Case ID: wash_34/html/0001-01.html
Source: Caselaw Access Project
Author: {"author": "Hadley, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[No. 4756.
    Decided January 2, 1904.]
    F. C. Lawrence, Respondent, v. Cornelius Pederson, Appellant.
      
    
    New Trial — Questions op Law Only — Reviewed Regardless op Discretion op Trial Court — Sales—Option—Payment. In an action to recover commissions for effecting a sale of mining property, where it appears at the trial that only an option had been secured and no sale made thereunder, and a nonsuit is granted, the subsequent granting of a new trial upon the sole ground that the sale had been effected by payment in full since the trial, raises only a question of law, and the ruling is subject to review on appeal without reference to the trial court’s discretion.
    New Trial — Nonsuit—Pleadings—Supplemental Complaint— New Cause op Action. After the granting of a nonsuit because no cause of action existed at the time of the trial, a new trial can not be granted or a supplemental complaint allowed to show a cause of action subsequently arising which did not exist when the action was commenced.
    Brokers — Sales — Option — Pleadings — Supplemental Complaint Introducing New Cause op Action. In an action to recover commissions for effecting a sale, a written contract optional in form, is not evidence of an actual sale, and a supplemental complaint showing a subsequent sale by payment in full under the option introduces a cause of action not existing before, and can not be sustained on the theory that it merely introduces new facts showing that the parties construed the transaction as an actual sale from the beginning.
    Brokers — Action eor Commissions — Option not a Sale— Part Payment Under an Option. A broker, whose contract is to effect a sale, is not entitled to commissions where the contract for the sale of mining property for $56,500 stipulates that the owner agrees to sell upon the payment of specified amounts at certain times, without any agreement on the part of the purchaser to pay the amounts, although $2,500 is paid for the privilege of the option, and possession is taken and improvements are made, and later $5,000 more is paid for an extension, the greater part of the price still being unpaid and there being no assurance that it would be paid.
    Same — Contracts—Ambiguity—Parol Evidence as to Construction. Such a contract is in no sense ambiguous and hence parol testimony as to the construction placed thereon by the parties would be inadmissible, and could not establish the fact that the parties considered it as a sale from the beginning.
    Appeal from an order of the superior court for King county, Bell, J., entered January 13, 1903, setting aside .a nonsuit entered May 15, 1902, and granting a new trial, with leave to file a supplemental complaint, upon plaintiffs showing by affidavits of events occurring since the nonsuit was granted.
    Reversed.
    
      R. F. Lewis and Wright & Kelleher, for appellant.
    Sweeney, French & Steiner, for respondent.
    
      
       Reported in 74 Pac. 1011.
    
   Hadley, J.

Respondent brought this action to recover from appellant the sum of $2,325, alleged to he due and owing to respondent as a commission for effecting a sale of certain mining property in Alaska for appellant. The cause was tried before a jury, and at the close of the plaintiffs testimony the defendant moved for a nonsuit. The motion was granted and the jury discharged. The consideration which induced the court to grant the nonsuit appears to have been its construction of the written instrument pertaining to the sale of the mining property. That written instrument is as follows:

“Know All Men By These Presents: that this indenture, made this 21st day of May, 1900, by and between Cornelius Pederson, the party of the first part, resident of Virgen Bay, Prince William Sound, Alaska, and J. D. Meenach, resident of Seattle, Wash., party of the second part, Witnesseth:
“That the party of the first part, for and in consideration of the sum of forty-six thousand five hundred dollars, lawful money of the United States of America, to be paid as follows: Two thousand five hundred dollars ($2,500) to be paid at the time of signing this bond, five thousand dollars ($5,000) to be paid on or before the 21st day of May, 1901, after the aforesaid time; viz., 21st May, 1901, the party of the first part is to receive twenty per cent. (20 per cent.) of the value of the ore, less seven dollars ($7) per ton, which is to be deducted for shipping and smelting charges; the party of the first part is to take eleven thousand two hundred and fifty dollars ($11,250) in stock at par value when issued. The stock to be nonassessable. The balance, twenty-seven thousand seven hundred and fifty dollars, is to be paid on or before the 21st day of Kovember, 1902, for and in consideration of the before mentioned moneys, the party of the first part agrees to sell the following described quartz mining property: The Copper King quartz lode and the Convict quartz lode, situate, lying and being in Virgen Bay, Prince William Sound, Alaska, and recorded in Prince William Sound Mining District, reference is hereby made to the records of the aforementioned mining district, for a full and complete description of above quartz lode. Upon payment being made, the party of the first part agrees to give to the party of the second part, good and sufficient deeds for conveying and assuring the title of above mining property free from all incumbrances, all of his right, title, interest, claim, and demand, in and to all of the above mentioned quartz mines. It is hereby agreed and made a consideration, that the party of the second part is to commence "work on the aforementioned quartz lodes on or before the 21st day of August, 1900: all payments to be paid in person, or deposited to the credit of the party of the first part at W. J. Busby’s, Blighs Isld., Prince Wm. Sound: in the event of failure of the party of the second part to meet any of the aforementioned obligations, be forfeits all money or improvements to the party of the first part, as a penalty and liquidated damages.”

