Kinney v. Schlussel

• Decision Date: 13 October 1925
• Citation: 116 Or. 376,239 P. 818
• Parties: KINNEY v. SCHLUSSEL ET AL.
• Court: Oregon Supreme Court

239 P. 818

116 Or. 376

KINNEY v. SCHLUSSEL ET AL.

Supreme Court of Oregon, En Banc.

October 13, 1925

Appeal from Circuit Court, Multnomah County; J. U. Campbell, Judge.

Suit by Robert C. Kinney against Birdie F. Schlussel and another. From a decree for defendants, plaintiff appeals. Affirmed.

Burnett and Bean, JJ., dissent.

Chriss A. Bell, of Portland, for appellant.

Veazie & Veazie, of Portland, for respondents.

RAND J.

This was a suit in equity, to compel the specific performance of an alleged contract for the sale of land. The complaint alleges that defendants entered into a contract with plaintiff whereby defendants agreed to sell and convey in fee simple, and he agreed to purchase, certain real property in Clatsop county, Or. This allegation was denied by the answer. Two writings are attached as exhibits to the complaint, which the complaint alleges and the answer admits were signed by plaintiff and defendants on April 23, 1923. Omitting the attestation clause, these papers, the signatures to the first of which are sealed, read as follows:

"Know all men by these presents, that Birdie F Schlussel and Sadie R. Schlussel, hereinafter referred to as Schlussels, agree upon the terms hereinafter set out to sell to Robert C. Kinney, hereinafter referred to as Kinney, the following described land, to wit: The southwest quarter of the southeast quarter and the southeast quarter of the southwest quarter and the southwest quarter of the southwest quarter of section 17, township 6 north, range 9 west of the Willamette meridian, and the southeast quarter of the southeast quarter of section 18, township 6 north, range 9 west, Clatsop county, Or.

"The said Kinney agrees to purchase and pay for said land the sum of fifty-five hundred and no/100 ($5,500.00) dollars on the following terms, to wit: Fifteen hundred ($1,500.00) dollars upon his approval of title and the execution and delivery of this contract and the balance of four thousand ($4,000.00) dollars on or before two years after date with payments of not less than two thousand ($2,000.00) dollars per year, with interest on all unpaid balances at the rate of 7 per cent. per annum, payable semiannually.

"The said Schlussels agree that upon the delivery of this contract the said Kinney may go upon the premises described for the purpose of constructing and laying out his logging road for the purpose of removing the timber on said premises prior to the delivery of the deed according to the terms hereinafter set out, then the entire balance due on said purchase price will become immediately due and payable.

"The said Schlussels agree to pay taxes for the year 1922, and the said Kinney agrees to pay all taxes thereafter.

"The said Schlussels agree to furnish, at their own expense, an abstract of title to date, showing title free and clear of all incumbrances in the said Schlussels, the said Kinney to have five days after receipt of abstract for the purpose of examining the same.

"It is hereby mutually agreed that this contract shall be deposited in Ladd & Tilton Bank, together with fifteen hundred ($1,500.00) dollars by the said Kinney, and, when he shall approve title as hereinbefore set out, the fifteen hundred ($1,500.00) dollars shall be by said bank paid to the said Schlussels and the contract delivered to the said Kinney.

"The said Schlussels agree to deposit in Ladd & Tilton Bank a general warranty deed to said premises with instructions to deliver the same to the said Kinney upon full payment of the balance due under this contract. * * *"

"Portland, Oregon, April 23, 1923.

"Ladd & Tilton Bank, Portland, Oregon--Gentlemen: There is deposited herewith three copies of a contract between Birdie F. Schlussel and Sadie R. Schlussel on the one part and Robert C. Kinney upon the other, together with the sum of fifteen hundred ($1,500.00) dollars. When Mr. Kinney shall signify to you that he has approved title to these premises, kindly deliver one copy of the contract to him and hold the other copy subject to our order and credit the $1,500.00 to our account.

