282 F. 750 | 8th Cir. | 1922
(after stating the facts as above). Appellant’s bill being dismissed, the allegations of fact therein are to be taken as true. Kansas v. Colo., 185 U. S. 125, 22 Sup. Ct. 552, 46 L. Ed. 838. These allegations, however, must be distinguished from conclusions of the pleader. The court will accept as true the allegations of fact in the bill well pleaded, bdt will not accept as true mere conclusions.
The question that presents itself at the threshhold of this case is whether or not the record shows a contract between appellant and appellees. Appellant’s theory of the alleged contract is stated in the reply brief as. follows:
“The first letter appearing in the bill is a positive direct offer to sell for the sum of §125,000.00 (Eec. p. 6). On page 11 of the record is a positive direct offer to purchase at the sum of §132,000.00 and signed by J. H. Miller, who was the president of the plaintiff at the time and had authority to bind it.”
After the receipt of the first letter from Hemme to Stein, and the one of February 2, 1919, Stein evidently sought to procure a purchaser, and, after a great deal of negotiation, Bland, the associate of Stein, secured from one Miller an offer to pay $132,000, the same to be disposed of and divided as stated by Stein in his letter to Hemme of February 25, 1919; that is, $121,500 to Hemme, $4,000 to the Interior Oil & Royalty Corporation, the balance to be divided among the various brokers and real estate agents, and that Mr. Hemme, for himself and as agent for his wife, accepted over the telephone this proposition of Mr. Miller.
As appears by the allegations of the bill, after the appellees had received the letter from Stein of February 25, 1919, explaining the foregoing to them, they notified said broker and agent to bring his prospective purchaser to Stillwater, Okl., and that they would there close the deal upon the terms and conditions agreed upon as to the payment of money and “divisionally proceeds.” It is upon these allegations and letters that appellant relies to establish a contract.
Is the claim well founded? Does the record show mutual assent and a meeting of the minds of the parties upon all of the terms of the proposed agreement? A review of the correspondence and of the allegations of the bill is necessary to work out a correct solution of these questions. It will be well, however, first to settle the status of Miller and Stein, who appear frequently throughout the record, and who are important figures in the transaction.
It is the theory of appellant that Miller was the agent of appellant, with authority to act, and that Stein was likewise an agent of the Hemmes, with authority to procure a purchaser, and that Bland was an associate of Stein. The record is not clear as to the scope of the authority of these agents. It is alleged on page 10 of the transcript of record that plaintiff (appellant) on the 13th day of February, 1919, authorized Miller, its agent and officer, to send the telegram to Bland,
“Plaintiff, through its officer and agent, J. H. Miller, accepted All of the terms and conditions laid down in said telegram, and in writing agreed to pay the sum of $135,000.00 for said property,” etc.
In the reply brief of appellant, in the statement which we have heretofore set out, it is claimed that Miller was the president of the plaintiff (appellant) company at the time of these transactions, and had authority to bind it, and that these allegations are in the bill. We find no allegations as to Miller’s authority, other than those we have stated, and while there is a serious question as to whether the allegations are sufficient to show authority on the part of Miller to bind appellant, we assume for the purpose of this' case that he had such authority.
As to the authority of Stein, the early correspondence, especially the letter of February 12th from Hemme to him, would indicate that Hemme did not regard him as an agent, but looked upon him more as a prospective buyer. The later correspondence, however, shows that Hemme did expect to pay, and Stein expected to receive, a commission for his services; that Stein was his agent, with limited authority only, to secure a purchaser for Hemme; and that such purchase and purchaser were subject to the approval of both Mr. and Mrs. Hemme. Stein had no authority to bind either Hemme or Mrs. Hemme.
We pass to a review of the record in the quest to ascertain if any agreement was made between the parties as claimed by appellant. The point is stressed that the letter of February 1, 1919, contains a positive and direct offer to sell for the sum of $125,000. We do not so understand this letter. It makes a suggestion as to what it would take to secure Hemme’s royalty. It invites discussion. There is nothing definite however, as to how the amount should be paid, when it should be paid, or the kind of title that should be transferred. It submits a question to Stein as to how much he wants out of it. This letter is a mere opening of negotiations, and is in reply to a letter of Stein, which does not appear in the record. There is no proposal of sale' that could be accepted, and thereby a contract created.
