.O. had not been furnished any evidence
that the 40.05 acres had been conveyed to Diamond by Stone Investments. Second, due to
amendments to the MDEQ rules and regulations concerning the operation of landfills,
O.W.O. had been unable to confirm that the existing permit to operate the ten-acre landfill
could be assumed by O.W.O. Wheeler averred that these two problems constituted material
misrepresentations under the amended contract. Therefore, he requested extension of the
January 3, 2007, closing date by thirty days, assuming O.W.O. had received written
verification that the permit was transferrable, and assuming O.W.O. had been furnished proof
of the transfer of the 40.05 acres to Diamond and the initiation of a title-confirmation suit.
In a January 2, 2007, letter from Wheeler to Parsons, Wheeler stated he had received no reply
to the December 28, 2006, letter. Wheeler stated that O.W.O. was unwilling to close until
the issues were resolved.
¶7. On January 4, 2007, O.W.O. filed a complaint for specific performance and damages.
O.W.O. alleged that during due diligence, questions had arisen as to whether certain
environmental permits, licenses, zoning, and other authorizations were transferrable, and that
Diamond had misrepresented that he had title to the full three hundred acres of land, while
in reality, 40.05 acres were titled in the name of Stone Investments. O.W.O. claimed that
Diamond had refused its request for thirty days’ additional time prior to closing to address
these problems. On April 23, 2007, O.W.O. filed its first amended complaint for damages,
requesting a return of the $50,000 earnest-money deposit, $40,034.80 in due-diligence
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expenses for engineering services to determine whether there was compliance with MDEQ
regulations, attorneys’ fees, and punitive damages.
¶8. On April 20, 2007, Stone Investments filed a motion to dismiss for lack of
jurisdiction. A basis for the motion was that, on March 19, 2007, it had sold the 40.05 acres
to E-Z Disposal, Inc. In a response to the motion to dismiss, O.W.O. contended that a lis
pendens on the 40.05 acres had been filed with the original complaint, which rendered the
sale to E-Z Disposal, Inc., a nullity. On May 24, 2007, O.W.O. moved to add E-Z Disposal,
Inc., as a necessary party. On September 20, 2007, the trial court entered an agreed
judgment providing that the defendants would withdraw the motion to dismiss, and
authorizing O.W.O. to file an amended complaint within fifteen days.3
¶9. Stone Investments answered and admitted its ownership of the 40.05 acres, and that
Diamond had represented to O.W.O. that it had full title to and right to sell the three hundred
acres, including the 40.05 acres owned by Stone Investments. Stone Investments denied that
Parsons had represented Stone Investments in the matter. Stone Investments counterclaimed
for fraud, alleging that O.W.O. had fraudulently entered into a contract to purchase property,
because O.W.O. continually had requested extensions and orally had offered an amount
lower than the contract price. Stone Investments requested specific performance of the
contract, removal of the lis pendens, and $400,000 in damages caused by the placement of
the lis pendens on the property.
¶10. On April 30, 2008, Diamond moved for summary judgment. On the same day, Stone
Investments filed a motion for summary judgment, asserting that a contractual relationship
3
E-Z disposal was never added.
6
between Stone Investments and O.W.O. had never existed, and that there was no legal basis
for the court to hold Stone Investments liable to O.W.O. for misrepresentations. Stone
Investments requested dismissal from the lawsuit and cancellation of the lis pendens. Stone
attached a copy of an unexecuted deed signed by Dana Parsons, the president of Stone
Investments, conveying the 40.05 acres to Diamond, dated December 29, 2006.
¶11. O.W.O. filed responses to both motions. Its claims against Diamond centered upon
Diamond’s misrepresentations that the landfill was in compliance with MDEQ regulations.
As to Stone Investments, O.W.O. asserted that there were genuine issues of material fact that:
(1) Jack Parsons was an authorized agent for Stone Investments; (2) he was an active
participant in the contract negotiations on behalf of Diamond; (3) he was aware that Diamond
was unable to perform the terms of the contract because Stone Investments owned the 40.05
acres; and (4) Stone Investments had concealed its ownership of the 40.05 acres until after
O.W.O. had paid the $50,000 nonrefundable earnest-money deposit to Diamond. O.W.O.
argued that there was a genuine issue of material fact that Stone Investments, acting through
Parsons, had fraudulently induced O.W.O. to pay Diamond the earnest-money deposit.
