First Nat. Bank v. Roanoke Oil Co.

• Decision Date: 23 September 1937
• Citation: 169 Va. 99
• Parties: FIRST NATIONAL EXCHANGE BANK OF ROANOKE AND R. H. THOMAS, EXECUTORS OF PAUL MASSIE v. ROANOKE OIL COMPANY, INCORPORATED.
• Court: Virginia Supreme Court

Page 99

169 Va. 99

FIRST NATIONAL EXCHANGE BANK OF ROANOKE AND R. H. THOMAS, EXECUTORS OF PAUL MASSIE v. ROANOKE OIL COMPANY, INCORPORATED.

Supreme Court of Virginia, Staunton.

September 23, 1937.

Present, Campbell, C.J., and Holt, Hudgins, Gregory, Eggleston and Spratley, JJ.

1. OPTIONS — Option to Lessee to Purchase Leased Property — Notice to Lessee of Offer to Purchase Leased Premises Together with Other Land — Case at Bar. — In the instant case, a suit for specific performance of a contract to sell land, appellants leased a certain lot to appellee with a condition in the lease that the lessors had a right to terminate it if they received a bona fide offer of sale, provided they gave the lessee an opportunity to purchase "the said property at the price and upon the terms of the said offer," and that if such offer was received the lessors were to notify the lessee in writing of the offer and of their willingness to sell. The lessee received a letter from the lessors notifying it that they had received a cash offer for the leased property and for an adjoining parcel owned by the estate of which appellants were executors. Officers of the lessee testified that they had several conferences with the lessors and were repeatedly told by them that they could do nothing except sell the whole property and then the lessee wrote offering to meet the cash offer already received. The lessors thereafter refused to sell the entire tract, consisting of the two parcels of land, contending that their letter of notification to the lessee was simply for the purpose of making it cognizant of the terms of the lease and of the receipt of an offer for the entire property, and that they were not required to submit offers acceptable to them affecting the leased premises when such offers included other property, because, under the lease, the lessee had only an option on the leased property.

Held: That there was no merit in this contention of the lessors, as the option clause was inserted for the benefit of the lessee and if the premises could be sold together with other property, discharged of the lease, without giving the lessee an opportunity to purchase, the intention and purpose of the option would be completely destroyed.

2. OPTIONS — Option to Lessee to Purchase Leased Property — Notice to Lessee of Offer to Purchase Leased Premises Together with Other Land — Case at Bar. — In the instant case, a suit for specific performance of a contract to sell land, appellants leased a certain lot to appellee with a condition in the lease that the lessors had a right to terminate it if they received a bona fide offer of sale, provided they gave the lessee an opportunity to purchase "the said property at the price and upon the terms of the said offer," and if such offer was received the lessors were to notify the lessee in writing of the offer and of their willingness to sell. The lessee received a letter from the lessors notifying it that they had received a cash offer for the leased property and for an adjoining parcel owned by the estate of which appellants were executors. Officers of the lessee testified that they had several conferences with the lessors and were repeatedly told by them that they could do nothing except sell the whole property and then the lessee wrote offering to meet the cash offer which had been received. The lessors thereafter refused to sell the entire tract of two parcels, contending that their letter of notification to the lessee was simply for the purpose of making it cognizant of the terms of the lease and of the receipt of an offer for the entire property, and that they were not required to submit offers acceptable to them affecting the leased premises when such offers included other property, because, under the lease, the lessee had only an option on the leased property. The letter containing the notification was written by a capable and intelligent trust officer who had participated in the original negotiations for the lease, and nothing was said concerning any further negotiations, either for a sale of the two parcels of the property, or a part thereof, nor was there any satisfactory explanation why the letter failed to make such reference.

Held: That both the letter and the actions of the lessors evidenced their interpretation of the option clause and made it unmistakable that the letter was transmitted thereunder, and constituted an offer of sale.

3. CONTRACTS — Construction — Expressions as Manifesting Intention. — The Supreme Court of Appeals must look to the outward expression of a person as manifesting his intention rather than to his secret and unexpressed intention. The law imputes to a person an intention corresponding to the reasonable meaning of his words and acts.

