Court Opinion

ID: 7068698
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:29:41.117861+00
Date Added: 2024-06-11T16:12:31.012633
License: Public Domain

On Petition for Rehearing.
Nichols, C. J.
3. Appellants, in an able brief on petition for rehearing, earnestly contend that the court has misinterpreted the statute of frauds. Their contention is that an oral agreement does not fall under the condemnation’ of the statute of frauds unless it affirmatively appears that the contract could not be performed within the year without a violation of the intention of the parties. In support of their position they have quoted from Nester v. Diamond Match Co. (1906), 143 Fed. 72, 74 C. C. A. 266, where the court upheld an oral contract to receive from, sort and deliver to plaintiff, logs “continuously so long as defendant controlled, managed and operated” a certain river. We see nothing in the face of this contract that indicates as to whether the defendant would control, manage and operate the river a week, month or a year, or longer.
They also cite Rogers v. Brightman (1859), 10 Wis. 49, 65, which was decided upon the evidence, the court saying: “The evidence of the defendants themselves showed that the logs could not all have been sawed by their mill, within one year from the time the contract was made.” And the court further speaking says that if “it appears that everything-provided for by the contract may in the nature of things and without any violation of its provisions, be done within the year, it cannot then be avoided by an outside inquiry.” In the case at bar there was no outside inquiry, but the court determined from the contract itself, the substance of which is stated in the original opinion, that in the na*331ture of things, without a violation of its provisions, the contract could not be performed within the year.
They also cite Warner v. Texas Pac. R. Co. (1896), 164 U. S. 418, 434, 17 Sup. Ct. 147, 153, 41 L. Ed. 495, in which case the railroad company contracted to “put down the iron rails and maintain a switch for appellant’s benefit for shipping purposes as long as he needed it,” and the court said: “The parties may.well have expected that the contract would continue in force for more than one year; it may have been improbable that it would not do so; and it did in fact continue in force for much longer than a year, but they made no stipulation which in terms or by reasonable inference required that result, and again the question is * * * whether the contract according to reasonable interpretation of its terms required that it shotild not be performed within the year.” The contract here under consideration was for the construction of a building, thereafter to be operated by a realty company, and from the proceeds of its operation to pay the indebtedness represented by preferred stock, maturing at the rate of $3,500 per year for nine years, $58,500 at the end of the tenth year, with the right to make additional payments on the stock- last maturing. We hold that the reasonable interpretation of these terms required that it should not be performed within the year.
Treat v. Hiles (1887), 68 Wis. 344, 32 N. W. 517, 60 Am. Rep. 858 is cited, in which it was held that in the nature of things the parties could not have known that a certain quarry to be operated would not be exhausted within one year. This case is clearly not in point.
Wooldridge v. Stern (1890), 42 Fed. 311, 9 L. R. A. 129, is cited. In that case it was held that the term not to be performed “does not include an agreement not likely to be performed within the year, nor one scarcely expected to be performed within that time; *332but rather does it purport such agreements which, by a reasonably clear or fair interpretation of all the parts, vieived by the then existing, circumstances, do not •admit of performance according to the language and intention within so short a period.” And again we repeat that the contract involved in this transaction by reasonably dear and fair interpretation of all of its parts does not permit of performance within the year.
Blair Town Lot and Land Co. v. Walker (1874), 39 Iowa 406, is cited, in which case it is said “to be within the statute, the contract itself must show from the nature of its subject matter, by its express terms, or by its necessary implication, that its performance within the year is forbidden—it must show that it is not to be performed.” By the construction which we give this contract, not only by its terms, but by necessary implication, it was not to be performed within the year.
In the case of Lennard v. Texarkana Lumber Co. (1906), 46 Tex. Civ. App. 402, 94 S. W. 383, it was expressly held that the contract of employment was for an uncertain or indefinite period of time.
In the case of Thomas v. Armstrong (1889), 86 Va. 323, 10 S. E. 6, 5 L. R. A. 529, it was held that if by the terms or by reasonable construction a contract not in writing can be fully performed within a year, although it can be done only by the occurrence of some improbable event, as the death of the person referred to, it is not within the statute.
We are not out of harmony with'this decision for we hold that by a reasonable construction of the contract involved it cannot be performed within the year. The above cases cited by appellants are cases from which they have quoted in their brief.
