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Terry v. Auto

Court of Common Pleas of Delaware, New Castle

January 4, 2017

CAMAL TERRY Plaintiff-Below/ Appellant,
v.
ROBIN DRIVE AUTO, Defendant-Below/Appellee

          Submitted: December 7, 2016

          Carnal Terry Plaintiff-Below/Appellant.

          Robert C. McDonald, Esquire Silverman McDonald & Friedman Attorney for Defendant-Below/Appellee.

          DECISION AFTER TRIAL

          Honorable Carl C. Danberg Judge.

         This is an appeal de novo from the Justice of the Peace Court No. 13, and centers upon payments made toward the purchase of a motor vehicle. The Plaintiff-Below/Appellant, Carnal Terry (hereinafter "Terry"), brought an action sounding in breach of contract against the Defendant-Below/Appellee, Robin Drive Auto (hereinafter "Robin Drive"), seeking to recover the $1, 250.00 Terry had allegedly made in payments to Robin Drive.

         On December 7, 2016, a trial de novo was convened on the matter. At the conclusion of the trial, the Court reserved decision. This is the Court's final decision after trial.

         LEGAL STANDARD

         Court of Common Pleas Civil Rule 72.3 governs de novo appeals from the Justice of the Peace Court. A de novo trial from the Justice of the Peace Court "means a trial anew, whether of law or fact, according to the usual or required mode of procedure."[1] The burden of proof in an action for breach of contract is proof by a preponderance of the evidence.[2]

         During the trial, the Court sat as the sole trier of fact. Therefore, it is the Court's responsibility to assess the credibility of the testifying witnesses and, where there is a conflict in the testimony, to reconcile these conflicts, "if reasonably possible[, ] so as to make one harmonious story."[3] In doing so, the Court takes into consideration the demeanor of the witnesses, their apparent fairness in giving their testimony, their opportunities in hearing and knowing the facts about which they testified, and any bias or interest that they may have concerning the nature of the case.[4]

         FACTS

         At trial, the Court heard testimony from Terry and from David DeMeglio (hereinafter "DeMeglio"), the owner of Robin Drive. The Court also received documentary evidence in the form of a Test Drive Agreement, a Sales Agreement, and four (4) receipts. As the sole trier of fact, the Court finds the relevant facts to be as follows.

         In June of 2014, Terry began working for Robin Drive. Aside from his regular income, Terry received various amounts in "store credit, " usable for goods and services sold by Robin Drive.[5] In July of 2014, Terry decided to purchase a 1995 BMW 3 Series (the "Vehicle") from Robin Drive for approximately $4, 500.00. Pursuant to an oral agreement, Terry began making cash payments toward the Vehicle, totaling at least $300.00 by August 20, 2014.[6] On August 20, 2014, Terry signed a written agreement with Robin Drive (the "Contract"), pertaining to Terry's intended purchase of the Vehicle.[7]

         The Contract is a single page document, the top of which contains such information as the stock number and type of the Vehicle, Terry's name, and a starting date listed as August 20, 2014. The Contract listed the full price as $4, 995.00, with a required down payment of $1, 200.00. According to the Contract, the total down payment received on August 20, 2014 was $560.00, with a remaining balance due of $640.00.[8] Installments toward the down payment were to be made weekly, beginning on August 22, 2014.

         In addition to the aforementioned terms, the Contract contained four block paragraphs of text. The Contract stated, inter alia, that "the maximum term of this layaway is twenty-one (21) days from todays [sic] date." Concerning the consequences of a breach, "[f]ailure to follow these terms will void this contract." In addition, "[a]ll money paid towards this layaway will be applied to the costs of storing this vehicle as well as internal cost to prep said vehicle for sale." The Contract states that all deposits are not transferrable or refundable, and that breach will forfeit any claims to the Vehicle.

         At the bottom of the Contract, there is a signature line with Terry's name. Also along the bottom are several handwritten notes, including a notation of "Approved with mother as cosigner - customer agree." Another note says "update: Carnal lost job, deal ok w/ mother." None of these handwritten additions are initialed, dated, or otherwise verified on the face of the Contract.

