Britt v. Thorsen

• Decision Date: 03 March 1971
• Citation: 258 Or. 135,481 P.2d 352
• Parties: Wayne O. BRITT and Dorothy L. Britt, husband and wife, Appellants, v. Arne THORSEN and Else Thorsen, husband and wife; Birger Karlsen and Solveig Karlsen, husband and wife; and Lawrence G. Gardner and Teresa H. Gardner, husband and wife, Respondents.
• Court: Oregon Supreme Court

Page 352

481 P.2d 352

258 Or. 135

Wayne O. BRITT and Dorothy L. Britt, husband and wife, Appellants, v. Arne THORSEN and Else Thorsen, husband and wife; Birger Karlsen and Solveig Karlsen, husband and wife; and Lawrence G. Gardner and Teresa H Gardner, husband and wife, Respondents.

Supreme Court of Oregon.

Argued and Submitted Jan. 6, 1971.

Decided March 3, 1971.

Helen J. Frye, Eugene, argued the cause for appellants. With her on the briefs were Husband, Johnson & Frye, Eugene.

W. T. Hollen, Newport, argued the cause and filed a brief for respondents.

Before O'CONNELL, C.J., ^* and McALLISTER, DENECKE, HOLMAN, TONGUE, HOWELL and BRYSON, JJ.

HOLMAN, Justice.

Plaintiffs and defendants are the respective owners of two pieces of real property. Defendants' property lies between plaintiffs' property and the Pacific Ocean. Plaintiffs brought a suit against defendants, asserting a right-of-way across defendants' property to the ocean. Defendants denied the allegations in plaintiffs' complaint and requested affirmative relief by way of an injunction.

Immediately prior to the date set for the trial of the case, plaintiff Wayne Britt sought out defendants Lawrence Gardner and Arne Thorsen to see if the case could be settled without trial. The three men had two conversations and apparently thought that the basis for a settlement had been established, as they informed their attorneys that the case had been settled and it was taken from the trial docket. The negotiating parties contemplated a written memorial of their agreement. Subsequently, a document purportedly encompassing the agreement was drawn by defendants' lawyer from information given him by the defendants. All defendants signed the agreement but plaintiffs refused to sign it.

A subsequent trial was had on supplemental pleadings in which the sole issue litigated was whether there had been a settlement of the case. Plaintiffs' and defendants' versions of what had been agreed upon were not the same. Plaintiffs contended the agreement was to dismiss the case and to leave the situation undecided. The defendants contended it was to dismiss the case and plaintiffs were to have a permissive right-of-way which could be cancelled at any time by defendants when they wished to build on that portion of the property over which the claimed right-of-way lay.

The trial court found that the case had been settled by the parties in accordance with the defendants' version. The plaintiffs appealed.

We agree with the trial court that the parties who participated in the negotiations did arrive at the terms of an agreement for a settlement of the case. We further agree with the trial court that the terms were those testified to by the defendants. However, in view of the evidence, these findings are not sufficient to constitute a disposition of the case. The issue still remains whether the parties intended the agreement to be immediately effective or only so upon the signing of a written agreement. The law relative to whether an immediate settlement occurs where the parties contemplate a subsequent written memorandum, as they did here, is laid down in General Realty Corp v. Douglas Lowell, Inc., 223 Or. 244, 354 P.2d 306 (1960).

'Where parties agree to reduce their agreement to writing, the question arises as to whether their negotiations constitute a contract. This question usually depends upon their intention, or, as it is sometimes expressed, upon whether they intend the writing to be a condition precedent to the taking effect of the agreement. If the written draft is viewed by the parties merely as a convenient memorial or record of their previous contract, its absence does not affect the binding force of the contract; if, however, it is viewed as the consummation of the negotiation, there is no contract until the written draft is finally signed. Where the terms of a contract have in all respects been definitely understood and agreed upon, the failure subsequently to embody such terms in a written contract, as agreed, does not pevent the contract, where no statutory objection interposes,...