Davidson v. Katz

Court of Appeals of Maryland · Property

Propertyparol evidence ruleassignmentconsiderationambiguitybench trialclearly erroneouscredibility

Facts

Davidson and Katz allegedly agreed to acquire Montgomery County land jointly, and Katz later executed an assignment to Davidson of all Katz's rights in a supposed contract and option to purchase the land for stated consideration of one dollar and other good and valuable consideration, including an assignment of a '$200 deposit heretofore tendered.' Davidson claimed Katz had represented that the owners had signed the underlying contract, but the owners testified they never signed it, and the original contract produced in court was unsigned. Katz testified no deposit had been tendered and explained the assignment was intended simply to transfer whatever interest he might have so as to end his relationship with Davidson. The trial judge, after hearing conflicting testimony, found Davidson failed to prove actionable deceit and fraud by a fair preponderance of the evidence.

Issue

Whether the trial court erred by admitting Katz's oral testimony about the underlying transaction and consideration despite the written assignment, whether the delay between trial and decision invalidated the court's reliance on witness demeanor and credibility, and whether the trial court's finding for Katz was clearly erroneous on the evidence.

Rule

Parol evidence is generally inadmissible to vary or contradict a written instrument, but extrinsic evidence may be admitted where the writing is not decisive as to the parties' intent, to explain the rights actually covered by an assignment, and to show the true consideration when a conveyance recites a stated sum and 'other good and valuable consideration.' In a bench trial, the appellate court will not set aside factual findings unless clearly erroneous, gives due regard to the trial court's ability to judge credibility, and delay in rendering a decision alone does not show the judge forgot the evidence or witness impressions; the two-month decision rule is directory, not mandatory.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Baltimore, Lena Ortiz signed a document assigning to Omar Reed "all my right, title, and interest in a contract to purchase a warehouse in Frederick" for "$5 and other good and valuable consideration." When Omar later sued Lena for misrepresenting the deal, Lena offered testimony that the supposed purchase contract had never been signed by the owner and that she meant only to transfer whatever interest, if any, she had.

Should the court admit Lena's testimony over Omar's parol evidence objection?

Explanation. Parol evidence is generally inadmissible to vary or contradict a writing, but it may be admitted where the instrument is not decisive as to the parties' intent. The majority allowed oral testimony to clarify what rights were actually covered by an assignment when it was uncertain whether any underlying contract rights existed at all. That is the same here. (Derived from Davidson v. Katz (n.d.).)