## Facts

- American National Self Storage, Inc. (buyer) purchased real property from Carlos Lopez-Aguiar (seller).
- The contract for sale included an express warranty: the seller “represents and warrants that water, sewer and electric service are presently available at the property line or lines of the premises with sufficient capacity to accommodate a 45,000 sq. ft. office/warehouse building.”
- After the transaction, American alleged that water and sewer connections were not “presently available at the property line” and that the lines were far enough away that American had to pay more than $25,000 to extend them.
- American sued Lopez-Aguiar for breach of the express warranty and sought damages tied to the extension costs.
- Lopez-Aguiar moved for summary judgment, arguing (1) the contract merged into the deed delivered at closing, and the deed contained no utilities warranty; and (2) American knew before closing that the lines were not at the property line and closed without objection, which (he argued) waived any breach.
- The trial court granted summary judgment for Lopez-Aguiar on the theory that the contract (and warranty) merged into the deed and therefore could not be enforced after closing.
- American appealed.

## Issues

1. Whether delivery and acceptance of a deed that is silent on utilities “ipso facto” extinguishes an express utilities-availability warranty in a prior land sale contract under the merger doctrine.
2. Whether the buyer’s knowledge before closing of the utilities’ location, combined with closing without objection, constituted waiver of the seller’s express warranty as a matter of law.

## Decision

- The appellate court reversed the summary judgment and remanded.
- The court held that the execution and delivery of the deed did not, by itself, extinguish the contract’s utilities-availability warranty.
- The court treated the utilities-availability warranty as a collateral undertaking—one calling for performance beyond merely conveying title and possession—and therefore not necessarily merged into a deed that omitted it.
- The court noted the seller did not show that the parties intended the warranty to be merged into and extinguished by the deed.
- The court rejected the waiver argument at the summary-judgment stage, holding that the buyer’s pre-closing knowledge and decision to close did not establish waiver as a matter of law.
- Because factual questions remained (including whether the warranty was breached and what the parties intended regarding survival), summary judgment was improper.

## Legal Principles

- Acceptance of a deed tendered in performance of a land sale contract generally merges contract covenants into the deed, but the merger rule does not apply to contract provisions not performed or satisfied by delivery of the deed.
- A deed is often only part performance of the overall agreement; the contract remains enforceable as to further provisions that require performance beyond conveyance of title.
- Collateral agreements—undertakings incidental to the transfer of title and not ordinarily included in a deed—may survive closing despite the deed’s silence.
- Whether a particular contract promise is merged can depend on the parties’ intent; deed silence alone does not necessarily prove intent to extinguish a collateral warranty.
- A purchaser may be able to close with knowledge of the seller’s breach of a collateral covenant without forfeiting the right to sue on that covenant; waiver is not established merely by closing without objection where an express warranty is alleged.
- Summary judgment is improper when material questions remain about breach, intent to merge, or waiver.

## Conclusion

The Third District Court of Appeal held that a contract warranty that water, sewer, and electric service were “presently available at the property line” did not automatically merge into a deed that omitted the warranty, because the promise could be treated as a collateral undertaking not satisfied by delivery of title. The court also ruled that the buyer’s knowledge before closing and failure to object did not establish waiver as a matter of law, so summary judgment for the seller was reversed and the case was remanded for further proceedings.


American National Self Storage, Inc. v. Lopez-Aguiar, 521 So.2d 303 (1988)