124 P. 817 | Cal. | 1912
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[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *186 In each of these actions, the defendant has appealed from the judgment and from an order denying defendant's motion for a new trial. The cases depend mainly upon the same facts. They were tried together upon stipulation that the evidence taken should be considered in both cases so far as applicable.
The plaintiffs, respectively, sue to enforce an agreement for the sale of real estate, made by all of the plaintiffs, as vendors, and by the defendant as vendee. The agreement and the circumstances under which it was made are peculiar. Two actions for the condemnation of said lands and other lands for *187 railroad purposes were, and still are, pending in the superior court of the city and county of San Francisco. The Southern Pacific Railroad Company was the plaintiff in each of said actions, and the plaintiffs above named, together with other persons, were the defendants therein, except that the plaintiff, Sharp, was a party to only one of the actions. The Southern Pacific Railroad Company, it must be noted, is not the same company as the Southern Pacific Company, the defendant appealing herein. The Southern Pacific Company, however, owns a majority of the capital stock of the Southern Pacific Railroad Company and it controls the latter company. The condemnation suits were carried on by the Southern Pacific Railroad Company at the direction and for the benefit of the Southern Pacific Company. The agreement aforesaid was made on December 17, 1906, and is as follows: It was first recited that Ellen Dore, Charlotte E. Dore Horrigan, Maurice Dore, and William B. Sharp, who are the plaintiffs in the first case above entitled, owned, or claim to own, interests in certain tracts of land, described, and that Clara E. Folger owned a certain other tract in fee, and an interest in one of the tracts in which the first named parties also had interests. It appointed Frank S. Johnson, William Hale, and William Thomas as a board of arbitration and empowered them to ascertain and determine the value of each separate tract of said land and of each separate interest therein belonging to said parties. The judgment of a majority of said board was to be conclusive. It further provided that when the awards should be made, the Southern Pacific Company would, within sixty days thereafter, pay to the other parties, respectively, the sums so awarded to said parties and that the said parties immediately thereupon would each, respectively, convey said parcels of land to said Southern Pacific Company by good and sufficient deeds. It was further provided, with respect to the lands owned or claimed by the plaintiffs in the Dore case, that the sums fixed as the price thereof by the board of arbitration should be paid into the superior court in one of the condemnation suits above mentioned, being the case No. 1675, in the superior court, entitled Southern Pacific Railroad Company v. Griffith J. Kinsey et al., and that such payment into court should discharge said Southern Pacific Company from liability to said parties. Before the award was made a supplementary agreement was *188 made by the defendant and the plaintiffs in the Dore case, reciting that the said plaintiffs did not own the reversionary interest in one of the tracts, and providing that five per cent of the value fixed for said tract by the arbitrators should be deducted and the remainder taken as the value thereof, for the purposes of the contract of sale. The board of arbitration made an award, fixing the value of the respective parcels of land in question. The respective parties, plaintiffs herein, thereupon tendered to said defendant good and sufficient deeds, duly executed, conveying the several parcels of land in question and demanded payment of said sums so awarded and agreed on as the price thereof, but the defendant refused and still refuses to pay the same.
These facts are alleged and the court found that they are true. Judgment was given in each case in favor of the respective plaintiffs enforcing the agreement of sale. As grounds for the reversal of the judgment and orders, the defendant contends that certain of the facts are contrary to the evidence, and that the court below erred in certain rulings at the trial.
The agreement did not provide for a statutory arbitration, under the provisions of title X, part III of the Code of Civil Procedure. (Secs. 1281-1290.) The matters which fall within the scope of these provisions are those described in section 1281. It reads as follows: —
"Persons capable of contracting may submit to arbitration any controversy which might be the subject of a civil action between them, except a question of title to real property in fee or for life. This qualification does not include questions relating merely to the partition or boundaries of real property."
This section does not authorize the submission of any matter to arbitration except a "controversy which might be the subject of a civil action" between the parties concerned. The only thing submitted was the question of the value of the land. There might be a controversy over such value, of course, but that controversy could not be the subject of an action, and the value when fixed, either by an award, so called, or by an agreement, would, of itself, impose no obligation on either party, or determine anything that could be enforced as a judgment, or entered on the judgment book as such, as provided in sections *189 1283 and 1286. An action will not lie for the mere purpose of fixing the value of property.
