Johnston v. Trippe

• Decision Date: 19 December 1887
• Citation: 33 F. 530
• Parties: JOHNSTON v. TRIPPE. [1]
• Court: U.S. District Court — Northern District of Georgia

33 F. 530

JOHNSTON v. TRIPPE. ^[1]

United States Circuit Court, N.D. Georgia.

December 19, 1887

G. A Howell, for complainant.

Hopkins & Glenn, for defendant.

NEWMAN J.

This is a bill filed by complainant against defendant to enforce the specific performance of a certain conditional or optional contract for the sale of land. The bill, after stating some preliminary correspondence and negotiation between complainant and defendant, relative to the sale of certain land in White county, Georgia, by the latter to the former alleges that in January, 1887, defendant prepared and executed the following written instrument:

'Georgia Fulton County. This agreement witnesseth, that the undersigned R. B. Trippe, of said state and county, agrees that if said J. Lamb Johnston, of Charleston, S.C., or any one for him, pays or causes to be paid to the said R. B. Trippe, one thousand dollars, on or before January 20, 1888, that the said R. B. Trippe, for himself, his heirs and assigns, covenants and agrees that he will make to the said Johnston good and sufficient title to lots of land numbers 9 and 25, in 3d district, White county, said state. And it is further agreed that if a draft for $50.00 this day drawn by R. B. Trippe, with this option bond attached, is paid at sight, then said R. B. Trippe will make said title, if nine hundred and fifty dollars is paid him on or before January 20, 1888; if said sums of money are not paid within the time mentioned, that is, $50.00 on sight draft and $950.00 within twelve months from this date, then this bond to be null and void; and it is understood that if the balance of one thousand dollars (i.e., $950.00) is not paid by January 20, 1888, the $50.00 paid on sight draft is forfeited to said R. B. Trippe, and that this option bond is null and void, otherwise of full force and effect.

'Witness my hand and seal, this January 20, 1887.

(Signed) 'R. B. Trippe.

'Witness:

(Signed) 'J. H. Curtright, M. L. Cohen.'

This instrument was sent, about the time of its execution, by defendant to complainant by mail to his home in Charleston, South Carolina, and received by complainant. Defendant also drew on complainant a sight draft for $50, which was sent, with the foregoing written instrument, to Charleston. His draft was honored and paid at once by complainant, and defendant received the $50. Sometime after this, defendant wrote to complainant, saying he had an offer of $1,500 for the land, and offering, if complainant would release him from his obligation, to return the $50 paid him, and to pay complainant $50 in addition, if the other sale was made. In the same letter defendant stated that the bond sent by him to complainant was not legally binding anyway. Complainant promptly replied, both by wire and letter, to defendant, refusing to release him from his obligation to convey the land in pursuance of the before stated contract. In the same letter in which the complainant refused to release defendant, he instructed defendant to submit his deeds to complainant's attorney, and that, upon their approval by him, complainant would pay the balance, $950. This defendant failed and refused to do, but wrote complainant that he declined to furnish the titles or convey the land in accordance with his contract; and in the same letter inclosed a check payable to his, defendant's, order, and indorsed by him in blank, which he tendered as a repayment of the $50. This letter was received by complainant in Nacoochee, Georgia, on the night of March 17, 1887. On the next day, March 18th, complainant went to Atlanta, the home of defendant, sought an interview with him, and immediately returned to him the $50 check which he had received from him; stating to defendant that he refused to receive it; and defendant now has the check in his possession. Complainant at the same time tendered to defendant $950 in cash, and demanded that defendant make complainant a good and sufficient title to the land in controversy, which tender defendant refused, and refused to convey, and repeatedly refused to carry out his contract with complainant. A tender is made in the bill of $950; and the prayer is for a decree for specific performance against defendant, with an alternative prayer for damages, in the event specific performance ca-not be obtained. An amendment has been filed to this bill, which amendment alleges that the property described in the bill, bargained by defendant to complainant, is now worth the sum of $3,000, and also that the damages to complainant resulting from such refusal and the failure of the defendant to perform his contract, exceed $3,000. To this bill a demurrer has been filed, which demurrer is on two grounds: First, that this court has no jurisdiction of the subject-matter in the bill stated; and, second, that the complainant has not shown a right to any relief against defendant.

