KING v. STANLEY

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District Court of Appeal, Second District, Division 1, California.

KING et al. v. STANLEY.

Civ. 15937.

Decided: January 19, 1948

Abraham Glicksberg, of San Francisco, for appellant. M. Lewis Lehman, of Los Angeles, for respondents.

This is an appeal from the judgment in an action for specific performance.

The complaint alleges that defendant, the owner of certain real property, ‘had agreed in writing to convey the property to plaintiffs by good and sufficient deed in consideration of the sum $4,000.00’; the usual necessary and appropriate allegations were also included. The answer set up a general denial, also three separate defenses which alleged, ‘the defendant had not agreed to sell the property to plaintiffs; that there was no consideration for the purported agreement sued on; and that no contract in writing for the sale of the property, or note or memorandum thereof, had been subscribed by defendant or, her agent’.

The evidence at the trial consisted of a stipulation and six exhibits; the latter were four letters and one telegram and are as follows:

Plaintiffs' first letter reads:

‘In looking through the records I find that you are the owner of two lots on 4th Ave. in the 9100 block in Inglewood, Calif.

‘If you are interested in disposing of one I would be willing to pay $1,500.00 cash. Please reply to:—1st Lt. John W. King USMCR 8811 3rd Ave., Inglewood, Calif.’

Defendant replied:

‘In reply to your letter of November 23rd regarding the two lots I own on 4th Ave. in Inglewood, I wish to say I would like to get $2,000 for each of them.

‘I thank you for your offer of $1,500 cash. I am sorry I can't accept your offer as I feel the price will go even higher than $2,000 in a short time.

‘I think you for your courtesy.’

Plaintiff John W. King wired defendant on November 29, 1945:

‘My father and I will purchase your lots at $2000 cash each. will open escrow here and forward papers for signature if arrangements are satisfactory wire collect.’

To which plaintiff replied as follows, on December 2nd:

‘In reply to your telegram stating you would purchase both lots for $2,000 cash each. If you will take care of all necessary expenses of Escrow & any commission, if any, to be paid to I will net $4,000 in the deal you may start Escrow & send the papers to me for signature.

‘The first half of the taxes for the year has been paid & there are no assessments due. Kindly inform me if this meets with your approval.’

The foregoing was followed by a letter from an escrow company to defendant enclosing directions and escrow instructions, together with a deed for defendant's signature; the part of the escrow instructions for the purchaser's signature had been signed by plaintiffs; plaintiff John W. King's father was not mentioned. To this last letter defendant replied:

‘In reply to your letter Escrow No. 1730 regarding lots 29 & 30 Block 12 Track 5320 Inglewood, I wish to refer to a letter of Dec. 2nd, 1945, to Lt. J. W. King in which I requested he inform me if contents of the letter met with his approval. Having failed to receive a reply to that letter I assumed he had changed his mind about purchasing said lots.

‘The papers you mailed me which arrived here Dec. 7th came as quite a surprise. I therefore decided not to sell the property at this time. Will you kindly cancel all papers regarding these lots & notify Lt. King. Thank you for your courtesy.’

The trial consisted of a stipulation to the introduction in evidence of the above-mentioned documents and the further stipulation that the price was ‘fair’ and that ‘plaintiffs have been ready, able and willing to complete the purchase.’ Then followed counsel's argument for the defense which in addition to an analysis of the correspondence pointed out that, ‘we have but to look into the agreement, as set out in the escrow, and see in what way it adds to and brings forth new conditions which necessitate the approval of the defendant in this action or her rejection. She then sees fit to reject it and call the whole deal off. One of the new conditions set out in the agreement which was forwarded provides for an insured title. The Court, from this correspondence before this Court, cannot place such a construction on the agreement. Assuming that there was this purported agreement which they contend was effected between these parties, where, in any of the documents before this Court, is there any reference made to an insured title? We have that added condition. The plaintiffs say, ‘By reason of executing that document, we will purchase if you give us an insured title,’ and they go further and say, ‘provided that insured title is done on or before January 3, 1946.’

‘No such conditions were agreed upon in the exchange of these communications and the proposal of any offers. And we go further. In signing that offer and proposal, as contained in the escrow, plaintiff says, ‘In the event that the conditions of this escrow have not been complied with,’ he reserves the right to withdraw from the entire transaction. That is submitted with those added conditions, submitted to the defendant in this action for her signature and approval.

‘And above her signaure and approval are these words: ‘All the conditions and demands above are hereby approved.’ She is asked to approve a new proposal and offer. And, going further, we find another new condition there which she is being called upon to approve: ‘And you are hereby authorized to pay any bonds, assessments and/or taxes and any encumbrances of record to show title as called for.’

‘She never agreed to anything like that in this interchange of communications, these four or five proposals that passed between the parties.

‘We then come to the last paragraph: ‘All of the demands of the purchaser of the property as set forth above are hereby agreed to.’

‘She is asked by that proposed escrow agreement to enter into a duly, fully executed agreement for the sale of this property, setting forth the specific terms and conditions under which the plaintiffs will purchase the property.

‘Now, assuming that the telegram, ‘My father and I will buy your property’, and let us go further and assume that the defendant in this action agreed to that, hasn't there been a change when we find a new party on the scene purchasing the property? She has a right to say who she will sell the property and who she won't.

‘As to the law, if the Court please, I will stop there, as to our theory of the case, and counsel may proceed from there on.

