Opinion ID: 1704209
Heading Depth: 1
Heading Rank: 1

Heading: Obligatory Character of Charitable Subscription.

Text: We first consider defendant's claim on appeal that his motion for directed verdict should have been sustained on the ground the instrument of pledge was not obligatory. He cites and relies on our decisions in Pappas v. Hauser, 197 N.W.2d 607, 612-13 (Iowa 1972) and Pappas v. Bever, 219 N.W.2d 720, 721 (Iowa 1974), which held the form of the charitable subscriptions involved in those cases to be nonobligatory and therefore unenforceable. In each of those cases, the form of the pledge was cast in terms of I intend to subscribe and I intend to pay the subscription. In Hauser, we held that this language was not obligatory in the face of extrinsic evidence that it was not intended to be. In Bever, we held that such language was not obligatory in the absence of extrinsic evidence that it was intended to be binding. In the subsequent case of Salsbury v. Northwestern Bell Telephone Co., 221 N.W.2d 609, 611-13 (Iowa 1974), we limited the Hauser and Bever holdings to their particular facts and enforced a charitable subscription to the same cause which was involved in Hauser and Bever. The form of the agreement undertaken by the subscriber in the Salsbury case was as follows: This is to advise you that the contribution... has been approved .... The $15,000 contribution will be made over a three-year period, in three equal payments. Our first $5000 payment will be made in 1968. Id. at 610. We held this language to be obligatory within the context of its execution and further opted to follow the rule now stated in Restatement (Second) of Contracts, section 90(2) (1979) that charitable subscriptions are binding without proof of action or forbearance. Id. at 613. In deciding defendant's contentions on this appeal in accordance with our prior decisions, we find the language employed in the charitable subscription agreement in the present case to be sufficiently obligatory in nature to render the agreement enforceable. Moreover, the extrinsic evidence of intent which was before the court in the present case strongly supports and in no way detracts from this conclusion. Finally, although not necessary under the standard adopted in Salsbury, the present case does contain strong evidence of reliance on the part of the grantee of the subscription.