Friedman v. Decatur Corporation

• Decision Date: 12 April 1943
• Docket Number: No. 8066.,8066.
• Citation: 135 F.2d 812,77 US App. DC 326
• Parties: FRIEDMAN v. DECATUR CORPORATION.
• Court: U.S. Court of Appeals — District of Columbia Circuit

77 US App. DC 326, 135 F.2d 812 (1943)

FRIEDMAN v. DECATUR CORPORATION.

No. 8066.

United States Court of Appeals for the District of Columbia.

Decided April 12, 1943.

Mr. Alfred M. Schwartz, of Washington, D. C., for appellant.

Mr. Warren E. Magee, of Washington, D. C., with whom Mr. Arthur R. Murphy, of Washington, D. C., was on the brief, for appellee.

Before GRONER, Chief Justice, and MILLER and EDGERTON, Associate Justices.

MILLER, Associate Justice.

By contract of May 31, 1935, appellee agreed to sell, and appellant agreed to buy, certain real estate situated in the District of Columbia. The contract was in the common form of an agreement, to buy and sell for a price stated, except that it contained the following sentence: "This agreement to be null and void in the event the property is not made available for industrial use or in the event the Party of the Second Part appellee is unable to obtain wharfage facilities and the privilege of running a pipe line from said wharf to the property aforesaid." Appellee sued appellant on this contract, and recovered judgment. Appellant's main contention on this appeal — that the court erred in refusing to grant his motion for a directed verdict — presents the issue, whether the quoted language constituted the agreement a unilateral contract, of which complete performance, and a tender by appellee, was necessary in order to bind appellant. He says the contract imposed no obligation upon appellee to bring about the contingencies upon which performance by appellant was dependent; that it imposed no time limit within which these contingencies had to occur; that it attempted to bind appellant, while leaving appellee free to proceed with performance or to repudiate the agreement; that appellee never did complete performance or make the necessary tender; hence, that appellant was under no obligation to buy the property.

Appellee contends that this proposition was not presented to the trial court as a ground for the motion¹ or otherwise; that under the rule it is presumed to have been waived;² that errors claimed to have been committed in a trial court, concerning questions not presented to that court for its consideration, will not be reviewed on appeal.³ The record fails to reveal any specification concerning unilateral contracts as a ground for the motion for directed verdict. There was some argument concerning lack of obligation upon appellee's part; but the specification finally stated by appellant was: "* * * that this count does not allege any breach and does not show any tender, and that the plaintiff has not shown by the testimony certain means of performance." Appellee's contention, therefore, seems to be well founded.

But, even assuming that appellant were privileged to present the question on this appeal, he has misconceived the applicable law. The disputed contract contains a mutual exchange of promises between the two parties; hence is bilateral in character.⁴ The provision that the agreement should be null and void, in event the property were not made available for industrial use with wharfage facilities and pipe line privilege, was a condition precedent.⁵ The fact that no duty of performance can arise until the happening of such a condition does not make the validity of the contract depend upon its happening. Each party was irrevocably bound from the outset.⁶ In the present case, since the condition was for the benefit of appellant, he could, if he wished, have waived it and insisted upon transfer of the land.⁷ "Null and void" here means only voidable at the buyer's option. To that extent, at least, appellee was obligated — a sufficient obligation to satisfy the requirement of mutuality of obligation⁸ upon which the bilateral character of the contract depends.

Appellant contends, in the alternative, that, even if the agreement is construed to be a bilateral contract, nevertheless, appellee was not entitled to recover unless he had performed the condition. It is true, as a general rule, that such a condition must be exactly fulfilled, or no liability can arise on the promise which it qualifies.⁹ But this is subject to the exception that, if performance of the condition is excused, the promise becomes enforceable.¹⁰ Such an excuse may be found from the fact that, even had the promisee performed the condition, the promisor would, nevertheless, have failed to carry out his promise.¹¹

The record in the present case shows that there was such an anticipatory breach. Between May 31 and the following September, appellee had made considerable progress in satisfying the conditions precedent. It had obtained a rezoning of the property to permit industrial use, and had procured the enactment of legislation which authorized the Commissioners of the District to permit the laying of pipe lines for the carriage of petroleum products from the property to the pierhead line of the Anacostia River. It had not yet obtained wharfage facilities. In September, 1935, appellee inquired of appellant concerning the type of wharf which he desired, and the desired location of the pipe lines. It suggested that the necessary applications should be submitted to secure permits for the wharf and pipe lines. Appellant then revealed that he did not intend to go through with the contract until he had worked out a deal with an oil company; and requested that appellee hold up the further performance of the contract and the submission of applications for permits. In January, 1936, appellant advised that his deal with the oil company had not gone through, and that his performance of the contract looked rather hopeless. Early in February, appellant informed appellee that, as his deal with the oil company had not gone through, he could not, and would not, go through with his contract of May 31, 1935. This was clearly sufficient to bring the case within the exception to the general rule, because of excuse resulting from an anticipatory breach.

Appellant contends that, even assuming an anticipatory breach, nevertheless, appellee should not recover, because of failure to show that it was able, ready and willing to perform. He says, in support of this contention, that appellee was unable to deliver either good title or wharfage facilities. This issue was submitted, by the court to the jury, in express terms. It instructed, further, that the burden was on appellee to prove these and other essential elements of its case. Specifically, upon the propositions urged by appellant, the court instructed as follows: "You will recall that the contract provided that it should be null and void in the event The Decatur Corporation was unable to obtain wharfage facilities. In the construction of a contract the intention of the parties is to prevail, and in ascertaining this intention the language is to be given its plain and ordinary meaning. Giving that contract its plain and ordinary meaning and considering all the provisions of the contract there still remains an ambiguity as to what was intended by the parties by the term wharfage facilities. Accordingly I have permitted evidence to be received showing that it was the intention of the parties that the wharfage facilities referred to in the contract were those incident to the mooring of the vessels transporting petroleum or its products at a wharf to be erected and the discharge of its cargo at the wharf and thence into a pipeline for delivery to storage tanks of such products to be erected on the land. Therefore, in determining whether The Decatur Corporation was able to obtain wharfage facilities you will understand the term as I have just defined it to you. Apparently from the evidence these wharfage facilities which the plaintiff contends it was able to obtain were at a point at the foot of Fifteenth Street. To obtain them required a permit from the War Department to construct a wharf and the lease of part of the mainland at the foot of Fifteenth Street adjoining the proposed wharf. Of course, as in the case of the most convincing proof of ability to obtain wharfage facilities is to obtain them sic; but, as in the case of the pipeline permission, the obtaining of the wharfage facilities was not accomplished but the plaintiff has offered testimony, which I say is disputed by the defendant, that it did not go through with the matter...