Case ID: nc_189/html/0610-01.html
Source: Caselaw Access Project
Author: {"author": "Yarser, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

J. M. SAMONDS v. G. D. CLONINGER.
    (Filed 6 May, 1925.)
    1. Contracts — Options—Seals—Consideration.
    An option of purchase of lands given by the owner in writing under seal indisputably imports a consideration sufficient to enforce it upon the payment of the purchase price within the time therein specified, and upon an unconditional acceptance of its terms by the optionee, with his readiness and ability to comply therewith, it becomes a bilateral or binding contract.
    2. Sam© — Acceptance—Tender—Waiver.
    Where the optionee in an option on lands offers to comply therewith according to its terms within the period of time granted therein, and is ready, able and willing to do so, a tender of the agreed purchase price is unnecessary where the owner has previously sold the lands, and by his breach has put it out of his power to make the conveyance contemplated in the option.
    3. Same — Evidence—Questions for Jury — Nonsuit.
    Where the optionee of lands accepts the option within the time limited, evidence that he had then correctly informed the owner that he had a cashier’s check for the amount of payment required is sufficient to be submitted to the jury upon his readiness and ability to make this payment, and to deny the defendant’s motion as of nonsuit thereon.
    4. Contracts — Writing—Options—Parol Evidence — Principal and Agent— Breach — Defenses.
    In an action by the optionee for damages against the owner for the breach of his contract of option in failing to convey the land according to its terms, the latter, without seeking reformation of the contract in equity, cannot maintain the position that the instrument did not contain the contract as made, but that it rested in parol, whereby the optionee was an agent to sell and had not advertised, etc., as he had agreed to do, when it appears that the defendant had sold the lands to another within the time prescribed, and had put it beyond his power to comply with the agency contract he has attempted to establish.
    Appeal from MeckleNbtjbg Superior Court, Shaw, J. Judgment in favor of defendant, and plaintiff appeals.
    Plaintiff alleges that defendant executed, 20 August, 1923, an option whereby the defendant gave, for sixty days, -the plaintiff an option to purchase the locus in quo at the price of $10,000 net, payable “$2,500 in cash and balance, $5,000, in B. & L.,.$2,500 on second mortgage for 2 years.” The option provided that the defendant would execute and deliver a deed in fee with full covenants of warranty and seisin, and free from all encumbrances. It was further stipulated that, upon a failure to exercise the option within the time (60 days), the obligation'would he null and void.
    
      It appears in evidence that plaintiff is a real estate dealer and that he did not register this option. On 19 September, 1923, the defendant, together with his wife, conveyed the locus in quo to W. T. Burroughs and H. L. Taylor and their wives for $10,000. Evidence for plaintiff tends to show that, on 18 October, 1923, J. A. Williamson agreed with plaintiff to purchase the locus in quo .at the price of $11,000, and gave plaintiff a letter evidencing his offer and containing a check for $2,500 as cash payment thereon. This check was certified by the Merchants and Farmers’ National Bank, of Charlotte, N. C. On 19 October, 1923, plaintiff advised defendant by letter that he wished to exercise the option and that he was ready to pay the cash payment and to “sign for the balance purchase price in accordance with the terms of the option, which I hereby accept.” The signing and delivery of the option was not denied. Plaintiff testified that this was done on its date or the next day.
    Plaintiff further testified that he phoned defendant that he had a purchaser and defendant said the property was sold; that plaintiff went into defendant’s store and told him that he had a purchaser for the property in the option and that the purchaser was willing to take it and to give to him his check ($2,500) ifihe would deliver the deed. Oloninger said the property had been sold.. “I (plaintiff) asked him what disposition he was going to make of the option I held on the property, and he said, None — you have no option.’ ”
    Plaintiff further testified that he showed defendant a copy of 'the option and the defendant showed the disposition not to want to talk to plaintiff about the option. Plaintiff testified that he stood ready, able and willing to perform the option on his part.
    There was other evidence from which defendant claims plaintiff was unable to comply with the option, and that the efforts to sell to ^Williamson were after he knew defendant had sold the locus in quo and was not a bona fide effort to sell, but only a pretense to get money from defendant.
    The defendant offered no evidence.
    In the answer, defendant admits the signing of the option, and alleges that the writing did not contain all of the contract between the parties, and that the agreement was based on the condition that the plaintiff would advertise the locus in quo and make diligent effort to sell same at once; and that said writing was signed as a mere incident to the “aforesaid contract of agency.” And the consideration was the agreement to make diligent effort to sell, and that plaintiff breached the contract by his failure to advertise and to make diligent effort to sell the land. That defendant waited some time for plaintiff to sell the land, and he then sold the property, and when his deed was registered, tbe plaintiff began to try to fix up a pretended sale, and by fraudulent representation induce a buyer to make an offer.
    At tbe close of plaintiff’s evidence, on defendant’s motion, tbe court entered judgment as upon nonsuit, and plaintiff excepted and appealed.
    
      Taliaf&rro & Clarkson for plaintiff.
    
    
      Parker, Stewart, McRae & Bobbitt for defendant.
    
