Full Opinion

Cite as 2026 Ark. App. 422 ARKANSAS COURT OF APPEALS DIVISION III No. CV-25-91 DOMUS FARAS AMERICA, INC.; AND Opinion Delivered September 23, 2026 CHRISTOPH WULLSCHLEGER APPELLANTS APPEAL FROM THE POLK COUNTY CIRCUIT COURT V. [NO. 57CV-22-9] HONORABLE ANDY RINER, JUDGE GARY E. COLE AND LINDA G. COLE APPELLEES AFFIRMED IN PART; REVERSED IN PART N. MARK KLAPPENBACH, Chief Judge Appellants Domus Faras America, Inc. (hereinafter “Domus Faras”), and its president, Christoph Wullschleger, appeal from a $144,270 judgment in favor of appellees Linda and Gary Cole. Appellants did not prevail on their counterclaim. Appellants present five arguments for reversal. We affirm in part and reverse in part. In November 2018, the parties agreed that the Coles would sell approximately 255 acres to Domus Faras for $800,000. Preceding the sale contract, Domus Faras had leased pastureland from the Coles for appellants’ horse operation. The sale contract required Domus Faras to tender a cashier’s check for $125,000 upon execution of the agreement. That money represented $75,000 in lease payments that were “already due” while the remaining $50,000 was to be credited as earnest money toward the purchase price. The parties agreed, however, that beginning September 1, 2018, the daily rental rate would be $70, which, until closing on the sale, would be deducted from the earnest money. If the closing did not occur within fifteen days “of the completion of the conditions described” in the contract, then the earnest money would be forfeited, and Domus Faras would have to vacate within fifteen days thereafter. Importantly, the forfeiture clause required that if the deal failed to close, it had to be “through no fault of the Sellers.” The contract’s conditions included the following: b. The SELLERS will request the adjacent property owners Campbell and Nance to execute the Property Line Acknowledgment Agreement along the East line of the above described property (Exhibit “C” and “D”). c. The SELLERS will officially request Polk County to change the name of Fender Lane to _________________ (Exhibit “E”). d. The SELLERS will assist in the purchase of two homes adjoining the real estate on Highway 88 (Exhibits “F” and “G”) by talking to the existing owners on the BUYER’S behalf. e. The SELLERS will supervise and the BUYER will pay for labor and material deliveries on site when services are rendered for the building of a fence on the East line of the “North Wind” tract of land. (Exhibit “H”). Said fence will be completed within 30 days of the date of this agreement. f. The SELLERS will supervise and the BUYER will pay for labor and material deliveries on site when the services are rendered for the cleanup of the South property and repair/replacement of the fence line (Exhibit “I”). Said cleanup will be completed within 30 days of the date of this agreement. g. SELLERS agree to supervise and the BUYER will pay for the establishment of Tifton 44 Bermuda Grass in the existing pasture land, as weather permits, and will allow the BUYER to use the SELLER’S two row spriger. This covenant is not a condition of closing but will survive the closing of the sale contemplated herein if such sale does occur. h. Within 60 days after the closing of the contemplated sale, the SELLER will remove a set of steel working pens with gates, 6 rolls of unclimbable fence and the 2 old wooden barn. SELLER shall not leave trash or debris where the items are being removed. All other personal property belonging to SELLERS not conveyed in this Contract which is not removed within 60 days from the closing of the sale shall be deemed abandoned. This covenant is not a condition of closing but will survive the closing of the sale contemplated herein if such sale does not occur. The contract was signed by Wullschleger and Mr. and Mrs. Cole. In February 2022, the Coles filed suit against Domus Faras and Christoph Wullschleger for breach of contract and for ejectment. Appellants filed an answer and counterclaim in June 2022. Appellants alleged that the Coles had not fulfilled their obligations under the contract, that appellants had invested money in making improvements that the Coles had yet to complete, and that it was only fair to require the land sale to be completed at a reduced price. Appellants accused the Coles of trespassing and interfering with the horse operation. Appellants said they paid the required $125,000, $50,000 of which was the earnest money. In July 2022, appellants requested an injunction against the Coles; appellants asked the circuit court to make the Coles stop putting chicken litter on the property. In July 2023, appellants filed an amended counterclaim adding that they had suffered “consequential” damages as well as actual damages. In August 2023, appellants