189 P. 887 | Or. | 1920
Lead Opinion
When attempting to ascertain what Emanuel May intended when he wrote “on or before the end of four years,” the letter in which he used that language should be construed in the light of the provisions found in the option. Although the option was not delivered until September 21, 1911, it was evidently prepared on or before September 15, 1911, for on it appears that date; and in view of the fact that all the details had for a long time been discussed by May and Thompson, it is obvious .that May knew what the option contained, or would contain, when he signed the letter dated September 16th, which it will be observed is the day following the date of the option.- It is appropriate to add that the option was signed by May as president, and by Lowengart as secretary of the May Land Company.
In his letter, May agrees to pay a commission “on my interest in the May Land Company,” and he declares that his interest “now amounts to $184,000.” The litigants here agree that, if $295,000 is fixed as the purchase price, May’s share would amount to $184,000. The option fixed $295,000 as the price to be paid for the land, and manifestly May had in mind this price named in the option when in his letter he said to the plaintiffs: “You are to form a syndicate for the purchase of this land,” and “when this sale is negotiated” (sale to the syndicate), the commission of 5 per cent on $184,000 is due and payable on or before four years, provided “the $184,000 is paid” as provided in' the contract
It is true that in their reply the plaintiffs say that Emanuel May consented to the adjustment made on July 14th, and that, therefore, the defendants, as his representatives, are estopped to deny payment. The plaintiffs do not claim that May personally consented to the adjustment, but they take the position that consent was given through his guardian Ben Selling. Having been adjudged incompetent May, of course, could not act for himself or for the May Land Company in the adjustment on July 14th. In the settlement made on July 14th, Ben Selling represented the May Land Company as vice-president, and as such he signed the release given by that company to Hartman & Thompson. Selling was at that time guardian of the person and estate of Emanuel May, and, because of that circumstance and the fact that Selling participated in the adjustment, the plaintiffs insist that May must be deemed to have consented to the adjustment. There is no evidence in the record showing that Ben Selling was acting or pretending to act in his capacity as guardian when the adjustment was made. It is not necessary, however, to decide whether Ben Selling’s participation in the transaction of July 14th operated to estop the defendants to deny performance of the contract; for in their brief the plaintiffs expressly disclaim any intention to rely upon waiver, or modification of the contract, or estoppel, but they stand upon the ground that the purchase price was paid on July 14, 1915. The theory of the complaint is that the conditions of the contract were fulfilled and that the giving of the
The judgment rendered by the trial court is predicated upon the notion that when Hartman & Thompson paid the first installment of $45,000, they, by that act, transformed a mere option to purchase into a binding obligation on their part to complete the purchase by paying the remaining installments; and that, by the adjustment of July 14th, the May Land Company released the plaintiffs from their obligation, and in lieu of it accepted the notes from the Parkrose Association. An examination of the option will disclose that it does not contain even a word attempting to obligate Hartman & Thompson to pay any moneys at any time. The plaintiffs do not in the option promise to pay any moneys whatsoever. At no time could the May Land Company have sued Hartman & Thompson and recovered from them any part of the purchase price. There is nothing in the record to show that the Parkrose Association promised to pay any moneys prior to the execution of the six notes. It is true that, until they transferred the option to the Parkrose Association, Hartman & Thompson had the right to pay, but they were not obliged to pay; and, so too, until the execution of the notes, the Parkrose Association had the right to pay,
Moreover, before receiving the notes, the May Land Company expressly stated that the notes should not be regarded as payment of the indebtedness; and, consequently, the notes cannot be treated as payment: Riner v. Southwestern Surety Ins. Co., 85 Or. 293, 299 (165 Pac. 684, 166 Pac. 952). A meeting of the board of directors of the May Land Company was held on July 14, 1915, “for the purpose of considering an adjustment of differences with the Park-rose Association and with Hartman & Thompson.” The minutes of this meeting show the purpose for which it was held, and they contain a recital of the amount of the unpaid balance of the purchase price. The minutes also state that the Parkrose Association “would give notes” for $80,608.50, and an additional note for $6,918.25 as evidence of the interest, provided the May Land Company “would release Hartman & Thompson frojn and against all claims of every name and nature that it has against the said Hartman & Thompson growing out of the sale of the lands of the May Land Company”; and then the minutes declare that—
“The notes referred to are to be taken only as evidence of the indebtedness, and the securities held for*385 the indebtedness are to remain in the Title & Trust Company as heretofore.”
