McLeod v. Morrison & Eshelman

• Decision Date: 23 January 1912
• Court: Washington Supreme Court
• Parties: McLEOD et al. v. MORRISON & ESHELMAN.

120 P. 528

66 Wash. 683

McLEOD et al. v. MORRISON & ESHELMAN.

Supreme Court of Washington

January 23, 1912

Department 2. Appeal from Superior Court, King County; J. T. Ronald Judge.

Suit by Beatrice B. McLeod, administratrix, and another against Morrison & Eshelman. From a judgement for plaintiffs defendant appeals. Affirmed.

Charles E. Patterson and Charles R. Crouch, for appellant.

Byers &amp Byers and G. G. Lee, for respondents.

ELLIS J.

Appeal from a judgment in favor of respondents and against appellant decreeing specific performance of a contract for sale and conveyance of real estate.

On February 14, 1903, respondents' intestate, who lived at Toppenish, Wash., entered into a written contract with one William E. Smith for the purchase of certain lots in Aldine Heights addition to West Seattle for an agreed price of $1,025. The contract acknowledged payment of $300 on its delivery, and provided that $375 should be paid on July 1 1903, and $350 on January 1, 1904. An indorsement on the contract shows payment of the first of these deferred payments on July 3, 1903. There was evidence to show that the appellant, Morrison & Eshelman, a corporation, at the time of and prior to the execution of this contract, had, under an agreement with the owner of Aldine Heights addition, an option on, or at least the exclusive sale of, all lots in that addition. The evidence tended to show that the appellant corporation had listed the lots here in question with Smith, as a real estate broker, with verbal authority to secure a purchaser, but had never given him authority to execute any contract of sale in its name, or otherwise. He had only the authority of any ordinary real estate broker. Under this authority, he had, prior to the sale here in question, produced a purchaser, and appellant had taken earnest money and given the purchaser a receipt for it, but this sale was abandoned. Appellant claims that after this transaction no authority of any kind was given Smith to sell the lots to respondents' intestate, McLeod. The secretary-treasurer of the appellant, however, testified that after this transaction Smith was not told that he could not sell to any one else. The evidence fails to show any revocation of Smith's authority, as a broker, to find a purchaser. This authority, which we must assume continued, was not sufficient to authorize Smith to execute a written contract of sale, either in his own or in appellant's name, which would be binding upon the appellant. Carstens v. McReavy, 1 Wash. 359, 25 P. 471. On the whole record it appears that Smith was agent for the appellant to find a purchaser, but if he intended to bind the appellant by the contract of sale here in question he had not sufficient authority for that purpose.

The evidence does not show that Smith, at the time of executing the contract, informed the respondents' intestate that he was acting or assuming to act for the appellant; but it does show that when the last payment was due Smith could not convey title, and afterwards, in 1905, wrote the intestate that he would 'see the other party about your deed for Aldine Heights,' and again, in March, 1907, as follows: 'I met Mr. Eshelman yesterday afternoon and I asked him about your calling for your deed and he said they were having trouble about a settlement with the owner and he would let me know a little later about it.' While this evidence was not competent to show agency, it was competent as showing when respondents' intestate learned that Smith had assumed to act for appellants in making the contract.

The respondents' intestate soon after this took the matter up directly with the appellant. Appellant's secretary-treasurer testified that some time in 1907 respondents' intestate came into appellant's office and showed him the contract. The intestate's death precluded evidence as to what demands were then made, but three letters in evidence sufficiently show that the intestate was insisting on the performance of the contract. The first of these letters, dated March 17, 1908, was signed by appellant's treasurer personally. The writer says: 'I thought we would get matters adjusted long before this so that we might be in position to deliver to you the deed for the seven lots you purchased of W. E. South (Smith ) on contract, but I am sorry to say that we have not definitely reached that point yet, and cannot now state positively when we will be in position to deliver deed.' The letter goes on to explain the delay as being caused by a difficulty with the owner of the addition, and that it might be necessary for appellant to sue her before procuring deed, and then continues: 'In this event it may require some time yet before we can expect to receive the deed. If you prefor to relinquish or assign your contract on some equitable basis, to waiting for the deed, we are willing to afford you the opportunity, as we feel that you have been withheld quite too long in this matter on account of the unfortunate condition this matter has assumed.' The writer concludes with an offer to take an assignment of the contract and pay back all payments made thereon and taxes paid on the land by the intestate, with 7 per cent. interest on these sums. The respondents' intestate answered this letter, under date of March 25th, as follows: 'Your favor of Mar. 17th received and contents noted, and would say that in buying those lots I done so for speculation and not for 7% interest. I could have invested the money here and made 500% and have done it. If you feel like you would rather pay me $500.00 per lot or $3,500.00 for the seven lots we may make a deal. I have been very patient but there will be a limit to it one of those days.'

Appellant's reply to this letter was dated April 1st, and signed by the appellant corporation by its treasurer, and, among other things, contains the following: 'As desirous as we are to get this matter closed up and to give title to the property, it is quite certain we cannot convey title by deed till we can get it from this party in whom the record title now stands. If we cannot settle with this party on a reasonably fair basis, and are compelled to sue to enforce such a settlement, there is no telling how long it may take to secure deed. It is in view of this complicated state of affairs making it uncertain as to how long we may have yet to wait for a deed to the property and a desire to get the matter quickly adjusted that we were led to make the proposition to you that we did. If, however, you prefer to abide the necessary time it may take to secure the deed, all well and good, we have no objections. We will continue to do as we have been doing, exerting our best efforts to obtain an equitable settlement with the party and secure deed for the property in question as quickly as it is possible. This is as well as we can do.'

The last of these letters, being signed in the corporate name and relating to the matters discussed in the first letter, conclusively shows that the first...