The first ground is based upon the fact that the amount in controversy, as shown by the original bill, is not sufficient to give this court jurisdiction; the bill having been filed since the passage of the act of March 3, 1887. This objection seems to be obviated by the amendment since filed, fixing the value of the land at $3,000 and the damages at not less than that sum. There was very little discussion upon this point, in the argument, and it was not strongly urged. The serious and main question in the case arises under the second ground of the demurrer, that the complainant has not shown a right to any relief against defendant. The question made is that this contract between defendant and complainant lacks the element of mutuality, which is necessary to authorize a court of equity to decree a specific performance. That is to say, that, as complainant was not compelled by his contract to take the land and pay defendant the remainder of the purchase money, defendant could not be required to carry out the agreement. There is a general rule of law, undoubtedly, that this element of mutuality must exist to justify enforcement of specific performance. Fry, Spec. Perf. Sec. 286; Wat. Spec. Perf. Sec. 196. It is also true that there are clear exceptions to this rule. In Fry on specific performance it is stated in section 291, as follows:

'The contract may be of such a nature as to give a right to the performance to the one party which it does not give to the other; as, for instance, where a lessor covenants to renew upon the request of his lessee, or where the agreement is in the nature of an undertaking. But the more accurate view of such cases as the first,-- perhaps of all that could be treated as wanting mutuality,-- seems to be that they are conditional contracts; and when the condition has been made absolute, as, for instance, in the case above stated, by a request to renew, they would seem to be mutual, and capable of enforcement by either party alike.'

In Wat. Spec. Perf. Sec. 200, in discussing the matter of exceptions to this general rule, the author says:

'But it is well settled that an optional agreement to convey, or to renew a lease, without any covenant or obligation to purchase or accept, and without any mutuality of remedy, will be enforced in equity if it is made upon proper consideration, or forms part of a lease or other contract between the parties that may be the true consideration for it, though such an agreement can perhaps scarcely be called an exception; for, being in fact a conditional contract, when the condition has been made absolute by a compliance with its terms, the contract becomes mutual, and capable of enforcement by either party. A contract for the sale of real estate, at the option of the vendee only, upon election and notice, may not only be specifically enforced, but the refusal of the vendor to accept the purchase money will not destroy the mutuality, though the vendee could thereupon withdraw his election.'

The decisions upon this question have been numerous, and it has been discussed ably and at length by many courts of high authority. The case very generally referred to and relied upon to sustain the rule requiring that a contract must be mutually binding to justify its enforcement, is the decision of Lord REDESDALE in the case of Lawenson v. Butler, 1 Schoales & L. 13. A careful examination of that case and the argument and reasoning of the Lord Chancellor will show that the decision was put mainly upon the ground that where parties enter into an agreement, each supposing the other to be bound thereby, and it transpires that one was not bound, such party could not have specific performance of the contract by the other. He says, in concluding the opinion, (page 21;)

'No man signs an agreement but under a supposition that the other party is bound, as well as himself; and therefore, if the other party is not bound, he signs it under a mistake. That mistake might be a ground for relief in equity, but is surely not a ground for specific performance. Under these circumstances, the impression upon my mind is that I must dismiss the bill. This agreement was signed in mistake. It is manifest that Butler could not have executed a lease in compliance with it; and as he could not, it is manifest that this is not the agreement he meant to sign.'

From a note to this case, (page 21,) it would seem that the Lord Chancellor was not himself entirely satisfied with the decision, as he proposed that the case lie over until the next day to look into the cases cited, when plaintiff's counsel stated that they were content with a dismissal of the bill without costs, and it was ordered accordingly. These comments upon and citations from this much-quoted case, are not made to question the existence of the general rule alluded to, but to show that its application, even in its origin, was a matter...