¶12. On May 22, 2008, O.W.O. filed a motion to disqualify Parsons due to his status as a
necessary witness in his capacity as agent for Stone Investments. On August 13, 2008,
O.W.O. filed a second amended complaint, adding a cause of action for tortious breach of
contract and claiming an additional $110,000 in actual damages.
¶13. In his deposition, Parsons stated that he was the attorney for Stone Investments and
had acted as its agent on some occasions. Parsons stated that Stone Investments had acquired
the 40.05 acres from the First National Bank of Wiggins on August 29, 2006, after the bank
7
had acquired it in a foreclosure sale on August 18, 2006. He had been aware of the
transaction at the time. Parsons stated that, in his representation of Diamond, he had
participated in contract negotiations. However, he stated, it was not until after the September
28, 2006, contract that he first had become aware that this same 40.05-acre parcel was part
of the three-hundred-acre parcel that his client, Diamond, had agreed to sell to O.W.O.
¶14. Dana Parsons, the president of Stone Investments,4 testified that he had authorized
Parsons to tell John Diamond that Stone Investments would sell the 40.05 acres to Diamond
if needed for inclusion in the sale to O.W.O. He also had authorized Parsons to tell Diamond
that Stone Investments would deliver a deed upon payment, and he had authorized Parsons
to prepare a proposed deed conveying the 40.05 acres to Diamond. Dana Parsons testified
that he would have executed the deed to Diamond upon receipt of the purchase price.
¶15. Robert Windham, the president of O.W.O., testified by affidavit that Parsons had held
himself out as the agent of Stone Investments, who was authorized to negotiate on its behalf
and bind the company. Windham testified that, after he had discovered that Diamond did not
own the 40.05 acres, Parsons had told him Stone Investments would not enter into a contract
with O.W.O. Instead, Parsons represented that Stone Investments would convey the 40.05
acres to Diamond if and when he had sold the property to O.W.O. O.W.O.’s attorney,
Wheeler, found this plan unacceptable. Subsequently, Parsons told Windham he would
prepare a deed conveying the 40.05 acres to Diamond.
¶16. Windham further testified that, on the closing date, O.W.O. had been prepared but
unwilling to close due to Diamond’s misrepresentations about the assets to be included in the
4
Dana Parsons is Parsons’s son.
8
sale, missing tax returns, missing employee lists, and missing MDEQ reports. Windham
testified that O.W.O. wanted to close after these problems were resolved. Windham testified
that, on January 4, 2007, he had obtained a letter from MDEQ stating that the landfill was
noncompliant and that any successor in interest would be liable for bringing it into
compliance. Windham testified that O.W.O. subsequently had purchased another piece of
land and was no longer ready, willing, and able to buy from Diamond.
¶17. The summary judgment hearing occurred on June 19, 2008. The chancellor reserved
ruling on the motion to disqualify Parsons and denied Diamond’s motion for summary
judgment. At an August 14, 2008, hearing, the chancellor granted Stone Investments’ motion
for summary judgment. The chancellor also removed the lis pendens. The parties agreed
that O.W.O. would dismiss all claims against Diamond and pursue an appeal as to Stone
Investments. The chancellor entered a final judgment, dismissing Stone Investments on
August 25, 2008, nunc pro tunc August 14, 2008.
STANDARD OF REVIEW
¶18. Our standard of review of the grant or denial of a summary judgment motion is de
novo. Kuiper v. Tarnabine, 20 So. 3d 658, 660-61 (Miss. 2009). The trial court “shall”
grant a summary judgment motion “if the pleadings, depositions, answers to interrogatories
and admissions on file, together with the affidavits, if any, show that there is no genuine issue
as to any material fact and that the moving party is entitled to a judgment as a matter of law.”