In the letter of February 3, 1919, Stein speaks of $130,000 being paid for the property, he taking a $6,500 commission out of it, which, he states, will leave to Hemme “a net amount of $125,000 cash.” There was nothing settled by this letter, except the inaccuracy of Stein’s mathematics, as it is difficult to deduct $6,500 from $130,000, and have $125,000 left. Stein in this letter asks Hemme whether the price of $130,000, less 5 per cent, commission, is satisfactory. Certainly up to this time no terms proposed by any purchaser were accepted by Hemme. Stein in this letter seemed to be quite uncertain as to just what his authority was. It is to be noted in the postscript of this letter that Stein had submitted Hemme’s property to Mr. Perry early in January, indicating quite a willing attitude on the part of
One Andrew Whitehead, alleged agent of plaintiff (appellant), first appears in the proceedings on February 13, 1919, by telegram to Bland; said telegram suggesting that deal can be made with Miller, if Bland will divide the commission with him. While he is the alleged agent of appellant, he was .concerned over securing part of the commission that Bland, as an associate of Stein, seems to have expected. After Miller’s telegram to Bland that he would add $1,000 to the commission, provided Bland divid'ed with Whitehead, Bland seems to have been satisfied, and wired Miller that they had arranged to divide the commission in three ways, as appears in the telegram, hereinbefore set forth, of February 14, 1919. The three real estate agents, Whitehead, Bland, and Stein, having arranged, the matter of the division of the commission satisfactorily among themselves, concluded that the entire matter had been adjusted. The commission and its division appear to be about the only proposition that the record shows was absolutely agreed upon.
The Miller telegram to Bland of February 15, 1919, accepting the proposition that Bland had made to Miller, which related almost entirely to the commission, expresses the wish to close the deal on the basis of total payment of $132,000. Stein then, on February 18th, after being advised of the Miller proposition, sent deeds to Mr. Hem-me, witl^ the letter of February 18th, asking that Hémme and wife execute the deeds. Stein, not hearing from Hemme, writes him the letter of February 22d, complaining that Hemme does not answer telephone calls, and threatens him with suit. He is told to “wire your answer to-day.” Hemme does not wire, but on February 23, -1919, he replies by letter. This letter shows, either that Hemme did not have complete information as to the propositions made, or that they were, not fully understood by him. He draws Stein’s attention to the fact that at some previous time, when he had left him at the hotel at Tulsa, he had told him that he must talk the matter over with his wife. He also in this letter notifies him that it would be “best to close here where we are and where the records are”; notifies him, also, that his wife is not satisfied; advises him thapthe money must be put up in the bank at Stillwater on the proposition; refers to the old contract, evidently meaning the one made with Chaney, Webb, and Herring for sale of the property; and expresses disappointment over the situation as to that. He closes with these words, “My wife must understand fully and he satisfied.” Evidently at that time there had been absolutely no meeting of minds. It is evident from this letter that Hemme was taking advice and that he had help in the preparation of the letter.
After the. letter of February 23d, which apparently gave notice to Stein that Hemme was not in the mind to enter into final negotiations, Mr. Stein wrote him the letter of February 25, 1919, heretofore set out, giving the full terms of the Miller proposal; and the record alleges, as we have previously stated, that the said defendants by phone requested Stein to bring the prospective purchaser to Stillwater, and
In Miller’s telegram of February-15th, he speaks of his wish “to close deal.” In Stein’s letter to Hemme of February 18th, he uses the term “finally close this deal.” The allegation of alleged acceptance uses the term “close the deal,” the same to be done at Stillwater. In Stein’s letter of February 25th he speaks of finally “closing deal” at Tulsa. Further appears the statement that Bland and Stein and Gubser, attorney and agent for the plaintiff, went to Stillwater March 1, 1919, for the purpose of “closing the deal.” The allegation of record is, not that Hemme agreed fully to all the terms and conditions, but that he agreed to the terms and conditions as to the payment of money and “divisionally proceeds” theretofore agreed upon. It cannot be said that here was a complete meeting of minds upon all questions. There was and is yet a question in the minds of the parties as to the kind of, title to be conveyed and just what Miller was buying—whether royalty rights in land or rights to royalty that had accrued or would accrue from the operation of the five wells; whether he was to receive title to the fee, or whether that was to remain in Hemme; whether he was merely securing an interest in personal property or an interest in the land. Possibly this question remained open for final settlement at Still-water. There is no allegation that Hemme accepted all the terms and conditions proposed by Miller; but, the allegation being that he accepted all terms and conditions as to certain things, there is a limitation upon a full acceptance, and it is quite fair to assume that other matters ■were necessary to be agreed upon “to close the deal”—to use the language repeatedly employed by the parties.