"There is also delivered herewith a warranty deed covering said premises, signed by Birdie F. Schlussel and Sadie R. Schlussel, which you are instructed to deliver to Mr. Kinney upon his paying the balance of four thousand ($4,000.00) dollars according to the terms of the contract, and you are further authorized to affix and cancel the necessary United States revenue stamps upon said deed prior to delivery, reimbursing yourself for the cost of said stamps out of moneys in your care and to our credit.

"In the event that Mr. Kinney shall fail to signify to you, within thirty (30) days from the date of this letter that he has approved title to these premises, upon the demand of Sadie R. Schlussel and Birdie F. Schlussel, you are to deliver back to them, or either of them, said contracts and the deed deposited with you with this letter."

The first of these writings is in the form of a contract; the second contains instructions which were given to the bank directing the disposal to be made of the first paper. Whether the first writing was, in fact, a concluded contract, and went into immediate effect, depends upon the intention of the parties, as the fact itself is put in issue by the pleadings. On their face, these two writings show that they relate to the same transaction, and therefore they must be taken and read together, and be so construed that each may have the effect intended by the parties.

While it is ordinarily true that the manual traduction of a written contract is not required, yet the parties may themselves agree that a writing, which if completely executed would be a valid and enforceable contract, shall not be delivered as a contract until the happening of a certain event, or that, if such event does not happen, there shall be no delivery of it. If there was such an agreement in this case, then there could be no contract until delivery, for no other intention could reasonably be imputed to the parties. There is no evidence of the intention of the parties to be found in this record except that contained in the writings themselves, and so we must look to them alone to determine the intention of the parties.

In construing these two instruments for the purpose of determining the intention of the parties, and treating them as one instrument, there are certain well-defined rules of construction which must be followed. Section 715, Or. L declares that the office of the judge in construing an instrument is simply to ascertain and declare what is in terms or in substance contained therein, not to insert what has been omitted or to omit what has been inserted; and, where there are several provisions or particulars, such construction is, if possible, to be adopted as will give effect to all; and, as said by Mr. Justice Wolverton in Arment v. Yamhill County, 28 Or. 474, 43 P. 653, an instrument must--

"be construed by taking it at the four corners and looking through the whole instrument from the identical standpoint of the contracting parties when it was entered into, and that construction must be given it, if possible, which will give effect to all its parts and carry out the obvious intention of the parties, and which will make the contract legal, rather than one that will render it void."

An examination of these two instruments discloses that, by the provisions of the first, second, and fifth paragraphs of the first writing, the defendants agreed to sell and the plaintiff to purchase the premises in controversy for $5,500, of which $1,500 was to be paid upon the delivery of the contract and balance later at stated intervals, and that the defendants agreed to furnish an abstract of title, and that the abstract so furnished should show a good title. If there had been nothing else contained in the contract except the provisions just referred to, and if it was executed by the parties with intent that it should go into immediate effect as a contract, it would, of course, be a concluded contract, and either party, upon his performance, would be entitled to require the other party to perform.

Now, before referring to any other provisions of the contract, let us assume that the contract contained only the terms just referred to, and that the contract was executed by both parties, and that they intended it to go into immediate effect, and that, upon the performance by one, or offer to perform, he would be entitled to compel the other to perform, and apply this legal result to the facts appearing in this case.

The first payment of $1,500, together with the three copies of the first writing, were deposited and placed in the bank in accordance with the terms of the understanding between the parties. Defendants furnished an abstract, and this abstract failed to show that defendants had a good and merchantable title in the premises, and for that reason, the plaintiff did not approve the title and did not notify the bank of his approval, and it further appears that defendants cannot cure the alleged defect in the title. Let us further assume that defendants' failure to furnish the abstract was a breach of the contract upon their part. Now, under those circumstances, what was plaintiff's remedy so far as his right to sue to compel specific performance is concerned? That question is answered in the only way it can possibly be answered by the former decisions of this and other courts. If the title was unsatisfactory to plaintiff, he had an election to do either of two things. He could either perform the contract and take a conveyance relying on the covenants in the deed as security against any defects in the title, or he could refuse to perform the contract and receive from the bank the money he had placed there. ...