Burleson v. Blankenship

• Decision Date: 23 February 1938
• Docket Number: 26883.
• Citation: 193 Wash. 547,76 P.2d 614
• Parties: BURLESON et al. v. BLANKENSHIP et al.
• Court: Washington Supreme Court

76 P.2d 614

193 Wash. 547

BURLESON et al. v. BLANKENSHIP et al.

No. 26883.

Supreme Court of Washington

February 23, 1938

Department 2.

Appeal from Superior Court, Lewis County; Howard J. Atwell, Judge.

Action by Alphus Burleson and wife against E. H. Blankenship and another, individually and as copartners doing business under the firm name and style of Blankenship & Keith and others, to forfeit a contract to sell a business and real and personal property used in connection therewith. From a judgment of dismissal, plaintiffs appeal.

Affirmed.

Reuben C. Carlson and Robert W. Copeland, both of Tacoma, for appellants.

C. D Cunningham, of Centralia, for respondents.

BLAKE Justice.

Prior to May 5, 1936, the plaintiffs owned real estate in the town of Morton, in the building upon which they ran a beer tavern. On the date mentioned, they entered into a contract whereby they agreed to sell the business and the real and personal property used in connection therewith to the defendants E. H. Blankenship and G. F. Keith, 'a partnership.' The consideration for the sale was $9,000, of which $2,000 was paid when the contract was executed. The contract contained the following provision: 'This contract cannot be assigned without the written consent of the seller.' The contract also contained a clause permitting forfeiture for failure to make payments or to perform any of its other covenants and conditions.

On December 9, 1936, Keith, in consideration of $250 relinquished all claim in 'that certain partnership,' and delivered to Blankenship a quitclaim deed to the real estate. Blankenship agreed to assume 'all obligations now existing or which may come into existence on account of the partnership.' No specific reference was made, either in the contract or in the deed, to the contract with plaintiffs.

On December 12, 1936, Blankenship entered into articles of copartnership with one Sethe, in which he assigned to Sethe 'one-half of his equity in said business and in the equipment being purchased under said contract [with plaintiffs], together with one-half of all his rights * * * under said conditional sale contract.'

In January, 1937, the plaintiffs brought this action to forfeit the contract on the ground that the covenant against assignment had been breached. Subsequently, on February 1 1937, Blankenship and Sethe dissolved partnership; the latter assigning all his interest to the former. Upon trial of the issue, the court entered a decree dismissing the action, from which plaintiffs appeal.

The appellants contend that they were entitled to a forfeiture under the rule laid down by this court in the following cases: Behrens v. Cloudy, 50 Wash. 400, 97 P. 450; Bonds-Foster Lumber Co. v. Northern Pacific R. Co., 53 Wash. 302, 101 P. 877; Hunter Tract Improvement Co. v. Stone, 58 Wash. 661, 109 P. 112; Lockerby v. Amon, 64 Wash. 24, 116 P. 463, 35 L.R.A., N.S., 1064, Ann.Cas.1913A, 228; Boyd v. Bondy, 113 Wash. 384, 194 P. 393, 394; Bethel v. Matthews, 187 Wash. 175, 59 P.2d 1125. These cases hold that an assignee of the vendee cannot maintain an action for specific performance or damages against the vendor, when the assignment has been made without the consent of the latter in face of a covenant against assignment. But these cases are not decisive of the question presented here, for two reasons: (1) As stated in Boyd v. Bondy, supra, 'The question of forfeiture [was] not involved' in any of them--that is, on the ground of breach of the covenant against assignment; and (2) in each the entire interest of the vendees had been assigned. (The latter statement might be challenged from a reading of the opinion alone in Bethel v. Matthews, supra. The statement is justified, however, by the findings of fact made by the trial court.) In the case at bar, we have a claim of forfeiture against an original vendee, based upon two partial assignments. In the first instance, we have only a transfer by one vendee to the other of his interest in the partnership. In the second instance, we have the formation of a new partnership and an assignment by the old partner to the new of a one-half interest in the contract. In determining whether these transactions violate the stipulation against assignment, we must look to the covenant itself, bearing in mind that covenants of such character are to be strictly--even literally--construed. 1 Taylor, Landlord and Tenant, 9th Ed., §§ 403, 405; Burns v. Dufresne, 67 Wash. 158, 121 P. 46; Willenbrock v. Latulippe, 125 Wash. 168, 215 P. 330. While the cases just cited relate to covenants in leases against assignment and subletting, the principles laid down are of some assistance in solving the problem now confronting us. The gist of the holding in Burns v. Dufresne, supra, is that a covenant not to assign without the consent of the lessor is not breached by subletting a portion of the premises. Willenbrock v. Latulippe, supra, presented a converse situation, and it was held that a covenant against subletting without the consent of the lessor was not breached by an assignment of the entire lease. And Taylor says (section 405, supra): 'But a covenant not to underlet without the consent of the lessor does not apply to a mere change in the business of the lessee's firm, incident to the admission of a new partner or the withdrawal of an old one.'

It is a...