While this statement of alleged acceptance comes the nearest to showing a contract on the part of appellees of anything in the record, it still leaves the matter open until the parties arrived at Stillwater and there arranged “to close the deal.” We do not think the language “to dose the deal” refers merely to the drawing and delivery of papers and going through the necessary formalities to reduce to writing a completed agreement, but there were material matters on which the parties had not agreed. It is somewhat strange that this notification of acceptance was given in a telephone conversation on or about the 27th of February, 1919, in view of Hemme’s refusal, as shown by the letters, to talk matters over on the telephone. He evidently had some suspicion of contracts closed in that way, as we find in Stein’s letter of February 22d complaint that Hemme would not answer telephone calls, and in Hem-me’s letter to Stein of February 23d he advised him there was no need “of any phones.” It may be noted, also, that in Stein’s letter to Hem-me of February 25th he refers to Hemme’s dislike to talk over the phone, and requests Hemme to let him know by return mail when he will be in Tulsa with the deeds signed by himself and Mrs. Hemme.
However, accepting the allegation at its full face value, it does not
Our discussion, so far, of the alleged contract, has been concerning Mr. Hemme’s relationship thereto. Let us analyze the situation as to Mrs. Hemme. There were no communications with her on the part of Stein. His letters were directed to Mr. Hemme alone. Evidently Stein did not regard his alleged agency such as to require any authority from Mrs. Hemme, but contented himself with believing that whatever Mr. Hemme agreed to she would likewise agree to. It is charged in the bill that both appellees are the owners of the land in question, namely, the west one-half of the northeast quarter of section 13, township 19 north, range 5 east of the Indian meridian, Payne county, Oklahoma. That is an allegation that Mrs. Hemme is one of the owners of the land. Appellant cannot now claim, in the face of this allegation as to ownership, that Mrs. Hemme does not have an interest in the land equal to that of Mr. Hemme. It was an ownership in the property that could be conveyed only by her separate action. As bearing on this see section 3352, Revised Laws of Oklahoma 1910, reading as follows:
“Except as mentioned in the preceding section, neither husband or wife has any interest in the separate property of the other, but neither can be exelud.ed from the other’s dwelling.”
If the alleged agreement here were for a transfer of interest in real estate, under the statutes of Oklahoma, an agent would have no authority to bind his principal in the transfer of such interest, unless the authorization were in writing (statute hereinafter set out). No such authorization had been given by Mrs. Hemme to Mr. Hemme, or to Mr. Stein. Outside of the question, however, of transferring an interest in land, Hemme had no right to bind her to any contracts concerning the said land, including the acceptance of the Miller proposals, without express authority from her. The only statements to show any right on the part of E. W. Hemme to act for Mrs. Hemme are certain allegations in the bill, such as: “The said defendant, E. W. Hemme, acting for himself and as agent for his codefendant, Mary Hemme.” Another: “The said broker and agent of said defendants.” Again the expression is used: “The said defendant, acting for himself and as agent for his codefendant.” These are mere statements of conclusions. There is no allegation of any authority whatsoever on the part of Hemme to bind his wife, Mary Hemme. The mere statement that he was an agent for her, without any allegation showing the scope of his authority, or that his agency was of such general character as would enable him to make contracts for her, is insufficient to bind her in the manner appellant claims. Further, in the letter of February 23, 1919, from Hemme to Stein, he was put upon notice of the limitations on his authority, and that his wife must be satisfied.
In Tilley v. County of Cook, 103 U. S. 155, 161 (26 L. Ed. 374), the court said:
'“An offer of a bargain by one person to another imposes no obligation upon the former, unless it is accepted by the latter upon the terms on which it whs made. Any qualification of or departure from them invalidates the offer, unless the same be agreed to by the party who made- it.”
The fact that the minds of the contracting parties must meet is simply stated in Richmond, etc., Railroad Co. v. Tobacco Co., 169 U. S. 311, 314, 18 Sup. Ct. 335, 336, 42 L. Ed. 759, where the court said:
“The contract is the concrete result of the meeting of the minds of the contracting parties. The evidence thereof is but the instrument by which the fact that the will of the parties did meet is shown.”