requested that Wullschleger, Domus Faras’s president, be removed as a defendant because he signed the contract only on behalf of Domus Faras, not in his individual capacity. In September 2023, appellants requested a default judgment against the Coles. In November 2023, the Coles filed a response, requested an enlargement of time in which to file their answer, and 3 filed an answer to the amended counterclaim. The Coles stated that appellants did not substantively change their counterclaim. Appellants asked for a hearing on their motion for default. A hearing was set for April 2024, but appellants subsequently asked for a continuance. In June 2024, appellants asked for a continuance of the jury trial set for July 11, 2024. On the day of trial, appellants’ counsel asked for a continuance because Wullschleger was in Europe at a horse show. The circuit court stated that it had been difficult all along to get Wullschleger to be present; he had appeared only for a deposition, and that was pursuant to a body attachment. The Coles resisted the motion for a continuance and asked the circuit court to dismiss the counterclaim. The circuit court denied both requests and allowed the jury trial to proceed; it denied all pending motions and requests. Gary Cole was the sole witness. He testified that he had done what the contract required of him as best he could and that his efforts were stymied by Wullschleger. He said that appellants did not tender the required $125,000 cashier’s check. Instead, appellants tendered a $100,000 cashier’s check and a “regular” check for $25,000. According to Cole, the $25,000 check was to cover an obligation from 2011 or 2012 for which appellants had tendered a bad check, and it (the most recent check) was also a bad check. Even so, Cole said he asked the adjacent property owners to execute a boundary line by agreement, and he attempted to have Fender Lane’s name changed, but appellants never designated another name. Cole said he could not assist appellants in buying the two adjacent homes because appellants became disinterested when informed of the purchase price. Cole 4 said he could supervise the fence construction project, but appellants failed to purchase the proper materials. Cole said he could not “supervise” planting the grass because no one from Domus Faras ever came out to work on the grass project. Cole said that Wullschleger continued to live on and run horses on the property despite Cole’s repeated demands in previous years to vacate. He described ways in which appellants mismanaged the operation, abused the horses, and made no sincere effort to close on the real estate sale. This, Cole said, led to the present lawsuit. The Coles concluded their presentation, and appellants put on no case. The Coles moved for a directed verdict on appellants’ counterclaim, which the circuit court granted. The jury was instructed to determine whether the Coles did what the contract required of them or if they were excused from performing because appellants prevented or hindered their performance. The jury found in the Coles’ favor and awarded them $144,270 in damages. The circuit court entered the money judgment against Domus Faras and Wullschleger. This appeal followed. There is one point on which all parties agree. The jury found that only Domus Faras owed the money damages to the Coles, but the final judgment included Wullschleger as a judgment debtor, too. This was erroneous. Therefore, the money judgment against Wullschleger is reversed. Appellants further argue on appeal that (1) the Coles were not entitled to a judgment on their breach-of-contract claim because they materially failed to perform conditions precedent, resulting in no enforceable contract; (2) even if there were a valid contract, 5 appellants were not properly credited the $50,000 that they paid; (3) the circuit court erred when it did not enter a default judgment against the Coles on the counterclaim; and (4) the circuit court erred when it directed a verdict in favor of the Coles on appellants’ counterclaim. On review, it is not this court’s place to try issues of fact; rather, we review the record for substantial evidence that supports the jury’s verdict. Poole v. Arnold, 2026 Ark. App. 277, 739 S.W.3d 1. Substantial evidence is evidence that goes beyond suspicion or conjecture and is sufficient to compel a conclusion one way or the other. Id. On appellate review, we view the evidence and all reasonable inferences in the light most favorable to the prevailing party. Id. Here, the jury was presented with evidence that appellants did not tender the agreed- upon amount when the contract was executed and belatedly tendered $25,000 (if at all). Additionally, Mr. Cole testified about his efforts to comply with what the contract required of him and the significant lack of cooperation from appellants. “‘One who unjustly prevents the performance or the happening of a condition of promissory duty thereby eliminates it as a condition. Thus, that party cannot escape liability by preventing the happening of the condition on which it was promised.’” Perkins v. Cedar Mountain Sewer Imp. Dist. No. 43, 360 Ark. 50, 199 S.W.3d 667 (2004) (quoting 8 Arthur L. Corbin, Corbin on Contracts § 40.17 (2004)). Having reviewed this record under the proper standards, we hold that appellants fail to establish reversible error in the jury’s verdict concluding that appellants were in breach and that the Coles were excused from completing the contract. 