Opinion
Docket No. 16, Calendar No. 45,655.
Decided June 8, 1953.
Appeal from Ingham; Salmon (Marvin J.), J. Submitted April 7, 1953. (Docket No. 16, Calendar No. 45,655.) Decided June 8, 1953.
Assumpsit by James Ehninger Knox against James Chowell Knox for money due under written agreement. Directed verdict and judgment for plaintiff. Defendant appeals. Affirmed.
Judson B. Robb, for plaintiff.
Herman J. Lipp ( Foss O. Eldred, of counsel), for defendant.
Plaintiff in this case is the son of defendant and of defendant's former wife, Florence E. Knox, who deceased on October 25, 1946. In 1940, or 1941, because of difficulties not material in this case, Mr. and Mrs. Knox separated and did not live together thereafter. It does not appear that divorce proceedings were instituted by either. They owned a farm in Berrien county, comprising approximately 90 acres, as tenants by the entireties. Mrs. Knox remained on the farm, receiving no direct support from defendant. At the time of her death in 1946 she was the owner of an estate, consisting largely of property that she had inherited, slightly in excess of $25,000. In accordance with her will the property was assigned to plaintiff and to his sister.
For some years prior to her death, plaintiff assisted his mother financially, paying bills incurred by her for medical attendance. He also paid her funeral expenses. For such expenditures he did not obtain, or seek, reimbursement from the estate. No bills of the character referred to were paid by defendant.
Following the death of Mrs. Knox, plaintiff endeavored to persuade defendant to reimburse him for the expenditures that he had made for the funeral expenses of his mother and for her benefit during the last years of her life. A memorandum was prepared, dated November 13, 1946, and signed by defendant, listing bills that plaintiff claimed to have paid, and reciting that defendant would pay such bills if the parties reached a settlement. Subsequently, under date of January 29, 1947, a formal agreement was drawn by an attorney representing defendant, which referred to the claims of plaintiff and stated in substance that defendant would pay the expenses as listed up to the sum of $5,000, together with any amount over said sum that James E. Knox might be able to establish by legal proof had been paid by him for and in behalf of his mother. The writing further indicated that from the obligation assumed there should be deducted any moneys owing by plaintiff to defendant. It provided also that plaintiff would deliver to defendant certain items of personal property. Specific reference was made to building and loan stock, creamery stock and life insurance papers, other stocks, bonds and papers, belonging to defendant being covered by general reference.
Plaintiff agreed to deliver to defendant's attorney the warranty deed to the farm in Berrien county, presumably the instrument of conveyance by which title to the property was vested in Mr. and Mrs. Knox, to make a quitclaim deed, to be signed by himself and his sister, of all right, title and interest, in and to said farm, to deliver to defendant an inventory of personal property on the farm, and to pay for any such property belonging to defendant that he could not deliver. The agreement stipulated that any crops raised during "the past current year," or money derived from the sale thereof, or from the sale of stock, should belong to defendant. Delivery of a bill of sale of certain specific items of personal property was also required. The instrument as prepared by the attorney was signed by defendant, and plaintiff's attorney, having been duly authorized thereto, signed plaintiff's name.
It appears from the record that the certificates of stock and the insurance papers referred to in the agreement were received by defendant through his attorney. Plaintiff and his sister signed a quit-claim deed of any interest owned by them in the farm, but the record does not show that such deed was turned over to defendant. The latter denied receiving the warranty deed referred to, and claimed that it was his understanding that it could not be found. Plaintiff sought to reach an accounting with defendant with reference to the proceeds of any crops or personal property to which the latter was entitled. The conclusion is fully justified that defendant refused to cooperate with regard to any inventory or accounting and further refused to perform under the agreement into which the parties had entered.
Under date of December 29, 1949, plaintiff brought an action in circuit court against defendant, basing his alleged right to recover on the written undertaking that the parties had made. In his answer to the declaration, defendant alleged in substance that the writing on which plaintiff relied was not a binding agreement because plaintiff had not signed it, and, further, that plaintiff had not performed his obligations thereunder. On the trial of the case before a jury plaintiff and defendant testified, and at the close of the proofs each moved for a directed verdict. It appears, however, that counsel on both sides presented to the court written requests to charge. As to the effect thereof, see Arnold v. Krug, 279 Mich. 702, 706, and prior decisions there cited.
The trial judge came to the conclusion that there were no issues of fact to be submitted to the jury, that the contract was valid, that there had been partial performance by plaintiff, that plaintiff was ready, willing and able, to perform his remaining obligations as set forth in the contract, and that he was entitled to recover the amount claimed in the declaration, namely, the sum of $5,000. Verdict was therefore directed in that amount, and judgment entered accordingly. Defendant has appealed, claiming that the action of the trial judge was erroneous, that a verdict for defendant should have been directed, or that, in the alternative, the case should have been submitted to the jury.
