170 P. 530 | Or. | 1918
delivered the opinion of the court.
1. The defendant Holbrook was permitted to testify over plaintiff’s objection and exception as follows:
“Q. What was the understanding among the parties, if there was any, as to the necessity of vacating streets intervening between the different parcels of that property?
“A. It was clearly understood by everybody interested in the transaction and who knew the property and knew what it was that a sawmill could not be erected there unless the streets were vacated. Nothing could be more clearly understood than that. That was discussed frequently and Mr. Powers assured me there would be no trouble about getting the streets vacated.”
This testimony was clearly inadmissible. The parties had reduced their agreement to writing and their intent and understanding are to be gathered from the writing: Section 713, L. O. L.; Maxson v. Ashland Iron Works, 85 Or. 345, 353 (166 Pac. 37, 167 Pac. 271); Muir v. Morris, 80 Or. 378, 403 (154 Pac. 117, 157 Pac. 785). In a case tried without the intervention of a jury the admission of incompetent testimony will often
“That owing to the size and shape of the property in the city of St. Johns upon which the agreement hereinbefore set forth contemplated the erection of a mill, it was impossible to erect a sawmill of the capacity mentioned in the contract set forth in the complaint or to operate the same unless the streets intervening between the separated portions of said property should be vacated so that said property could be used, and that such facts were known and within the contemplation of all the parties to such agreement at the time of making the same and thereafter. ’ ’
This finding is wholly without competent evidence to support it. The defendants introduced expert testimony to show that the lots set apart to them on the partition were too small in area to admit of the profitable operation of a sawmill thereon. This testimony does not lead to the conclusion that their contract was impossible of performance. In Reid v. Alaska Packing Co., 43 Or. 429, 436 (73 Pac. 337) Mr. Justice Bean says:
‘ ‘ The rule to be deduced from the authorities is that, if one enters into a valid contract, for a sufficient con*582 sideration, to do a lawful thing, possible in itself—that is, in the nature of things—to be done, he must either carry out the contract according to its terms or answer in damages for a failure to do so. The mere impossibility of performance in fact will not be enough, but the contract must be obviously impossible upon its face before such a defense can be made.”
The contract in that case was to pack, in Alaska, salmon “exactly like Puget Sound fancy Sockeye.” The inference of impossibility was sought to be drawn from evidence that no such salmon are caught in Alaska. It was held that they might be caught in Puget Sound and transported to Alaska for packing, or that such salmon might be found in Alaska at some time in the future. The decision is to the effect that “impossible” does not mean “impracticable.” A party who contracts to do that which is not inherently impossible on the face of the agreement is not to' be released from his obligation by proof that it would be commercially unprofitable to carry it out. The doctrine of the above case is affirmed in Anderson v. Adams, 43 Or. 621, 630 (74 Pac. 215); Fleishman v. Meyer, 46 Or. 267, 270, 271 (80 Pac. 209); Zanello v. Smith & Watson Iron Works, 62 Or. 213, 217 (124 Pac. 660). It appears from the defendants’ testimony that it is not impossible to erect a sawmill on the property in question; all that the testimony tends to prove is that such a mill could not be profitably operated without control of a larger piece of land and without the vacation of certain streets which intersect the property. The court erred in deducing the third finding from this testimony.
“Referring to a certain bond executed by P. S. Doembeeher and M. L. Holbrook on the 12th day of*583 March, 1903, in behalf of the Oak Park Land Company and Otis E. Learned, wherein time is made the essence of the matter of the beginning and completion of a sawmill on certain land of St. Johns mentioned in the said bond.
“This is to certify the modification by mutual consent of that portion of said bond relating to the time when said mill is to be begun and completed;
“That is to say, if the proceedings to be instituted by the said Holbrook and Doernbecher with the authorities for the vacation of said streets are prolonged by the opposition of the interested property owners beyond the usual time required in such matters such delay is not to be charged against the said Holbrook and Doernbecher under said bond.”
Plaintiffs'contend that this instrument is not binding upon them because it was executed without consideration and was signed only by the plaintiff Quackenbush at a time when he individually had no interest in the cause of action.
It will not be necessary to pass upon these contentions. Assuming that the foregoing instrument binds plaintiffs, it does not purport to do more than extend the time allowed defendants within which to fulfill their covenant. It is alleged in the complaint that defendants have refused to build the mill stipulated for and this allegation is proved by the admitted fact that they sold the property without first constructing a mill thereon. This sale operated to mature the obligation of defendants.
“The fact that a contract is for the performance of a single act or condition is regarded by the courts as favoring the construction that a stipulated sum to be paid on nonperformance is to be regarded as liquidated damages rather than as a penalty. ’ ’
Pearson v. Williams Admrs., 26 Wend. (N. Y.) 630, is parallel with the case at bar. The defendant in that case purchased lots from plaintiff for $21,000. It was a part of the contract that defendant should erect brick houses on the lots purchased and in default of such erection defendant agreed to pay damages in the sum of $4,000. Plaintiff was the owner of other property in the neighborhood. Chancellor Walworth held that the agreement was one for the payment of liquidated damages and that defendant was liable in accordance with the letter of his agreement.
Reversed With Directions.
Petition to Modify Denied.
Denied March. 5, 1918.
On Petition to Modify Former Opinion. Denied.
Department 2.
delivered the opinion of the court.
Defendants petition us to modify our conclusions in so far as they direct the lower court to enter judgment in favor of plaintiffs in the sum nominated in the bond. They ask that the cause be remanded to the lower court with leave to defendants to offer evidence to show that plaintiffs have sustained no damage by the default complained of.
It follows that the parties are bound by their agreement. Plaintiffs could not be heard to say that their - damages are greater than $2,000, and defendants are not entitled to urge that there are no damages: Salem v. Anson, 40 Or, 339, 345 (67 Pac. 190, 91 Am. St. Rep. 485, 56 L. R. A. 169); Webster v. Bosanquet, [1912] App. Cas. 394 (Ann. Cas. 1912C, 1019).
The former opinion is adhered to.
Petition to Modify Denied.