Court Opinion

ID: 9461900
Source: CourtListenerOpinion
Date Created: 2023-08-04 22:27:19.943757+00
Date Added: 2024-06-11T17:37:18.869651
License: Public Domain

On Appellants’ Petition for Rehearing
ORDER
On consideration of appellants’ petition for rehearing, it is
Ordered by the Court that the aforesaid petition for rehearing is denied, in accordance with the opinion of this Court filed herein this date.
SPOTTSWOOD W. ROBINSON, III, Circuit Judge:
The daymans seek rehearing of our decision herein 1 and advance two arguments in support of their petition. The first is that a principle to which we adhered — that a promise by two or more persons presumptively creates a.joint obligation 2 — is not apposite to this case. *1038The second is that we were mistaken in our understanding that Goodman Properties was personally liable for payment of the mortgage indebtedness on Gateway Apartments.3 These contentions lead to renewed insistence that Hillman’s disaffiliation with the Gateway Apartments project did not legally affect the Clay-mans’ endeavor to exercise the option in suit. We disagree, and accordingly deny the petition for rehearing.
I
In our earlier opinion, we interpreted the agreement conferring the option in light of the well settled rule “ ‘that the obligation created by the promise of several persons is joint unless the contrary is made evident.’ ” 4 We concluded that the agreement conditioned exercise of the option upon an assumption by Hill-man, as well as by the daymans, of half of the outstanding mortgage debt on Gateway Apartments.5 The petition for rehearing asserts that the canon guiding our construction of the agreement is limited in operation to those who are obligors, and has no application to those to whom a contract extends its benefits as obligees. The petition further claims that the daymans and Hillman were strictly obligees of the option agreement —that the agreement demanded of them no performance whatever to ripen the right to exercise the option.
This argument ignores the express terms upon which the option was granted.6 One term was the optionees’ assumption of half of the balance owed on the mortgage.7 The option agreement explicating that term was itself a provision of a bilateral contract between those who were the optioner and the optionees. To be sure, the option provisions, by their very nature, conferred upon the optionees a prerogative to which they were free to resort. But those provisions, in no uncertain terms, exacted from the optionees a compliance with the conditions stipulated in the event that an. exercise of the' option was attempted.
It was that obligation of compliance which our opinion held to be joint,8 and to be unsatisfied by an assumption proffered by the daymans without Hillman.9 As our opinion stated,
The contract requires the optionees, upon an exercise of the option, to assume one-half of a large mortgage indebtedness on the property. We carefully note that the requirement is an assumption of half of the outstanding balance, as distinguished from acceptance of a half interest in Gateway Apartments subject to the mortgage. Upon an assumption, the optionees would become personally liable along with Goodman Properties to the mortgage. Upon such an assumption, the optionees would become personally liable along with Goodman Properties for repayment of half of the indebtedness. They would, too, become personally liable to Goodman Properties in the event it had to pay any more than the remaining half. Thus, as a precondition to availing themselves of the option, the optionees — all three, we have held — would pledge their credit, to the tune of half of the debt, primarily to further secure the mortgagee and secondarily to protect Goodman Properties against payment exceeding the other half.10
*1039II
The daymans’ second complaint focuses on our statement that upon the assumption which the option agreement called for, “the optionees would become personally liable along %oith Goodman Properties for repayment of half of the indebtedness.”11 The petition for rehearing asserts that Goodman Properties took title to Gateway Apartments subject to the mortgage, without incurring any personal liability for payment of the debt it secured. On this ground, the petition argues that Goodman Properties, the optionor, did not need the personal responsibility of others for part of the indebtedness, and that an assumption by all three of the optionees was of little or no importance.12
The record on appeal, though sparse on the point, suggests that Goodman Properties was itself personally liable for payment of the mortgage. The contract of the sale of Gateway Apartments to Goodman Properties specified a price of $160,000 above the balance of approximately $1,098,034 then due on the mortgage.13 The contract provided that Goodman Properties would take title subject to the mortgage, without expressly stating whether Goodman Properties would assume the responsibility for payment.14 The contract also contained the sellers’ covenant that the mortgage was self-liquidating, without any extraordinary curtailment requirement,15 and the statement of the settlement of the sale discloses that the transaction was consummated on the basis foregoing.16 An assumption of personal liability on a .mortgage indebtedness may be either express or implied17 and, it has been held, will be implied when the amount of the indebtedness is deducted from the agreed price under circumstances fairly contemplating assumption by the purchaser.18 Unlike the daymans, we cannot overlook the somewhat unique circumstances here.19
We need not pursue the matter further, however, for the status of Goodman Properties’ responsibility to pay the mortgage does not in any way affect the outcome of this case. While our earlier opinion intimates a thought that Goodman Properties was personally liable, we did not intend an adjudication on that score, nor do we now. The critical consideration is that in any event the mortgage debt had to be paid or else Gateway Apartments would be lost through foreclosure, and Goodman Properties obviously had an interest in protecting itself against that. The option agreement conferred upon the three optionees the privilege of buying a half interest in Gateway Apartments, and the optionees’ assumption of personal liability for half of the debt was an available means of maximizing Goodman Properties’ security.
In these circumstances, it will not do to say merely that an assumption was unimportant, factually or legally, to Goodman Properties. It deemed the assumption condition important enough to write it into the option agreement and it is not for us to delete it. As we said in our earlier opinion,
*1040When we are dealing with a contract, We are not at liberty to inquire as to why the contractors chose to contract the way they did. Here the parties cast their option agreement in terms exacting the joint performance of all three of the optionees. It is not our function to ferret out their reasons for doing so, or to rewrite their agreement when dissatisfaction develops. Our duty is to enforce the contract as made.20
Petition denied.
Senior Circuit Judge FAHY did not participate in the foregoing opinion and the order disposing of the petition for rehearing.