As to the necessity of a complete meeting of minds, in Compania Bilbaina, etc., v. Spanish-American & Co., 146 U. S. 483, 497, 13 Sup. Ct. 142, 148, 36 L. Ed. 1054, the court said:
“But, if there is any part of it in regard to which the minds of the parties have not met, the entire instrument is a nullity, as to all its clauses.”
Again in Fire Insurance Association v. Wickham, 141 U. S. 564, 579, 12 Sup. Ct. 84, 88, 35 L. Ed. 860, it was said:
“To constitute a valid agreement, there must be a meeting of minds upon every feature and element of such agreement, of which the consideration is one.”
The term “contract,” as used in the Constitution, is defined by lie Supreme Court in Chase v. Curtis, 113 U. S. 452, 464, 5 Sup. Ct. 554, 560, 28 L. Ed. 1038, as follows:
“The term ‘contract’ is used in the Constitution in its ordinary sense, as signifying the agreement of two or more minds, for considerations proceeding from one to the other, to do or not to do certain acts. Mutual assent to its terms is of its very essence.”
On this question of mutual assent of the parties, which is an important one here, we quote from the case of Utley v. Donaldson, 94 U. S. 29, 47 (24 L. Ed. 54):
*763 “There can be no contract without fhe mutual assent of the parties. This is vital to its existence. There can be none where it is wanting. It is as indispensable to the modification of a contract already made as it was to making it originally. Where there is a misunderstanding as to anything material, the requisite mutuality of assent as to such thing is wanting; consequently the supposed 'contract does not exist, and neither party is bound. In the view of the law in such case, there has been only a negotiation, resulting in a failure to agree. What has occurred is as if it were not, and the rights of the parties are to be determined accordingly.”
In National Bank v. Hall, 101 U. S. 43, 50, 51 (25 L. Ed. 822), it was said:
“In making a contract, parties are as important an element as the terms with reference to the subject-matter. Mutual assent as to both Is alike necessary. * * * There was no privity between the bank and -the new firm. There was no binding acquiescence by the hank. There could be none without knowledge, and it is not claimed or pretended that such knowledge existed. A new party could no more be imported into the contract, and imposed upon the bank without its consent, than a change could be made in like manner in the other pre-existing stipulations. The bank might have been willing to contract with the firm as it was originally, hut not as it was subsequently. At any rate, it had the right to know and to decide for itself. Without its assent a thing was wanting which was indispensable to the continuity of the contract.”
Tested by these various elementary essentials of a contract, tbe record fails to show any completed agreement between the parties.
While the conclusion expressed is determinative of the case, we refer to the interesting theory of appellant that the contract claimed by it was one giving a right to participate in the division of personal property, and amounted in effect merely to an assignment to it of the Hemmes’ right to royalty under the contract with Crockett. On page 48 of appellant’s brief this theory is expressed as follows:
“By this contract Hemme did not undertake to convey the land, or any interest therein, or indeed the oil and gas, but to assign and sell to the appellant his interest in a contract which gave him the right to participate in the division of certain personal property after it had been brought into existence. They still retained title to the fee and to the use of the demised premises, subject only to the rights and privileges granted by them to Crockett, their lessee. None of these rights did they undertake to convey to appellant, but his right to receive the one-eighth part of all the oil in the pipe lines to which the wells were attached.”
Again, on pages 51 and 52 of appellant’s brief, the thought is expressed as follows:
“Just what the lights of the purchaser of oil royalty, separate and apart from an assignment or transfer of the lease, may be, we are not called upon to consider, not being involved. But we are directly interested in the rights of the purchaser of the royalty, property essentially personal in its character. Such sale would not, in our.judgment, affect the relation of lessor and lessee that theretofore existed between the landowner and Crockett, but would merely work a transfer or assignment of the consideration from the landowners to the purchaser, and that all of the rights would remain, unaffected by the sale, in the lessor.”
