Pearson v. Millard

• Decision Date: 17 March 1909
• Citation: 63 S.E. 1053,150 N.C. 303
• Parties: PEARSON et ux. v. MILLARD.
• Court: North Carolina Supreme Court

63 S.E. 1053

150 N.C. 303

PEARSON et ux. v. MILLARD.

Supreme Court of North Carolina

March 17, 1909

Appeal from Superior Court, Buncombe County; Peebles, Judge.

Action by Richmond Pearson and wife against C. C. Millard. From a judgment for defendant, plaintiffs appeal. Affirmed.

Specific performance is not a matter of absolute right, but rests in the discretion of the court, to be exercised on consideration of all the circumstances of each particular case in accordance with settled principles of equity.

Plaintiff Mrs. Pearson, being the owner of the property in controversy known as "The Farmers' Warehouse" in Asheville N. C., together with her husband, Richmond Pearson, on the 19th day of December, 1901, leased it to defendant Millard and H. W. Lasater, his copartners, for the term of five years, at a rental of $60 a month. The term began July 3 1902. The lease contained a number of provisions, none of which are necessary to be set out, except the following "It is understood and agreed between the parties hereto that the parties of the first part for, and in consideration of, the covenants and agreements herein contained to be performed by the parties of the second part, hereby agree and covenant to and with sad parties of the second part, that they shall have an option of purchasing the property hereby conveyed on or before the third day of July, 1907, at the price of nine thousand dollars, payable one thousand dollars cash on consummation of trade, and the balance in four annual installments of two thousand dollars each, the deferred payments to draw six per cent. semi-annual interest from the date of such consummation as aforesaid, and to be represented by four promissory notes of denominations aforesaid duly secured by deed of trust to provide that the parties of the second part shall pay all taxes and assessments for, and on account of, said property within the time and as prescribed by law; to keep the property in good condition and repair, and to keep the same insured. *** But it is expressly agreed and understood that this option to purchase, as hereinbefore stated, does not mean that the parties of the second part herein shall have the sole and exclusive right of purchase, but that they shall have the refusal or preference of right of purchasing on terms herein stated and their failure to accept the same on those terms when offered to them shall give the parties of the first part a perfect and complete right to make sale of same to any other party on such terms as they may see fit," etc. This lease was executed by all of the parties; Mrs. Pearson complying with the statutory provisions required for the execution of a deed. On October 2, 1903, Lasater having sold and assigned all of his interest in the livery business, in which the firm were engaged, to defendant Millard, executed to him an assignment of his interest in the lease and option. This assignment was introduced over plaintiffs' objection, and subject to their exception. Mr. and Mrs. Pearson resided abroad, the former being United States minister to Persia. Mr. Whitson was Mrs. Pearson's agent for the collection of rent. On the 28th day of May, 1906, plaintiffs instituted this action for the recovery of possession of the property, alleging that by the failure of defendant to perform certain covenants in the lease, he had forfeited his term. Defendant set up the lease, alleged that he had performed all of the covenants, and exercised his option to purchase the property by notifying plaintiffs' agent, tendering the cash payment, and that he was ready and willing to perform all of the other conditions of the option. Plaintiffs replied, and, upon issues submitted to the jury, they found the following facts: That defendant, during the month of December, 1905, notified Mr. Whitson of his purpose to purchase the property under the terms of the contract; that Mr. Whitson was the authorized agent of the plaintiffs, with power to accept or reject the offer; that defendant tendered the amount of $1,000, and was able to pay same; that the rent was not in arrears at that time; that defendant had not failed to comply with the condition of the lease in regard to repairs; that he was not in the wrongful possession of the property; that plaintiffs were not entitled to recover any amount for rent or damages; that Lasater assigned his interest in the option to defendant prior to January 1, 1906; that defendant owed the plaintiffs, on account of purchase money for the property, $9,000, with interest from January 3, 1906, the date of the tender. Upon this verdict his honor rendered judgment that, upon the payment to plaintiff Mrs. Pearson by defendant, or by payment into the clerk's office, of $9,000, with interest from January 3, 1906, plaintiffs execute and deliver to defendant a good and sufficient deed for the property; that if they failed to do so the judgment should operate as a conveyance, in accordance with the provisions of the statute. The plaintiffs, having noted exceptions to his honor's rulings, excepted to the judgment and appealed.

J. C. Martin and W. R. Whitson, for appellants.

Merrick & Barnard, for appellee.

CONNOR J.

Plaintiffs except, and assign as error his honor's refusal to submit the issue, "Did defendant offer to comply with all of the conditions of the written contract mentioned in the pleadings as alleged in the answer?" His honor submitted separate issues, directed to the several conditions in the lease, and this we think was proper. Every controverted question of fact was settled by the verdict upon the issues submitted. The exception cannot be sustained. Plaintiffs assign as error the admission of the assignment by Lasater to defendant. It was certainly relevant and competent. Its admission did not affect its effect upon the rights of the parties, but was necessary to enable the court to pass upon that question. We are unable to perceive how it could prejudice the plaintiffs.

The next assignment of error is in the admission of Mr. Pearson's letter of February 23, 1906, to Mr. Whitson. This letter was written from Teheran, Persia, in response to the letter notifying plaintiffs that defendant had accepted the option, and was ready to make the purchase "under its terms." Mrs. Pearson insists that Mr. Pearson was not her agent, and that she was not bound by his letter. Conceding this to be true, we do not see how the letter affected her rights. Mr. Pearson simply placed his construction upon the option, which, if correct, deprived defendant of any right under it. He insists that the option entitled the lessees to purchase, provided no one else would give more, and said that he had been offered a larger price. There is no suggestion that the acceptance was not in accordance with its terms, but that under the terms defendant had no right to call for a deed. Certainly there is nothing in the letter prejudicial to Mrs. Pearson. There was some evidence that Mr. Pearson was her agent. In any point of view there is no prejudicial error in his honor's ruling. The jury having found that none of the conditions in the lease-payment of rent and for repairs-had been broken, and having further found that Mr. Whitson was the authorized agent of the plaintiff, with power to accept or reject the offer made by defendant, and that he was notified of the acceptance by defendant, and the cash payment of $1,000 was tendered within the time fixed in the lease, we are brought to a consideration of the pivotal questions argued by counsel. The option was simply an offer by plaintiffs to permit the lessees to purchase, upon the terms stated, "on or before the 3d day of July, 1907." Until accepted by the lessees it was a unilateral contract, binding only the lessors.

We had occasion to consider the subject in Trogden v Williams, 144 N.C. 192, 56 S.E. 865, 10 L. R. A. (N. S.) 867, and examined the authorities bearing upon the relative rights and duties of the parties to a contract of this character. The option was, in this case, based upon a sufficient consideration. "When an option is given the lessee to purchase the leased premises, the lease is a sufficient consideration to support the option, and the lessor cannot withdraw it before the time...