Powell v. Sheets
| Decision Date | 03 December 1952 |
| Citation | 196 Or. 682,251 P.2d 108 |
| Parties | POWELL et al. v. SHEETS et al. |
| Court | Oregon Supreme Court |
George P. Winslow, of Tillamook, argued the cause and filed a brief for appellants.
Robert Y. Thornton, of Tillamook, argued the cause and filed a brief for respondents.
Before BRAND, C. J., and LATOURETTE, WARNER and TOOZE, JJ.
This is a suit brought by Floyd Powell and Wesley Powell, as plaintiffs, against Robert A. Sheets and Frances J. Sheets, his wife, and Harold Guthert, as defendants, to reform a written contract for the sale of timber, and for injunctive relief. The case, a suit in equity, was tried to the court without the intervention of a jury. Judgment in favor of plaintiffs and against defendants Robert A. Sheets and Frances J. Sheets in the sum of $2,421.28 was entered. This suit was dismissed against defendant Harold Guthert with prejudice. Defendants Robert A. Sheets and Frances J. Sheets appeal from the judgment against them.
Defendants are the owners of the northeast quarter and the southeast quarter of the northwest quarter of section 12, township 3 south, range 10 west of the Willamette meridian, in Tillamook county, Oregon. Hereafter we shall refer to the northeast quarter of the northwest quarter as the 'north forty', and to the southeast quarter of the northwest quarter as the 'south forty', that being the designations given the two tracts of land by the parties to this litigation.
Upon each of the forty-acre tracts there was a stand of merchantable timber, consisting of hemlock, old-growth fir, and some second-growth fir. The stand on the south forty was more extensive and was composed of better timber from the standpoint of being merchantable.
On November 8, 1949, plaintiffs and defendants entered into a written agreement for the sale of the timber on the north forty. The provisions of that agreement so far as material to our discussion are:
'Witnesseth; That the said parties of the first part [plaintiffs] for and in consideration of the covenants hereinafter contained on the part of the said party of the second part, do covenant and agree to and with the said party of the second part as follows:
'To purchase any and all the merchantable timber contained on the following premises to-wit: The Northeast quarter of the Northwest quarter of Sec. 12 Township 3 South, Range 10 of Willamette Meridian, all being in Tillamook County and in the State of Oregon.
'That the parties of the first part agree to pay unto the party of the second part at the rate of $7.00 per thousand board fee for any and all old growth fir and $4.00 per thousand board feet for second growth fir and hemlock contained on the aforesaid premises, the per thousand board feet shall be arrived at from Scribner's scale (Columbia River); with the payments to be made at the aforesaid rates at the end of each month for all logs delivered for sale by the parties of the first part; said timber to be removed by Nov. 8, 1950, unless further extension of this contract is agreed to.
'That the parties of the first part agree to construct a bridge across the creek and build any necessary road for the removal of the timber at their own expense.
'That the party of the second part agrees to sell to the parties of the first part all the timber on the aforesaid premises and as aforesaid.' (Italics ours.)
In their complaint filed in this cause on May 20, 1950, plaintiffs allege the making of the aforesaid contract and then charge as follows:
'II.
'That the agreement pursuant to which said contract was executed was for purchase of all merchantable timber contained in the southeast quarter of the northwest quarter of Section 12, Township 3 south, Range 10 west, Willametee Meridian.
'III.
'That in drawing said agreement the scrivener by mistake made the same for the purchase and sale of timber in the northeast quarter of the northwest quarter of Section 12, Township 3 south, Range 10 west, Willamette Meridian.
'IV.
'That plaintiffs hired certain fallers and buckers to go on the southeast quarter of the northwest quarter of Section 12 and caused them to fall all of the merchantable timber thereon, at plaintiffs' expense.
'V.
'That plaintiffs and defendants Sheets relied upon the accuracy of the scrivener and did not check on the legal description in said agreement nor discover the erroneous description until on to-wit, the 1st day of April, 1950, when plaintiffs notified the defendants Sheets thereof and requested defendants Sheets to join in endorsement on the agreement or other suitable writing to rectify the error.
'VI.
'That the defendants Sheets then and ever since have refused to join, in any way, in rectifying the error.