Tbe court construed the instrument to be a mere agreement upon tbe part of appellant to sell when tbe proposed vendee should comply with all conditions named, and that the latter was not obligated to buy, but held a mere option to purchase, which be could exercise or not as be chose. It appeared at tbe trial that tbe payments bad not been made, tbe time therefor not having expired, and the property bad not been conveyed by appellant.

It was contended by appellant, and bis view seems to have been adopted by tbe court, that no sale bad yet been effected; that tbe payment of tbe balance of tbe designated purchase price was merely optional with tbe prospective purchaser; that it might not be paid, and no sale might ever be effected. Respondent’s demand for commission was based upon five per cent of tbe entire selling price, and upon the claim that be bad caused an actual sale to be effected. It was tbe view of the court that a completed sale bad not been shown and that respondent was, for that reason, not entitled to recover any commission at that time. Hence tbe granting of tbe nonsuit.

The nonsuit was granted May 15, 1902, and thereafter respondent moved for a new trial for alleged errors of law occurring at tbe trial, particularly specifying that error was committed in withdrawing tbe ease from tbe jury. Tbe motion was taken under advisement for some months, and, pending a decision thereon, respondent filed a new motion in tbe nature of a request for a reargument of tbe motion for new trial. Tbe motion was accompanied by affidavits to the effect that, since the granting of the non-suit, the balance of the purchase price of $46,500 had been paid and the sale completed. The motion renewed the request for a new trial, and asked leave to amend the complaint or file a supplemental complaint showing that such final payments had been made. On the 13th day of January, 1903, the court granted a new trial, and also leave to file an amended or supplemental complaint. The record shows that the court, in its oral decision, granted the motion upon the ground that the submitted affidavits showed a proper case for allowing the plaintiff to file an amended or supplemental complaint, and for allowing a new trial thereon. The order afterwards entered in the record contained the following:

“fiow, therefore, it is ordered that the nonsuit heretofore granted be, and the same is hereby, set aside, and the plaintiff is granted a new trial upon the ground that, as set forth in the said motion and affidavits, payments have been made since the commencement of this suit; and the plaintiff is given permission to file an amended, or supplemental complaint, showing the above facts of payment; subject to the right of the defendant to have the form of the said amended or supplemental complaint settled by the court upon motion, demurrer or otherwise in the usual manner.”

This appeal is from said order, and the only assigned error is that the court erred in making its order granting a new trial.

Inasmuch as the order appealed from specifies the exact ground upon which the court granted the new trial, showing that it involved a question of law only and not questions of fact, appellant therefore urges that no other question should be considered here within the rule followed in Gray v. Washington Water Power Co., 27 Wash. 713, 68 Pac. 360, and Gardner v. Lovegren, 27 Wash. 356, 67 Pac. 615. The sole ground upon which the court granted the new trial was that it appeared by affidavits, which were submitted seven or eight months after the nonsuit, that the selling price for the mining property had been fully paid since the nonsuit, and that respondent for that reason should be permitted to shape his complaint so as to state that fact and proceed to a new trial under the amended or supplemental complaint. It was purely a question of law that was decided by the court, and in such a ease, as was stated in Gardner v. Lovegren, supra, this court will not hesitate to set aside an order granting a new trial, although it might hesitate to interfere with the discretionary powers of the trial court as to a new trial if the order granting it were based upon matters of fact.

Considering the only point decided by the court adversely to the appellant within the rule of Gray v. Washington WaterPower Co., supra, we think the court erred in making the order upon the ground stated. An actual cause of action must exist at the time of bringing the suit, and if such does not then exist, no cause of action subsequently arising can be introduced by amended or supplemental complaint, or by proof of facts constituting a cause of action and occurring after the beginning of the suit. Pinch v. Anthony, 10 Allen 470; Dickerman v. New York etc. R. Co., 72 Conn. 271, 44 Atl. 228; Willoughby v. Atkinson etc. Co., 93 Me. 185, 44 Atl. 612; Berford v. New York Iron Mine, 8 N. Y. Supp. 193; Lewis v. Fox, 122 Cal. 244, 54 Pac. 823; Lennox v. Vandalia Coal Co., 158 Mo. 473, 59 S. W. 242; Barker v. Prizer, 150 Ind. 4, 48 N. E. 4; Meyer v. Berlandi, 39 Minn. 438, 40 N. W. 513, 1 L. R. A. 777, 12 Am. St. 663; Payne v. School Dist., 87 Mo. App. 415; Gould’s Pleadings (5th ed.), 161.

