Solondz v. Kornmehl
721 A.2d 16, 317 N.J. Super. 16 (1998)
Rule of Law:
When a contract's terms are clear and unambiguous, courts must enforce the agreement as written and will not rewrite it to relieve a party from a hardship or a bad bargain they could have guarded against. A party who forgoes equitable remedies like reformation at trial and instead insists on enforcing the contract's plain language is bound by that choice on appeal.
Facts:
- Leonard I. Solondz agreed to sell four commercial condominium units to Marvin Kornmehl for an initial price of $410,000.
- A tenant in the units, GYNE Surgical Associates, owed Solondz money on a promissory note for capital improvements Solondz had made.
- The parties executed a rider, drafted by Solondz's counsel, that reduced the purchase price to $400,000 and provided for the transfer of the tenant's promissory note to Kornmehl.
- The rider contained a clause stating, 'The parties theretofore agree that the consideration to be paid and received for the property shall be calculated by deducting from the price stated in the Contract the outstanding principal amount due on this note.'
- At the closing, the outstanding note balance of $67,667.54 was deducted from the $400,000 purchase price, and Kornmehl paid the resulting amount of $324,111.54 after other adjustments.
Procedural Posture:
- Leonard I. Solondz (plaintiff) filed a complaint against Marvin Kornmehl (defendant) in the Superior Court of New Jersey, Chancery Division (trial court).
- Solondz sought a money judgment for $67,667.54, alleging the credit given to Kornmehl at closing was a mistake.
- At a hearing, the trial court judge offered Solondz's counsel the opportunity to pursue the equitable remedies of rescission or reformation to correct the alleged mistake.
- Solondz's counsel rejected the offer, instead arguing for specific enforcement of the contract's plain language, which he believed supported his client's position.
- The trial court found the contract's plain language unambiguously supported Kornmehl's position and entered judgment against Solondz.
- Solondz (Plaintiff-Appellant) appealed the trial court's decision to the Superior Court of New Jersey, Appellate Division.
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Issue:
Must a court enforce a clear and unambiguous contract provision that explicitly requires deducting the outstanding balance of a transferred promissory note from a property's purchase price, even when the party who drafted the provision later claims it was a mistake?
Opinions:
Majority - Kimmelman, J.A.D.
Yes. A court must enforce a clear and unambiguous contract according to its plain terms, even if it results in a bad bargain for one party. The trial court correctly found that the rider's language admitted of only one interpretation: that the outstanding balance of the note was to be given to Kornmehl as a credit against the $400,000 purchase price. At the trial level, Solondz’s counsel rejected the court's suggestion to pursue equitable remedies for mistake, such as reformation or rescission, and instead insisted that the contract was 'disgustingly clear' and should be enforced as written. Having made that strategic choice, Solondz is bound by it and cannot change his legal theory on appeal to now argue about the parties' intent. This court will not rewrite the contract to give Solondz a better deal than the one for which he expressly bargained. As established in cases like Kampf v. Franklin Life Ins. Co., courts must enforce the contract the parties themselves have made, not relieve a party from a hardship that could have been avoided.
Analysis:
This case serves as a powerful illustration of the plain meaning rule in contract interpretation, emphasizing that objective, written terms will triumph over a party's subsequent claims of subjective mistake. It also highlights the principle of judicial estoppel, as a party cannot adopt one legal theory at trial and, upon losing, adopt a contrary theory on appeal. The decision acts as a cautionary tale for litigators, demonstrating that the strategic choice to forgo equitable remedies in favor of a strict 'plain language' argument can be binding and irreversible if the court's interpretation of that language is unfavorable. The court's extensive critique of the plaintiff's procedural missteps further provides guidance to the legal community on the proper use of court procedures.