In Brown, Statute of Frauds (5th ed.) §281 the author said:' “Where the manifest intent and understanding of the parties, as gathered from the words and *333circumstances existing at the time, are that the contract shall not be executed within the year, the mere fact that it is possible that the thing to be done may be done within the year, will not prevent the statute from applying. * * * such an accomplishment must be an execution of the contract according to the understanding of the parties.”
Again in 1 Chitty, Contracts (11th ed.) 99, the principle is thus stated: “This enactment applies to all contracts, the complete performance whereof is of necessity to extend beyond the space of a year; the rule being that where the agreement distinctly shows upon the face of it, that the parties contemplated its performance to extend over a longer period than one year, the case is within the statute. Accordingly, the provisions of the statute render a verbal contract void, if it appear to have been the understanding of the parties at the time, that it was not to be completed within a year, although it might be, and was, in. fact, in part performed within that period.”
In the English case of Boydell v. Drummond (1809), 11 East 142, the plaintiff proposed to publish a series of illustrated scenes from Shakespeare in eighteen numbers, one number at least annually. After receiving two numbers the defendant refused to take any more. Although there was mo express agreement that the contract should not be performed within the year, the court held that it was “impossible to say that the parties contemplated that the work was to .be performed within the year,” but that on the contrary “the whole scope of the undertaking shows that it was not to be performed within the year, and was therefore within the statute of frauds.”
In Peters v. Westborough (1837), 19 Pick. (Mass.) 364, 31 Am. Dec. 142, the court said: “It must either have been expressly stipulated by the parties, or it must *334appear to have been so understood by them, that the agreement was not to be performed within a year.” But who can doubt what the express and specific understanding of the parties in the case at bar was and that it was not to be performed within one year or at any rate that it appears to have been so understood by them?
In the original opinion there were other grounds of demurrer presented, but we did not deem it necessary to consider them. We deem it expedient, however, in ruling upon the motion for a rehearing that we call attention to one other ground of demurrer.
4. It is provided by cl. 4, §7462 Burns 1914, §4904 R. S. 1881, that no action shall be brought upon any contract for the sale of lands unless the promise, contract or agreement upon which the action is brought, or some memorandum or noté thereof is in writing and signed by the party to be charged, or by some person by him lawfully authorized.
By the contract involved, appellants agreed to furnish appellees with funds with which to acquire certain real estate located in the city of Indianapolis, Indiana and appellees agreed to cause said real estate to be conveyed to a realty company which was to be incorporated, and to furnish abstracts showing, the title in such company to be a good merchantable estate in fee simple. It was agreed that in payment for such real 'estate there would be issued to such persons as the appellees might designate $16,000 of the common stock of the realty company. To say that this contract did not involve the purchase, the sale and the conveyance of real estate would be. a clear misinterpretation of its terms.
In the case of Collins v. Green (1907), 40 Ind. App. 630, 82 N. E. 932, appellant contracted with appellee to purchase for him certain real estate agreeing to pay him a commission when the purchase was made. Ap*335pellee made the purchase and took a conveyance therefor to himself. Thereafter he refused to convey the same to appellant but sold it to another party. The court held that the transaction was within the section of the statute above quoted.
In the case of Mather v. Scoles (1870), 35 Ind. 1, appellee conveyed certain lands to appellant upon an agreement that appellant would procure a conveyance of certain real estate from one Evans to appellee or to pay the appellee a sum of money sufficient to procure such conveyance from Evans.
Appellant failed to procure from Evans the conveyance of the land stipulated. In deciding the case on appeal, the Supreme Court says: “But what is the effect of the statute of frauds upon the contract alleged in the complaint? Our statute provides that no action shall be brought upon any contract for the sale of lands, unless the promise, contract, or agreement upon which the action shall be brought, or some memorandum or note thereof shall be in writing, and signed by the party to be charged therewith, or by some person thereto by him lawfully authorized. Here the contract was not that Mather himself would convey the lands to Seoles but as it is alleged in the complaint, that he would procure Evans to do so. Was this a contract for the sale of lands within the statute, which, to be binding, must be in writing? We think it was. It is so decided in Chiles v. Woodson, 2 Bibb. 71; Parker’s Heirs v. Bodley, 4 Bibb. 102; Griffin v. Coffey (1849), 9 B. Mon. 452; Hooker v. Gentry, 3 Met. Ky. 463; Brown, Admr. v. Jones, 46 Barb. 400; 4 Amer. Law Reg. (N. S.) 383.” See also, Allen v. Richard (1884), 83 Mo. 59; Haeberle v. O’Day (1895), 61 Mo. App. 390.
Petition for rehearing overruled.