. Clayman v. Goodman Properties, Inc., 171 U.S.App.D.C. -, 518 F.2d 1026 (1973).

. See id. at note 26.

. See id. at note 69. As in our earlier opinion, we adopt the contracting parties’ use of the word ‘’mortgage” in their agreement as to the option, see id. at n. 27, referring in each instance to what seems actually to have been a deed of trust.

. Id. at note 26, quoting Welch v. Sherwin, 112 U.S.App.D.C. 124, 126, 300 F.2d 716, 718 (1962), in turn quoting 2 Williston, Contracts § 323 (1936).

. Clayman v. Goodman Properties, Inc., supra note 1, at notes 21-74.

. Id. at n. 27.

. Id.

. Id. at notes 26-34.

. Id. at notes 51-74.

. Id. at notes 67-72.

. See text supra at note 10 (emphasis supplied).

. Alternatively, the (’laymans argue that there was a jury question as to the materiality of Hillman's disaffiliation with the Gateway Apartments project and his refusal to join the (’laymans in the exercise of the option.

. Plaintiffs’ Exhibit 14.

. Plaintiffs’ Exhibit 14.

. Plaintiffs’ Exhibit 14.

. Plaintiffs’ Exhibit 13.

. See cases cited infra note 18.

. E. g., Banta v. Rosasco, 12 Cal.App.2d 420, 55 P.2d 601, 602 (1936) ; Warner v. Bookstahler, 48 Idaho 419, 282 P. 862, 863 (1929) ; Rosenthal v. Heft, 155 Md. 410, 142 A. 598, 602-03 (1928) ; Sanderson v. Turner, 73 Okl. 105, 174 P. 763, 764, 2 A.L.R. 347 (1918) ; Faulkner v. McHenry, 235 Pa. 298, 83 A. 827, 828, Ann.Cas.1913D, 1151 (1912).

. Compare Dick v. Vogt, 196 Okl. 66, 162 P.2d 325, 327, 329, 331 (1945). Cf. Hinckley Estate Co. v. Gurry, 53 Idaho 551, 26 P.2d 121, 123 (1933).

. Clayman v. Goodman Properties, Inc., supra note 1, at notes 73-74.