Court Opinion

ID: 9730631
Source: CourtListenerOpinion
Date Created: 2023-08-26 15:18:30.040887+00
Date Added: 2024-06-11T18:26:01.623258
License: Public Domain

Dissenting Opinion by
Hoffman, J.:
The majority holds that time is not of the essence when a contract requires that notice of termination be *187submitted “at least (60) sixty days prior” to the expiration date.
This holding disregards the clear meaning of the contract language and the intent of the parties. In addition, it is not in accordance with the decided cases in other jurisdictions. Wheeler v. McStay, 141 N.W. 404 (S. Ct. of Iowa 1913); Fred Mosher Grain v. Kansas Co-op Wheat Market. Ass’n, 136 Kan. 269, 15 P. 2d 421 (1932); Brown Method Co. v. Ginsberg, 153 Md. 414, 138 Atl. 402 (1927). See 5 A Corbin, Contracts §1177 (1964); 6 Corbin, Contracts §1266 (1962); 5 Page, Contracts §2598 (1921); Triekett, Landlord and Tenant, 328 (Stern 3rd ed., 1950).
The contract in the instant case provided for automatic renewal unless the defendant gave written notice of termination “at least (60) sixty days prior” to the expiration date. Such language is clear and unequivocal on its face. The insertion of a magical formula, “time is of the essence,” should not be necessary, therefore, to give effect to this language. Rather, I agree with Corbin’s statement that “a provision that a contract may be terminated at one or more specified dates by giving 30 days notice requires that the notice bo given 30 days before one of those dates; and time is of the essence.” (Emphasis added) 6 Corbin, Contracts §1266 (1962).
The time limitation for cancellation was included in the contract for the benefit of both plaintiff and defendant. It was designed to assure that each would have no less than sixty days to seek other contracts in the event of cancellation. The clause in question “should be so construed as to preserve that benefit, if it be possible to do so.” Stetler v. North Branch Co., 258 Pa. 299 at 301, 101 Atl. 980 at 981 (1917). To allow the defendant to expand the time limitation, in and of itself reasonable, by an additional reason*188able period of time would give it something for which it did not bargain.
Moreover, the doctrine that time is not of the essence is inapplicable in the instant case. As Corbin has indicated, the law will infer that time is not of the essence in order to avoid a heavy penalty or a forfeiture. 5 A Corbin, Contracts, §1177 (1964). But no forfeiture or penalty results here if it is held that the termination notice as given is ineffective. The defendant would still be entitled in the future to whatever benefits were conferred upon him by the contract. While defendant may have determined that these benefits were of little or no value to him, he can no more seek to avoid the clear obligations of the second term of his contract than if he had discovered this fact immediately after the commencement of the initial term of the contract.
Furthermore, the defendant was not faced with any hardship which interfered with the timely exercise of his right to terminate the contract. At any time prior to the last sixty (60) days of the initial contract term of three years and eight months the contract could have been cancelled. His delay was voluntary as well as imprudent.
The majority’s reliance on Central Guarantee Co. v. National Bank, 137 Wash. 24, 241 Pac. 285 (1925), is misplaced. There, the clause in question gave the subscriber the privilege to cancel “at the end of the first year.” This was interpreted by that Court to mean that the right to cancel arose only at the end of the year and was not available during the course of the year. Indeed, that Court found this clearly distinguishable from the instant situation where the defendant could have cancelled at any point prior to a specified time before the renewal date. The Washington Court stated: “Most certainly, the ordinary person, a person not versed in the technical lore of the law, *189would understand that a right granted to be exercised ‘within one year’ would expire with the expiration of the year, while he would equally understand that a right granted to be exercised ‘at the end of one year’ arose at the expiration of the year. Stated in another way, he would understand from the first impression that the end of the year marked the expiration of the granted right, while he would understand from the latter that it marked its beginnings.”
As an alternative ground for the decision, the majority, in a footnote, indicates that notice was timely given because the sixtieth day prior to the renewal date was a Saturday and notice was received the next business day, a Monday. Such an allowance should not be made where, as here, the party giving notice has had ample opportunity to comply in all respects with the literal requirements of the contract clause. Nothing prevented the defendant from having notice arrive on the sixtieth day, because the mails are delivered on Saturday, and whether plaintiff did business on Saturday was not its concern. In Berg Co. v. Thomas & Son Co., 256 Pa. 584, 100 Atl. 951 (1917), cited by the majority, notice was required to be given on a date which happened to be a Sunday, and no other date was specified. But it was also anticipated that notice would be sent by mail. As mail deliveries were not made on Sunday, the court indicated that Monday must have been acceptable to the parties. Otherwise notification could not be made in the manner the parties anticipated. Here, however, delivery of such notice by mail could have been made on the sixtieth day in accordance with the specific terms of the contract and the anticipation of the parties.
Plaintiff is entitled to its lost profits for the renewal term of three years and eight months. The lost revenue is $45.00 a month for the entire contract term, but the record is unclear as to its costs. I would, *190therefore, remand the case to the lower court with instructions to ascertain plaintiff’s lost profits and award judgment accordingly.
Watkins, J., joins in this dissenting opinion.