Northwest Properties Agency, Inc. v. McGhee, 10--40104--II
| Decision Date | 18 November 1969 |
| Docket Number | No. 10--40104--II,10--40104--II |
| Citation | 462 P.2d 249,1 Wn.App. 305 |
| Court | Washington Court of Appeals |
| Parties | NORTHWEST PROPERTIES AGENCY, INC., a Washington corporation, Respondents, v. Joseph McGHEE and Jane McGhee, husband and wife, Appellants. |
Murray, Scott, McGavick & Graves, Frederick R. Hokanson, Tacoma, for appellants.
Conrad, Kane & Vandeberg, Elvin J. Vandeberg, Tacoma, for respondents.
This is an appeal by the defendant seller from a decree of specific performance of an earnest money receipt and agreement pertaining to 14 lots in Barker's Addition to the City of Tacoma. This real property borders Interstate 5 on the east and the Tacoma Mall properties on the west.
The defendants, Joseph C. McGhee and his wife, admitted signing an earnest money receipt and agreement in December, 1966. They contended to the trial court, however, that the earnest money agreement should not be specifically enforced, for four reasons:
1. The agreement was not signed by the purchasers by its termination date of December 30, 1966.
2. The purchasers, prior to signing, made a material change in the terms, thereby revoking the offer to sell.
3. The earnest money agreement, which called for a future real estate contract, was not certain enough for equity to enforce.
4. Part of the acceptance of the contract was oral, violating the statute of frauds.
The operative facts show that an employee of Northwest Properties Agency, Inc., Sherman Hale, acting for an undisclosed principal, Peter Wallerich, on December 29, 1966 came to the home of the defendants, Joseph McGhee and wife, ages 81 and 86 respectively, with a prepared earnest money receipt and agreement. (There was a dispute as to whether it was December 29 or December 30, which the trial court resolved in favor of December 29.)
The prepared earnest money agreement showed the plaintiff--'Northwest Properties Agency, Inc., Trustee'--as the purchaser. In its original form, the earnest money agreement called for a sales price of $30,000, to be paid with $7,500 down and the balance on a real estate contract at $500 or more per month, with interest at 6 per cent. The form also provided that sellers would pay a 10 per cent real estate commission. The sellers declined to sign the earnest money agreement in that form and after some negotiations the earnest money agreement form was changed, so as to call for a purchase price of $55,000, with a $9,000 down payment. At this time the following words were added at defendant's request, by Sherman Hale: '(C)ounter offer good until midnight of 30 December 1966 * * *.'
Hale took the earnest money agreement as signed by the McGhees to Peter Wallerich, the undisclosed principal, where the following language was added: '(p)rovided that no restrictions to the utilization of the property exists by virtue of its proximity to the freeway.'
While there is a dispute in the testimony as to when the changes in the earnest money agreement were approved by the purchaser, the trial court found that the acceptance was made on December 30, 1966, and that notice of acceptance was given to the sellers on December 31, 1966. Since there was substantial evidence to support these findings, this court is bound thereby.
With reference to the title, the earnest money receipt and agreement contained the following provisions:
1. TITLE: Title of seller is to be free of encumbrances or defects, except: None
Existing reservations, existing easements, building or use restrictions general to the district, and building or zoning regulations or provisions shall not be deemed encumbrances or defects. Encumbrances to be discharged by seller may be paid out of purchase money at date of closing.
2. TITLE INSURANCE: Title is to be shown by title insurance report furnished by the seller within 30 days after loan approval if financing is provided for, otherwise 15 days. Seller authorizes agent to apply for such policy or report, showing condition of title within the specified time. The title policy to be issued shall contain no exceptions other than those provided for in said standard form plus encumbrances and defects noted in Paragraph 1 above. Delivery of such policy or title report to closing agent shall constitute delivery to purchaser. If title is not so insurable as above provided and cannot be made so insurable within one hundred twenty days from date of title report, earnest money shall be refunded and all rights of purchaser terminated: Provided that purchaser may waive defects and elect to purchase. If title is so insurable and purchaser fails or refuses to complete purchase, the earnest money shall be forfeited as liquidated damages unless seller elects to enforce this agreement or seek damages for breach thereof.
The earnest money receipt and agreement contained the following provision, pertaining to the type of future real estate contract to be executed:
7. CONTRACT PURCHASER: If this agreement is for sale on real estate contract, seller and purchaser agree to execute a Real Estate Contract for the balance of the purchase price on Real Estate Contract Forms L--37, L--137, L--38 or L--138 of Washington Title Company, or Form 109 of Puget Sound Title Company, as selected by agent. The terms of said form are herein incorporated by reference.
The earnest money receipt and agreement also contained the following acceptance and commission agreement:
14. ACCEPTANCE AND COMMISSION AGREEMENT: December 29, 1966. We approve this sale and agree to deliver deed or contract for deed in accordance with the terms of this agreement, and pay..........agent, a commission of $ 10% For services rendered. In the event the Earnest Money is forfeited, the same, after deduction of expenses incurred by the agent, shall be divided equally between the seller and agent, providing the amount to agent does not exceed the agreed commission. I/we acknowledge receipt of a true copy of this agreement, signed by both parties. I agree to absorb a mortgage discount to finance this transaction, in an amount not to exceed..........% Of the sale price.
