Business Law – Legal Memo Formatted 10

James L. “Skip” Deupree, a developer, was building a development of townhouses called Point South in Destin, Florida. All the townhouses in the development were to have individual boat slips. Sam and Louise Butner, husband and wife, bought one of the townhouses. The sales contract between Deupree and the Butners provided that a boat slip would be built and was included in the price of the townhouse. The contract stated that permission from the Florida Department of Natural Resources (DNR) had to be obtained to build the boat slips. It is undisputed that a boat slip adds substantially to the value of the property and that the Butners relied on the fact that the townhouse would have a boat slip.

Prior to the sale of the townhouse to the Butners, the DNR had informed Deupree that it objected to the plan to build the boat slips and that permission to build them would probably not be forthcoming. Deupree did not tell the Butners this information but instead stated that there would be “no problem” getting permission from the state to build the boat slips. The Butners purchased the townhouse. When the DNR would not approve the building of the boat slips for the Butners’ townhouse, they sued for damages for fraud. Who wins? Deupree v. Butner, 522 So.2d 242, 1988 Ala. Lexis 55 (Supreme Court of Alabama)

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