Court Opinion

ID: 9547414
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:47:10.762102+00
Date Added: 2024-06-11T15:17:43.791288
License: Public Domain

BAKES, Justice,
dissenting:
I dissent from the majority’s application of the principles enunciated in Funk v. Funk, 102 Idaho 521, 633 P.2d 586 (1981), to this contract dispute. As I explained in my dissent in Funk, a contract should be carried out as the parties negotiated it, and not as the majority of this Court thinks they should have negotiated it.
In reading a “good faith” requirement into the Cheney/Jemmett contract, the majority has ignored both the contract provisions and existing Idaho law. It is well established that a court must respect the contract provisions to which parties have lawfully agreed. Nichols v. Knowles, 87 Idaho 550, 555, 394 P.2d 630, 633 (1964); Howard v. Bar Bell Land & Cattle Co., 81 Idaho 189, 197, 340 P.2d 103, 107 (1959). The Jemmetts signed this real estate purchase agreement despite the presence of the clause conditioning assignment of the contract on the sellers’ approval. If a “good faith” or “reasonability” requirement was desired, it was for the parties, not this Court, to make that determination.
This Court has previously refused to read a reasonability requirement into the assignment clauses of contracts. Speaking to just such a clause in J.R. Simplot Co. v. Chambers, 82 Idaho 104, 350 P.2d 211 (1960), this Court stated:
“It will be noted that said section 31 specifies the only qualification of the assignee to be a controlled corporation____ To construe said section 31 as restricting the right to assign to a corporation which may be by appellants considered ‘reasonable’ would necessitate the insertion of words and the making by the court of a new contract. This we cannot do. Courts cannot make for the parties better agreements than they themselves have been satisfied to make, and by a process of interpretation relieve one of the parties from the terms which he voluntarily consented to; nor can courts *836interpret an agreement to mean something the contract does not itself contain.” (Citations omitted.) 82 Idaho at 109-110, 350 P.2d at 214.
Here, by reading a reasonability requirement into the non-assignment clause of this contract, the Court has reworded the contract. This is contrary to Simplot v. Chambers, supra, which the Court neither overrules nor distinguishes, but merely ignores.
The majority suggests that bilateral contracts which absolutely forbid assignment of the contract might be valid, ante at 1034, but holds that a non-assignment clause conditioned on the consent of the seller implies a reasonability requirement which is subject to the approval of the court. This merely enhances the uncertainty which the Court’s opinion today injects into the law of contracts.
Following the Court’s decision today, a seller would be ill advised to enter into a contract which permits an assignment subject to the seller’s approval. By entering such a contract, the seller would essentially be surrendering any control over that assignment. Sellers will no doubt routinely insert provisions in the contract containing complete restrictions on assignment. But under the majority opinion even the validity of complete restrictions is still up in the air. The only certain thing to result from this case is that there will be a lot of litigation between buyers and sellers over what the courts may think is reasonable. Since this Court has not set down any standards as to what is to be considered in determining reasonableness, all such determinations must of necessity be ad hoc decisions. This will no doubt assure litigation in every case. Such a rule of law which requires litigation to settle every dispute does not have much to commend it.
I dissent.