Title: Brady Et Ux v. Ray

State: oregon

Issuer: Oregon Supreme Court

Document:

Modified June 22, 1960.
Opinion corrected; petition for rehearing denied September 14, 1960.
*614 Thomas A. Huffman argued the cause for appellants. On the brief were Schwenn, Brink & Huffman, Hillsboro.
Warde H. Erwin argued the cause for respondents. On the brief were Barzee, Leedy & Erwin, Portland.
Before McALLISTER, Chief Justice, and ROSSMAN, WARNER, GOODWIN and HOLMAN, Justices.
*622 Warde H. Erwin, Portland for the petition.
MODIFIED.
HOLMAN, J. (Pro Tempore)
On or about September 15, 1957, plaintiffs Brady and defendants Ray and Zimmerdahl entered into an oral contract for plaintiffs to sell and defendants to buy certain timber on land owned by plaintiffs. The purchase price was $15,000, one quarter of which, $3,750, was paid at the time the oral agreement was made, and the balance was to be paid within a year in quarterly installments. Defendants had three years in which to cut the timber. The land on which the timber stood was landlocked by the holdings of the International Paper Co. The parties contemplated plaintiffs would deed the fee in the land to International, subject to defendants' right to cut the timber. In return therefor plaintiffs would receive a right of way for defendants across International's land for the purpose of allowing defendants access to set up a mill in the timber they were purchasing. This right of way was to be furnished by plaintiffs to defendants. Lest there be any misunderstanding as to who was to furnish the right of way and because it is important, we will quote from plaintiff Dane Brady's testimony.
The parties further agreed that they would go to a scrivener and have the contract reduced to writing. Thereafter the defendant Ray went to International to inquire about the right of way and found that one was available but was told that International wanted to deal directly with the plaintiffs concerning it. Several times plaintiffs suggested to defendants that they go have the contract drawn, and defendants did not refuse but presented reasons why it was not convenient for them to go at that particular time.
In January, 1958, plaintiff Dane Brady went to a lawyer and had a contract drawn for the parties' signatures. The only parts thereof concerning defendants' right to enter the property are as follows:
The defendants refused to sign the contract because they claimed they wanted to make other arrangements for payment and because the contract did not provide for any right of way over International's land. Defendants then asked for the return of their money and said they wanted to call the whole thing off.
Plaintiffs immediately, on January 27, 1958, brought this suit for specific performance of the agreement. Defendants counter-claimed for the $3,750 down payment. The defendants contended the contract was unenforceable because of the statute of frauds. The plaintiffs contended the defendants could not take advantage of the bar of the statute of frauds and at the same time ask for their money back. The trial court sustained both the contentions and denied both parties relief. The defendants appeal from the court's denial of a decree for the return of the money. Plaintiffs did not appeal.
The law is not seriously in dispute. It is set forth in 49 Am Jur 868, Statute of Frauds § 563, as follows:
Oregon cases on the point are Helgeson v. Northwestern Trust Co., 103 Or 1, 203 P 586, and Lanham v. Reiman, 177 Or 193, 160 P2d 318.
It is clear that if the plaintiffs were both willing and able to perform the oral contract, defendants cannot recover their down payment. However, at no time, at the proffering of the written contract or at the time of trial, was a right of way in existence. Plaintiff Dane Brady testified as follows:
Plaintiffs were never able to perform the contract because they had no right of way to give defendants. They were ready, able and willing to sign a contract, but in it they were unable to give defendants the right of way across International's land.
Defendants had a right to know what strings or qualifications were going to be attached to the grant of the right of way by International. Apparently defendants' refusal to sign the written agreement profferred by plaintiffs and to otherwise perform the agreement was well-founded. Plaintiff Dane Brady testified that after defendants' refusal to sign the written *619 agreement he presented to them and defendants' request for the return of the money, he went to International and had them draft a right of way agreement. Mr. Brink, defendants' attorney, was called as a witness by the plaintiffs and testified he had gone to International's office and examined the agreement. His testimony concerning it was as follows:
Plaintiffs seem to feel it was defendants' duty to help them negotiate the right of way. This was not so under their oral agreement. Perhaps it was as the trial judge thought, that defendants were using the lack of right of way merely as a convenient excuse not to do that which they did not want to do anyway. *620 So long as defendants were within their legal right in insisting they be furnished with a right of way across International's land it does not make any difference what their real motives were in so insisting. Defendants would have been foolhardy to have paid the money or have signed the contract obligating them to pay the money when they did not know for sure the right of way would be forthcoming or what restrictions and requirements International would attach to the use of their property.
There is no evidence that any documents were ever presented to defendants showing them exactly what International would do. The situation is illustrated by the following quotation from Helgeson v. Northwestern Trust Co., supra, at p 8:
The inherent value of the statute of frauds will never be better illustrated. It may be there was never any oral agreement because of the indefiniteness as *621 to what type of access would be furnished defendants. However this may be, it would not change the result. Defendants would still be entitled to the recovery of their money.
The decree of the trial court will be modified to provide for the return of defendants' down payment to them by plaintiffs, without interest and without costs to any party, in this court or in the court below.
OPINION CORRECTED; PETITION DENIED.
HOLMAN, J. (Pro Tempore)
Plaintiffs in their petition for rehearing state as follows:
They again state in their petition as follows:
Despite these statements the prayer of plaintiffs' complaint requests as follows:
Plaintiffs thus assert the novel idea that if one of the provisions of an oral contract, which would normally be within the statute of frauds, is to subsequently reduce the contract to writing, all one has to do to avoid the statute is to first request the contract *623 be reduced to writing and then ask its performance. The statute of frauds does not rest upon such an unsubstantial footing.
Plaintiffs assert that it was defendants' fault the contract was not reduced to writing and thus it was defendants' fault that the contract was not performed. We will presume it was defendants' fault the contract was not reduced to writing. The thing that determines whether defendants are entitled to the return of their down payment is at whose door lies the fault for non-performance. Performance means the carrying out of the actual purpose for which the contract was made. The parties could perform the contract even though it was not reduced to writing. The thing that made it impossible of performance was lack of access. We disagree with plaintiffs' contention that there was access.
In their petition for rehearing plaintiffs have called the court's attention to an obvious error in the original opinion. It stated that a written contract with International for the right-of-way was necessary for defendants' protection before defendants entered into a written contract with plaintiffs. This, of course, is not so, as the parties could have made a written contract requiring the plaintiff to furnish the right-of-way as a condition precedent to defendants' performance. This, however, in no way affects the basic premises on which the case was decided, i.e., the contract was never capable of performance because of lack of access. With the above correction we adhere to the original opinion and the petition for rehearing is denied.