RICHARD W. GIBBS ET AL. V. CLINT GILLELAND ET AL. - Articles

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RICHARD W. GIBBS ET AL. V. CLINT GILLELAND ET AL.

Posted by: Chandra Williams on Mar 1, 2016

Court: TN Court of Appeals

Attorneys 1:

L. Gilbert Anglin, Murfreesboro, Tennessee, for the appellants, Richard W. Gibbs and Kathryn S. Gibbs.

Attorneys 2:

Radford H. Dimmick, Nashville, Tennessee, for the appellees, Clint Gilleland and Kim Gilleland.

Judge(s): CLEMENT

Buyers of unimproved real property seek rescission of a Lot/Land Purchase and Sale Agreement on the ground of mutual mistake. Buyers purchased the property for the purpose of constructing a house. It is undisputed that at the time of contracting, Buyers and Sellers believed the property was suitable for that purpose. One week after obtaining the necessary building permits and commencement of construction, Buyers were informed by the county that the property was substantially below the required Base Flood Elevation (“BFE”) and that construction must cease immediately. Buyers halted construction and hired a professional engineer to address the issue. Based on unique drainage and flooding concerns, the engineer concluded that the property was not suitable for construction of a residential building and it had not been suitable for such purpose since the land was subdivided in 1999. After Buyers sued for rescission of the contract, both parties filed motions for summary judgment. The trial court found that when the contract was entered into the property was suitable for construction of a house and it only became unsuitable due to the subsequent action of the county in setting the BFE. Therefore, the court concluded there was no mutual mistake of fact. Based on this finding the court granted Sellers?s motion for summary judgment and summarily dismissed the complaint. Buyers appeal. We conclude that, at the time of contracting, the parties were operating under a mutual mistake as to a contemporaneously verifiable fact; nevertheless, the contract assigned the risk of mistake to Buyers. Therefore, rescission on the ground of mutual mistake is not available. Accordingly, we affirm.

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