Sikora v. VanderPloeg

Douglas A. VanderPloeg (defendant) was a chiropractor who owned his own practice, VanderPloeg Chiropractor. In 1999 VanderPloeg decided to sell his practice to Xavier Sikora (plaintiff). Sikora’s attorney, Arshad Khan, prepared a purchase agreement containing a warranty provision for VanderPloeg Chiropractic’s total billings and collections for 1999, leaving a blank for the amount. VanderPloeg provided Sikora with a chart stating the total billings for the seven-month period from June to December 1999 were $257,952. Sikora made some handwritten notes indicating that he understood that these billings were for June to December 1999. Khan then mistakenly filled in the blank in the warranty provision to state that the billings from July (rather than June) to December 1999 were $257,952. The parties executed the agreement. After VanderPloeg left the practice, Sikora made a number of changes, and the practice began to fail. Sikora then sued VanderPloeg for breach of warranty, arguing that because the warranty provision incorrectly stated that VanderPloeg Chiropractic’s income was $257,952 for the six-month period from July to December 1999, VanderPloeg had breached the warranty. Following a bench trial in which Sikora argued that it was mere inattention rather than a mistake that caused the error in the warranty provision, the trial court found in Sikora’s favor, awarding him $34,443 in damages. VanderPloeg appealed, arguing that the figure for total billings and collections in the warranty provision was a mutual mistake and, therefore, reformation was the appropriate remedy.