Herndon v. Armstrong

• Decision Date: 27 November 1934
• Citation: 38 P.2d 44,148 Or. 602
• Parties: HERNDON v. ARMSTRONG et al.
• Court: Oregon Supreme Court

38 P.2d 44

148 Or. 602

HERNDON v. ARMSTRONG et al.

Supreme Court of Oregon

November 27, 1934

In Banc.

Appeal from Circuit Court, Umatilla County; Calvin L. Sweek, Judge.

Suit by R. L. Herndon against Evelyn G. Ramsay, also known as Mrs. J L. Ramsay, and Stanley Armstrong and Mabel F. Armstrong, his wife, who filed a cross-complaint against their codefendant. From a judgment for plaintiff, Stanley Armstrong and Mabel F Armstrong, his wife, appeal.

Affirmed.

See also, (Or.) 36 P.2d 184.

This is a suit by plaintiff R. L. Herndon against the defendants Stanley Armstrong and Mabel F. Armstrong, his wife, and Evelyn G. Ramsay, to enforce specific performance of a contract of the following tenor:

"Milton Or., Jan. 19, 1934.

"Received from R. L. Herndon, the sum of $100.00 as earnest money upon the purchase price of the Northeast Quarter of the Southeast Quarter of the Northwest Quarter of Section 23 Township 6 north, Range 35 E. W. M., in Umatilla County, Oregon, the purchase price to be the sum of $3175.00, title to be clear and free of incumbrances, except taxes payable in the year 1934.

"It is understood that said premises are now occupied under lease by Stanley Armstrong and family, and that said Armstrong has an option for the purchase of said property, which expired on January 15, 1934, but I am allowing said Armstrong until Monday, January 22nd, 1934, at 12 o'clock M. in which to comply with the terms of said option, when, in the event said Armstrong is unable to comply with said option for purchase, or furnish me satisfactory assurance that he can pay the purchase price provided in said option, then it is understood that this receipt shall be considered and construed to constitute a written agreement on my part to sell and convey said premises to the said R. L. Herndon, or to such other person or persons as he may name, I to furnish an abstract of title showing same free of all incumbrances except the taxes due and payable in the year 1934, as aforesaid. In the event the said R. L. Herndon should fail or refuse to complete the purchase of said premises, then the said $100.00 hereby receipted for shall be forfeited by him. It is further agreed and understood that I am to have a reasonable time in which to furnish abstract of title and complete said sale. In the event said Armstrong shall successfully comply with his said option, then the said $100.00 hereby receipted for shall be refunded to said Herndon.

"Evelyn G. Ramsay (Mrs. J. L. Ramsay)

"Approved January 19th, 1934.

"R. L. Herndon."

The appellants Stanley Armstrong and Mabel F. Armstrong filed a cross-complaint asking for specific performance of a contract covering the same real property, executed for a valuable consideration December 15, 1933, between Evelyn G. Ramsay, party of the first part, and Stanley Armstrong and Mabel F. Armstrong, his wife, parties of the second part, whereby the parties agreed that a certain contract entered into between the parties, dated November 20, 1928, for the sale of the ten acres of land involved, was mutually canceled, terminated, and settled. The contract further provided:

"2. The party of the first part hereby lets and leases unto the party of the second part, for a period of sixty days from date hereof, the dwelling located upon said premises now occupied by the party of the second part and his family, without the payment of rent therefor.

"3. The party of the first part hereby grants unto the party of the second part, an option for a period of thirty days from date hereof, to purchase all the premises above described, for the sum of Three Thousand Dollars ($3,000.00), plus the unpaid taxes thereon to and including the 1932 taxes now delinquent. In case the party of the second part purchases said premises under this option, the purchase price shall be paid as follows, to-wit: Not less than $2,500.00 cash at time of sale, the remainder to be paid on or before five years thereafter, bearing interest at the rate of six per cent. per annum, interest payable annually, and to be secured by a second mortgage upon said premises, to be second only to the mortgage of the Federal Land Bank of Spokane, which the party of the second part contemplates giving in the amount of approximately $2,500.00.

"4. It is further agreed that failure of the party of the second part to purchase the said premises within said thirty days, or to furnish the party of the first part assurances from the said Federal Land Bank of Spokane, that his application for a loan sufficient to enable him to make said cash payment of $2,500.00, has been duly approved and allowed, shall terminate this lease and option without further notice or action by the party of the first part, time being the essence of this agreement, and in that event it shall be lawful for the party of the first part to re-enter said premises and to remove all persons and property therefrom, the party of the second part hereby waiving any notice to quit or of intention to re-enter under the statute."

The decree of the circuit court was rendered in favor of the plaintiff, requiring specific performance of the contract first mentioned, as prayed for in plaintiff's complaint. The Armstrongs appealed.

Homer I. Watts, of Athena (Don T. Randall, of Freewater, on the brief), for appellants.

John F. Kilkenny, of Pendleton (Raley, Raley & Warner, of Pendleton, on the brief), for respondent R. L. Herndon.

S.D. Peterson, of Milton, for respondent Evelyn G. Ramsay.

The appellants contend that their contract with Mrs. Ramsay was a contract of sale and not an option. The trial court held that this contention could not be sustained. There was no obligation on the part of the Armstrongs to purchase. It was a unilateral contract and created no interest in the property described in the contract. This finding we approve.

Mrs Ramsay was residing in Yakima, Wash. S.D. Peterson, an attorney of Milton, Or., was attorney for her in handling her legal matters. She came to Milton January 16, 1934, to look after the sale of the real estate. It will be noticed from the option contract that the option was granted for a period of thirty days from December 15, 1933. This option would therefore expire on January 15, 1934 (January 14 was Sunday). The option contract further provided that if...