Miss. R. Civ. P. 56(c). Summary judgment is appropriate if the nonmoving party has not
made a sufficient showing to “establish the existence of an element essential to that party's
case, and on which that party will bear the burden of proof at trial.” Kuiper, 20 So. 3d at 661
9
(quoting Smith ex rel. Smith v. Gilmore Mem’l Hosp., Inc., 952 So. 2d 177, 180 (Miss.
2007)).
DISCUSSION
I. DID THE CHANCELLOR ERR BY GRANTING SUMMARY
JUDGMENT TO STONE INVESTMENTS?
II. DID THE CHANCELLOR ERR BY NOT FINDING THAT
PARSONS HAD A DUTY OF DISCLOSURE TO O.W.O. AS THE
DUAL DISCLOSED AGENT OF DIAMOND AND STONE
INVESTMENTS?
¶19. Although O.W.O. raises two issues on appeal, it provides no argument pertaining to
the second issue. Accordingly, we do not address it, as this Court does not consider
unsupported assignments of error. Touchstone v. Touchstone, 682 So. 2d 374, 380 (Miss.
1996). We note that our review of the grant of summary judgment embraces all relevant
legal issues.
¶20. O.W.O. argues that there were genuine issues of material fact because there was
sufficient evidence that Parsons had made a material misrepresentation that Diamond owned
the entire three hundred acres under contract, and his misrepresentation constituted fraud and
tortious interference with contract. The elements of fraud include:
(1) a representation, (2) its falsity, (3) its materiality, (4) the speaker's
knowledge of its falsity or ignorance of its truth, (5) his intent that it should be
acted on by the hearer and in the manner reasonably contemplated, (6) the
hearer's ignorance of its falsity, (7) his reliance on its truth, (8) his right to rely
thereon, and (9) his consequent and proximate injury.
Mabus v. St. James Episcopal Church, 884 So. 2d 747, 762 (Miss. 2004) (quoting Franklin
v. Lovitt Equip. Co., 420 So. 2d 1370, 1373 (Miss. 1982)). These elements must be proven
by clear and convincing evidence. Id.10
¶21. Stone Investments argues that there was no evidence on the element of damages
because O.W.O. never elected to purchase the property by giving Diamond written notice
within seven days of the time and place of closing. Because O.W.O. never elected to
purchase, Stone Investments argues, it is not entitled to a return of earnest money. See Gunn
v. Heggins, 964 So. 2d 586, 594 (Miss. Ct. App. 2007); Hamilton v. Hopkins, 964 So. 2d
586, 594 (Miss. Ct. App. 2003). Moreover, Stone Investments argues that, because O.W.O.
knew the true state of the title to the 40.05 acres before it executed the November 20, 2006,
contract, O.W.O. had actual knowledge, negating the element of fraud that requires the
hearer to have been ignorant of the representation’s falsity.
¶22. This Court finds that this case must be resolved through the application of agency
principles. O.W.O. sued Parsons’s client, Stone Investments, not Parsons individually. “The
relationship between client and attorney, regardless of the variations in particular
compensation agreements or the amount of skill and effort the attorney contributes, is a
quintessential principal-agent relationship.” CIR v. Banks, 543 U.S. 426, 436, 125 S. Ct.
826, 832, 160 L. Ed. 2d 859 (2005). For liability to attach to Stone Investments based on
Parsons’s misrepresentation, there must have been sufficient evidence to enable a jury to find
that Parsons was acting as Stone Investments’ agent at the time that he made the alleged
misrepresentation. A principal-agent relationship is "the fiduciary relation which results
from the manifestation of consent by one person to another that the other shall act on his
behalf and subject to his control, and consent by the other so to act." Butler v. Bunge Corp.,
329 F. Supp. 47, 49 (N.D. Miss. 1971). An agent may bind his or her principal through
actual or apparent authority. Barnes, Broom, Dallas and McLeod, PLLC v. Estate of
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Cappaert, 991 So. 2d 1209, 1211 (Miss. 2008). “Apparent authority exists when a
reasonably prudent person, having knowledge of the nature and the usages of the business
involved, would be justified in supposing, based on the character of the duties entrusted to
the agent, that the agent has the power he is assumed to have.” Id. The existence of apparent
authority is a fact question for the jury. Id.