The minutes close by stating that the vice-president and secretary are authorized to accept the notes of the Parkrose Association and to give a re-' lease to Hartman & Thompson. A copy of these minutes was delivered to the Parkrose Association, and that corporation placed the copy in its own minute-book. If the recorded minutes of the May Land Company, knowledge of which was admittedly brought to the Parkrose Association, speak the truth, the May Land Company took the position that both the Parkrose Association and the partners were liable for the balance of the purchase price; for we read in the minutes as follows:
“The board informally discussed all negotiations previously had with representatives of the Parkrose Association, and the May Land Company was claiming that there is due, owing and unpaid from said association and from Hartman & Thompson, growing out of the sale, * * the sum of $90,608.50 with interest from October 20, 1914.”
There is no evidence to show that Hartman & Thompson admitted at any time prior to July 14, 1915, that they were personally liable for any of the purchase price; and, as we have already stated, they were not in truth personally liable. It does appear, however, that the May Land Company was claiming that both the Parkrose Association and the partners were liable, and hence, on the basis of the position taken by the May Land Company, one of two joint debtors was released; but the debt was expressly preserved and was not paid, althougth reduced in amount and evidenced by promissory notes. At no time during the negotiations which culminated in the
It may be that, if the notes are now fully paid, the plaintiffs can compel payment of a commission, notwithstanding the fact that a comparatively small reduction was made in the purchase price, and even though the time for payment of that reduced balance was extended beyond the four, years period; but^if, in these circumstances, the plaintiffs are entitled to a commission, they cannot compel the payment of such commission in this action on the pleadings as they now are.
There is a sufficient bill of exceptions within the rule established in Malloy v. Marshall-Wells Hardware Co., 90 Or. 303 (173 Pac. 267, 175 Pac. 659, 176 Pac. 589).
The judgment is reversed, and the cause is remanded for such further proceedings as may be consistent with this opinion.
Reversed and Remanded.
Rehearing
On Petition for Rehearing.
(192 Pac. 408.)
Substantially, this is an action to recover a real estate brokers’ commission for effecting a sale of land. In the former opinion by Mr. Justice Harris, after a discussion of the issues in the case, he arrived at the conclusion that the plaintiffs “cannot compel the payment of such commission in this action on the pleadings as they now are.”
“We draw the attention of the court to the option dated September 15, 1911, from the May Land Company to J. L. Hartman and E. L. Thompson.”
With all of these data before us, we know not how to respond to this invitation, except by the examination of the option that appears physically joined to the bill of exceptions. As all of these papers were used before us in the former argument, we feel that under all the circumstances delineated it would he sacrificing substance to form if we declined to consider them in the decision of the case. Therefore, accepting the invitation of counsel for the plaintiffs, we shall consider the option agreement as if it were regularly and properly before us as part of the record on appeal.
“An option founded on a consideration is a unilateral agreement binding, from the date of its execution, on the party who executes it; and it becomes a contract inter partes when exercised according to its terms. In such a transaction two elements exist: (1) The offer on the one side which does not become a contract until accepted upon the other; and (2) the*389 completed contract to leave the offer open for a specified time.”; 13 C. J. 336.
It is further defined as:
“A continuing offer, binding for the time specified the one who makes it, but not the one to whom it is made, unless he accepts, when it becomes binding upon both”; Benedict v. Pincus, 191 N. Y. 377 (84 N. E. 284).