         After the Contract was signed, Terry continued making payments; however, Terry admitted he had missed one payment, which he made up in a subsequent week. At some point in September, Terry was discharged from Robin Drive, leaving Terry unemployed and dependent upon his parents for money.[9] Ultimately, Terry did not meet the requisite down payment by September 26, 2014.[10] Furthermore, when Terry came to Robin Drive to complete the paperwork, Terry's mother reportedly declined to sign as a guarantor. In addition, Terry failed to provide proof of insurance, as required by the Contract. At this point, Robin Drive considered the deal to be "dead."

         In October of 2014, Robin Drive attempted to "revive" the deal, and told Terry he could have the Vehicle if he met the requirements. On October 11, 2014, Terry provided an additional payment of $250.00 to Robin Drive. However, after the payment, Terry was unable to meet the requirements of the Contract. Specifically, Terry's stepfather refused to fill out an application to be a co-signer, Terry again failed to provide proof of insurance, and Terry had not paid the requisite $1, 200.00. This marked the close of Terry's dealings with Robin Drive, and the instant matter proceeded into the courts.

         DISCUSSION

         The chronology of this matter involves three distinct phases: (1) the pre-Contract phase; (2) the Contract phase; and (3) the post-Contract phase. However, because the pre- and post-Contract phases may depend upon the validity of the Contract itself, the Court will first address the matters in the Contract phase.

         I. The Contract Phase

         The Contract was signed on August 20, 2014, and contained a single page detailing the terms of the layaway, the deposit, payments, and the consequences of default. The Uniform Commercial Code governs the creation, interpretation, and enforcement of the Contract because it involves a merchant - Robin Drive - selling a Vehicle, which is a consumer good, to Terry, a consumer.[11]

         Under UCC § 2-204, "A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract." Furthermore, "Terms ... set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented ... [b]y course of performance, course of dealing, or usage of trade[.]"[12] "In order for there to be an agreement, the parties must have a distinct intention common to both without doubt or difference."[13]

         The Court finds there was a meeting of the minds with respect to the down payment. The Contract states there was a total required down payment of $1, 200.00. Terry testified he believed the down payment was $800.00, but this assertion is not credible given how conspicuous that term is on the face of the Contract.[14] It is well settled that "a party who enters into a contract governed by Delaware law will be charged with knowledge of the contents of the instrument and will be deemed to have knowingly agreed to the plain terms of the instrument absent some well-pled reason to infer otherwise."[15] The Court does not find a difference of $400.00 to be a significant enough variation under these circumstances to negate finding a distinct intention common to both parties as it relates to the written Contract.

         However, as discussed infra, the Court does not find there was a meeting of the minds with respect to certain other essential terms of the Contract. It is apparent the Contract contains numerous ambiguities, some or all of which have the potential to render the creation of the Contract invalid. When a contract is ambiguous on its face, the Court must analyze the contract to determine, where possible, the intent of the parties. Whereas a flaw or failure of a term may render a contract voidable, in whole or in part, Delaware recognizes certain circumstances where the contract is unenforceable in its entirety. "Certain agreements ... are so egregiously flawed that they are void at the outset. Those arrangements are often referred to as being void ab initio, Latin for "from the beginning." A court may never enforce agreements void ab initio, no matter what the intentions of the parties may be."[16] "Under Delaware common law, contracts that offend public policy or harm the public are deemed void, as opposed to voidable."[17]

         While not rendering a contract voider se, " '[C]ourts traditionally have reviewed with heightened scrutiny the terms of contracts of adhesion, form contracts offered on a take-or-leave basis by a party with stronger bargaining power to a party with weaker power.' An 'adhesion contract' is defined as a 'standard-form contract prepared by one party, to be signed by the party in a weaker position, usually a consumer, who adheres to the contract with little choice about the terms.' "[18] In addition, "[t]he Court may apply contra proferentem to construe ambiguous terms in a non-negotiated contract against the contract's drafter. That is, the doctrine is limited to resolve ambiguities."[19]

         An unambiguous contract is sufficient on its face; an unambiguous contract exists when a reasonable, objective third person would understand what the term means.[20] "If, however, there is more than one reasonable interpretation, a provision is ambiguous. But, a provision is not ambiguous just because the parties disagree on its proper construction; nor are unreasonable interpretations considered."[21] "The relative importance of a term is by its nature a fact-intensive inquiry. . . . Where, however, the unresolved terms are ...


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