¶23. The crux of O.W.O.’s fraud claim is that it paid Diamond $50,000 in earnest money
in reliance on Parsons’s misrepresentation during negotiation and execution of the original
contract that Diamond owned the entire three hundred acres. Parsons denied having had any
knowledge at that time that his other client, Stone Investments, owned a portion of the land
under contract. However, Parsons’s status as the attorney for Stone Investments would have
been sufficient to enable a jury to find that he had the requisite knowledge and was guilty of
a misrepresentation. Nonetheless, even if Parsons committed a misrepresentation, viewing
all of the evidence in the light most favorable to O.W.O., there was no evidence that Parsons
was acting on behalf of Stone Investments at the relevant time. The evidence was that
Parsons had represented Diamond during the negotiation and execution of the original
contract; Stone Investments was not a party to that contract. No evidence tended to show that
Stone Investments had cloaked Parsons with any authority to act on its behalf during the
negotiation and execution of the original contract between Diamond and O.W.O. Rather, the
evidence was that Stone Investments had authorized Parsons to negotiate with Diamond and
to communicate with O.W.O. on its behalf only after O.W.O. had discovered that Stone
Investments owned the 40.05 acres. Simply put, Stone Investments was not “at the
bargaining table” during the negotiation and execution of the original contract. Because there
12
was no evidence that Parsons was acting on behalf of Stone Investments at the relevant time,
his alleged misrepresentation did not bind Stone Investments as a matter of law, and Stone
Investments was entitled to summary judgment.
¶24. Additionally and alternatively, and viewing the evidence in the light most favorable
to O.W.O., O.W.O. waived its claim to recover the earnest money by entering into a new
contract which superceded the original contract.5 O.W.O. alleged that it had paid the earnest
money in reliance on the fraudulent misrepresentation by Parsons during the negotiation and
execution of the original contract. O.W.O. sought to recover the earnest money from Stone
Investments as damages for Parsons’s alleged fraudulent misrepresentation. It is undisputed
that, when O.W.O. discovered the misrepresentation, it did not seek recission of the contract.
Instead, with full knowledge that Diamond did not own the 40.05 acres, O.W.O. executed
an amended contract providing that O.W.O. would close on the 259.05 acres on the original
closing date of January 3, 2007, and would close on the 40.05 acres in a separate transaction
to take place fourteen days after a lawsuit confirmed Diamond’s merchantable title to that
parcel.
¶25. It is well-established that “a buyer who has been deceived by material false
representations in the procurement of a contract may elect to rescind and to be restored to the
position he occupied at the time of sale.” Browder v. Williams, 765 So. 2d 1281, 1285
(Miss. 2000). It also is well-established that:
5
Even assuming the dissent’s argument is correct, and the evidence was sufficient to
create a genuine issue of material fact that Parsons was acting as Stone Investments’s agent
at the relevant time, O.W.O. waived any claim of fraud by entering into an amended
contract.
13
Where the person defrauded after having knowledge of the fraud enters into
a new contract concerning the same subject matter, or an agreement modifying
the original contract, or renews the original contract for an additional term, or
asks favors, as, for example, requesting an extension of time for performance,
he will ordinarily be regarded as having waived the fraud in the original
transaction . . . .
Hines v. Hambrick, 210 Miss. 358, 368-69, 49 So. 2d 690, 694 (1951); see Gardner v. Little,
755 So. 2d 1273, 1276 (Miss. Ct. App. 2000) (stating that, “[i]f the Gardners felt that the
Littles misrepresented the corporation's net worth or acted in bad faith, then they were
required to either promptly rescind the contract or affirm the contract and maintain an action
in damages”). Instead of seeking recission of the contract or affirming the contract and suing
for damages, O.W.O. elected to execute an amended contract that superceded the original
contract. The amended contract provided a course of action by which the title problem with
the 40.05 acres would be remedied before the parties closed on that parcel. Therefore, by
entering into the amended contract, O.W.O. waived its claim for the return of earnest money
based upon the alleged fraudulent misrepresentation.