At common law it is competent for persons to submit any question or matter of difference between them to the decision of third persons, whether it could be the subject of an action or not, and when they have done so, the decision will be binding upon them. (5 Am. Eng. Ency. of Law Prac. 33.) "To furnish a sufficient basis for entering into a submission, no legal cause of action in favor of either party need exist. That there is a dispute, controversy, or honest difference of opinion between them concerning any subject in which they are both interested is enough. Nor indeed is it necessary that they should have come to the actual point of a dispute; for a matter simply in doubt may be submitted." (Morse on Arbitration, p. 36.) Where the thing to be done is merely ministerial, as the casting up of an account, the measurement of timber, or the estimate of the quantity of work done under a contract, the decisions are somewhat at variance on the question whether such a submission is properly an arbitration in which the award, in the absence of fraud, will be conclusive on the parties, or a mere computation for the information of the parties. (Ibid.) Submissions to determine values are of two kinds — first, where the valuers are to examine the property and fix the value in accordance with their own opinion or judgment; second, where they are to afford the parties a hearing, and an opportunity to offer evidence, and are to adjudge the value upon a consideration of the evidence, as well as their own opinion. In cases of the first class, it is usually held that the agreement is not properly a submission to arbitration and is not subject to the rules which govern arbitrators, and that notice of the meetings of the valuers is not required. Church v. Seitz,
The agreement for submission in the case at bar was of the second class above mentioned. It expressly provides that the arbitrators should fix a day to begin the taking of testimony and hear the respective parties. Cases of this class are usually held to be common law arbitrations, and subject to the *190 common law rules on the subject. The distinction is not important, for notice was duly given, the parties appeared and days were spent in the investigation. The above cases hold that, in the absence of fraud, the decision of persons appointed as mere appraisers or valuers, although not properly or technically an arbitration and award, is binding on the parties. It cannot be disputed that where an award as to values is to be made after a hearing and upon a judicial investigation and consideration of evidence, as in the case at bar, such award, if regularly made, is final and conclusive upon the parties with respect to the matter submitted. (Morse on Arbitration, 487.)
The defendant claims that if the thing submitted does not come within the terms of the statute, then there was no agreement at all and that the entire proceeding was unauthorized and the award void. This proposition is founded on the following stipulation in the agreement:
"This agreement shall be held and taken to be a submission within the meaning of section
The argument is that this stipulation shows that both parties intended that the controversy should be submitted under the statute, that the statute gives the right to have the award vacated for gross error, and to have it modified or corrected for miscalculation or imperfection, by a motion made in the proceeding, which remedies are not available against a common law award, and that as it cannot be taken as a statutory submission, it cannot be said that the parties did agree, or ever would have agreed, to a common law submission, that there was no meeting of minds in a valid agreement for any arbitration, and that to hold the agreement good as a common law arbitration, would require the court to make a new contract for the parties.
There are a number of cases which hold that where the parties agree to a statutory submission and follow it up by proceeding, or attempting to proceed, in the statutory mode, but because of fatal defects in the procedure the award is invalid, the reasons above stated will prevent it from enforcement by action as an award at common law. (Williams v. Walton, *191
As this stipulation derives all its force from the agreement of the parties and none from the statute as such, it follows that this part of the agreement could be waived. What the *192 parties may do, by executory agreement, they may undo, or disregard, or waive by mutual consent duly carried into execution. The court below found that, notwithstanding the said stipulation, neither of the parties at any time caused the submission to be entered as an order of court, but that each of them, well knowing that it had not been so entered, proceeded with the arbitration, introduced evidence before the arbitrators and proceeded to an award without objection on that score, that each waived any right to cause the submission to be so entered, and that the form and manner of the arbitration and of the proceedings therein, and the making of the award without such entry as an order of court, was with the knowledge and consent of each and all of the parties and was agreed to by them. These findings are not challenged by the defendant. We must accept them as true. Indeed, the evidence in the record tends strongly to support them. The facts found show that there was a complete waiver of the stipulation for the entry of the submission as an order of court and of the right to have it considered as a statutory submission, and a practical agreement to proceed in the manner actually followed.
The statute requires that before acting the arbitrators must be sworn and that the award must be signed and delivered to the parties. (Secs. 1285, 1286.) The specifications of insufficiency of the evidence point out that there was no evidence that either of these things was done. The court found that the arbitrators were not sworn and that on the day the award was signed an unsigned copy thereof was served on defendant and that defendant waived all objections on account of the failure of the arbitrators to be sworn and the lack of a better service of the award.
