Jack Richards Aircraft Sales, Inc. v. Vaughn

• Court: Kansas Supreme Court
• Writing for the Court: O'CONNOR
• Citation: Jack Richards Aircraft Sales, Inc. v. Vaughn, 203 Kan. 967, 457 P.2d 691 (Kan. 1969)
• Decision Date: 05 August 1969
• Docket Number: No. 45402,45402
• Parties: JACK RICHARDS AIRCRAFT SALES, INC., Appellee, v. J. C. VAUGHN, Appellant.

Page 691

457 P.2d 691

203 Kan. 967

JACK RICHARDS AIRCRAFT SALES, INC., Appellee, v. J. C. VAUGHN, Appellant.

No. 45402.

Supreme Court of Kansas.

Aug. 5, 1969.

Syllabus by the Court

1. The general rule that in order for a written agreement to be binding it must be sufficiently definite in its terms and requirements as to enable a court to determine what acts are to be performed and when performance is complete is subject to the qualification that the agreement may contain some formal imperfections or be lacking in detail, but it will not fail for uncertainty if the court can ascertain the terms and conditions by which the parties intended to be bound.

2. The fact that the exact meaning of language used in a written agreement can be ascertained only by consideration of extrinsic evidence does not render the agreement unenforceable for indefiniteness or uncertainty.

3. Evidence of a contemporaneous oral agreement that neither party would be bound to perform in accordance with the terms of a written contract is inadmissible under the fraud exception to the parol evidence rule, as more fully explained in the opinion.

4. Where a buyer repudiates a contract of sale, the seller may resell the article which is the subject matter of sale; and if the resale is fairly conducted, made in good faith, and within a reasonable time, the measure of the seller's damages is the difference between the contract price and the resale price, plus expenses properly incidental to such resale.

5. The record is examined in an action for damages by the seller against a buyer because of an alleged breach of contract involving the sale of an airplane, and it is held, the trial court properly rendered judgment for the plaintiff-seller.

Walter B. Patterson, Fort Scott, argued the cause, and was on the brief for appellant.

Edward A. McConwell, Overland Park, argued the cause, and Thad E. Nugent, Prairie Village, was with him on the brief for appellee.

O'CONNOR, Justice.

This is an action for damages by the plaintiff, Jack Richards Aircraft Sales, Inc., against defendant J. C. Vaughn because of an alleged breach of contract involving the sale of an airplane. After trial without a jury in district court, judgment was entered in favor of plaintiff, from which defendant now appeals.

A brief recital of the facts will set the state for discussion of the questions presented.

Plaintiff was an Oklahoma corporation engaged in the sale of aircraft, and in 1964 had an Aero Commander 520 twin-engine airplane for sale. In early January of that year, plaintiff, through its duly authorized salesman, Stan Bernstein, entered into negotiations with defendant for the purchase of the aircraft. On January 8, Bernstein flew the plane to Nevada, Missouri, where he met defendant, and they proceeded to Joplin for lunch and further discussion about the contemplated purchase. This meeting culminated in the signing of a 'Purchase Order' by Bernstein and defendant, a copy of which follows:

NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE

As disclosed by the written instrument, the purchase price for the Aero Commander was $30,950. Defendant was allowed the sum of $4,450 as a trade-in on a single-engine Swift aircraft owned by him. Defendant gave Bernstein a check for $500 as down payment, leaving a balance due of $26,000. Defendant also signed an application for title to the new aircraft for filing with the F.A.A.

A few days later (January 13) Bernstein met defendant at Fort Scott, Kansas. Thereupon, they drove to Prescott and received from the cashier of the Prescott State Bank (where defendant did business) a letter of credit, and also defendant's personal financial statement showing a net worth in excess of $270,000. These documents were to be used by Bernstein in aiding defendant to secure any financing necessary for the purchase. Defendant also executed and delivered to Bernstein a bill of sale on the Swift aircraft. In the meantime the new plane was being repainted and new tires put on in accordance with the terms of the purchase order.

