Marsh v. Brown-Crummer Inv. Co.

• Decision Date: 08 July 1933
• Docket Number: 31254.
• Citation: 23 P.2d 465,138 Kan. 123
• Parties: MARSH v. BROWN-CRUMMER INV. CO.
• Court: Kansas Supreme Court

23 P.2d 465

138 Kan. 123

MARSH v. BROWN-CRUMMER INV. CO.

No. 31254.

Supreme Court of Kansas

July 8, 1933

Syllabus by the Court.

Where buyer merely seeks to specifically enforce seller's oral contract to repurchase securities, allegations setting up seller's fraud should be stricken out on seller's timely motion.

Where seller orally agrees to repurchase bonds on buyer's demand but no time is fixed within which such demand must be made, buyer must make demand within reasonable time.

Seller's alleged oral agreement to repurchase bonds on buyer's demand and return face value thereof with reasonable adjustment as to accrued interest thereon held sufficiently certain, as against demurrer.

Where seller orally agrees to repurchase bonds on buyer's demand but no time is fixed within which demand must be made what is reasonable time for making demand is ordinarily question for jury; but where facts are undisputed, court may as matter of law, determine whether demand was within reasonable time.

Where seller orally agrees to repurchase bonds on buyer's demand, but no time is fixed within which demand must be made, if no reasons to contrary appear, reasonable time would not be in excess of that period in which action on oral contract might be brought.

1. Where plaintiff seeks to enforce specifically an oral contract of repurchase and does not seek relief on account of fraud, allegations setting up fraud on the part of the defendant should be stricken out on timely motion made by the defendant.

2. The contract as pleaded examined, and held to be sufficiently certain as against a demurrer.

3. Where an oral contract is made whereby plaintiff purchases bonds on seller's agreement to repurchase upon plaintiff's demand but no time is fixed within which such demand must be made, it must be made within a reasonable time.

4. What is a reasonable time is ordinarily a question for the jury but where the facts are not disputed the court may, as a matter of law, say whether the demand has been made in a reasonable time.

5. If no reasons to the contrary appear, a reasonable time in which to make demand for performance, under circumstances as above set forth, would be not in excess of that period of time in which an action on a contract not in writing might be brought, or three years.

Appeal from District Court, Sedgwick County, Division No. 3; Grover Pierpont, Judge.

Action by J. T. Marsh against the Brown-Crummer Investment Company. Judgment for plaintiff, and defendant appeals.

Judgment affirmed in part and reversed in part, and cause remanded with instructions.

Thomas E. Elcock and James G. Martin, both of Wichita, for appellant.

A. M. Ebright and P. K. Smith, both of Wichita, for appellee.

THIELE Justice.

This is an appeal from the lower court's rulings on a motion to strike and on a demurrer, both directed against plaintiff's amended petition.

The petition contained five causes of action, each being on an oral contract to repurchase securities sold by the defendant to plaintiff on the following dates: October 10, 1925, October 11, 1927, March 5, 1928, March 30, 1928, and May 31, 1928. The first cause of action charges that on October 10, 1925, plaintiff entered into an oral contract with defendant company for the purchase from time to time of certain bonds and securities with the distinct understanding and agreement that the defendant company would repurchase such bonds and securities so sold upon demand of plaintiff and return to the plaintiff the face value thereof "with a reasonable adjustment as to accrued interest thereon," and that plaintiff purchased 18 certain drainage district bonds of the total face value of $9,000, which sum plaintiff paid defendant; that thereafter and in August, 1930, plaintiff offered to return said bonds, and when said offer and tender were made and demand made that defendant return to plaintiff the $9,000 theretofore paid, defendant refused said offer and tender and refused to repurchase said bonds; that thereafter other offers, tenders, and demands were made by plaintiff and refused by defendant. The sixth paragraph of the first cause of action alleges that when the oral agreement was made the defendant did not intend to perform and entered into said oral agreement with the fraudulent intent to deny the agreement and to refuse to carry out the same if it later proved to the advantage of the defendant to so do, and that plaintiff relied on said agreement and would not have purchased except for it, and that plaintiff entered into said agreement in good faith and defendant entered into it in bad faith. The second and succeeding causes of action each incorporate all statements and allegations of the first cause of action material to the stated cause of action and allege purchases of other bonds on the dates above noted, and each contains the following allegation: "That on said date, the said parties acknowledged, admitted and renewed the oral contract theretofore entered into on the 10th day of October, 1925, and each and all of the provisions of said oral contract of October 10, 1925, were again made and entered into by and between said parties." The prayer is for the total face value of the bonds sold ($15,500), "and accrued interest thereon unpaid up to August 1, 1930, with interest on said $15,500 plus accrued interest from August 1, 1930, at six percent per annum, and the costs of this action."

