Shirer v. O. W. S. and Associates, No. 18960

• Court: United States State Supreme Court of South Carolina
• Writing for the Court: BRAILSFORD; MOSS
• Citation: 253 S.C. 232,169 S.E.2d 621
• Parties: Jesse D. SHIRER, Respondent, v. O.W.S. & ASSOCIATES, Inc., the Jefferson Standard Life Insurance Company, and Julian A. Ott, Defendants, Of Whom The Jefferson Standard Life Insurance Company is, Appellant.
• Decision Date: 15 September 1969
• Docket Number: No. 18960

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169 S.E.2d 621 253 S.C. 232 Jesse D. SHIRER, Respondent,
v.
O.W.S. & ASSOCIATES, Inc., the Jefferson Standard Life
Insurance Company, and Julian A. Ott, Defendants,
Of Whom The Jefferson Standard Life Insurance Company is, Appellant. No. 18960. Supreme Court of South Carolina. Sept. 15, 1969.

Roberts, Jennings & Thomas, Columbia, F. Hall Yarborough, Orangeburg, for appellant.

[253 S.C. 233] Marshall B. Williams, Bryant & Fanning, Orangeburg, for respondent.

BRAILSFORD, Justice.

This is an appeal by Jefferson Standard Life Insurance Company from a judgment against if for $21,600.00, the amount of a 'liquidated damage deposit,' retained by it upon the cancellation by O.W.S. & Associates, Inc., of a conditional acceptance of a mortgage loan commitment. This closely held corporation was organized for the purpose of constructing and operating a motel at Smithfield, North Carolina, under a Holiday Inns of America, Inc., franchise. The principal incorporators, all residents of Orangeburg County, South Carolina, were Julian A. Ott, president, Jesse D. Shirer and Fisher Walter. The corporation engaged the services of Stockton, White & Company, mortgage brokers of Raleigh,

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North Carolina, to procure permanent financing for the construction and furnishing of the motel. On November 22, 1966, Stockton obtained a commitment[253 S.C. 234] for a mortgage loan of.$540,000.00 from Jefferson Standard Life Insurance Company, which was accepted by Mr. Ott for the corporation, subject, however, to a number of exceptions. The commitment required a 'liquidated damage deposit' of $21,600.00, and the corporation's check for this sum was issued by Mr. Ott and delivered to Stockton.

A revised proposal of December 6, 1966, was submitted by Jefferson Standard through Stockton and was accepted for the corporation by Mr. Ott, subject only to a modification in the restriction imposed by the proposal upon secondary financing for the purchase of furnishings. This conditional acceptance and the corporation's check for the required deposit were transmitted to Jefferson Standard by Stockton. By letter of January 31, 1967, Mr. Ott notified Stockton and Jefferson Standard that the corporation was canceling 'all preliminary agreements and commitments' because of dissatisfaction with the terms proposed and requested a return of its deposit of $21,600.00. Jefferson Standard refused this request, asserting that it had accepted the corporation's counterproposal by letter of December 22, 1966, to Stockton, the corporation's agent in the transaction, whereupon the negotiations had ripened into a mutually binding loan commitment.

This stockholders' action was brought by Jesse D. Shirer to recover the amount of the deposit. The complaint alleges that Jefferson Standard made 'unreasonable, technical, time consuming and trivial demands' upon the corporation, as a result of which the application for...