   Yarser, J.

Tbis case presents only tbe question wbetber, upon all tbe evidence, viewed in its most favorable aspect for tbe plaintiff, there was any evidence sufficient to support a verdict for tbe plaintiff upon tbe issues necessary to bis recovery.

Tbe defendant offered no testimony, and bis allegations that present an affirmative defense are not material to tbis discussion further than as bis explanation of transaction.

The option in tbe instant case is under seal and extends sixty days from tbe date. It is a continuing offer to sell for tbe period named- — • sixty days. We find in tbe instant record sufficient evidence upon which tbe jury may find that tbe plaintiff gave notice to defendant of bis acceptance of tbe terms of tbe option and of bis readiness, willingness and ability to perform it on bis part.

Tbe option under seal required no consideration to support it. Of course, tbe recital of a consideration in tbe contract is not conclusive as to tbe consideration further than tbe contractual nature of tbis recital extends. Tbis recital is contractual that a consideration exists sufficient to support tbe contract. Harrell v. Watson, 63 N. C., 454; Mordecai’s Law Lectures, 931; Minor’s Institutes, Vol. 3, Part 1, 139; Watkins v. Robertson, 105 Va., 269; Willard v. Tayloe, 75 U. S., 557, 19 L. Ed., 501; O’Brien v. Boland, 166 Mass., 481; Weaver v. Burr, 31 W. Va., 736; McMillan v. Ames, 33 Minn., 257. In Thomason v. Bescher, 176 N. C., 622, Hoke, J., quoting from Pomeroy on Contracts, says:' “If tbe unilateral contract is sealed and tbe common-law effect of tbe seal has not been taken away or changed by statute, it appears that the promissory offer contained in tbe writing cannot be recalled before tbe time for acceptance has expired.” 9 Cyc., 287.

It appears from tbis latter case that tbis rule is absolute, and that tbe defendant will not be beard to dispute tbe existence of a sufficient consideration to support such a contract when tbe action is at law for damages, as in tbe instant case. However, when tbe suit is in equity for specific performance, as was tbe case in Ward v. Albertson, 165 N. C., 218, 222, the $5.00 mentioned as a consideration was held sufficient, although it bad never, in fact, been paid, because tbe vendor bad refused to accept tbe vendee’s check for same when tendered. It was, nevertheless, a sufficient consideration to support tbe contract when specific performance was sought. The real consideration to wbicb equity will look, regardless of form, in order to determine whether it will exercise its discretion to decree specific performance is the price promised for the land. When the acceptance and notice thereof have been given to the vendee, with readiness and ability to perform, the contract becomes bilateral and the mutual promises are the real consideration for the bilateral obligations arising therefrom. Thomason v. Bescher, supra; Alabama Ry. Co. v. Long, 158 Ala., 301; Ross v. Parks, 93 Ala., 153; Smith v. Bangham, 156 Cal., 359.

When notice is given to the defendant of plaintiff’s intention to purchase the land in controversy, and plaintiff offers to comply with the option, it thereby becomes a binding contract and the rights of the parties are fixed as set out therein. Bryant Timber Co. v. Wilson, 151 N. C., 154; Ward v. Albertson, supra; Watkins v. Robertson, supra; Thomason v. Bescher, supra; Dill v. Reynolds, 186 N. C., 296; Elvington v. Shingle Co., ante, 366.

An elaborate note collecting the authorities from many courts, fully discussing this question, is contained in 2 A. L. R., 631, immediately after the report of Thomason v. Bescher, supra.

It may be, upon a trial of this case, that the jury may not find that the plaintiff, within the life of the option, accepted the terms thereof and offered to comply therewith and was ready, able and willing to do so, but, from the evidence submitted, it appears that a jury may so find, and it was, therefore, error to dismiss as upon nonsuit. The execution of the contract' is admitted, but the defendant contends in his answer that all of the contract was not contained in the writing and that such other stipulations were made as a part thereof as would require the plaintiff to make diligent effort to sell the land and to advertise it for sale in order to bring about a speedy sale. There is no prayer for reformation, but defendant seeks by this to convert the contract into a mere incident attendant upon the creation of an agency by which the plaintiff is to have the privilege of selling and is to make an effort to sell the lands in controversy for defendant. No evidence to this effect appears, but, since the agreement is to sell the lands for the stipulated price, we now see no hurt to the defendant from the omission of such stipulations or the nonperformance of them on the part of the plaintiff, if the jury shall find that the plaintiff was ready, able and willing to comply with the contract, and so notified the defendant during the 60 days of its life.

