Oberhansly v. Earle
| Decision Date | 21 December 1977 |
| Docket Number | No. 14820,14820 |
| Citation | 572 P.2d 1384 |
| Parties | O. B. OBERHANSLY, Dennis Wilcox and Robert May, Plaintiffs and Appellants, v. Don B. EARLE, Betty Earle and Rainbow Properties Corporation, a Utah Corporation, Defendants and Respondents. |
| Court | Utah Supreme Court |
Robert M. McRae, Salt Lake City, George E. Mangan, Roosevelt, for plaintiffs and appellants.
Reese C. Anderson, Salt Lake City, for defendants and respondents.
Before us is a judgment of the District Court. The court held the agreement and actions between the parties were too vague and conflicting to constitute a valid contract. The court awarded plaintiffs the sum of $2,040.93 as equitable relief. Plaintiffs appeal, we affirm. Costs to defendants.
On December 5, 1974, defendants, as buyer, and plaintiffs as seller, signed an Earnest Money Receipt and Offer to Purchase Form (hereafter referred to as agreement). For a purchase price of $6,000.00, buyers were to obtain the "distributorship for Schlitz, Miller and Hamms Beer and RC Cola and Frostie Root Beer." The phrase "All stock in Basin Dist. Co. included" was handwritten in immediately following. Five hundred dollars down was paid at that time and monthly payments of $500.00 each were to begin on January 10, 1975. Possession of the distributorship was to be given on December 6, 1974, at which time the inventory would be counted and paid for in cash by buyers. The agreement recited the $6,000.00 purchase price was to "be treated as a note and mortgage on unpaid balance and will still be owed regardless of what buyer does with dealership." Next followed a promise by sellers to provide signed agreements with the beer companies to show exclusive distribution rights in the area. Below the signatures of the parties was the handwritten provision "Betty (buyer) will pay sellers also for $1,000.00 deposit on truck if Betty chooses to continue lease on truck." Below this was the handwritten provision that buyers could rent the warehouse for $350.00 per month if they wished.
It appears the parties did count the inventory on December 6, 1974, and buyers made partial payment of $1,500.00 in cash at that time. However, buyers did not assume control of the business until about December 17, 1974, and thereafter operated it for only about two months. Despite repeated requests, sellers never provided the agreements showing exclusive distributorship rights. After about February 3, 1975, the Schlitz supplier refused to deliver any more beer to Basin Distributing Co. Buyers ascertained that Schlitz accounted for the majority of their sales and that they could not operate profitably without it.
During the time buyers operated the business there was never any transfer of capital stock from seller to buyer nor any change of directors or officers of the corporation. Additionally, buyers never obtained the state license required to distribute alcoholic beverages but instead relied on a seller's promise to continue the license in his name.
On these facts, the trial judge, held the agreement was ambiguous, uncertain, conflicting, and unenforceable as an agreement of the parties, and that subsequent dealings between the parties were also too ambiguous to create a binding contract. He granted equitable relief to sellers of $4,040.93, which was later reduced to $2,040.93 since buyers had already paid $500.00 down and $1,500.00 for the inventory. On appeal, appellant seeks to have the handwritten agreement enforced.
We begin by noting that on appeal the decision of the trial court is entitled to a presumption of validity. We are required to view the evidence and any inferences drawn therefrom in the light most favorable to sustaining the decision. 1
It is a basic principle of contract law there can be no contract without a meeting of the minds of the parties which must be spelled out either expressly or impliedly with sufficient definiteness to allow enforcement. 2 The burden of proving the existence of a contract is on the party seeking enforcement of it. 3 Of course the intentions of the parties are controlling and normally those intentions will be found from the instrument itself. If a writing is not sufficient to establish meaning however, resort may be had to extraneous evidence manifesting the intentions of the parties. 4
Applying these principles to the case at hand, we first...
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