Norman v. McLelland

• Citation: 354 S.W.2d 906
• Decision Date: 08 March 1962
• Docket Number: No. 7978,7978
• Parties: H. E. NORMAN and E. E. Ross, Plaintiffs-Respondents, v. Rufus W. McLELLAND, Defendant-Appellant.
• Court: Missouri Court of Appeals

Page 906

354 S.W.2d 906

H. E. NORMAN and E. E. Ross, Plaintiffs-Respondents, v. Rufus W. McLELLAND, Defendant-Appellant.

No. 7978.

Springfield Court of Appeals, Missouri.

March 8, 1962.

Hogan & Hogan, Robert E. Hogan, West Plains, William C. Jenkins, Mammoth Spring, Ark., for defendant-appellant.

Green & Green, H. D. Green, West Plains, for plaintiffs-respondents.

RUARK, Presiding Judge.

This is a suit for damages based upon the failure of defendant to comply with the terms of an option for the sale of land. From an adverse jury verdict awarding damages to plaintiffs in the sum of $4,000, the defendant has appealed.

The option agreement involved, given for 'one dollar and other valuable considerations,' was dated November 24, 1959, described the land, gave plaintiffs the option for six months 'from date hereof' at $15 per acre, 'and first party agrees to furnish deed conveying above land with Abstract of title covering the above land, and title to be marketable. If not ask (sic) to furnish title within said period then this option is null and void.' The agreement was signed and acknowledged (incidentally, before separate notaries) by the parties.

The petition charged that defendant McLelland was the owner of $1000 acres of land in Oregon County; that for valuable consideration he gave the plaintiffs Norman and Ross the written option as above stated; that within the period of said option they deposited the full purchase price ($15,000) in the Bank of Alton and notified defendant both orally and in writing of the exercise of such option, but that defendant breached such agreement by failing to give deed or furnish an abstract showing marketable title; and by reason thereof they were damaged in the sum of $4,000.

Defendant's answer admits that he signed the 'purported option agreement' but states that it was not the true agreement, inasmuch as, on November 20, 1959, (this was before the written instrument was executed) he told plaintiffs he would give them a 60-day option; that when the instrument was presented to him he signed it without reading it, and his signing it was the result of a wicked and fraudulent scheme; further, that after he discovered the mistake he talked with the plaintiffs about it, and they verbally agreed to consider the option null and void.

According to the evidence, including defendant's testimony, plaintiffs approached the defendant for the option and there was some discussion about their attempting to find a buyer. They (plaintiffs) were 'pretty sure' they could find a buyer. Mr. Norman said he thought he had a buyer from Louisiana, and, 'Well, I offered it for sale.' Defendant could read and write, had on his glasses, took the paper in his hand, looked at it, and had ample opportunity to read it but says he did not do so. No trick or artifice was practiced. Afterward defendant acknowledged the instrument and kept a copy.

Defendant contended and so testified that afterward he discovered the option was for six months instead of 60 days as he had intended; that he went to the plaintiffs separately and they verbally agreed to consider the option as null and void. This is denied by both plaintiffs, and if this amounted to a cancellation of the agreement (the court permitted defendant to submit it), we must take the jury's verdict as foreclosing it.

After the option was signed, the plaintiffs cast their net, incurred expense (in an amount not shown), made calls, got in touch with possible buyers in various places, including Louisiana, showed the land to men from Blytheville, Arkansas, and Memphis, and finally induced two me from Texas to come and be shown over the land. This apparently was on or near to May 14, 1960. The Texans indicated interest in the land and stayed over Sunday and until Monday afternoon. Plaintiffs told the prospective purchasers that they expected to make some money on the deal, and the prospective purchasers agreed that was all right with them. Sunday night plaintiffs went to see McLelland and told him they thought they were going to get the place sold and that the purchasers had asked until Wednesday night to give a definite answer. Defendant testified, 'Oh, I believe Mr. Ross spoke of $5,000, going to send $5,000 to bind their trade.' At that time defendant told plaintiffs, 'Well, I have sold off two hundred acres of it,' but 'it hasn't went through yet.' He said he would go see the man to whom he sold it and he thought he could get it back. Thereafter plaintiffs completed an agreement (apparently partly in oral conversation, by correspondence, and by phone call) to sell the land to 'the Texas men' for $19,000. On Wednesday the plaintiffs got a call from the prospective purchasers stating they were ready to do business. On the next day plaintiffs went to defendant, told him the purchasers were ready to do business, and asked him if he had made his arrangements to get the land (the 200 acres) back. At that time he said that 'he didn't aim to' and 'flatly refused' to go ahead with the option. This defendant admits. On May 21, 1960, plaintiffs mailed to defendant a registered special delivery letter, stating that arrangements had been made at the Alton bank to pay for the land in compliance with the option after title was examined. The following day the defendant refused to accept delivery of the letter from the postmaster. We will credit him with being facetious in the reason he offered, i. e., 'Well, I wasn't supposed to get a registered letter from anybody. It might have had a bomb in it, just might have had a missible in it.' There is some evidence that along about this time defendant went out of town to one place but told people he was going to another place. He first testified he had no recollection of it, but in another instance:

'Q. Why did you tell Mr. Crews you were hiding out? Why did you tell Mr. Crews that if you thought the option had run out?

'A. Just a joke, I guess.

Asked if he had asked one Doug Geering 'to get in touch with these men in Taxas and stall them off until after the option time,' his answer was, 'I might have done that.'

Plaintiffs produced the deposition of the 'Texas men,' who testified that they owned some property jointly and intended to purchase this land jointly; that they looked at the land and agreed (with plaintiffs) to pay $19,000 in cash and were in position to do so; that title was to be examined and if title was marketable they were to pay the purchase price upon delivery of deed; that the deal fell through because plaintiffs notified them the owner refused to go through with it. 'We kept the matter open for a while to give them [time] to work it out. Finally Mr. Ross told us that the deal would have to be called off because the owner of the land would not go through with the deal.'

'Q. If the deal had gone through were you ready, able, and willing to comply with the terms of the contract and pay $19,000 cash for the one thousand acres of land?

'A. Yes, sir, subject to good title we were willing and able to close the deal and ready to pay cash if they had delivered us the deed.'

There was no evidence from either party as to the market value of the land other than as above stated.

Suit was filed on June 11, 1960.

The first assignment is that there was no evidence to support a verdict assessing plaintiffs' damage at $4,000, because there was no evidence to show that plaintiffs had ever concluded an enforceable contract for the sale of the land, for the reason the prospective purchasers' obligation to perform was conditioned upon the acceptance of title by a particular attorney.

To support this contention the appellant cites cases dealing with contracts wherein the determination of title, and hence enforceability of the agreement, is left to the sole judgment of one certain person. In so doing appellant skips over the first part of his premise, i. e., that plaintiffs could not recover damages unless they actually had a binding and enforceable contract with their buyers. He cites no cases in support of such premise and we do not find the law to be such when applied to the facts of this case.

No question has been raised in regard to pleadings or reception of evidence, and no contention has been made as to whether special damages were involved. Without wandering too far down the trail in respect to the recovery and measure of damages, we refer again to the fact that, by the testimony of both parties, the option was given and accepted with the understanding that the plaintiffs were to attempt to find buyers, and that this was the end result within the contemplation of the parties. The uncontradicted evidence is that plaintiffs did find buyers ready, willing, and able to pay in cash the full purchase price, subject only to delivery of marketable title, and the evidence is sufficient to justify a finding that defendant was not in good faith as regards performance. This transaction failed of consummation, not because the plaintiffs did not (if in fact they did not) have an ironclad contract with the prospective purchasers, but because, according to defendant's own testimony, (a) he voluntarily put it out of his power to convey title and (b) he flatly refused to proceed further with the deal. Under these circumstances we think that the plaintiffs were entitled to recover for what some cases and texts refer to as 'the loss or value of their bargain' or 'the value of their contract.' ¹

The agreement in question, although it took the form of an option contract, was, in the contemplation of the parties, a broker's contract, and such option contracts which are in substance brokers' contracts are at least related to brokers' contracts by the courts. See Mitchell v. Philippi, 359 Mo. 754, 223 S.W.2d 441. Actual tender of the purchase price or other action necessary to 'wrap up' the transaction on the part of plaintiffs or their assignees was not necessary where, because of defendant's refusal, it became plain and...