The very term “option” indicates choice, not obligation. Such a contract is indeed binding as any contract, but only for what it specifies. As to the optioner who executes the instrument for a consideration, it is an offer made by bim to sell upon certain terms which are conditions of his contract, the binding force of which is to restrain him from withdrawing the offer for a certain time. To make it a mutually binding contract compulsory upon the proposed purchaser, the latter must accept the offer according to its terms. Like any other contract based on offer and acceptance, the latter must exactly coincide in all its terms with the former. Until this occurs there is no meeting of minds between the proposer and the accepter, and hence no contract other than the original one binding only upon the man who makes the offer.
Referring, then, to the option, we find that the May Land Company, in consideration of $5,000, “does hereby give to the parties of the second part, their heirs and assigns, an option, and nothing more than an option, to purchase the following described real property, for the sum of $295,000 on the terms and conditions hereinafter set forth.” The terms were: $45,000 in cash on or before October 20, 1911; $30,000 on or before October 20, 1912; an additional
Much stress is laid by the plaintiffs in their petition upon these words in the option:
“Said party of the first part hereby agrees that, if the parties of the second part shall exercise the option hereby granted and shall pay to the party of the first part said sum of $45,000 on or before October 20, 1911, the party of the first part will, upon the payment of said $45,000, execute and deliver a deed of conveyance * * to the Title and Trust Company,”
—upon conditions too long to quote, but in substance placing the legal title in the trust company, to hold and to convey to the plaintiffs or their assigns only upon payment of the moneys named in the option. Even yet, there was nothing compelling the plaintiffs to make the payments. The only effect of that clause was to afford them further assurance that the optioner would perform his part of the option and make the conveyance, if the moneys were paid. We read further in the option agreement:
“It is distinctly understood and agreed that time is of the essence of this option, and that the parties of the' second part acquire no rights at law or in equity in the title to said property by virtue of the payment herein made, and that said payment is not made on account of the purchase price of said real property, but is a payment made for this option, and*391 that if said property is not bought in accordance with the terms of this option by the parties of the second part on or before October 20, 1911, then and in that event shall the parties of the second part have no further rights whatever, and the option shall have expired and become null and void.”
With this résumé of the option agreement, we return to the contract for the payment of a commission, upon which this action is founded, and which appears as exhibit “A,” attached to the original complaint. We find therein this clause:
“It is understood that you [meaning the plaintiffs] are to form a syndicate for the purchase of this land, and when thé sale is negotiated, it will be understood that this five per cent is due and payable on or before four years, providing the one hundred eighty-four thousand dollars ($184,000) is paid as provided in the contract of .purchase, on or before the end of four years.”
As stated in Union Street Ry. Co. v. First National Bank, 42 Or. 606 (72 Pac. 586, 73 Pac. 341):
“It has often been held by this court that the plaintiff must prevail, if at all, upon the matters alleged in his complaint, * * and that he cannot set up one cause of action or suit in the complaint, and recover upon another and different ground' of relief alleged in a reply.”
See, also, Bruce v. Phoenix Co., 24 Or. 486 (34 Pac. 16); Long Creek Bldg. Assn. v. State Ins. Co., 29 Or. 569 (46 Pac. 366); Hannan v. Greenfield, 36 Or. 97 (58 Pac. 888); Young v. Stickney, 46 Or. 101 (79 Pac. 345); Cranston v. West Coast Life Ins. Co., 63 Or. 427 (128 Pac. 427); Waller v. City of New York Co., 84 Or. 284 (164 Pac. 959, Ann. Cas. 1918C, 139).
On the record before us the reply is a plain departure from the cause of action stated in the complaint. Instead of showing performance of their contract as alleged in their primary pleading, the plaintiffs have disclosed a performance of something other and different from the original stipulation, which profits them nothing. It is believed that this elaborates the conclusion, reached by Mr. Justice Harris, that the plaintiffs “cannot compel the payment of such commission in this action on the pleadings as they now are.” The petition for rehearing is therefore overruled.
Reversed and Remanded. Rehearing Denied.