Miller v. Miller, 6-34
| Decision Date | 20 May 1983 |
| Docket Number | No. 6-34,P,No. 5836,6-34,5836 |
| Citation | 664 P.2d 39 |
| Parties | Cecil MILLER, Appellant (Third-Party Defendant), v. G.O. MILLER, Vivian Miller Hytrek and Cecil Miller, Executors of the Estate of Freda Miller, Deceased, Probatelatte County, Wyoming, Appellees (Defendants and Third-Party Plaintiffs), v. FIRST NATIONAL BANK IN WHEATLAND, (Plaintiff). |
| Court | Wyoming Supreme Court |
D.N. Sherard and Rex E. Johnson, Wheatland, for appellant.
William R. Jones and John P. McBride of Jones, Jones, Vines & Hunkins, Wheatland, for appellees.
Before ROONEY, C.J., and RAPER, THOMAS, ROSE and BROWN, JJ.
The First National Bank in Wheatland filed suit against the estate of Freda Miller, deceased. The amended complaint alleged that G.O. Miller, Vivian Miller Hytrek, and Cecil Miller, as executors of the estate, owed payment on a promissory note executed by Freda Miller. The defendants, appellees herein, confessed judgment on the note and proceeded to trial on an amended third-party complaint against appellant Cecil Miller, contending that the obligation was his. The district court ruled in favor of appellees. Although appellant urges five issues on appeal, we need only address the issue of whether the evidence was sufficient to support the judgment.
We reverse.
On January 27, 1966, appellant and his wife entered into a real estate contract with his mother, Freda Miller, which provided that appellant buy the family farm. The purchase price was $75,000; purchasers also assumed a mortgage to Travelers Insurance Company of approximately $82,000. The $75,000 due Freda Miller was to be paid in 30 years at $2,500 each year and was not to bear interest.
On April 17, 1978, Freda Miller and appellant co-signed a promissory note for $60,000 to the First National Bank in Wheatland. The loan proceeds went to appellant. On June 14, 1978, Freda Miller, appellant and his wife refinanced the farm through Travelers Insurance Company and increased the mortgage to Travelers to $210,000. The proceeds which resulted from this refinancing, $91,823.67, went from Travelers Insurance Company to Freda Miller. On July 14, 1978, she paid in full the April 17, 1978, note to the First National Bank in Wheatland.
On October 31, 1978, Freda Miller executed a promissory note for $60,000 in favor of First National Bank in Wheatland. This loan was to purchase a modular home for Freda Miller. The October 31, 1978, promissory note is the note sued on by the bank against appellees.
On November 3, 1978, appellant, his wife and their son entered into a contract with Freda Miller. They agreed to assume the $210,000 Travelers Insurance Company loan, and to pay Freda Miller $100,000 in installments without interest. Freda Miller died around the middle of November, 1978. 1
The court below and the lawyers had difficulty sorting out the legal ramifications of the dealings between mother and son. We cannot say that we fully understand what went on between them or what their intentions were. We can say, however, that appellees did not show the existence of a contract between Cecil Miller and Freda Miller wherein Cecil Miller legally obligated himself to pay his mother the $60,000 which she owed the bank for the October 31, 1981, promissory note.
It is well established that an offer, acceptance, and consideration are the basic elements of a contract. The burden of proving a contract is on the one seeking to recover on the contract. Black & Yates, Inc. v. Negros-Philippine Lumber Company, 32 Wyo. 248, 231 P. 398 (1924). This includes the burden of proving consideration. Houghton v. Thompson, 57 Wyo. 196, 115 P.2d 654 (1941). 2
Ennis v. McLaggan, Mo.App., 608 S.W.2d 557, 561 (1980).
A generally accepted definition of consideration is that a legal detriment has been bargained for and exchanged for a promise. Higgins v. Monroe Evening News, 404 Mich. 1, 272 N.W.2d 537 (1978). The Restatement of Contracts says that a performance or a returned promise must be bargained for. " * * * The performance may consist of an act, other than a promise, or a forbearance, or the creation, modification or destruction of a legal relation." Restatement of Contracts (Second), § 71, p. 172 (1981). Lack of consideration goes to the validity of contract formation. Absent some indicia of actual consideration, a contract will be held invalid by the courts.
"For several centuries, it has been customary to say by the common law that no informal promise is enforceable if it is without consideration. * * * " 1 Corbin on Contracts, § 110, p. 491 (1963 Replacement).
The question whether an oral contract exists is a question of fact. Jim's Water Service, Inc. v. Alinen, Wyo., 608 P.2d 667 (1980). Nevertheless, as with any question of fact, the decision of the finder of fact will be reversed if there is little or no evidence to support the finding. Alco of Wyoming v. Baker, Wyo., 651 P.2d 266 (1982). Appellees failed to prove that there was any consideration for appellant's alleged promise to pay.
The theory of appellees' original third-party complaint against appellant was that the promissory note of October 31 was really his debt, and that he received the benefits from that promissory note, and that he had agreed to pay it. Appellees then changed the theory of their suit against appellant, and amended the third-party complaint to allege that appellant was indebted to Freda Miller because of the April 17, 1978, promissory note and because appellant received the proceeds from the loan. Appellees further alleged that because of the April 17, 1978, indebtedness, appellant agreed to pay the October 31, 1978, promissory note signed by Freda Miller. 3
The record does not support their allegations. The testimony was that when appellant, his wife, and his mother refinanced the farm with Travelers Insurance on June 14, 1978, approximately $125,000 was used to pay off an old mortgage to Travelers, and approximately $91,000 remained. Appellant testified that he turned the $91,000 over to his mother to repay the $60,000 note, which would have to be the April 17, 1978, note that they co-signed. Appellant then testified that he entered into a contract on November 3, 1978, with Freda Miller, partly because he wanted to have his son added to the contract, and partly because he wanted to assume in writing the Travelers' loan of June 14, 1978.
Appellees contended that appellant entered into the November 3, 1978, contract because it covered different land than the 1966 contract. The proof was apparently presented to show that appellant received more value from Freda Miller than he had agreed to pay for in formal contracts, and that therefore he must have intended and agreed to pay the $60,000 note for the modular home to the bank to even things out between his mother and himself. Appellees seem to be arguing that appellant had a motive for offering to pay the note on the modular home, but evidence of motive does not substitute the necessary element of consideration in a contract. Agnew v. Brown, 96 Ill.App.3d 904, 52 Ill.Dec. 430, 422 N.E.2d 111 (1981). Perhaps appellant had a moral obligation to pay the note, but moral obligation alone is not a valid consideration for a promise to pay. Matter of Estate of Voight, 95 N.M. 625, 624 P.2d 1022 (1981). A moral obligation is not necessarily a legal one. Wantulok v. Wantulok, 67 Wyo. 22, 214 P.2d 477, 21 A.L.R.2d 572 (1950).
Appellant did tell his mother and others that he would pay off the October 31, 1978, loan, if and when he could. Appellees argue that this statement by appellant that he would pay the note shows a contract. However, "the mere fact that one man promises something to another creates no legal duty and makes no legal remedy available in case of non-performance." 1 Corbin on Contracts, supra, at p. 490. Further, appellant testified, and the testimony was uncontradicted, that he expected to receive a deduction on the November, 1978, contract with Freda Miller.
Appellees also argue that their mother understood that she and appellant had a contract. On or about November 10, 1978, Freda Miller gave a daughter a memo in her handwriting:
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