It seems a long road to travel to accomplish what could have been easily done by a written assignment of the Crockett lease, if such were the intention of the parties. If the allegations of the bill could be tortured into expressing an agreement between Hemme and Miller, it is apparent that what Miller expected and what the'agreement would
We think the correspondence between the various parties, their agents and agents’ associates, shows that a transfer of title to the land was in contemplation. We refer to some matters in the record bearing on this question. In the letter of February 2, 1919, from Hemme to Stein, Hemme speaks of giving a warranty deed of the place to a man in Tulsa, and states he is not able to give a clear title, because of the option given to Chaney, Webb, and Herring. On February 18, 1919, Stein writes to Hemme as follows:
*'I am inclosing herewith deed as prepared by Dr. Miller’s attorneys. If you will he here Thursday morning with same duly executed by yourself and wife, I know of no reason why we cannot finally close this deal.”
Nothing is said here of any mere transfer of accrued royalty rights. Itjs perhaps unfortunate that the deed referred to does not appear in the record, as it might throw considerable light on the transaction and the intention of the parties. In the telegram of Miller to Bland of February 15, 1919, he requests that-deeds be prepared. If the transaction were to be a mere assignment of rights under the Crockett lease, no deed was necessary. He does not ask for such assignment. That would have been the usual procedure, if such were the intention of the parties. There is nothing to indicate that Miller ever heard of the Crockett lease. He seemed to be in ignorance of the theory, now advanced, that he was merely buying a right to participate in a distribution of personal property.
On February 22, 1919, Stein writes to Hemme, demanding that they deliver title by the following Monday evening. In other places throughout the bill are found references to a deed of conveyance, and in the relief prayed for we find appellant demanding such deed of conveyance, and asking that, upon a failure to convey, the judgment of the court shall operate as a complete conveyance of all the interest and royalty rights of the said defendants in and to said premises by virtue of the
The laws of Oklahoma provide (fifth subdivision of article 2, under the headings of Contracts, 1 Eaws of Oklahoma 1910, § 941):
“Fifth. An agreement for the leasing for a longer period than one year, or for the sale of real property, or of an interest therein; and such agreement, if made by an agent of the party sought to be charged, is invalid, unless the authority of the agent be in writing, subscribed by the party sought to be charged.”
The Crockett lease evidently was drawn under this section. The intention of appellant’s agent by the alleged offer and contract being to secure an interest in land, and the intention of appellee Hemme, if he had any intention in the matter at all, being to convey his land, it would be necessary that any agreement carrying out this intention should be in writing.
A contract can be made by letters and written memoranda sufficient to satisfy the statute1'of frauds; but it is universally held that such writings must be in themselves sufficient to create the contract, without resort to parol evidence to supply omissions. Atwood v. Rose, 32 Okl. 355, 362, 122 Pac. 929; Woodworth et al. v. Franklin, 204 Pac. (Okl. Sup.) 452, 459; Halsell v. Renfrow, 14 Okl. 674, 78 Pac. 118, 2 Ann. Cas. 286; Id., 202 U. S. 287, 292, 26 Sup. Ct. 610, 50 L. Ed. 1032, 6 Ann. Cas. 189; Bibb v. Allen, 149 U. S. 481, 13 Sup. Ct. 950, 37 L. Ed. 819.
The letters and writings here do not sufficiently meet the test of the law to satisfy the statute of frauds. Appellant’s theory that Miller was buying merely the right to participate in the division of personal property after it had been brought into existence is ingenious, but is not sustained by the record. In this connection it is of interest to note the language of the Supreme Court of the United States in U. S. v. Noble, 237 U. S. 74, 80, 35 Sup. Ct. 532, 59 L. Ed. 844, where the court said:
“The rents and royalties were profit issuing out of the land. When they accrued, they became personal property; but rents and royalties to accrue were a part of the estate remaining in the lessor. As such, they would pass to his heirs, and not to his personal representatives.”
Also see Woodworth et al. v. Franklin (Okl. Sup.) 204 Pac. 452, 458.
Appellant claims damage in the sum of $365,000 by the failure of appellees to carry out the alleged contract. It alleges that the property has had a large earning power, and that its royalty rights would have amounted to $150,000. That would be up to the time of filing the bill, which was December 10, 1920. As the contract was to be'made on March 1, 1919, it would mean that in approximately 20 months appellant would have received $150,000 from its share of the royalty. If this is true, notwithstanding Mr. Hemme had originally suggested $125,-000 as the amount necessary to secure his royalty, the Hemmes apparently were not receiving a' fair price for their interest, and these allega
Viewed from every standpoint, there is, we think, a singular lack of equity in this bill, and the trial court was right in sustaining the motion to dismiss the cause of action as set forth in plaintiff’s (appellant’s) second amended bill.
The decision is affirmed.
