Cameron v. Edgemont Inv. Co.

• Decision Date: 13 February 1935
• Parties: CAMERON v. EDGEMONT INV. CO.
• Court: Oregon Supreme Court

41 P.2d 249

149 Or. 396

CAMERON v. EDGEMONT INV. CO.

Supreme Court of Oregon

February 13, 1935

Department 2.

Appeal from Circuit Court, Multnomah County; William A. Ekwall Judge.

Action by Clementena R. Cameron against the Edgemont Investment Company. Judgment for plaintiff, and defendant appeals.

Affirmed.

W. B. Shively, of Portland (John P. Winter, of Portland, on the brief), for appellant.

C. M Hodges, of Portland (Hodges & Gay, of Portland, on the brief), for respondent.

BEAN Justice.

This is an action for damages for the breach of certain terms of a contract for the sale and purchase of a portion of lots 9 and 10 in block 5, Terwilliger Heights, situate in the city of Portland, county of Multnomah, state of Oregon, described in the contract by metes and bounds. The cause was tried to the court without the intervention of a jury, and a judgment was rendered in favor of plaintiff for $841.75. Defendant appeals.

Plaintiff first brought a suit for rescission of the contract, which was dismissed by this court. See Cameron v. Edgemont Investment Co., 136 Or. 385, 299 P. 698.

On March 29, 1928, defendant agreed to sell to plaintiff, and plaintiff agreed to buy from defendant, a certain lot for $1,975, which price the plaintiff agreed to pay, as follows: $493.75 at the time the contract was executed, and the remainder of $1,481 in monthly installments of not less than $29, including interest, deferred payments bearing interest at the rate of 7 per cent., payable monthly. Plaintiff made the down payment of $493.75, and, beginning with June 1, 1928, plaintiff paid $29 each month on the purchase price up to and including May 1, 1929, making a total of $841.75. The contract, as then executed, provided as follows: "A concrete pavement 18 feet wide shall be laid in the street or lane in front of said lot, and a city sewer installed to serve said lot, all on or before October 1, 1928. ***"

Plaintiff alleges and claims that defendant breached the contract in the following particulars, among others: That it failed and refused to install a sewer to serve said lot and lay an 18-foot pavement in the street in front thereof, all at its own expense, within six months from the date thereof, and that plaintiff was damaged in the sum of $1,341.75.

During the latter part of July or first of August, the provision of the contract was changed by the secretary of defendant in the presence of plaintiff by running a pen through the printed words, "and a city sewer installed to serve said lot," and a paper was pasted near the end of the contract, which contained the following words: "When the city installs a sewer to serve the above property the vendor will pay all sums assessed against said lot by said city for such installation." This typewritten slip was initialed by the secretary of defendant and by plaintiff on the left margin of the slip and contract.

As stated by defendant in its brief, when the contract was made the city was installing a sewer in Terwilliger Heights. It had been assumed that this particular lot could be served with this sewer. Later it was discovered that this was impossible and for this reason the change in the contract was made.

The answer of defendant has attached to it as an exhibit a copy of the contract as changed, and alleges in paragraph IV of the further answer to plaintiff's complaint: "That the said contract, Exhibit 'A', is the only contract by the parties to this litigation." This is denied by the reply, as follows: "Plaintiff denies Paragraph IV of defendant's first further and separate answer and defense, and each and every allegation therein contained and the whole thereof."

The trial court found in regard to the change made in the contract, as follows, "That during the latter part of July, 1928, the defendant induced the plaintiff to permit it to place a rider on said contract by which said defendant attempted to relieve itself of its contractual obligation to install said sewer to serve said property and to shift said obligation to the City of Portland, and making no provision when said sewer should be installed, if ever, by said City, which said change or attempted modification of said contract, was without any consideration whatsoever therefor," and made the following conclusion of law: "That the change in the contract by which the defendant attempted to relieve itself of the obligation of installing a sewer and to shift said obligation upon the City of Portland is void."

The court found by reason of the breach of said contract by the defendant that plaintiff has been injured in the sum of $841.75, and rendered judgment accordingly.

