The plaintiff has taken appeal from the Superior Court's (Dickson, J.) order granting the defendant's motion to dismiss made at the close of the plaintiff's case during a jury-waived trial. Two questions are raised on appeal: (1) by what standard should we review the evidence when a judge grants a motion to dismiss during a jury-waived trial; and (2) whether the court erred in its findings and in its order of dismissal based thereon. We find no errors and affirm.
The plaintiff, Renovest Company (Renovest), entered into a purchase and sale agreement with the defendant. Hodges Development Corporation (Hodges), on June 30, 1986, for a two-building apartment complex in Franklin. The agreed-upon purchase price was $1,476,000 and the initial deposit paid to Hodges at the signing of the contract was $65,000. The contract specified that the deposit would serve as liquidated damages if Renovest failed to close on or before September 3, 1986.
Renovest first inspected the buildings on July 10, 1986, sending a partner and a building inspector. It was during this inspection that Renovest discovered a crack in the exterior of one building, and it consulted with Hodges the next day. Whether Hodges agreed to extend the deadline in order to allow further inspection by Renovest is disputed. Further investigation was performed on July 17 and 23 by another engineer, and his report on August 6 contained his opinion that the building would require "underpinning" of the foundation in order to prevent further settling of the building. Underpinning involves stabilization of the building's foundation. Based on this report, Renovest wrote to Hodges on August 7, terminating the transaction and demanding return of the $65,000 deposit. Hodges undertook its own engineering study, which commenced with borings on August 12 and culminated in an evaluation report dated August 26. This report described the cracking as cosmetic, found the problem building structurally sound, and rejected the need for underpinning. Hodges shared this report with Renovest.
Renovest did initially undertake to secure the financing by approaching four banks. Two of these, the Bank of New England and the Shawmut Bank, were favorably disposed toward the financing application, up to the time that Renovest notified them of the results of the engineer's report about the building's structural problems. Upon receipt of this information, the banks indicated they would not continue to process the loan applications until the issue of the building's structural soundness was resolved. Although time still remained in which to meet the financing deadline, Renovest never
At trial on its suit to obtain return of its deposit, Renovest presented three witnesses and introduced the deposition of a fourth witness. After Renovest rested, Hodges moved to dismiss, both orally and in writing, and the judge granted the motion based on the court's findings of fact. Rather than making a determination of whether the plaintiff established a prima facie case, the judge specifically concluded that Renovest's objection to the building's structure was untimely, and that Renovest prematurely terminated its attempts to obtain financing. He therefore ruled that the plaintiff had failed to carry its burden of proof, and granted the defendant's motion to dismiss. Renovest appeals the findings of the court, and asserts that, viewing the evidence presented to the judge in the light most favorable to it, Renovest had met its initial burden of presenting a prima facie case.
I. Standard of Review
The defendant, Hodges, urges that, although it would prevail under either standard, this court should adopt a standard recognizing that when the judge is the trier of fact, that judge may make findings of fact at the close of the plaintiff's case, which findings are entitled to deference upon review, unless clearly erroneous.
In Auclair, a case appealed from an order issued during a jury-waived trial at the same trial juncture as the present case, we applied the standard of viewing all evidence in the light most favorable to the plaintiff. Auclair supra. Auclair arose in a different procedural setting from the case before us today. Rather than dismissing the case on the basis of findings of fact made against the plaintiff, as in the present case, the trial judge in Auclair declined to make findings of fact at the close of the plaintiff's case, and instead chose to hear the
Our standard of review is a common-law, court-developed, doctrine based upon a weighing of the benefits of an expedited trial, and the resulting judicial efficiencies, against the risk of losing what might be developed in extended proceedings. As a court-developed doctrine, an appropriate standard may be established by this court in circumstances where no separate trier of fact exists and we are not, therefore, obligated to preserve a separate prerogative. See Briere v. Briere, 107 N.H. 432, 434, 224 A.2d 588, 590 (1966); Dean v. Smith, 106 N.H. 314, 317, 211 A.2d 410, 412-13 (1965).
We believe the better view is that supported by Hodges. The purpose behind the highly deferential "prima facie" standard for evaluating the plaintiff's evidence is to permit the issue to go to the jury if it is possible for the jury to resolve the issue in the plaintiff's favor, to preserve all factual matters that reasonably might be determined against the moving party. See Page v. Parker, 43 N.H. 363, 366 (1861). Therefore, the issue must go to the jury upon the presentation of a prima facie case, regardless of the judge's view of the weight of the evidence. R. WIEBUSCH, 5 NEW HAMPSHIRE PRACTICE, CIVIL PRACTICE AND PROCEDURE § 1585, at 298 (1984).