What we have said heretofore is a sufficient answer to the point that the failure of the arbitrators to be sworn, and the failure to serve a signed copy of the award, makes it invalid as a statutory award. It is not a statutory award, and we need not decide whether or not these defects would avoid such an award. We may concede, for the purposes of the case, that the stipulation above quoted was, in effect, an agreement that the arbitrators should be sworn and that the award should be delivered. As before stated, these requirements, if agreed to, could be waived. We think the finding that they were *193 waived is supported by the evidence. The original agreement was made on December 17, 1906. The evidence does not show how soon thereafter the hearings before the arbitrators were begun, but it appears that many days were occupied in the hearings and that defendant appeared and presented evidence and conducted the proceeding on its part without ever demanding or suggesting that the arbitrators be sworn, or objecting because they had not been sworn. The agreement for a five per cent deduction from the amount awarded for a certain parcel was made on March 11, 1907. On April 30, 1907, the failure to make the award within the ninety days fixed in the original agreement was waived and the time was extended to May 15, 1907. The award was made on May 10, 1907, and on the same day the unsigned copy was delivered to defendant and it was informed that the arbitrators had not been sworn. No objection was then or ever made on either ground. Negotiations to obtain payment before the expiration of the sixty days by allowing a discount, and for an approval of the title, were begun at once. Defendant agreed to make such payment if the title was good. Defendant's attorneys examined the evidences of title offered by plaintiffs and approved the same, except that there was an outstanding tax-sale and that one Kearney owned an equitable interest in a part of the Dore lands. The clause providing that the value awarded to the Dore lands should be paid into court in the condemnation suit was inserted in the original agreement to enable the defendant to secure the Kearney interest by a judgment in condemnation, if necessary, using said money to pay him. In order to obtain payment without delay, it was agreed by defendant and plaintiffs that the Dores should procure title to the Kearney interest. In pursuance of this agreement they obtained a deed from Kearney to the defendant for his interest and paid him $11,500 on account. They also redeemed the land from the tax-sale. The defendant examined the award and pointed out an error in the calculations of the area of some of the parcels. On this account it was agreed that $5,371.86 should be deducted from the values of the Dore lands, as awarded. The defendant's attorneys then approved the title and the defendant promised to pay the values as thus fixed. The plaintiff on July 9, 1907, appeared at defendant's offices, tendered to the defendant duly executed *194 deeds, including that of Kearney, conveying the lands to defendant, and asked payment. It was late in the afternoon, too late to conclude the transaction on that day, and for that cause defendant asked plaintiffs to call again the next morning, at which time defendant promised to pay the money and take the deeds. Plaintiffs called the next morning with the deeds and were informed that the price was considered too high and that defendant would not pay the price or take the land. No other objection was made. It is clear from all these proceedings that all objections to the arbitration proceedings and to the award were waived.
The finding that defendant, after the award was made and with full knowledge that the arbitrators were not sworn, treated the award as valid and promised to pay the amount allowed, is challenged. There was some conflict in the evidence on this point, but, as the facts already recited show, there was sufficient evidence to sustain it.
The other findings attacked are: 1. The finding that the respective plaintiffs were the owners of the property at the time the deeds were tendered and payment demanded; 2 The finding that the value of the property was fairly and properly determined by the arbitrators and that the value so fixed was the reasonable value of the property.