Neither the defendant nor the city has ever installed that sewer. It appears that on March 29, 1928, defendant's agent delivered to plaintiff a written contract prepared by defendant, which was introduced in evidence, which she signed, the original of which he retained, and at that time plaintiff made the balance of the down payment to said agent. The defendant, although it retained the down payment made under this contract, never signed the same. This contract, at the same place that the rider mentioned was attached in the subsequent contract, contained the following in typewriting: "A sewer is to be installed to serve said lot and an 18-foot concrete pavement laid in street in front thereof, all at the vendor's expense, within six months from the date hereof." Subsequent to May 5, 1928, defendant prepared a second contract which it signed and therein gave plaintiff credit for the down payment which she made on the first contract. This second contract was sent to plaintiff. Plaintiff made the June 1 and July 1, 1928, payments of $29 each. On July 23, 1928, defendant wrote plaintiff a letter in which she was advised that her best interests required that the contract should be corrected, and that she should bring it in for that purpose. Following this plaintiff presented her contract to the defendant. Thereupon defendant changed its terms and attempted to relieve itself of its obligation by the rider. In connection with the matter of changing the language of the contract, we quote plaintiff's testimony as follows:

"Q. After you received that letter, dated July 23rd, from the Edgemont Investment Co., did you go any place? *** A. I went up to see Mr. Shively, because it asked that I come in to see him.

"Q. Was there anything done when you went up there? A. Yes; he had a little slip of paper, printed or typewritten, and he put that on the contract. ***

"Q. Now, was that on there when you originally signed it? A. No, it was not.

"Q. Then you signed it when you went back to- A. When Mr. Shively wrote and asked me to come in.

"Q. That was about when? A. About the first week in August.

"Q. What year? A. 1928. He told me it was to my advantage to have that signed.

"Mr. Shively: You initialed it on the side, didn't you? You approved it at the time? A. Yes, you told me to put it there.

"Mr. Shively: The reasons we gave to you were satisfactory, weren't they? A. I didn't know; I thought you were a lawyer and were looking out for my interests, because you were one of the men in the Edgemont Investment Company. I always treated people with honesty myself, and I expect that much in return. *** I wouldn't have signed it if I had known. ***

"Q. Now, at the time that was put on there, was there anything given to you or paid you for putting it on? *** A. No, sir.

"Q. No money or property of any kind whatsoever for putting that on? A. No, sir."

Defendant's assignment of error is that the lower court erred in concluding that the modification of the contract with reference to the sewer was void for lack of consideration. The plaintiff asserts and contends that the stipulations in the contract whereby the vendor agreed to sell the land and then improve it, all for a single consideration, are mutual and dependent covenants; citing Pennings v. Giboni, 86 Or. 110, 167 P. 598, 1014; Ihrke v. Continental Life Ins. & Inv. Co., 91 Wash. 342, 157 P. 866, L. R. A. 1916F, 430; and other cases.

Defendant's assignments of error raise the questions: First, that the modification was supported by ample consideration; second, that under the particular circumstances no consideration was necessary to support the modification; third, that the modification having been made prior to the time fixed for performance, plaintiff is now estopped to say that defendant, who relied on plaintiff's waiver, should now be held in default for lack of performance of the original contract.

Defendant provided in its contract for but one consideration, and made time of performance the essence of the contract. The property which it agreed to sell was unimproved, and it agreed to improve the same to make it saleable. The property was to be conveyed as a whole; that is, the lot with an 18-foot pavement and a sewer connected to serve the lot. It was all one contract. The whole property was to be conveyed to plaintiff, as agreed, for one price. We think the contract was one in which the covenants to lay the pavement and install the sewer were dependent, and that plaintiff was not required to purchase the property without such improvements being made. To compel plaintiff to purchase the property without the sewer being installed or without the pavement would be making a new contract for the parties, which the court should not do.

It is stated in 13 C.J. 592, § 607, in substance, that a modification of a contract being a new contract, a consideration is necessary to support the new agreement, as for example, where it is to extend the time for performance or payment or to release one of the parties from performance. Although some cases hold that no new consideration is necessary, the...