The trial court found from evidence adduced by both parties that plaintiff was not to finance the purchase of the aircraft in question, but was only to assist defendant in seeking credit sources. Bernstein, a native of Chicago, even went so far as to contact a financing institution in that city which, in turn, contacted defendant's bank. At any rate, no difficulty was encountered with respect to the financing.

Within a few days after January 13, 1964, defendant decided not to go through with the transaction. He notified Bernstein by telephone that his banker advised him against the purchase and that he (defendant) 'didn't want the plane at that time.' There was testimony defendant suggested plaintiff keep his check and the trade-in aircraft and credit his account in anticipation of a later date of delivery. Plaintiff refused to accede to this arrangement, and defendant stopped payment on his check. At or before this time when plaintiff attempted to file the bill of sale on the Swift aircraft with the F.A.A., an unpaid mortgage on the plane was discovered, despite defendant's certification in the bill of sale previously executed that the plane was 'not subject to any mortgage or encumbrance.' At some later time defendant apparently satisfied the mortgage, and clear title was finally obtained. The bill of sale was subsequently registered by the F.A.A.; however, defendant refused to relinquish possession of the craft to plaintiff.

Defendant took no further steps to consummate the transaction, and on December 31, 1964, plaintiff filed its action, claiming damages for breach of contract. Shortly after filing the lawsuit plaintiff sold the Aero Commander to a third party for $22,000, after having again repainted the craft to satisfy the new buyer. The resale was made after repeated demonstrations to prospective purchasers and also after advertising of the plane in national trade journals.

In his answer to plaintiff's petition for damages defendant set up as a defense that the purchase order was procured by fraud on the part of plaintiff, and further alleged his disaffirmance of the entire transaction. Defendant also counterclaimed for return of the title to the Swift aircraft, and actual and punitive damages.

After trial, the district court, on June 14, 1967, rendered a comprehensive memorandum opinion, setting forth findings of fact substantially as recited herein, and concluded that the purchase order was a binding agreement on both parties; that plaintiff had properly minimized its loss by resale of the airplane; that as a result of defendant's breach of the contract plaintiff sustained a loss in the amount of $5,125 ($4,000 in the balance of the purchase price plus $1,125 for the cost of repainting the plane); and that plaintiff was entitled to the possession of the Swift aircraft.

Defendant first contends the court erred in overruling his motion for summary judgment and also his motion for directed verdict at the close of all the evidence because the purchase order on its face was so incomplete, indefinite and uncertain that it did not rise to the dignity of an agreement binding the parties contractually. Defendant points out alleged deficiencies in the instrument, and in particular the reference to 'Time,' inasmuch as the terms of financing were not set forth in writing. We do not agree.

As a general rule, in order for a written agreement to be binding it must be sufficiently definite in its terms and requirements as to enable a court to determine what acts are to be performed and when performance is complete. This rule however, cannot be blindly followed as a measuring stick for determining the sufficiency and definiteness of the terms of a contract. Where a purported contract is so vague and indefinite that the intention of the parties cannot be ascertained therefrom it is unenforceable; but absolute certainty is not required-only reasonable certainty is necessary. A contract may contain some formal imperfections or be lacking in detail, but it will not fail for uncertainty if the court can ascertain the terms and conditions by which the parties intended to be bound, and thus carry their intentions into effect. The fact that the exact meaning of language used can be ascertained only by consideration of extrinsic evidence does not render the agreement unemforceable for indefiniteness or uncertainty. Just recently we said that when it is apparent from the provisions of a written instrument that they are ambiguous, incomplete or silent as to a particular matter, parol evidence is admissible to clear up the ambiguity and to show the terms of the actual agreement in its entirety. (Culp v. Bloss (decided July 17, 1969), 203 Kan. 714, 457 P.2d 154.) For a compilation of authorities and a full discussion of the requisite certainty and completeness essential to create a binding agreement, see, Hays v. Underwood, Administrator, 196 Kan. 265, 411...