¶26. We turn to O.W.O.’s tortious-interference-with-contract claim. O.W.O. claims that
Parsons’s misrepresentation as to Diamond’s landholdings during negotiation and execution
of the original contract constituted tortious interference with contract. The elements of
tortious interference with contract are:
(1) that the acts were intentional and willful; (2) that they were calculated to
cause damage to the plaintiffs in their lawful business; (3) that they were done
with the unlawful purpose of causing damage and loss, without right or
justifiable cause on the part of the defendant (which constitutes malice); and
(4) that actual damage and loss resulted.
14
Par Indus., Inc. v. Target Container Co., 708 So. 2d 44, 48 (Miss. 1998). The plaintiff must
prove that an enforceable obligation existed between itself and another party, and that, but
for the defendant’s interference, the contract would have been performed. Id. Considering
the evidence in the light most favorable to O.W.O., there was no evidence that Parsons was
acting on behalf of Stone Investments during Diamond’s negotiation of the original contract
with O.W.O. Additionally, there was no evidence from which it could be inferred that
Parsons had concealed Stone Investments’s ownership of the land with the unlawful purpose
of causing O.W.O. to suffer damage and loss, or that his conduct was calculated to cause
damage to O.W.O. in its lawful business. We find that there was no genuine issue of material
fact, and Stone Investments was entitled to a judgment as a matter of law.
CONCLUSION
¶27. Viewing the evidence in the light most favorable to O.W.O., Parsons was not acting
on behalf of Stone Investments during the negotiation and execution of the original contract
between Diamond and O.W.O., and any misrepresentation committed by Parsons during that
time did not bind Stone Investments. Additionally and alternatively, O.W.O. waived any
claim for the return of earnest money based upon fraud by executing the amended contract
with full knowledge of the alleged misrepresentation. Accordingly, the trial court
appropriately granted Stone Investments’ motion for summary judgment.
¶28. AFFIRMED.
GRAVES, P.J., RANDOLPH, KITCHENS AND PIERCE, JJ., CONCUR.
DICKINSON, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY
WALLER, C.J., CARLSON, P.J., AND LAMAR, J.
DICKINSON, JUSTICE, DISSENTING:
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¶29. Because I cannot agree with majority’s decision to affirm the chancellor’s grant of
summary judgment, I must respectfully dissent. The affidavit of Robert Windham, owner
and CEO of O.W.O. Investments, Inc. states in pertinent part:
...
12. At all times during all negotiations which took place between myself
and John Diamond, Jack Parsons represented to me that he was an
authorized agent, (although not a principal) of Stone Investments and
that he was authorized to negotiate for them and bind to said company.
13. At all times during said negotiations, Jack Parsons and Stone
Investment were aware and fully knowledgeable that the 40.5 acres
included in the 300 acres John Diamond was negotiating to sell to us
was not owned by John Diamond but was, in fact owned by Stone
Investment.
14. O.W.O. was induced to sign the contract, first by John Diamond’s
representation to O.W.O. that he owned the entire 300 acres that was
the subject matter of the contract. This representation was made in
spite of the fact and with the full knowledge and participation of Stone
Investment by and through its agent, Jack Parsons, all the while
knowing that 40.5 of the acres out of the total 300 was not, in fact,
owned by John Diamond and Stone Investment, though its agent, Jack
Parsons, did participate in this representation.
¶30. Parsons stated in his deposition that “people think that I am the, quote, master, end
quote, of Stone Investment, which is quite erroneous.” He admitted to acting as an agent of
Stone Investments on occasion. Jack Parsons’s son, Dana Parsons, is the president of Stone
Investments. Viewing this evidence in the light most favorable to O.W.O., a question of
material fact exists as to whether O.W.O. was induced to enter the contract and the later
amended contract by the allegedly fraudulent representations of Stone Investments through
its purported agent, Jack Parsons. And I respectfully disagree with the majority’s conclusion
16
that “ O.W.O. waived any claim of fraud by entering into an amended contract.” Indeed,
fraudulent inducement to enter into the amended contract is part of the plaintiff’s claim. I
would reverse and remand this case for a trial on the merits, and therefore must respectfully
dissent.
WALLER, C.J., CARLSON, P.J., AND LAMAR, J., JOIN THIS OPINION.
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