Wilson v. Spry

• Decision Date: 05 July 1920
• Docket Number: 99
• Citation: 223 S.W. 564,145 Ark. 21
• Parties: WILSON v. SPRY
• Court: Arkansas Supreme Court

223 S.W. 564

145 Ark. 21

WILSON v. SPRY

No. 99

Supreme Court of Arkansas

July 5, 1920

Appeal from Nevada Chancery Court; James D. Shaver, Chancellor affirmed.

Decree affirmed.

McRae & Tompkins, for appellants.

1. The offer to sell such as the memorandum of understanding here was based on no consideration and not binding upon either party until the offer was accepted. Until acceptance the offerer has the right to change or withdraw the offer. 6 R C. L. 603; 32 A. 1120. The money expended by Spry in the examination of the land was not a sufficient consideration as it was no benefit to Wilson. James on Options, § 313; 110 N.Y.S. 176; 146 N.W. 418, 420; 41 So. Rep. 374; 73 Ga 570; 5 Cal. 302; 19 A. S. R. 205; 68 Md. 21. If the offer had been based upon a sufficient consideration, there was no new consideration for the extension of time, and it was nudum pactum. 10 Mont. 5; 24 A. S. R. 17; 68 Md. 21; 6 R. C. L 604; 110 N.Y.S. 176; 1 Ann. Cas. 986; 87 N.E. 874.

2. Wilson had the right to prescribe the method of acceptance and it must have been exactly as prescribed. 14 S.E. 249; 17 N.W. 534; 89 Id. 1072; 43 L. R. A. (N. S.) 1150; 97 Ark. 613; 13 C. J. 279; 43 Ark. 337; 97 Id. 613; 112 Id. 380.

3. There could be no binding contract until Spry paid the first $ 3,000 as the memorandum specifies. Before the tender was made, the offer was rejected and it was too late to revive it.

4. There could be no binding contract until Spry signed the memorandum. 41 P. 797; 28 A. 152. The minds of the parties never met. This is a question of intention. The learned chancellor overlooked the conditions in the letters from Wilson to Spry and from Spry to Wilson.

Where conditions are added, it is a rejection of the offer. The letters showed an absolute rejection, and not an unconditional acceptance. The letters and telegram added material conditions and this was a rejection of the offer. 4 L. R. A. 616; 107 A. S. R. 681; 6 L. R. A. 608; 101 U.S. 43-50; 124 F. 196; 1 Elliott on Cont., § 39; 21 A. & Eng. Enc. 930.

When once rejected, the party rejecting can not revive the offer by accepting. 6 R. C. L. 608; 119 U.S. 149-151; 10 L. R. A. (N. S.) 1116-7; 1 Elliott on Cont., § 41; 3 Ark. Law Rep. 74; 122 Mo. 667.

5. Spry never accepted the opinion as the evidence shows.

The court erred in extending the time for Spry to buy for two years from May 1, 1919, instead of from February 16, 1919, contrary to the terms of the memorandum.

6. The court erred in decreeing specific performance against the trust company. It pleaded the statute of limitations and it never signed anything. It held the legal title to the land and Spry did not show what its relation to the land was. The statute provides that no action shall be brought to charge any person upon any contract for the sale of lands or any interest in them, unless in writing. Spry has not performed the conditions imposed upon him. Having so failed, his failure is a defense to an action for specific performance. 118 Ark. 283.

Coleman, Robinson & House, for appellee.

1. It is Hornbook law that an offer and acceptance constitute a contract. A sufficient consideration is proven for the acceptance of the offer. The memorandum furnishes the written evidence. It was signed by the party to be charged, or against whom it is to be enforced. 72 Ark. 359; 83 Id. 149; 101 Id. 68. The contract was taken out of the statute of frauds by the memorandum and the letters. 4 C. P. Div. 450; 7 Q. B. Div. 125; 44 Ch. Div. 204; 33 S.C. 367; 22 Oh. St. 62; 81 Ill. 317; Wood on Stat. Frauds, § 364; 95 U.S. 289; 66 Ala. 345; 68 Id. 393; 82 Id. 417; 20 So. Rep. 587.

2. There could be no binding contract until Spry paid the first $ 3,000.

3. No new conditions were added to the offer and it was not a rejection of the offer.

4. Spry never accepted the offer or option. 26 R. C. L. 641; 175 P. 956. A conditional tender must be strictly followed if accepted or entirely refused. 175 P. 956; 55 Mo. 468; 23 Tenn. 490; 61 Barb. 497; 20 Mo.App. 271; 56 Ill. 450; 84 Ill.App. 417.

OPINION

WOOD, J.

This action was brought by the appellee against the appellants to enforce specific performance of a contract of which the following is the memorandum:

"MEMO. OF UNDERSTANDING."