In Pinch v. Anthony, supra, at page 477, the court said:

“We have found no authority that goes so far as to authorize a party who has no cause of action at the time of filing liis original bill to file a supplemental bill in order to maintain his suit upon a cause of action that accrued after the original bill was filed, even though it arose out of the same transaction that was the subject of the original bill. It would seem to be contrary to principle to allow this to be done.”

In Berford v. New York Iron Mine, supra, at page 194, the court said:

“Neither by amendment of the original complaint nor by supplemental complaint can facts which occurred after suit brought be made a part of plaintiff’s case so as to turn what is no cause of action at all into a good cause of action.”

The office of a supplemental complaint is merely to enlarge or change the kind of relief to which a party may be entitled upon a cause of action existing at the time of the commencement of the suit. If, therefore, no cause for any relief exists at the time the suit is begun, a supplemental complaint which avers facts occurring since the commencement of the suit as ground for relief cannot be entertained in the action.

Respondent insists that under the proofs the original complaint showed a cause of action existing when the suit was commenced, that the written instrument quoted above was evidence of an actual sale, that by its terms it could have been enforced by respondent, and that the proposed supplemental complaint merely introduces additional facts which show that the parties themselves construed the writing as meaning an actual sale. We do not think that, because payment may be made in full under a contract optional in form, it follows from that fact that the parties construed the transaction to be an actual sale from the beginning. The evidence of the transaction was the written instrument, and it was for the court to construe its effect. We think the court properly construed the contract when the nonsuit was granted. We believe by its terms it was not enforcible against the proposed purchaser, and that it was optional with him whether he made the payments or not. Respondent agreed to sell upon certain terms, but the other party did not bind himiself to buy, and actually agreed to forfeit all payments made if he should not comply with all conditions named. When the contract was made he paid $2,500 cash as a consideration for the optional privileges, and later paid $5,000 more to keep the privileges alive. He entered into possession, and spent money improving the property, as he was required to do if he kept the option alive. If the contract had been intended as a sale, and not as an option, it would have been immaterial to appellant whether the property was improved or not. He exacted that condition, however, evidently upon the theory that the property was still his, and, if the purchase should not be made, the period covered by the contract would not pass without some development of the mine. The time for making all payments had not expired when this suit was begun, or at the time of the trial. The evidence showed that the greater part of the price was unpaid, and it could not then be known that the balance ever would be paid. Under such circumstances, an actual sale was not shown, and respondent was not entitled to recover commission under claim of effecting a sale which was not then such in fact.

Parol evidence is inadmissible to show the construction placed upon a contract by the parties themselves when the intention may be readily ascertained from the contract, as reduced to writing by them. 21 Am. & Eng. Enc. Law (2d ed.), pp. 1113, 1114. The contract here being in no sense ambiguous, evidence in support of the proposed supplemental complaint on the theory, as urged, that the construction placed upon the contract by the parties themselves may be shown thereby, would not only be inadmissible within the above rule, but if admitted would not establish the fact that a sale was made in the beginning, for reasons hereinbefore stated.

The procurement by a broker of a mere optional contract of sale does not entitle him to recover a commission in advance of a sale, when his undertaking is to effect an actual sale. Dwyer v. Raborn, 6 Wash. 213, 33 Pac. 350; Lawrence v. Rhodes, 188 Ill. 96, 58 N. E. 910; Aigler v. Carpenter Place Land, Co., 51 Kan. 718, 33 Pac. 593; Runyon v. Wilkinson, Gaddis & Co., 57 N. J. L. 420, 31 Atl. 390; Kimberly v. Henderson, 29 Md. 512; Tousey v. Etzel, 9 Utah 329, 34 Pac. 291; Zeidler v. Walker, 41 Mo. App. 118.

Since, therefore, the contract pertaining to a sale was an optional one, and since no sale had been effected at the time suit was brought, the respondent was not entitled to recover a commission, and the nonsuit was properly granted; and since, as we have seen, the subject matter of the proposed amendment is not properly matter for a supplemental complaint, but introduces an actual cause of action when none existed before, it was error to grant the motion for a new trial and permit the amendment.

The judgment is reversed and the cause remanded, with instructions to the trial court to vacate the order appealed from and deny the motion for a new trial.

Fullerton, C. J., and Anders, Mount, and Dunbar, JJ., concur.