Joseph McGhee (signature)
Seller
Jane McGhee (signature)
Seller (Wife)
A true copy of the foregoing agreement signed by the seller, is hereby received on this 30 day of December, 1966.
W. W. Templin (signature)
Purchaser
Purchaser (Wife)
Plaintiff's exhibit 2, Washington Title Insurance Company real estate contract form L--37, was tendered to the defendants, together with the balance of the down payment of $9,000. Defendants refused to complete the transaction.
Plaintiff's complaint prayed for specific performance. Defendant's answer denied that a contract of sale had been executed and alleged as an affirmative defense that the transaction involved violated the statute of frauds.
We wish to dispose of one contention which is urged on appeal by the defendants, which does not appear to have been seriously advocated to the trial court. That argument was that the plaintiff, Northwest Properties Agency, Inc., failed in its duty of undivided loyalty, good faith, and full disclosure to the plaintiffs. Defendant urges that an agency relationship stemmed from this transaction between the plaintiff and the defendant sellers and that a duty of undivided loyalty, good faith, and full disclosure was created. We are asked to read into the commission agreement the creation of an agency relationship and are then asked to void the transaction because of the failure of the plaintiff to disclose the identity of the buyer. We do not accept this argument. The plaintiffs did not proceed on the theory that they were agents of the sellers. Defendants did not seek to avoid this transaction by pleading agency, fraud, or breach of trust. The closest this issue was brought to the trial court's attention was when defendant's counsel sought to question plaintiff about what work he had performed in earning a real estate commission. This question was objected to and sustained by the trial court on the grounds that it involved an issue which had not been pleaded. There was no attempt by defendant to seek an amendment of the pleadings, to press for fraud or breach of trust, nor was there an offer of proof made, tending to show evidence of fraud or breach of trust by an agent. Such failure would, in our view, foreclose urging this issue on appeal. Washington Cooperative Chick Ass'n v. Jacobs, 42 Wash.2d 460, 256 P.2d 294 (1953).
In any event, we do not deem the commission agreement as the acknowledgment of an agency relationship between the plaintiff and the defendant. From the manner in which the transaction was handled, the commission agreement was simply a term of the original offer made by the plaintiff purchasers and was retained in the counteroffer transmitted by the defendant sellers to the plaintiffs. (It should be noted that the plaintiffs had sought a listing on the property several months before this transaction, but defendants had declined to list the property for sale with the plaintiffs.)
We shall now consider the remaining assignments of error. Did the addition of the following language constitute a counteroffer by plaintiff purchasers? '(P) rovided that no restrictions to the utilization of the property exists by virtue of its proximity to the freeway.'
The trial court concluded...
To continue reading
Request your trial
-
Shinn v. Thrust IV, Inc.
... ... Citing Hebb and Northwest Properties Agency, Inc. v. McGhee, 1 Wash ... Page ... ...
-
Northwest Television Club, Inc. v. Gross Seattle, Inc.
...supra. Any material variance between offer and acceptance precludes the formation of a contract. Northwest Properties Agency, Inc. v. McGhee, 1 Wash.App. 305, 462 P.2d 249 (1969). If the intended acceptance adds a condition that can be implied in the original offer, then the condition is no......
-
Steadman v. Green Tree Servicing, LLC
...the offeror specifies the manner of acceptance, no contract is formed if the specification is not followed. See Nw Props. Agency, Inc., v. McGhee, 462 P.2d 249, 253 (1969); Corbit v. J. I. Case Co., 424 P.2d 290, 299 (Wash. 1967) (finding no contract formation because the "offer clearly spe......
-
Gresser v. Hotzler
...Club, 634 P.2d at 841-42; Karas v. Brogan, 55 Ohio St.2d 128, 130, 378 N.E.2d 470, 471 (1978); Northwest Properties Agency, Inc. v. McGhee, 1 Wash.App. 305, 462 P.2d 249, 253 (1969). The Minnesota Supreme Court used the language of the immateriality exception in Markmann v. H.A. Bruntjen Co......
-
Table of Cases
...(1970): 20.14(2) Northcraft v. Blumauer, 53 Wash. 243, 101 P. 871 (1909): 17.3(2)(d)(iii) Northwest Properties Agency, Inc. v. McGhee, 1 Wn.App. 305, 462 P.2d 249 (1969): 10.7(1)(b) Northwest Properties Brokers Network, Inc. v. Early Dawn Estates Homeowner's Ass'n, 173 Wn.App. 778, 295 P.3d......
-
§10.7 - Elements of the Agreement
...and date of printing, or the material terms must be contained in the REPSA. After Haire, in Northwest Properties Agency, Inc. v. McGhee, 1 Wn.App. 305, 462 P.2d 249 (1969), the court found that the reference to a specific real estate contract form put the purchaser on notice as to the conte......