A motion to dismiss, made to the judge in a jury-waived trial at the close of the plaintiff's case, can challenge the plaintiff's case in either of two ways. Although both types of motion are referred to as "motions to dismiss" in many jurisdictions, they serve two very separate purposes. One, directed at the judge in his role as judge, is used to assess the legal sufficiency of the case, and is measured by the familiar prima facie standard, taking all evidence introduced and resolving all conflicts in the plaintiff's favor. The second, however, is a broader one, asking the judge, as the trier of facts, for an expedited disposition. On such a motion, the judge is permitted to render a verdict for the defendant, on the merits, at the close of the plaintiff's case. Should the judge choose to address the case on the merits at that time, the judge should make findings of fact and assess whether
The plaintiff has had the chance to prove his or her case, tested by cross-examination, but unchallenged by the defendant's case-in-chief. The plaintiff has no right to rely on the defendant's witnesses or exhibits to supply essential elements of his or her case. An alert defendant, perceiving a fatal hole in the plaintiff's case or satisfied with the state of the record, may rest without putting on a case. The plaintiff has no right to require the defendant to proceed. On the other hand, the defendant should be allowed to test the sufficiency of the plaintiff's proof before making the decision to proceed.
In a case where the judge is also serving as the trier of fact, the judge can halt the trial at the close of the plaintiff's case when he or she determines that the facts, as presented, will not be sufficient to meet the burden of establishing the case. The judge need not review the evidence by the prima facie standard to see if the plaintiff might meet the burden, based on possible findings of fact, but rather, as the trier of fact, can evaluate whether the plaintiff has actually met the burden to the court's satisfaction. The "prima facie case means little or nothing in a case tried to the court where it is clear, as it is here, that the trial court has weighed the evidence and found that the [claim] was not established." Totem Equip. Co. v. Critchfield Log. Co., 62 Wn.2d 175, 178, 381 P.2d 738, 739 (1963). "[T]he trial court was the trier of the facts, and in considering the evidence was not bound to view it in a light most favorable to the plaintiff, with all attendant favorable presumptions, but was bound to take an unbiased view of all the evidence, direct and circumstantial, and accord it such weight as he believed it entitled to receive." Allred v. Sasser, 170 F.2d 233, 235 (7th Cir. 1948). Quite simply, if the trial judge determines that the plaintiff has failed to present evidence which may persuade the judge at the close of the case, by a preponderance of the evidence, no need exists to hear the case in defense.
II. Time of the Essence
In his order dismissing the complaint, the trial judge found that time was of the essence for the exercise of the rights under the conditions precedent. The judge based his conclusion on the strict time provisions applicable to performance of the conditions, concluding that these provisions required strict compliance with the timetables established. The court therefore determined that the late notification precluded the plaintiff's invoking its right to terminate the agreement under the physical inspection condition. The court apparently also determined that no waiver of the deadline occurred during the relevant period.
III. Waiver of Terms
Renovest further argues that the express condition's deadline for notification was waived by Hodges in the July 11 phone conversation. During this conversation, Hodges's vice president, Barry Sanborn, agreed with Renovest's suggestion that Renovest hire a structural engineer to conduct further inspection. Renovest takes this approval to be a waiver of the notification time limit. We disagree.
All the evidence presented by Renovest does not compel the trier of fact to believe the assertion that a waiver occurred. See 93 Clearing House, Inc. v. Khoury, 120 N.H. 346, 350, 415 A.2d 671, 674 (1980). The trier of fact may simply choose to disbelieve a witness. See id. The judge could have based his conclusion on the cross-examination of Mr. Sheedy, which went as follows:
The contract that the parties agreed to recited that "this Agreement may not be changed orally, but only by an agreement in writing, duly executed by or on behalf of the party or parties against whom enforcement or any waiver ... is sought." No writing invoking the physical inspection termination condition was sent until August 7.
IV. Financing Condition
Renovest asserts that it was unable to obtain financing for the project and, therefore, was excused from performing by paragraph 3(d). That paragraph, under the heading "Conditions Precedent to Buyers [sic] Obligation to Perform," reads:
We also reject Renovest's reliance upon this provision.
The ultimate determination of whether to provide financing is one for the lender, and Renovest's unilateral belief that financing would
Applying these considerations to the record before us, we conclude that the trial judge could have determined that Renovest failed to make a good faith effort to secure financing and prematurely terminated its loan application effort. The question of the reasonableness of such effort is for the trier of fact to decide. See Allview Acres v. Howard, 229 Md. 238, 244, 182 A.2d 793, 796 (1962). The record discloses that both the Shawmut Bank and the Bank of New England indicated they were "favorably disposed" to going forward with the loan, provided the structural problem was resolved as not being severe. This falls short of showing that an appropriate application, accompanied by all available information, would have been rejected or have been an empty gesture. Stabile, 336 Mass. at 406, 145 N.E.2d at 825. The deposition of Shawmut's loan officer, introduced into evidence, succinctly shows the dilemma of the bank. In responding to a question on whether the bank had undertaken an investigation of the structural questions, the loan officer responded:
Based on this evidence, the trial judge could have concluded that Renovest failed to make reasonable efforts to obtain the loan, and further concluded, as did the loan officer, that Renovest did not really wish to proceed with the loan process. Although Renovest concluded that the banks would not give financing, based on its own engineer's report, the fact that Renovest was aware of Hodges's engineering report stating that the building was structurally sound, and yet did not submit this in support of its application, could support a conclusion that Renovest did not use all reasonable efforts to obtain financing.
BROCK, C.J., and JOHNSON, J., did not sit; the others concurred.