‘The Court: I am satisfied, from an examination of the documents, that the contract was entered into, which was valid and forceful as against the defendant. The judgment will be for the plaintiffs.’

The trial court found for plaintiffs and entered judgment accordingly.

As appellant points out, ‘The broad question presented is whether the evidence is sufficient to support the judgment. Further narrowed, the question is whether the evidence supports the finding that a written contract for the sale and purchase of the real property was entered into between defendant and the plaintiffs or either plaintiff.’

In 23 Cal.Jur. at page 429 et seq. may be found the general rules applicable to actions of the type here considered. It is there pointed out that ‘Equity requires as a condition of specific performance a clear, mutual understanding and a positive assent on both sides as to the terms of the contract, and it will withhold the exercise of jurisdiction in that respect unless there is such a degree of certainty as will enable it at one view to do complete equity. Even on appeal if the reviewing court—giving full credit and weight to all the evidence tending to establish the contract and disregarding conflicting evidence—finds that the terms of the agreement are not clearly ascertainable, the decree of the trial court enforcing it may be reversed. To warrant specific performance, then, the contract must not only contain all the material terms, but those terms must, in the language of the code, be ‘sufficiently certain to make the precise act which is to be done clearly ascertainable.’ If all the evidence tending to establish the contract leaves the terms thereof in doubt it cannot be specifically enforced, unless the contract, or at least that portion of it claimed to be indefinite, has already been performed. The reason that an indefinite contract cannot be enforced is because the court cannot know what the parties agreed to; meaning and intent must be placed beyond the bounds of mere conjecture by full and clear proof, for the court cannot prescribe or fix the terms and conditions to which the parties are to bind themselves. Furthermore the court must be able to ascertain the terms from the instrument itself and not be compelled to determine them from the construction put upon the contract in the pleading demanding enforcement. In other words, a complaint in specific performance cannot supply deficiencies which cause the contract to be nonenforceable in equity. * * * A greater amount or degree of certainty is required in the terms of an agreement which is to be specifically executed than is necessary in a contract which is to be the basis of an action at law for damages. A contract expressed in very general terms might not be void for uncertainty and might be the basis of an action for damages for its breach, while it would be entirely too loose and inexact to warrant a decree for specific performance.' And with regard to mutuality appears the following at paragraph 19, ‘A contract will not be specifically enforced unless it has such mutuality that it may be so enforced by either party; and this mutuality must exist at the time the action is commenced. It results that when, from personal incapacity, the nature of the contract, or any other cause, a contract is incapable of being enforced against one party, that party is equally incapable of enforcing it specifically against the other. If for any cause, even one arising after the contract is concluded, it becomes wholly impossible for the plaintiff to perform any part of the contract on his part, he cannot enforce a performance against the defendant.

‘To avoid the application of the rule as to the necessity for mutuality, the contract cannot be divided into ‘independent covenants' and ‘subsequent conditions', for the purpose of enforcing a part of it and leaving the parties to some subsequent remedy as to the remainder, but the whole contract, including conditions subsequent as well as precedent, must be kept in view.’

In Breckinridge v. Crocker, 78 Cal. 529, at page 535, 21 P. 179, 181 the following appears:

‘But, to whatever form of action resort may be had, the burden is upon the plaintiff to show by the writings that a contract definite and certain in its terms was entered into between the parties, and, failing to do that, he must fail to obtain any relief.

‘In [Los Angeles Immigration & Land Co-operative] Association v. Phillips, 56 Cal. [539,] 546, it is said: ‘A court of equity will not specifically enforce any contract unless it be complete and certain. This rule applies as well to parties as to price, subject-matter, etc. Nor can the aid of a court of equity be had to specifically enforce that which is only the basis of an agreement, and not the agreement or contract itself.’ In Magee v. McManus, 70 Cal. [553], 556, 12 P. 451, it is said that ‘the thing agreed to be done must be definite and certain in its terms and in itself, and the party who claims performance must make out by clear and satisfactory proof the existence of the contract as he alleges it.’ And see Burnett v. Kullak, [76 Cal. 535,] 18 P. 401'.

Appellant's contentions are, as above noted, abundantly supported by both the facts and the law. Obviously there was no completed contract as between plaintiffs and defendant. Plaintiff Patricia King was no party to the negotiations at any time and has no cause of action whatever. The parties to the negotiations changed completely; the parties making the original offer were plaintiff John W. King and his father and even this offer was not signed by the ‘father’ nor is there any evidence that John W. King had authority to include his ‘father’ as a party to the offer. In any event, the offer was not accepted. Assuming that defendant's letter of December 2 was a counter offer, it was definitely qualified with the reservation, ‘Kindly inform me if this meets with your approval.’ By this reservation defendant remained in a position to give the matter further consideration, even if the conditions mentioned met with King's ‘approval’. And there is no evidence that it was accepted as made. On the contrary, even a new party entered into the negotiations. And as between plaintiff Patricia L. King and defendant the so-called contract lacks such ‘mutuality’ that it may be enforced by either party. And ‘To avoid the application of the rule as to the necessity for mutuality, the contract cannot be divided into ‘independent covenants' and ‘subsequent conditions' for the purpose of enforcing a part of it and leaving the parties to some subsequent remedy as to the remainder.’

For the foregoing reasons, the judgment is reversed with directions to enter judgment for defendant and appellant.

DORAN, Presiding Justice.

WHITE, J, concurs. YORK, P. J., did not participate.

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