101 Wash. 234 | Wash. | 1918
This is an action for a commission, claimed by plaintiff to have been earned under a contract to procure a loan on real estate.
Plaintiff was the resident financial correspondent of the Penn Mutual Life Insurance Company of Philadelphia, Pennsylvania. One B. Gr. Holt, the western fiscal agent of the insurance company, had headquarters at Denver, Colorado. It was Holt’s duty to examine western properties offered as security for loans and report his approval or rejection to the home office at Philadelphia. Defendant was a Washington corporation. Charles Cowen was its president and principal stockholder. Frank S. Bayley was its secretary. It owned lot 20 and the south half of lot 21, in block 12,
Some time in May, 1916, defendant, through its president, Charles Cowen, began negotiations with plaintiff through its president, Calvin Philips, for the procuring of a loan upon the property above described for the purpose mentioned. The loan application and the commission agreement as parts of the same transaction were dated July 20, 1916, and were executed July 26, 1916. The application was made “to or through Calvin Philips & Co.” so that the latter might lend its own money or the money of a third party. Neither the application nor the commission agreement contained any reference to the source from which the loan was to be procured, but it is admitted that, throughout the whole transaction, both before and after the application, no other source was contemplated by either party than the Penn Mutual Life Insurance Company. The' application stipulated that the loan would be personally guaranteed by Carles Cowen, defendant’s president. Defendant was advised that Holt must tentatively approve the application and security before the loan would be finally approved by the insurance company. Plaintiff’s president testified that he informed Cowen that Holt would arrive in Seattle about the middle of August. Cowen testified that the
“We have received from Mr. Holt the application of The Newoc Company for a loan of $13,500, 6%, repayable $500 at the end of one year, $1,000 at the end of two, three and four years, $500 at the end of six, seven, eight and nine years, “$7,500 at the end of ten years, covering three story brick store and apartment building, 4230 14th Avenue, NE., lot 60 x 103 feet, Seattle, the borrower to have the privilege of doubling the above annual payments, and principal and interest to be guaranteed by Messrs. Chas. Cowen and Prank S. Bagley.
‘ ‘ This application has been approved upon the above basis and the loan will be made, if all things are found satisfactory, subject to investigation and return, and subject also to settlement at our convenience.”
“We have received from the Penn Mutual Life Insurance Company of Philadelphia, its approval of your application for a loan of $13,500. The loan will be made if title and all things are found satisfactory.”
On August 15, Cowen called at plaintiff’s office and, on being told of the letter, stated that he had not received it and that he had made application to John Davis & Company for the money. That application was made under the following circumstances: On
August 7, John Davis, desiring final assurance as to defendant’s ability to take up the prior mortgage, at request of Cowen, who was then in Davis’s office, called up plaintiff’s office for information. Calvin Philips, Jr., a son of plaintiff’s president, answered the call and Davis asked whether the loan to Cowen would be made. Philips Jr., having in mind another application made by one Cahen, which had been rejected, answered “no” and told Davis that if he so desired he could go ahead and make the loan himself, as plaintiff had turned it down. It was admitted that this was an error resulting from confusion in the mind of young Philips of the names ‘
As to what further transpired at the interview in plaintiff’s office on August 15, plaintiff’s president testified that Cowen said he would try to get Davis Company to release him from its application and would then submit his abstract of title to plaintiff for examination. Cowen denied this and further testified that, on August 10, he informed plaintiff that he would wait no longer for an answer, and that he maintained the
“After investigation of the security in connection with the following proposed loans, our committee has concluded to remove the ‘subject’ condition: The Newoc Company $13,500, Manatawn Realty Company $16,000.”
When this letter was received by plaintiff does not appear, but in due course it must have been some days after the first of September.
In its complaint plaintiff alleges that, pursuant to the application and commission contract, it negotiated with the Penn Mutual Life Insurance Company to procure the loan; that the insurance company approved the loan application and agreed to make the loan if the title to the property should be found satisfactory as provided in the application; that it thereafter notified defendant of such approval and defendant refused to take the loan. Defendant answered, alleging failure of plaintiff to procure the loan in a reasonable time, withdrawal by defendant of its application, and release of defendant by plaintiff from the contract prior to the time of any notification by plaintiff of approval by the insurance company.
The trial was to the court without a jury. The court found that the application and contract were made on July 20, 1916, and provided no specific time limit for procuring the loan, but stipulated that defendant would not make application elsewhere until an adverse de
Appellant’s principal assignments of error and practically all of its argument are directed to the contention that the court’s findings were not supported by the evidence and that the conclusions are contrary to the law.
