Contract – Specific Performance – Statute of Frauds

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The master in equity erred in finding appellant equitably estopped from asserting the Statute of Frauds. The master also erred in granting specific performance where the contract included a “time is of the essence” clause, a merger clause, and a non-reliance clause.

We reversed.

Rudy Lamar Pearson appealed from the Master in Equity’s order granting specific performance of a real estate contract to Erin Burns Anderson, arguing the master erred in (1) granting specific performance although the contract had expired; (2) admitting evidence of pre-contractual discussions in violation of the parol evidence rule; (3) finding the Statute of Frauds did not void the contract; (4) finding Pearson was equitably estopped from asserting the Statute of Frauds; and (5) finding a meeting of minds between the parties on an alleged oral modification to the contract.

Anderson and Pearson entered a contract for Anderson to purchase a 21.99-acre parcel of land in Spartanburg County from Pearson for $400,000. The contract provided a closing date of September 29, 2017; a “time is of the essence” clause; and “an automatic extension of 5 business days for an unsatisfied contingency through no fault of either party.” After the parties did not close on the property, Anderson filed this action seeking specific performance. Pearson answered and the parties filed motions for summary judgment. On November 12, 2019, the matter was referred to the master. After a hearing, the master granted Pearson’s motion for summary judgment, finding the contract expired. Anderson moved to alter or amend, and Pearson opposed her motion. The master granted the motion, finding there was a genuine issue of material fact as to whether Pearson’s actions impeded Anderson’s ability to complete the purchase in accordance with the contract. Pearson moved to alter or amend, which the master denied. The master found Pearson was equitably estopped from raising the Statute of Frauds and Anderson was entitled to specific performance of the contract. Pearson moved to reconsider, which the master denied. This appeal followed.

Pearson argued the master erred in finding him equitably estopped from asserting the Statute of Frauds. We agreed. We found Anderson failed to meet the elements of estoppel because her reliance was not reasonable. Although there was evidence Pearson represented the survey for the right-of-way limited to no more than two acres would be provided to Anderson prior to closing, we found it was not reasonable for Anderson to rely on the representations. Additionally, although Mrs. Pearson created an expectation in Anderson that Pearson would have a survey prepared and sent to her before the closing date, there is also evidence the Pearsons were stalling in providing the survey.

We also found Anderson failed to show she suffered a detrimental change of position in reliance on the alleged promise to provide a survey. Anderson did not present evidence of any expenditures or other actions she took to her detriment in reliance on Pearson’s promise. After finding Anderson’s reliance was not reasonable and she failed to show a substantial, detrimental change in position, we reversed the master’s finding of equitable estoppel and order of specific performance.

Pearson also argued the master erred in granting specific performance where the contract included a “time is of the essence” clause, a merger clause, and a non-reliance clause. We agreed. Pearson argued he did not sign anything indicating that he would obtain a right-of-way survey or assume any financial contingency assigned to Anderson. He relied on the merger clause, the non-reliance clause, and the recommendation in the contract that Anderson obtain a survey. Pearson maintained any modification to the contract requiring him to obtain and pay for a survey of the overall land being sold to enable Anderson to obtain the loan must have been in writing and signed by him. Pearson also relied on the “time is of the essence” clause, arguing the contract expired and Anderson is not entitled to specific performance.

We found Anderson did not present evidence that she had the ability to perform her part of the contract at the time of closing or within the five-day grace period. Further, the contract, which included merger and non-reliance clauses, did not require Pearson to provide the survey. The contingency regarding a survey was not included in the parties’ contract, and its inclusion in the Transaction Brokerage Agreement did not bind Pearson, who was not a party to it. We found the master erred in failing to apply the parol evidence rule and in finding Anderson was timely able to perform her part of the contract. Accordingly, we also reversed the order granting specific performance on this ground.

Reversed.

Anderson v. Pearson (Lawyers’ Weekly No. 011-010-25, 10 pp.) (Paula H. Thomas, J.) Appealed from Spartanburg County (Shannon Metz Phillips, Master in Equity) Duane Alan Lazenby and James Andrew Smith, both of Lazenby Law Firm, LLC, of Spartanburg; Clifford Bush, III, of The Law Offices of Clifford Bush III, LLC, of Beaufort; and Steven Edward Buckingham, of The Law Office of Steven Edward Buckingham, LLC, of Greenville, all for Appellant; William B. Darwin, Jr., of Holcombe Bomar, PA, of Spartanburg; and Bernie W. Ellis, of Burr & Forman, LLP, of Greenville, both for Respondent. South Carolina Court of Appeals