The facts already stated in the discussion of the subject of waiver shows that the evidences of title exhibited by plaintiffs were satisfactory to the defendant and that the refusal to pay was on other grounds. The agreement itself recites that the plaintiff Folger is the owner of the land which she agreed to convey. This is an admission by the defendant and is sufficientprima facie evidence of title to those lands. In addition to this the plaintiffs introduced in evidence judgments in certain suits by the respective plaintiffs against "All Persons," etc., under the so-called McEnerney Act of 1906 (Stats. Ex. Sess. 1906, p. 78), adjudging and determining that the respective plaintiffs were the owners in fee of the said properties. These judgments were entered in 1909, after the present action was begun and before the trial. The said judgments would have become final, by expiration of time for appeal, before the findings were signed, and, as no showing was made to the contrary, we must presume that there was no appeal and that they were competent evidence of title during *195
the continuance of the trial, which, in legal contemplation, continued until the decision of the court below was made. There was no attempt whatever, by the defendant, on the trial, to show affirmatively any defect in plaintiffs' title. From all these facts and circumstances the court could reasonably infer that the plaintiffs were the owners of the land at the time the contract was made and thereafter until the time of trial. We think the evidence was sufficient to sustain the finding as to title. The ruling admitting in evidence the aforesaid judgments before they became final seems to be in accord with Cook v. Rice,
The objection that the evidence shows that at the time performance was due under the agreement and at the time tender was made by the plaintiffs, they did not have title of record to the lands, is without any force. It is based on the fact that this tender occurred after the great fire of April, 1906, in which practically all of the records of titles in San Francisco were burned. Upon this the defendant asserts that there was norecord title in existence. The destruction by the fire mentioned occurred before the agreement was made. The parties must be presumed to have contracted with reference to the existing condition. It was well known to them at the time of the contract. Moreover, it cannot be said that the destruction of the record of title to real estate destroys vested titles thereto, or deprives persons of the title or ownership thereof. The title and the record of title are two distinct things. Under such circumstances, where, as here, time is not of the essence of the contract, and it is a positive agreement to buy and not a mere option depending on the sufficiency of the showing of title, it is enough if the vendor is in fact the owner in fee, unencumbered, at the time of performance or at the time of the decree. (Alvarez v. Brannan,
It is a well established rule of equity that in an action to enforce specific performance of an executory agreement for the sale of land, the plaintiff must allege and prove that the consideration received by the other party was adequate and that the agreement is, as to him, just and reasonable; in other words, that it is not, as to the other party, an unconscionable, inequitable, or hard bargain, that the value of the land and the price to be paid are in reasonable approximation to equality. (Civ. Code, sec.
In the defendant's brief some objections are made to the proceedings of the arbitrators and to the accuracy of the facts recited in the award. No evidence was introduced to show that the facts therein stated were untrue, and with the single exception already referred to, which was corrected by agreement of the parties after the award was made, there was no evidence to show any inaccuracy or defect whatever in the award. This answers the objections. We cannot take notice of facts which rest upon the mere assertion of counsel in the briefs.
It is claimed that the court erred in admitting in evidence four volumes of so-called abstracts of title from the plant of the California Title Insurance and Trust Company, a corporation, which, ever since the year 1886, has been engaged in the business of preparing and issuing abstracts of title to lands in San Francisco. These volumes comprised an abstract of title as shown by the public records, to the lands in question belonging to the Dores. They were prepared and made up prior to the great fire of April, 1906. Objection was made to them on the grounds that they had not been "issued and certified to as correct" by the company which made them in the manner provided by section 1855a of the Code of Civil Procedure. They purported to show the contents of the public records affecting said lands prior to the destruction of said records by the great fire in San Francisco in April, 1906. We do not deem it necessary to decide whether they were *199 admissible or not. The evidence shows that when the arbitration was concluded the defendant authorized and directed its attorneys to examine the title of the plaintiffs to these lands and determine as to its sufficiency, and that said attorneys did make such examination and determined for the defendant that the title offered was satisfactory. Section 11 of the so-called McEnerney Act of 1906 provides that a judgment procured under that act establishing the title of the petitioner thereunder is "binding and conclusive upon every person who, at the time of the commencement of the action had or claimed any estate, right, title or interest in or to said property, or any part thereof, and upon every person claiming under him by title subsequent to the commencement of the action." (Stats. 1906, p. 81.) The aforesaid judgment under that act establishing the respective titles of the plaintiffs in the lands in controversy were made in suits begun in May, 1909, and July, 1909, respectively, and they are conclusive. It is not claimed that any change occurred in the condition of the titles between the ninth day of July, 1907, when the deeds were tendered, and the time of the beginning of these McEnerney suits, nor after they were begun and up to the time of the decision of the court in the case at bar. The defendant offered no evidence to impeach the plaintiff's title. It does not now point out any defect therein. It is apparent, therefore, that the evidence, without the aid of these abstracts, was conclusive of the fact that the title is in the plaintiffs, and that the ruling admitting the abstracts could not have prejudiced the defendant. The finding on that point must of necessity have been against defendant, even if they had been excluded. It is proper to add that section 1855a has been amended. (Stats. Ex. Sess. 1911, p. 64), so that the precise question is not likely to again arise in the trial court.
Twelve pages of appellant's brief are occupied in enumerating some twenty-eight alleged errors in the admission of evidence. None of them affects the substantial merits of the case. Many of them are covered by what we have already said in this opinion. We do not deem it necessary to discuss them. Indeed, with one exception, appellant does not discuss them, but merely states the objection. Such discussion deserves scant notice. (Duncan v.Ramish,
The judgments and orders are affirmed.
Sloss, J., Lorigan, J., Angellotti, J., Melvin, J., and Henshaw, J., concurred.
Rehearing denied.