"Between Mr. Spry and Mr. Wilson re approximately 10,000 acres in Arkansas owned by Mr. Wilson but in the name of Trust & Guarantee Company, Limited, and described in annexed list.

"Mr Spry to put estimators on at once and complete examination.

"Within forty-five days from today Mr. Spry shall decide whether he wants right to buy, and Mr. Wilson is not to sell in meantime to another.

"Within that forty-five days Mr. Spry may for $ 24,000 have the right to buy the land for $ 200,000 within two years from today.

"If Mr. Spry decides to buy, then the $ 200,000 shall be paid $ 50,000 in cash and $ 50,000 at the end of each year thereafter, with interest on amount unpaid at 6 per cent., payable quarterly. Title to be good and usual provisions for Mr. Spry to search title at his own expense and to have back any part of price paid if title not good, in which event the agreement to be void. Deed to be executed to Mr. Spry and put in escrow upon payment of first $ 50,000 and to be delivered when whole price paid as stipulated.

"If Mr. Spry after examination, within forty-five days, wants right to buy, he is to pay $ 3,000 cash and $ 3,000 at end of each three months, until the $ 24,000 is paid, or Mr. Spry decides to purchase and pays the $ 50,000 cash on price, and these sums to be forfeited if he do not purchase for the $ 200,000. Mr. Spry may at any time within the two years abandon right to purchase and stop further liability for the $ 24,000 payments.

"Mr. Wilson to pay proportion of taxes and rates for this year up to date of Mr. Spry's decision and Mr. Spry to pay taxes and rates for time up to his decision as to buying for $ 200,000.

"This memo not to be binding upon Mr. Spry or Mr. Wilson until Mr. Spry decides within forty-five days that he wants the right to buy and pays the first $ 3,000. R. E. Ward to continue collecting rent and net surplus after his trouble in looking after same and protecting property to be paid to Mr. Spry during time that Spry pays taxes and rates. February 16, 1919."

Appellee alleged that appellant Wilson was the owner of the lands mentioned in the memorandum. The lands are described in appellee's complaint. He alleged that the title to the lands was in the appellant Trust & Guarantee Company, Ltd., hereafter called company; that the company held the naked legal title for the benefit of appellant Wilson, who owned the lands in fee simple. He alleged that the time mentioned for exercising the option was extended, and that within the period of such extension appellee exercised the option and offered to purchase the lands on the terms specified and tendered to Wilson the sum of $ 3,000 as the first cash payment and offered to perform all the things required of him by the option contract; that Wilson refused to carry out the contract. Appellee prayed for specific performance.

The appellants denied the material allegations of the complaint and pleaded the statute of frauds and set up that there was no note or memorandum signed by the parties, and that there was no contract or agreement between them.

The facts are substantially as follows: Wilson, who lived in Canada, owned about 10,000 acres of land in Arkansas which he wished to sell. John C. Spry lived in Chicago and desired to buy this land. On February 6, 1919, Spry and Wilson met at Chatham, Canada. The meeting resulted in an understanding or agreement between Wilson and Spry, a memorandum of which was made in pencil by Wilson at the time, and after Spry left for Chicago, a copy was made by Wilson with a list of the lands attached, was enclosed in a letter written by Wilson and mailed to Spry the next day. In this letter Wilson designated the enclosed instrument as "a copy of our memorandum of understanding," and further said: "We may either sign this memo now or we may leave it until you decide to buy and pay the first $ 3,000." On February 19, 1919, Spry in a letter to Wilson acknowledged the receipt of the letter and memorandum of understanding, and protested that the time given him for the examination was too short, and asked that the time be extended until May 1st. But he added, "However, we accept your proposition and will do the best we can to finish our examination within the time specified."

Several other letters passed between Wilson and Spry in which Spry was insisting on a definite promise for the extension of time until May 1st to make the examination and to indicate his acceptance or rejection of the option. The letters revealed that Spry had requested his attorney and agent Denton to interview Wilson concerning the matter, and Wilson's final word on this subject was contained in a letter to Spry of March 1, 1919, in which he says, "Mr Denton has been at me today to extend the time until May 1st, for you to make the examination of the property in Arkansas, and I thought by my last letter I had gone as far as I should. However, at Mr. Denton's request I now tell you that if you keep at the job I will keep on extending the time until you finish it, but not beyond, however, the 1st of May." In answer to this letter Spry, among other things, says: "We wish to complete our examination as promptly as possible, as it is costing us between $ 25 and $ 30 a day to cruise it. Thanking you for the extension granted and assuring you that we will complete the work just as soon as possible," etc. In one of the letters to Wilson, Spry complained because it was reported to him that other people had recently been looking over the property, and h...