Sloan v. Paramore
| Decision Date | 03 March 1914 |
| Citation | 164 S.W. 662,181 Mo.App. 611 |
| Parties | MARY J. SLOAN, Respondent, v. FREDERICK W. PARAMORE, Appellant |
| Court | Missouri Court of Appeals |
Appeal from St. Louis City Circuit Court.--Hon. James E. Withrow Judge.
AFFIRMED.
Judgment affirmed.
E. W Banister for appellant.
(1) An agreement to purchase real estate is as much within the Statute of Frauds as an agreement to sell it. Brown on Statute of Frauds, Sec. 263; Schlanker v. Smith, 27 Mo.App. 516; Culligan v. Wingerter, 57 Mo. 241. And if suit for specific performance cannot be maintained neither can a suit for damages for a breach of the contract. Culligan v. Wengerter, 57 Mo. 241; Andrews v Braughton, 78 Mo.App. 179; Lydick v. Holland, 83 Mo. 703. (2) The court misdirected the jury as to the measure of damages in the case. The pleadings and uncontradicted evidence show that the contract was that in case appellant purchased the property in question respondent should receive one-half of the profits realized on its resale. Assuming then that respondent was entitled to recover, she could have judgment for one-half only of such profits as would have been realized from a sale of the property. 1 Story on Equity (13 Ed.), p. 672, Sec. 665; 8 Am. & Eng. Ency. of Law, page 632; Tinsley v. Jenerson et al., 74 F. 177; Jack v. McKee, 9 Pa. 235; Baeb v. Baeb, 9 Pa. 260; Taylor v. Bradley, 39 N.Y. 129; Hoyt v. Grenoble, 34 Pa. 9; Bush v. Chapman, 2 Greene (Iowa) 549. By the first instruction given by the court at the request of the defendant the court properly declared the law as to the measure of damages; but by the second instruction, given at the request of the plaintiff, the court in effect told the jury that if they found for the respondent she was entitled to all the profits. Where contradictory instructions are given the jury will be conclusively presumed to have followed the erroneous instruction and the judgment will be reversed. Russell v. Poor, 133 Mo.App. 723; Ross v. Metropolitan Street Ry. Co., 132 Mo. 472; Sheperd v. St. Louis Transit Co., 189 Mo. 362; Mansur, etc., Imp. Co. v. Ritchie, 143 Mo. 587; Mining Co. v. Fidelity, etc., Co., 161 Mo.App. 185; Sublette v. Lowe, 152 Mo.App. 186; Butz v. Construction Co., 137 Mo.App. 228. (3) There was no consideration to support the oral contract relied on by respondent.
L. Frank Ottofy for respondent.
(1) Agreements to share profits and losses arising from the purchase and sale of real estate are not contracts for the sale or transfer of interest in land and need not be in writing. 20 Cyc., p. 237; Browne on Statute of Frauds (5 Ed.), Sec. 261g; Wiedemann v. Crawford, 134 S.W. 495; Van Trotha v. Bamberger, 15 Colo. 1; Snyder v. Wolford, 22 N.W. 254; Benjamin v. Zell, 100 Pa. 33; Morrill v. Colehour, 82 Ill. 626. (2) The agreement between plaintiff and defendant was for a present partnership and not for one to begin in the future, hence it is not within the Statute of Frauds. Browne on Statute of Frauds (5 Ed.), Sec. 262; 29 Am. and Eng. Ency. of Law (2 Ed.), p. 898, Note 1; McNealy v. Bartlett, 123 Mo.App. 58; Hill v. Palmer, 56 Wis. 123; Treat et al. v. Hiles, 68 Wis. 344; Speyer v. Desjardins, 144 Ill. 648; Kayser v. Maugham, 8 Colo. 232; Goldstein v. Nathan, 158 Ill. 646. (3) The contract was founded on a valid consideration, the defendant was to share profits, a benefit which was accruing to him because plaintiff did not after the agreement protect the property at the sale and hence her loss. Bishop on Contracts, Sec. 481; German v. Gilbert, 83 Mo.App. 411; Phippen v. Stickney, 44 Mass. (3 Metc.) 384; Hunt v. Elliott, 80 Ind. 245; Underwood Typewriter Co. v. Realty Co., 118 Mo.App. 202; Hartzell v. Saunders et al., 49 Mo. 434; Scriba v. Neely, 130 Mo.App. 258; Little v. McCarter, 89 N.C. 233. (4) The instructions on the measure of damages clearly state that plaintiff was only entitled to recover one-half of the damages and, taking them as a whole, could not possibly have misled the jury. But in truth plaintiff was entitled to recover the entire damages, hence, the giving of the instructions for defendant was an error in his favor, of which he cannot complain. 2 Story's Eq. Juris., Sec. 665; McNeil v. Reid, 9 Bing. 68; Hill v. Palmer, 56 Wis. 123; Hyer v. Richmond Traction Co., 168 U.S. 471.