A motion to separately state and number was directed against the amended petition. The journal entry denying the motion contains the following: "And plaintiff's attorneys state to the court that plaintiff seeks to recover for a breach of each of the sundry contracts pleaded in his five several causes of action, and does not seek rescission of said contracts or any of them." Thereafter, a motion to make definite and certain and to strike was filed, the material portion being to strike out the sixth paragraph of the first cause of action, above referred to, and all reference thereto elsewhere in the amended petition. It is clear from the amended petition, and made certain by the quoted journal entry, that plaintiff seeks to enforce the oral contract of repurchase and is not seeking relief on account of fraud, and that portion of the amended petition included in the sixth paragraph of the first cause of action, and included by reference in the other causes of action, setting up fraud on the part of the defendant, should have been stricken out.

While the demurrer contains eight grounds, the argument is confined to two elements: (a) That the contracts pleaded are so indefinite and uncertain as to be unenforceable; and (b) that the contracts pleaded, if sufficiently definite, had expired by their terms before the action was brought.

With reference to the contention that the claimed repurchase agreement is too indefinite and uncertain to be enforceable, it is contended that there is uncertainty as to time of performance, and that what is to be performed is uncertain, in that the agreement to repurchase the bonds and return the face value "with a reasonable adjustment as to accrued interest thereon" is too indefinite to be performed. As to uncertainty of time of performance of contracts of this type, it has been held in many instances that if the contract does not specify the time within which the right to repurchase must be exercised, it must be exercised within a reasonable time. 55 C. J. 592. As this element is related to the contention that the contracts, if sufficiently definite, had expired by their terms before demand was made and action brought, it will not be separately discussed.

In so far as indefiniteness on account of the general provisions of the contract is concerned, it is urged by appellant that the contract as pleaded is not for any specific bonds, that there is a lack of subject-matter on which to operate, and that the provision as to interest adjustment is vague, indefinite, and uncertain, and further that the contract is entire and inseparable and, assuming that the subject-matter was made certain by purchase of specific bonds, still, on account of the lack of certainty as to interest, the entire contract is uncertain and so indefinite that it cannot be enforced. Reliance by appellant is placed chiefly on Brown-Crummer Inv. Co. v. City of Arkansas City, 125 Kan. 768, 266 P. 60. But in that case it was held that a contract uncertain in some of its terms may by practical construction be cured and made certain. If the original contract was uncertain, as soon as a purchase of bonds was made under it, it became certain at least so far as the subject-matter is concerned.

In Restatement, Contracts, § 32, it is said: "An offer must be so definite in its terms, or require such definite terms in the acceptance, that the promises and performances to be rendered by each party are reasonably certain." And at section 370, it is further stated: "Specific enforcement will not be decreed unless the terms of the contract are so expressed that the court can determine with reasonable certainty what is the duty of each party and the conditions under which performance is due."

In 58 C. J. 933, the rule is laid down as follows: "A greater degree of certainty is required in a suit in equity for specific performance than in an action at law for damages and as against assignee and representatives of the contracting parties, it is said that the requirement of certainty is more than ordinarily stringent. However, absolute certainty is not required; reasonable certainty is necessary and sufficient; where the main features of a contract are sufficiently definite and certain, uncertainty in a subsidiary part will not necessarily prevent specific performance; uncertainty in a portion of the...