4. OPTIONS — Option to Lessee to Purchase Leased Property — Withdrawal or Rejection of Offer to Sell Leased Property with Other Land — Case at Bar. — In the instant case, a suit for specific performance of a contract to sell land, appellants leased a certain lot to appellee with a condition in the lease that the lessors had a right to terminate it if they received a bona fide offer of sale, provided that gave the lessee an opportunity to purchase "the said property at the price and upon the terms of the said offer," and that if such offer was received the lessors were to notify the lessee in writing of the offer and of their willingness to sell. The lessee received a letter from the lessors notifying it that they had received a cash offer for the leased property and for an adjoining parcel owned by the estate of which appellants were executors. Officers of the lessee testified that they had several conferences with the lessors and were repeatedly told by them that they could do nothing except sell the whole property and then the lessee wrote offering to meet the cash offer already received. The lessors refused to sell the entire tract and contended that the offer, if such it was, contained in their letter of notification had been withdrawn, revoked and rejected before acceptance. The lessee never took the position that it could not be required to buy the entire property, or that the notice was not in accordance with the provisions of the lease; it did not ask any counter-proposal of the lessors, but, before accepting the offer of the entire property, requested them to secure another proposal which would permit of an alternative offer. Before any other proposal was received, and within the period provided in the lease, acceptance was made of the original offer in accordance with the terms thereof.

Held: That the offer contained in the letter of notification was not withdrawn or rejected while negotiations were pending.

5. CONTRACTS — Construction — Practical Construction of Parties Prevails over Literal Meaning. — The practical construction put by the parties upon the terms of their own contract is not only to be regarded, but, where there is any doubt, must prevail over the literal meaning of the contract.

6. APPEAL AND ERROR — Findings of Court — Weight of Trial Judge's Conclusions of Fact. — The conclusions of the trial judge on questions of fact are entitled to peculiar weight and consideration, and the Supreme Court of Appeals must accept them just as it must accept a jury's verdict sustained by evidence which it might have believed.

7. SPECIFIC PERFORMANCE — When Granted — Discretion of Court. — Specific performance of a contract is not a matter of absolute or arbitrary right, but is addressed to the reasonable and sound judicial discretion of the court.

8. SPECIFIC PERFORMANCE — When Granted — Circumstances of Each Case Control. — There are general rules and principles which govern the application of specific performance, but relief is granted, or refused, according to the circumstances of each particular case.

9. SPECIFIC PERFORMANCE — When Granted — To Promote Justice. — Specific performance will be used to promote an exact measure of justice, as nearly as is possible, and will be refused when it will produce injustice. It is never granted unless it is entirely in accordance with equity and good conscience.

10. SPECIFIC PERFORMANCE — When Granted — When Refusal and Not Enforcement Would Be Inequitable. — When the contract sought to be enforced has been proven by competent and satisfactory evidence, and there is nothing to indicate that its enforcement would be inequitable to a defendant, but will work injury and damage to the other party if it should be refused, in the absence of fraud, misapprehension, or mistake, relief will be granted by specific enforcement.

11. SPECIFIC PERFORMANCE — Contract to Sell Lessee Leased Premises and Adjoining Land — Nothing to Render Specific Performance Inequitable — Case at Bar. — In the instant case, a suit for specific performance of a contract to sell land, appellants, executors of an estate, leased a certain lot to appellee with a condition in the lease that the lessors had a right to terminate it if they received a bona fide offer of sale, provided they gave the lessee an opportunity to purchase "the said property at the price and upon the terms of the said offer." The lessee received a letter from the lessors stating that they had received a cash offer for the leased property and for an adjoining parcel owned by the estate, to which letter the lessee replied meeting the offer without modification or change, but the lessors thereafter refusal to sell the entire tract of two parcels to the lessee. There was no evidence of any legal obligation on the part of the lessors to the one who first made the cash offer for the entire property, nor of any hardship to be inflicted on him. The estate would receive the same amount for the entire property, whether sold as a whole or in parcels, and there was nothing to render the performance of the contract inequitable against the estate. It was apparent, on the other hand, that enforcement of the contract would be of considerable...