This is a suit for damages accrued to plaintiff through the breach of a contract of partnership to share the profits in land. Plaintiff recovered and defendant prosecutes the appeal.
It appears plaintiff owned a certain lot of land in the city of St. Louis, situate at the southeast corner of Eugenia and Twenty-first streets, together with the building thereon. The property was encumbered by a deed of trust in favor of Nicholls, trustee, for the principal sum of $ 16,000. Considerable interest had accumulated on the deed of trust and, indeed, the note therein secured was more than a year past due and the condition therefor broken. The entire amount due on the note and interest secured by the deed of trust was $ 17,174. Besides this, there were then due on the property taxes to the amount of about $ 1200. The property had a rental value of $ 1624 a year. Plaintiff owned the legal title to the property, but conveyed it to Nicholls, the trustee, for the purpose of securing the loan thereon, and by the terms of the deed of trust, she likewise surrendered the possession thereof to Nicholls and continued to occupy the property herself as his tenant at an agreed rental of one cent per month. The owner of the note desiring his money, insisted upon payment and plaintiff went about the matter of negotiating a new loan on the premises. At first defendant agreed to loan her $ 18,000 thereon, but upon examining the title, he declined to consummate this loan, but it is said agreed to buy the property in at the trustee's sale. The property was advertised for sale by Nicholls, the trustee, at the courthouse door in St. Louis on November 17th.
The evidence tends to prove, and the jury so found the fact to be, that defendant verbally agreed with plaintiff that he would attend the trustee's sale and buy the property in, provided it did not sell for more than $ 18,000, and that the parties would "be partners" in the profits which might be realized on a re-sale of the same. In other words, defendant agreed to bid enough on the property at the trustee's sale to pay off the mortgage, including the interest, of $ 17,174 and if need be bid as high as $ 18,000 for the property and take title thereto in himself. Thereafter the property should be sold and he, defendant, and plaintiff divide the profits realized on such re-sale, after deducting the amount of defendant's investment. Two days thereafter, November 17th, defendant attended the sale, but made no bid on the property whatever. The property was sold under the deed of trust and purchased by another at the price of $ 17,175, or one dollar more than the amount necessary to pay the note and interest against it. Defendant says that, while he agreed to buy the property, he agreed to bid only the amount of the mortgage--that is, $ 17,174--and that he omitted to buy it because another bid more than such amount. The evidence concerning the value of the property varies. For defendant, one witness says it was worth from twenty-one to twenty-two thousand dollars, while others value it higher still. For plaintiff, the evidence tends to prove the value of the property at the time was from twenty-five to thirty thousand dollars.
It is argued that, as the agreement between the parties was in parol, the court should have directed a verdict for defendant because of the Statute of Frauds. The argument is that, as the statute applies to the purchase as well as sale of real property, plaintiff should not be entitled to recover, in the absence of an agreement in writing between her and defendant touching the same. It is clear that the instant case is not within the statute, for the suit proceeds on a breach of a contract of partnership between the parties, whereby they were to share the profits arising from the sale of land. Here, though plaintiff owned an equity--that is, a right of redemption--she was to forego that entirely, and this, too, without acquiring any interest whatever in the land through the sale that was made. By the agreement she was to become entitled to share the profits realized by a resale of the property on the part of defendant after he had acquired the title from the trustee. Though the defendant was to acquire the title to the land, the agreement obviously contemplated no more than a sharing of the profits to be realized. If no profits were made, then the parties took nothing, save defendant held the land to compensate his investment, and it may be that both would suffer loss.
Cyc., Vol. 20, p. 237 thus states the rule with respect to such sharing of profits: "It is generally held that agreements to share profits and losses arising from the purchase and sale of real estate are not contracts for the sale or transfer of interests in land and need not be in writing."
Mr. Browne, in his work on the Statute of Frauds (5 Ed.), Sec. 263a says: "When, for instance, the defendant promises the plaintiff to buy land for himself--the plaintiff, whatever his advantage from having the defendant make the purchase, acquiring no interest in land,--the contract does not appear to be within the policy of the statute."
The Supreme Court of Pennsylvania says, "An interest in contingent profits, arising from a sale of real estate, to be made thereafter, does not amount to an interest in the land itself, within the meaning of the Statute of Frauds." ...
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