Touching the question of estoppel, it is urged that appellant was not estopped to deny that it released respondent from its application and contract by the telephone conversation with John Davis on August 7. In this view we concur. In the first place, there was no privity between John Davis & Company, to whom the alleged release was made, and the respondent Newoc Company. In the second place, the information that the loan had been refused by appellant was based upon a mutual mistake of Calvin Philips Jr. and John Davis as to the identity of the loan concerning which they were talking. When, therefore, acting on that mistake, Davis induced respondent to make an application to John Davis & Company, that application was made on a misapprehension of the facts by both parties. As between respondent and John Davis & Company, therefore, the application to John Davis & Company was not a binding obligation. Respondent, on discovering the mistake, had a perfect right to repudiate that application without incurring any liability to John Davis & Company, and the transaction is, therefore, as between appellant and respondent, wanting in the essential elements of an estoppel in pais; viz., a benefit on the one side or an injury on the other. Peck v. Peck, 76 Wash. 548, 137 Pac. 137.
Appellant further contends that respondent had no right to repudiate the loan application and commission agreement on the ground that the Penn Mutual Life Insurance Company was unreasonably delaying its answer. This is on the theory that, since the application
The issue here is thus reduced to this: Did the appellant secure such an unqualified acceptance of the loan by the insurance company within a reasonable time as contemplated by the loan application and commission contract? As answering this question in the affirmative, appellant relies upon its notification to respondent by the letter of August 14 that the application had been approved and the loan would be made. If, however, the application had not, in fact, then been approved according to its terms, but only with added conditions not contemplated by the application, then it is plain that the letter of notification to respondent had no probative force to establish the requisite unconditional acceptance, hence no tendency to prove the earning of appellant’s commission. That letter could only have such probative force when supplemented by proof that the insurance company had, prior to that time, actually accepted the application as made. Without such supplemental proof the letter to respondent was a mere self-serving declaration on appellant’s part. No such supplemental proof was made. On the contrary, the
Moreover, the approval of the insurance company embodied in its letter of August 8, in addition to requiring
The court’s further finding that .no acceptance of the loan by the insurance company was made within a reasonable time is also amply sustained. The evidence clearly shows not only that appellant was fully advised before taking the application of respondent’s purpose in seeking the loan; viz., to take up the prior mortgage maturing September 1, 1916, but also shows that both parties, by their subsequent conduct throughout, recognized that only an acceptance communicated to respondent in time to enable it to close the loan and make the necessary arrangements to pay off the prior mortgage on or about its maturity would be an acceptance within a reasonable time.
Appellant argues that evidence of these things was inadmissible as tending to vary the terms of the written contract. The case of Hoffman v. Tribune Pub. Co., 65 Wash. 467, 118 Pac. 306, is cited in this connection. As we read it, however, that decision is not in conflict with the views here expressed. There the written contract was construed as a contract to furnish machinery within a reasonable time. Defendant, in that case, attempted to show a contemporaneous, collateral, oral agreement that the delivery was to be made within four weeks and, as the opinion says, “irrespective of the question whether that period was or was not a reasonable time.” We held that this was an
“What constituted a reasonable time was a question of fact which appellant was entitled to show by competent evidence. The trial judge expressed and announced his willingness to admit such evidence.”
As we view it, that is what was done in this case. What is a reasonable time being a question of fact, it could only be determined by parol evidence as to the situation of the parties, the purpose of the contract, and the practical construction put upon it as shown by the subsequent conduct and declarations of the parties. Alexander v. Sherwood Co., 72 W. Va. 195, 77 S. E. 1027, 49 L. R. A. (N. S.) 985, and note p. 995; Alford v. Creagh, 7 Ala. App. 358, 368, 62 South. 254; Cotton v. Cotton, 75 Ala. 345; Cocker & Co. v. Franklin Hemp & Flax Mfg. Co., Fed. Cas. No. 2,932; Biddison v. Johnson, 50 Ill. App. 173; Geiger v. Kiser, 47 Colo. 297, 107 Pac. 267; Smith Sand & Gravel Co. v. Corbin, 81 Wash. 494, 142 Pac. 1163.
Appellant’s president testified:
‘ ‘ I knew of the mortgage which fell due on September 1st and that Mr. Cowen would have to have action in ample time for that mortgage to be met at maturity. . . . We did not tell him that Mr. Holt would be here early in August. I believe we told him the middle of August. Mr. Cowen came in every two or three days and we kept him posted as to the progress in the matter. After Mr. Cowen signed the application he frequently pressed us for an answer.”
The record is replete with testimony showing that appellant was throughout conceding that an acceptance too late to close the loan in time to enable respondent to meet the prior mortgage would not be an acceptance within a reasonable time.
Webster, Fullerton, Main, and Parker JJ., concur.