53 A.2d 129 | Pa. | 1947
Defendant appeals from a decree for specific performance of a contract to sell real estate. Two questions are presented (1) was the option exercised within the period fixed by the contract? (2) did the failure of the plaintiffs to tender the consideration and demand a deed preclude them from the relief granted by the decree?
The findings of fact of the chancellor, approved by the court in banc, and based upon substantially undisputed testimony, are as follows: On, and prior to, July 1, 1940, defendant was in possession of the real estate as mortgagee. He contemplated acquiring legal title by foreclosure. This fact was within the plaintiffs' knowledge. On July 1, 1940, defendant, by written agreement, leased the premises to the plaintiffs for two years, commencing July 1, 1940, and terminating June 30, 1942. Plaintiffs entered into possession and have since continued in possession. The lease provided that "The lessor [defendant] grants to the lessees [plaintiffs] the option to purchase the premises hereby leased at any time during the term hereof for the sum of Three thousand dollars ($3,000) cash; settlement, however, to be made before the termination of the lease." On May 5, 1942 (prior to the expiration of the term of the lease) plaintiffs gave written notice to defendant that they exercised the option and that they would make settlement on or before the termination of the lease. On June 16, 1942, plaintiffs again requested defendant, in writing, to convey the premises to them in accordance with the option. On September 9, 1942, plaintiffs again requested defendant, in writing, to convey the premises to them under the option. On September 5, 1944, defendant acquired a legal fee simple title to the premises through foreclosure. On September 19, 1944 (two weeks after defendant acquired legal title to the premises by foreclosure) plaintiffs again made oral and written demands *45 on the defendant for the conveyance of the premises in accordance with the option. On October 2, 1944, an action was commenced in equity in the court below for specific performance. The chancellor specifically found that the plaintiffs, at all times, have been ready, willing and able to comply with the terms and conditions of the option, but that the defendant has refused, and still refuses, to convey the premises to the plaintiffs without assigning any just, legal or equitable reason therefor. He further found that the defendant's conduct was such that "a tender would have been an utterly useless gesture and would have accomplished nothing."
It is the defendant's contention that time was of the essence of the option, hence plaintiffs' neglect to tender the purchase price and make settlement before the termination of the lease released defendant from his obligation to convey. This is without merit. While it is a sound legal principle that unless an option is exercised within the time fixed it necessarily expires: McMillan v. Philadelphia Company,
An option is an offer which, when accepted, becomes a valid and binding contract: Kerr v. Day,
It is not necessary to decide the effect of the termination of the original lease on the rights of a holder of an option where the original lease has been extended or the tenant has held over. See: Parker v. Lewis,
Defendant further maintains that he is excused from fulfilling his contract because plaintiffs did not tender the purchase money and demand a deed prior to instituting suit. It is a well-established rule of law that a tender is excused where such tender would be a useless and idle ceremony:Zents v. Legnard,