Watts v. Hogan, 11713
| Decision Date | 07 May 1975 |
| Docket Number | No. 11713,11713 |
| Citation | 534 P.2d 741,111 Ariz. 536 |
| Parties | B. C. WATTS, Appellant, v. Orville E. HOGAN, Elizabeth Hogan, Kenneth E. Stewart and Audrey L. Stewart, Appellees. |
| Court | Arizona Supreme Court |
G. H. Ladendorff, Phoenix, for appellant.
Renaud, Cook, Miller & Cordova, P.A. by Joseph B. Miller, Phoenix, for appellees.
The appellant, B. C. Watts, filed an action against the appellees to recover a real estate commission. Watts alleged that Watts Realty Company, of which he is assignee of the claim, obtained a purchaser who was ready, willing and able to purchase real property in which the appellees had an interest. The appellees contended that a binding contract never existed because of the failure of a condition precedent. Both parties moved for summary judgment. The motion of the appellees was granted and this appeal was taken by Watts.
Watts and Hogan had discussed the possibility of selling a parcel of land. Watts found an interested buyer and eventually a 'Purchase Contract and Receipt' was signed by Watts, the buyer, the Hogans, and the Stewarts. This was the only written instrument ever signed. As part of the contract, there was the following provision above the appellees' signatures:
'I (or we) agree to sell the above described property on the terms and conditions herein stated, and agree to pay the above mentioned Broker as commission the sum of 10% Of purchase price . . .'
Other parties had an interest in the realty besides the Hogans and the Stewarts. They were not signatories to the contract. The issues are whether or not there was an oral agreement to the effect that the approval of all of the owners of the property was required before the contract became effective and whether the entry of summary judgment for the appellees was appropriate.
All parties having an interest in the land to be conveyed must sign the instrument of conveyance. A.R.S. § 33--401. It is conceded that all of the interested parties in this case did not sign the purchase contract. The appellant contends, however, that he earned his commission as a broker when he secured a ready, willing and able buyer of the property, that this was not subject to any condition, and that parol evidence is inadmissible on the point.
The appellees concede that they signed the contract but contend that its effect was conditional upon obtaining the signatures of the other four people. To allow proof of such a condition precedent is not a violation of the parol evidence rule since it is not introduced to amend the terms of the contract, but to show that the contract never came into existence. Merritt v. Walter Pocock Associates Brokers, Inc., 105 Ariz. 392, 465 P.2d 585 (1970); United States Fidelity & Guaranty Co. v. Olds Bros. Lumber Co., 102 Ariz. 366, 430 P.2d 128 (1967). As pointed out in Merritt v. Walter Pocock Associates Brokers, Inc., Supra, this rule is consistent with the Restatement of the Law of Contracts § 241 which states that if there is an oral agreement that a writing is not binding upon the parties until a future time, the oral agreement is operative unless inconsistent with the written agreement.
Statements in the appellant's briefs that he did not know of the other parties with an interest in the land are contradicted by his own deposition testimony. Watts testified that at the time the contract was delivered to him by Hogan with the signatures of the appellees, the report of the title company had become available which gave the names of the other interested parties. He testified further that he knew it was the law of Arizona that all such parties must sign the instrument of conveyance. This supports the affidavits submitted by the appellees in support of their motion for summary judgment of their understanding that the contract would not be, nor could it be, an effective...
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