6 Next, appellants argue that, assuming there was a valid contract, the Coles should not be allowed to keep the earnest-money deposit. Given our holding that there was substantial evidence to support the claim that appellants were in breach of contract and that the Coles were not in breach, this argument fails. Additionally, the contract called for rental payments of $70 a day from September 2018 forward to be deducted from the “earnest money.” The earnest money was gone long before this lawsuit was filed. Appellants next contend that the circuit court committed reversible error when it did not enter a default judgment in their favor on their counterclaim seeking actual and consequential damages against the Coles. We disagree. When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules, the circuit court has discretion to enter a judgment by default. See Ark. R. Civ. P. 55(a). We review the grant or denial of a motion for default judgment for an abuse of discretion. Bowles v. Taylor, 2024 Ark. App. 299, 689 S.W.3d 447. A circuit court abuses its discretion when it acts thoughtlessly, improvidently, or without due consideration. Id. Default judgments are not favored by the law and should be avoided when possible; default should be granted only when strictly authorized and when the party affected (the Coles) should clearly know he is subject to default if he does not act in a required manner. Id. When a party fails to file a timely answer, the reason for that failure should be considered on a case-by-case basis. See Macom v. Di Cresce, 2023 Ark. App. 530, 680 S.W.3d 36. In deciding whether to enter a default judgment, the circuit court should take into account the factors utilized by the federal courts, including whether the 7 default is largely technical and the defendant is now ready to defend; whether the plaintiff has been prejudiced by the defendant’s delay in responding; and whether the circuit court would later set aside the default judgment under Rule 55(c). See Bryant v. Watts, 2024 Ark. App. 245, 687 S.W.3d 600. These parties filed their initial complaints and answers in 2022. Appellants filed an amended answer and counterclaim in July 2023. All the while, litigation continued. In September 2023, appellants filed a motion for default judgment. In November 2023, the Coles filed their tardy answer stating that this was a mere oversight and that the amended counterclaim was the same “word for word” except that it added a request for “consequential” damages in addition to actual damages. On the totality of these circumstances, we hold that the circuit court did not abuse its discretion in denying appellants’ motion for a default judgment. Appellants suffered no prejudice, and the Coles were (and had been) prepared to defend. Last, appellants argue that the circuit court erred in directing a verdict in favor of the Coles on appellants’ counterclaim. A motion for directed verdict should be granted only if there is no substantial evidence to support a jury verdict, meaning only when the evidence is so insubstantial that a jury’s verdict for that party would have to be set aside. Atkinson v. Parkway Health Ctr., Inc., 2026 Ark. App. 208, 737 S.W.3d 739. A jury question is presented when the evidence might induce fair-minded people to reach different conclusions. Id. Here, appellants did not present any witnesses. Appellants failed to establish that they tendered $125,000 upon execution of the contract, and $50,000 of it was reduced by 8 $70 a day from September 2018 forward. Appellants presented no evidence to support their bare assertion that they sustained damages related to this contract, so the circuit court did not err in entering a directed verdict in favor of the Coles. In summary, we reverse the judgment only to the extent that it purports to make Wullschleger liable for the money damages awarded to the Coles. In all other respects, the judgment is affirmed. Affirmed in part; reversed in part. ABRAMSON and VIRDEN, JJ., agree. Robert S. Tschiemer, for appellants. Hughes & Hughes Law Firm, by: Eric G. Hughes, for appellees. 9