314 Ky. 116 | Ky. Ct. App. | 1950
Affirming.
On July 26, 1947,. appellant submitted to appellee a written option contract and on tbat day it was accepted by appellee and signed by both parties. Tbe terms of the contract, insofar as tbey are pertinent to tbis litigation, are as follows: Appellee agrees to give an option to appellant for two weeks for tbe snm of $30,500 on a tract of land in Payette County containing about 5% acres as described in tbe contract. As evidence of good faitb
On August 30, 1947, appellant brought this suit against appellee and, after setting up the substance of the contract, a copy of which was filed with the petition, alleged in substance that on July 30, 1947, and two subsequent dates, all within the time provided for the exercise of the option, he notified appellee by registered mail that he elected to exercise the option and purchase the property according to its terms and that he would be ready to close the transaction on or before August 20, 1947, the date specified in the contract but which appellee failed or refused to do, thus breaching the contract, as appellant claims. He prays for specific performance of the contract and that appellee be required to execute a deed conveying him the property in accordance with the terms of the contract.
In his answer appellee denied the affirmative allegations of the petition and set up as a further defense in substance that the option contract referred to was without consideration; that it is unilateral, lacks mutuality of obligation and is grossly inequitable;' that after July 26, and prior to July (sic) 20, 1947, he xiotified appellant that the alleged agreement and option was terminated and was no longer in force insofar as appellee was concerned. He prayed that the option contract be canceled and held for naught and that the petition be dismissed.
The case was referred to the Master Commissioner and, after taking proof and upon submission, the Commissioner filed a brief report which, after setting out in full the option contract, said:
“An inspection of the writing discloses that it .was
This report of the Master Commissioner was confirmed by the Court and a judgment was entered in accordance therewith. Appellant prosecutes this appeal from that judgment.
Five grounds for reversal are relied on by appellant but three of them are without sufficient merit to justify consideration. Two of the grounds relied on are the crucial points in this case and, if the judgment is reversed, it must be on these contentions of appellant, (1) that the contract was a valid option and was supported by a good and valuable consideration, (2) that the option was not withdrawn by appellee until after it had been exercised and acted on by appellant.
We think it is clear that there was no monetary consideration to support the option contract here involved. There was no money paid for the option itself. The $650 check was simply an advance payment on the purchase price if the deal went through but, if not, to be refunded. If there was a consideration, it must be found in the mutual promises arising out of the acceptance of the option before it was withdrawn. These mutual promises constitute a valuable consideration. As was said in the case of Klateh v. Simpson, 237 Ky. 84, 34 S. W. 2d. 951, 953: “The law * * * is well settled in this and in other jurisdictions to the effect that the offer, though without consideration, if accepted within the
In the more recent case of Combs v. Turner, 304 Ky. 179, 200 S. W. 2d 288, 289, it was said: “It is well settled that an option is not binding as a contract where there is no consideration, unless it is accepted within the time limit and before the offer is withdrawn.”
It is, therefore, necessary to consider the evidence to determine whether the option, which was given to appellant by appellee without any money consideration, was withdrawn by appellee before it was accepted and acted on by appellant and by that acceptance making a binding agreement supported by the mutual promises of each.
It is shown by the evidence, in which there is little or no conflict on this point, that on Monday, July 28, following the execution of the option on the previous Saturday, July 26, appellee went to the office of appellant and attempted to withdraw the option and informed him that he would not go through with it. He offered appellant $500 for the contract, which was refused, and offered to return the $650 check to appellant, which was likewise refused, whereupon appellee obliterated the check. In his testimony he gave as his reason for withdrawing the option that he was not satisfied with the 4% interest which the deferred payments were to bear; that he felt he had been “high-pressured” into signing the option and felt as if he had a legal right to withdraw. That appellee did visit appellant’s office on Monday, July 28, and that he said he was not going to sell the property and offered $500 for the contract and offered to return the check was admitted by appellant in his testimony and by his only other witness, Mr. Kinnaird.
It is shown by the evidence that on July 30, 1947, two days after appellee had notified appellant that he would not go through with the contract and attempted
Wherefore the judgment is affirmed.