'VII.
'That defendants Sheets have pretended to make a sale of said timber to defendant Harold Guthert and that said Harold Guthert is now in the possession thereof and in the process of removing said timber.' (Italics ours.)
Plaintiffs pray a decree enjoining the sale and removal of the timber during the pendency of the suit; that the contract be reformed in accordance with the actual intention of the parties; that the agreement as reformed be specifically performed; and for an accounting for profits on any logs removed prior to the filing of the complaint.
Defendants' answer consists of a general denial.
On the day of trial (January 4, 1951), plaintiffs were permitted to file a supplemental complaint. In this pleading plaintiffs alleged that since the commencement of the suit, the logs on the south forty had been sold and removed by defendants; that in selling said timber defendants had received the benefit of plaintiffs' expenditures for felling and bucking, which expenditures were alleged to aggregate the sum of $1,828.15. Plaintiffs further alleged as follows:
'IV.
'That prior to the time of defendants' breach of contract as alleged in plaintiffs' original complaint, plaintiffs had made the necessary arrangements, including locating and contracting for logging equipment necessary, to begin and carry on successfully said logging and made all necessary arrangements pursuant to said contract with defendants Sheets; that by reason of said breach of said defendants Sheets, in failing to perform said contract, the plaintiffs have sustained considerable damages.
'V.
'Furthermore, by reason of said breach of said defendants Sheets, plaintiffs have been thereby deprived of reasonable profits which would have otherwise accrued to them on the logging and marketing of said timber, but for the breach of said defendants Sheets as alleged in plaintiffs' original complaint herein.'
Plaintiffs then repeated their prayer for reformation of the contract and prayed that defendants be required to account for the felling and bucking expenditures, for the reasonable profits that would have accrued to them on logging and marketing the timber, and for further damages in the sum of $1,000.
It was stipulated between the parties that the allegations of the supplemental complaint should be deemed denied by defendants.
Upon conclusion of the trial, the trial court in a memorandum opinion found that the evidence was insufficient to authorize the court to reform the contract as prayed for in plaintiffs' original and supplemental complaints. The court then said:
'However, since the plaintiffs have asked for general equitable relief the court is of the opinion that it should retain jurisdiction of the matter and grant the equitable relief that is indicated by the evidence in the case.'
The court then found that plaintiffs were entitled to recover $1,471.21 on account of their expenditures for felling and bucking, and the further sum of $950.61, as one-half the profits realized upon the sale of the logs.
Thereupon, plaintiffs presented a proposed decree in accordance with the court's memorandum opinion. Defendants immediately filed written objections thereto, accompanying their objections with a proposed decree in keeping with their theory of the case. The material portions of the objections are:
'II.
'Defendants object to the proposed finding to the effect that this court should retain jurisdiction of this cause after the court has expressly found that the evidence was insufficient to authorize the court to reform the contract pleaded by plaintiffs, for the reason that after plaintiffs' request for reformation has been disposed of adversely to plaintiffs then no equitable grounds remain authorizing an equity court to retain jurisdiction.
'That the finding and conclusion of law, to the effect that this court should retain jurisdiction and award plaintiffs a judgment, is erroneous, contrary to the law, and not based upon any fact, found by the court, giving this court the right to retain jurisdiction and to determine the controversies between plaintiffs and defendants in an equitable proceeding; that under the findings of the court, as set forth in the memorandum opinion of the court, the only conclusion of law which can be properly made is that this cause should be dismissed as to all of the defendants.
'V.
'That the failure of plaintiffs to allege and prove sufficient facts to give a court of equity jurisdiction makes it necessary to transfer this cause to the law side of the court where each party is entitled to a trial by jury.'
The principal contention of defendants on this appeal is that the trial court, sitting as a court in equity, erred in retaining jurisdiction and entering a money judgment against defendants after it had determined, as a matter of fact, that plaintiffs had failed to prove their allegations upon which equitable jurisdiction was predicated, and that, upon defendants' request, it should have dismissed the cause or transferred it to the law side of the court where jury trial might be had.
An examination of the record discloses that plaintiffs had no cause of suit for reformation of the contract. It is not a...
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