Thursday, June 4, 2009

Court finds latent ambiguity in deed; allows parol evidence to show intent of the deed

RUTH M. COOPER, ET AL. v. KEVIN SMITH and NATHANIEL LINDER (Tenn. Ct. App. May 7, 2009).

Appellants filed this action for declaratory judgment asking the trial court to interpret a provision in a deed. The trial court concluded that the deed was unambiguous and did not allow Appellants to present parol evidence showing the grantor’s intent. We find that the deed contains a latent ambiguity and therefore reverse and remand this matter to the trial court.

Opinion may be found at the TBA website:

"Parol evidence that adds to, varies, or contradicts the language of the deed is generally inadmissible. Parol evidence, however, may be admissible to remove a latent ambiguity in a deed; it is inadmissible to explain a patent ambiguity. Id. The Mitchell Court explained that “a patent ambiguity is one which appears on the face of the deed, while a latent ambiguity is one which is not discoverable from a perusal of the deed but which appears upon consideration of the extrinsic circumstances.” ‘ Id.

“In the present case, both parties agree that there was no entity or group known as “Wright Chapel Baptist Church” at the time the deed was executed. This is not apparent from simply examining the face of the deed. The ambiguity appears only after learning that “Wright Chapel Baptist Church” did not exist in 1969. The deed therefore contains a latent ambiguity, and Petitioners are entitled to present parol evidence to explain the meaning of the ambiguous term.” Id.