However, it appears from the admission of the defendant that the defendant conveyed the lands in controversy on 19 September, 1923, when the option had only run half its prescribed life.. This constituted a clear breach of the contract on the part of the defendant, for he then voluntarily put it beyond bis power to perform tbe contract on bis part. Therefore, a tender of tbe payments, as set out in tbe option, was not necessary. In Smith v. Jordan, 13 Minn., 264, 97 Am. Decisions, 232, the Court says: “Tbe complaint shows that tbe defendants, by tbe sale of tbe logs to Daniel Howes & Co., disqualified themselves from performing tbe contract. After this, either demand or tender would have been an idle ceremony which tbe law, under such circumstances, does not require.” Newcomb v. Brackett, 16 Mass., 161; Clarke v. Crandall, 27 Barb., 73. In Laybourne v. Seymour (Minn.), 54 N. W., 941, Dickinson, J., says: “Tbe corporation thereby disabled itself from performing tbe specific obligations expressed in its written undertaking, and, hence, subjected itself at once to tbe alternative liability to answer in damages as for breach of contract. Tbe law does not require tbe doing of a useless thing, and tbe corporation having thus disabled itself to specifically perform its agreement, a demand was not necessary to convert tbe right to demand tbe goods into a right to compensation in money.” Delamater v. Miller (N. Y.), 13 Am. Decisions, 512.

If liability is denied, as in tbe instant case, by tbe statement of tbe defendant that tbe land bad been sold and by a statement that plaintiff bad no option, a formal tender of tbe purchase price is not required in order to sue for specific performance or damages. Bradford v. Foster, 87 Tenn., 4; Sharp v. West, 150 Fed. Rep., 458; McLeod v. Hendry, 126 Ga., 167, Cobb, P. J., says: “It is well settled that no tender is necessary when it would be a mere idle and useless ceremony. When one of tbe parties to a contract is unable to perform bis obligation thereunder, no tender or performance by tbe other party, who is able and willing to perform, is necessary.” In Irwin v. Askew, 74 Ga., 582, it is held: “When a contract for tbe sale of land and putting tbe purchaser in possession was broken by tbe vendor, be saying to tbe purchaser that be could not comply with its terms, tbe tender of tbe purchase money was unnecessary.”

In tbe instant case there is sufficient, evidence for tbe jury to find, if they accept plaintiff’s contentions that tbe plaintiff bad tbe-$2,500 in a check, certified by tbe bank on which it was drawn, and that tbe currency in tbe form of legal tender was available therefrom or otherwise, and tbat.be was ready, able and willing to make this payment and to give such other securities as would be necessary, including tbe procurement of either tbe amount from tbe building and loan contemplated, or such securities as would meet tbe stipulation in tbe option, to wit: “Balance, $5,000, N. B. & L.”

When it is reasonably certain that an offer to perform will be refused and that payment, or performance will not be accepted, as a general rule, tender is waived. Gaylord v. McCoy, 161 N. C., 686. A refusal to deliver an article sold because tbe price bad gone up makes it unnecessary to tender the price. Blalock v. Clark, 133 N. C., 306. A refusal of an offer to pay waives a formal tender. Gallimore v. Grubb, 156 N. C., 575.

If defendant bas openly refused to perform, plaintiff need not make a tender or demand before suit brought. It is sufficient tbat be is ready and willing and offers to perform in bis pleadings. Bateman v. Hopkins, 157 N. C., 470. “Tbe defendant’s positively refusing to take tbe slave, Sam, at all, dispensed with tbe necessity of a tender of bim at Hillsborough..” Mobley v. Fossett, 20 N. C., 93, citing 2 Stark. on Evidence, 778.

A denial in one’s pleading of tbe agreement sued upon constituted a waiver of tender in Martin v. Bank, 131 N. C., 121. In Smith v. Building & Loan Asso., 119 N. C., 257, where a debtor stated tbat be bad tbe money in tbe bank ready to pay, but creditor refused to receive it, it was held tbat tbe money need not'be actually produced.

It is necessary tbat contracts, when entered into under circumstances as to import mature reflection before execution upon which tbe parties have a right to depend, should not be treated lightly. Unless there are such facts existent as will relieve tbe defendant from tbe performance of tbe instant contract, and if tbe jury shall find tbat tbe same bas been at all times fully kept on tbe part of tbe plaintiff, and tbat, notwithstanding tbe defendant’s conveyance of tbe locus in quo to other parties by deed of record during tbe 60 days, tbe plaintiff offered to perform on bis part, and tbat such offer was coupled with bis ability and readiness to perform, then tbe defendant bas no just right to complain if be is required to satisfy such loss as plaintiff may have suffered on account of defendant’s inability to perform said contract.

Tbe sanctity of contracts and a certainty of their performance, or satisfaction in lieu thereof, form tbe basis of modern business transactions. Upon these, energy and property may be expended and thrift and prosperity encouraged and promoted. Tbe law does not require tbat parties who are ready, able and willing to perform a contract which bas mutual obligations arising out of tbe acceptance by tbe optionee, shall do useless and vain things 'in making tenders on their part when it is admitted tbat tbe maker of tbe option bas voluntarily disabled himself so tbat performance on bis part is no longer possible. He must be ready, able and willing, and must give timely notice thereof. No unfair advantage must be taken of tbe seller, whether be is able to perform specifically or not.

Therefore, we are constrained to bold tbat there was error in dismissing this action as upon nonsuit, and it is ordered tbat a new trial be bad, and to tbat end, let tbe judgment be

Reversed.