Western Bank v. Morrill
| Decision Date | 16 November 1966 |
| Citation | 420 P.2d 119,245 Or. 47 |
| Parties | WESTERN BANK, an Oregon Banking Corporation, Plaintiff, v. Robert M. MORRILL and Mildred M. Morrill, Doris Hansen and Hans Hansen, Alora M. Tilley, Defendnats, and Dorothy Boice, Appellant, and Shaw Lumber Mill, a Partnership, and Ray E. Shaw and Ralph H. Shaw, members of said partnership, and Frank S. Slover, Respondents. |
| Court | Oregon Supreme Court |
Edward M. Murphy, Roseburg, argued the cause for appellant. With him on the brief were Stults, Jayne & Murphy, Roseburg.
Frederic H. Starkweather, Jr., Gold Beach, argued the cause and filed the brief for respondents.
Before McALLISTER, C.J., and PERRY, O'CONNELL, DENECKE and REDDING, JJ.
This is an appeal by the defendant Dorothy Boice from what is termed a 'decree' in a proceeding begun by a bill in interpleader by Western Bank against Robert M. Morrill and Mildred M. Morrill, his wife; Doris Hansen and Hans Hansen, her husband; Alora M. Tilley; Ray E. Shaw and Ralph H. Shaw, co-partners doing business as Shaw Lumber Mill; Frank S. Slover; and Dorothy Boice. The prrincipal question, and the only one which we need decide, is whether defendant Dorothy Boice is bound by a written release not signed by her, but to which she agreed orally.
The matters in issue here arise out of a contract for the sale of timber entered into between the defendants. Defendants Robert M. Morrill, Doris Hansen and Dorothy Boice are brother and sisters; defendant Tilley is the widow of the predecessor in interest of said brother and said sisters and holds a dower interest in the real property upon which the timber was located. Frank S. Slover is assignee of some of the rights of the Shaws.
The beginning of the trouble between defendants Robert M. Morrill, Doris Hansen and Dorothy Boice came from their joint ownership of the property they inherited and they quarreled with each other to the extent that as the trial court found, they were for many years not on speaking terms to each other, and in particular, defendant Dorothy Boice, the present appellant, had not spoken to her twin sister, Doris Hansen, for several years. This condition continued to the time of trial so that as a result, they, on many occasions, dealt through intermediaries and agents.
As a result of the inability of the brother and sisters to get along, a partition suit was instituted which concluded by each party taking certain portions of the real estate and the timber thereon in fee simple. At the time of the partition of the land, the parties to the partition suit agreed that the timber on the entire tract sought to be partitioned should be sold as a unit and the proceeds from the sale divided two-fifths to Robert M. Morrill and one-fifth each to Doris Hansen, Boice and Tilley. Pursuant to this agreement to sell the timber, the Hansens, Morrills, Boice and Tilley entered into an option agreement with the defendant Shaw Lumber Mill. The option which later became the contract under which the logging operation took place was, in part, as follows:
Robert M. Morrill and Mildred M. Morrill, Doris Hansen, and Hans Hansen, Dorothy Boice, and Alora M. Tilley, the optionors, granted to the Shaw Lumber Mill, the optionee, its successors and assigns, 'the sole and exclusive option to purchase upon the terms and conditions herein expressed, all of the merchantable Douglas Fir, White Fir, and Cedar timber, except dead Cedar, twelve (12) inches or greater DBH, down to an 8 inch top, * * *.' (By DBH is meant 'diameter breast high.')
In addition to the payment for the timber at specified rates per thousand, the agreement provided:
This fund, at the time the interpleader suit was instituted by Western Bank, the escrowee, amounted to $19,795. The parties have in their briefs referred to this fund as 'the liquidated damage fund' and the court will adopt that term in referring to said fund hereafter.
After providing that good forestry practices were to be observed in the removal of the timber, and that Manfred Martin, the mutual agent of the parties, should determine when logging was completed under the contract, the contract provided that '(t)itle to all lumber or logs cut or removed from said premises shall not pass until Optionors (sic) have paid in full therefore (sic).'
