Court Opinion

ID: 9545613
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:16:16.189616+00
Date Added: 2024-06-11T15:15:11.124285
License: Public Domain

ROSSMAN, J.,
dissenting.
This is an equity case, though—given the majority’s result—it is difficult to recognize it as such. Because I would reach the same result as the trial judge, who was well aware of the equities involved, I must respectfully dissent.
The majority admits that “plaintiffs did not expressly promise to buy” defendant’s property, but concludes, nonetheless, that the document “reflects an indubitable intent to bind the parties.” 98 Or App at 175. I do not believe that the record shows that the Heinzels intended to bind themselves.
*177The document in this case parallels that signed by the defendant in Sprague v. Schotte, 48 Or 609, 610, 87 P 1046 (1906):
“ ‘This Agreement entered into this sixth day of February, 1905, between A.C. Schotte and A.P. Sprague, both of Elgin, Ore., whereby A.C. Schotte agrees to sell, deliver and transfer by good and sufficient warrantee [sic] deed to said A.P. Sprague his homestead on the Wallowa River * * * for the sum of sixteen hundred dollars ($1,600.00). This agreement is in force from this date to April first, 1905, when it will become void.’ ”
Before April 1, without the knowledge or consent of the plaintiff, the defendant sold the property to a third party. The court refused to grant the plaintiff specific performance. It held that there was no mutuality or consideration to support a contract. The instrument was merely an offer to sell the land and, until accepted, imposed no obligation whatever on either party and was subject to revocation.
The requirements of a contract of sale, as distinguished from an option, were emphasized in Strong et al. v. Moore et al., 105 Or 12, 20-21, 207 P 179 (1922):
“The rights and obligations arising out of an option to purchase are to be contrasted rather than merely to be compared with the rights and obligations arising out of a contract of sale. An option is simply a contract by which an owner agrees that another shall have the privilege of buying his property at a fixed price and within the time expressly or impliedly prescribed by the writing. The optionee is not obliged to buy, although he may, if he chooses, elect to buy. A contract of sale imposes upon the vendee an obligation to buy. An option confers a privilege or right to elect to buy but it does not impose any obligation to buy.
“ * * * *
“An option is a continuing offer. If the option is without consideration it may be withdrawn before acceptance; but if it was given for a consideration it cannot be withdrawn before the expiration of the prescribed time without the consent of the optionee.” (Citations omitted.)
The agreement here is nothing more than an option. It does not obligate the Heinzels to do anything. It states that Backstrom will sell her property to the Heinzels for $55,000, but it does not bind the Heinzels to pay. Cf. Spencer v. Bales, *178108 Or 339, 216 P 746 (1923) (defendant’s distinct promise to pay created a binding contract of sale, not an option). The agreement gave the Heinzels the privilege of buying the property but did not oblige them to do so, see Aspinwall, executrix v. Ryan et al, 190 Or 530, 535, 226 P2d 814 (1951),1 and there was no consideration given for Backstrom’s offer.
The evidence shows that an option is what the Heinzels intended to have. The Backstrom purchase was to be part of a three-way exchange of property by the Heinzels. That exchange had not been finalized at the time the agreement was signed.2 The document, drafted by Mr. Heinzel, who was experienced in real estate, gave the Heinzels flexibility. Their silence in keeping Backstrom informed of the three-way exchange and their apparent unwillingness to pay the purchase price before the exchange was finalized show their intention not to bind themselves in the event the exchange did not take place. The trial judge, who had the benefit of eyeballing and evaluating the witnesses first-hand, had no trouble in determining what was going on.
Even if we accept the notion conjured v. by the majority that the Heinzel document somehow rises to the level of a contract of sale, I would still decide this case in Backstrom’s favor. It seems quite clear to me that the Heinzels have not shown that they acted “in good faith” so as to be entitled to enforce the terms of the sale. They tendered payment on October 29,1986, almost one month late. They claim that they could have paid cash on October 1. They did not do so.3 Their failure to tender performance on the agreed date *179was no more excusable than Backstrom’s failure to demand performance. Thus, under either analysis, Backstrom should win.
Accordingly, I would affirm the trial court.

 Although Heinzel titled the writing a “sales agreement,” instruments using terms of sale which do not bind a party to purchase are options and not contracts of sale. Aspinwall executrix v. Ryan, et al, supra, 190 Or at 536.

 In fact, one sale fell through after the signing of the document, even though money had been placed in escrow for that sale. The new sale of the California property was not to have closed until November 3.

 Plaintiffs testified that they met Backstrom on the street a few days after the agreement, told her that they were having a “little problem with the mail” and asked if there would be any difficulty if the escrow closed later than October 1. Plaintiffs stated that Backstrom responded that there was no problem. Backstrom did not recall the meeting. The trial court determined that, although it was possible that such a meeting occurred, anything that might have been said did “not approach the dignity of a modification of the original agreement.” Even if the exchange did take place, it does not excuse the Heinzels’ failure to perform on the date of their agreement. Their failure to tender payment on the closing date was unrelated to the mails. They had the money to pay.