After modifications not here material, the option was exercised by the Shaw Lumber Mill and the option agreement was adopted as the final contract between the parties in 1959.
Under this agreement, the respondent Shaw Lumber Mill logged the area until May, 1964, when the logging operation was substantially completed. At the conclusion of the logging, a dispute arose which resulted in the litigation now before the court. Both Shaw Lumber Mill and the Hansens, Morrills, Boice and Tilley, laid claim to the liquidated damage fund. The defendants who owned this timber contended that defendant Shaw Lumber Mill had breached the contract in that it had conducted the logging operations in an improper manner and had thereby forfeited the fund under the terms of the contract. Defendant Shaw Lumber Mill denied this and claimed it was entitled to the fund held in escrow by Western Bank.
Faced with these conflicting claims to the liquidated damage fund, and being unable to determine which of the two claimants was entitled thereto, Western Bank, on March 29, 1965, filed suit in interpleader and deposited the liquidated damage fund with the clerk of the court.
All of the defendants admitted the allegations of Western Bank's bill in interpleader and the court entered a decree discharging it from further participation in the case and ordered that the defendants interplead among themselves to determine who was entitled to the fund.
The defendants Hansen, Morrill, Boice and Tilley, by answer, which was verified by Dorothy Boice, claimed that Shaw Lumber Mill had breached the contract and had forfeited the liquidated damage fund. Shaw Lumber Mill, by reply, denied the breach, and by way of affirmative defense alleged that in December, 1964, the parties to the option agreement and timber sale contract entered into an agreement which, by its terms, 'operated as a full and complete release of any and all actions, causes of action, claims and demands, including but not limited to those arising or growing out of said option or agreement between the parties as aforesaid.' The Shaw Lumber Mill, by reply, further alleged:
'That said agreement was signed by the defendants Robert M. Morrill and Mildred M. Morrill, Doris Hansen and Hans Hansen, and Alora M. Tilley as members of said joint venture and that all the defendants who were signatories to said option agreement, including Robert M. Morrill and Mildred M. Morrill, Doris Hansen and Hans Hansen, Dorothy Bocie and Alora M. Tilley, are bound thereby and that no cause of action or claim whatsoever, according to the terms of said release, may now be maintained by any of said defendants.'
The release referred to in the reply of Shaw Lumber Mill provided that in exchange for mutual promises of release, the parties agreed that Western Bank should pay to the defendants Hansen, Morrill, Boice and Tilley, from the liquidated damage fund, the sum of $2,500 to be divided among them, and that the Bank pay the balance to respondent Shaw Lumber Mill.
The agreement shows upon its face that it was signed by all the parties to the timber sale contract, except appellant Dorothy Boice, who asserted on trial and asserts on appeal that she is not bound by the release. The Shaw partnership contends that Mrs. Boice is bound by her oral assent to the terms of the written release.
After the discharge of Western Bank from further participation in the case, and before trial of the issues between Shaw Lumber Mill on the one hand, and the remaining defendants on the other, all parties entered into an agreement to waive trial by jury on any and all questions of fact, and stipulated that the court determine all questions of fact and make findings thereof. Furthermore, at the suggestion of the court, the validity of the release agreement was isolated as the initial and controlling issue to be determined, since if it were determined that the release was binding upon all the parties, it would be determinative of the case and the issue of breach of contract and damages would be moot. The trial proceeded on this basis.
At the end of the trial, the court made its findings of fact and conclusions of law. The court concluded that the release agreement was a valid and binding instrument and entitled to be enforced, that it was 'agreed to in writing by the signers thereof and agreed to orally by defendant Dorothy Boice, and that all are estopped to deny the agreement of release and compromise.'
Judgment and decree was entered awarding $2,500 to defendants Morrills, Hansens, Tilley and Boice, and the balance of the liquidated damage fund to the Shaw partnership. Only Dorothy Boice has appealed. As both parties to this appeal were defendants in the interpleader suit, defendant Dorothy Boice, the only defendant who has appealed, will hereafter be referred to as appellant, and the defendant Shaw Lumber Mill will be referred to as respondent.
Before proceeding to decide whether appellant Dorothy Boice is bound by the release not signed by her, but...
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