Examination of the testimony of the parties on the trial discloses that they were in substantial agreement as to what had actually been done. Defendant conceded that plaintiff had in part performed his promises as recited in the agreement. He testified that he had refused to pay the $5,000 because plaintiff had not fully performed. He also said that he did not think the agreement was binding because his daughter did not sign it. From the averments of the answer it may be inferred that defendant declined performance on his own part because he considered the contract of no force and effect due to the failure of plaintiff to sign it in person. There was no dispute between the parties as to what plaintiff had done, nor as to defendant's refusal to make the payment that he had agreed to make. Plaintiff's proofs, including exhibits offered and received in evidence, established that he had paid his mother's bills and her funeral expenses in an aggregate amount exceeding $5,000. Such fact was not denied by defendant in his answer or in his testimony. The trial judge was correct in concluding that there were no issues of fact to be determined by the jury.
It is undisputed that plaintiff authorized his attorney to affix his signature to the written contract executed on January 29, 1947, which is the basis of this action. Such method of execution was permissible. The signature of plaintiff's sister was not required. She assumed no obligations, and was to receive no benefits. The undertaking with reference to the quitclaim deed was solely that of the plaintiff. Defendant's apparent belief that the contract between the parties was not binding on him because not properly executed was incorrect.
It is defendant's position on this appeal, as it was on the trial in circuit court, that if a valid contract had been made by the parties no performance whatever was required on defendant's part until plaintiff had fully performed his obligations. Obviously the trial judge did not accept such theory. It may be noted in this connection that the proofs fully justify the conclusion that plaintiff was ready and willing to carry out his agreement. There is no claim in the case, presented either by pleadings or by proofs, that the nonperformance by plaintiff of all of his obligations rendered it impossible for defendant to perform.
It is significant that the contract executed by the parties did not in specific terms provide that there should be no obligation on defendant's part unless and until plaintiff had carried out each and all of his promises. That defendant might have insisted on the inclusion of such a provision by his attorney in drafting the instrument is obvious. Kachanowski v. Cohen, 305 Mich. 438. This was not done, and we may not read into the contract any such mutual intent. There is nothing in the situation to justify a conclusion that the delivery of the title deed of the farm, the making of the quitclaim deed to be signed by plaintiff and his sister, or the execution and delivery of bills of sale, to which reference was made, were conditions on which defendant's liability rested. A like conclusion must be reached on this record as to the inventory of articles on the farm. On the death of Mrs. Knox such farm became the sole and absolute property of the defendant by right of survivorship. Presumably items of personal property on the farm were subject to his control. Under the circumstances it was but natural that plaintiff should seek defendant's cooperation with reference to the making of the inventory, and likewise with reference to the crops raised during the last current year before the making of the contract, or the proceeds thereof, if there were such. However, there is nothing in this record on which to base a conclusion that there were any items of property that plaintiff was unable to deliver to defendant, and for the value of which he was liable. Neither is there any showing, or any claim, as to crops raised, or stock sold, during the year 1946. It does not appear that plaintiff personally received money from the sale of such crops or stock. The contract contained no specific promise by plaintiff to pay defendant therefor, merely reciting the stipulation that any crops and stock, or proceeds thereof, of the character referred to, belonged to defendant. Defendant did not by answer raise the specific claim that his obligation to plaintiff was subject to an offset. On the record in the case defendant is not in position to assert that either an inventory or an accounting was a condition precedent to performance on his part. As before noted, plaintiff did perform his undertaking to deliver certain specified certificates of corporate stock, and insurance papers.
While parties to a contract may by specific provision, or by necessary implication, make performance by one party a condition precedent to liability on the part of the other, courts are not disposed, in the absence of specific provisions or reasonable implications, to give such construction to an agreement, especially if so doing brings about an unfair result. Recognizing this proposition, it is said in 17 CJS, p 794:
"While the courts may not turn a condition precedent into an independent agreement, they are disinclined to construe stipulations in a contract as conditions precedent, unless compelled to do so by language of the contract plainly expressed, where so to do would result in injustice."
The distinction between a condition precedent and a promise to discharge an obligation was considered in Lach v. Cahill, 138 Conn. 418 ( 85 A.2d 481). It was there said:
"A condition precedent is a fact or event which the parties intend must exist or take place before there is a right to performance. Mclsaac v. Hale, 104 Conn. 374, 379 ( 132 A 916); McFarland v. Sikes, 54 Conn. 250, 251 ( 7 A 408, 1 Am St Rep 111); 3 Corbin, Contracts, § 628 at p 515, § 629; 5 Page, Contracts (2d ed), § 2586; 1 Restatement, Contracts, § 250. A condition is distinguished from a promise in that it creates no right or duty in and of itself but is merely a limiting or modifying factor. 3 Corbin, Contracts, § 633. If the condition is not fulfilled, the right to enforce the contract does not come into existence. Bialeck v. Hartford, 135 Conn. 551, 556 ( 66 A.2d 610); Sheketoff v. Prevedine, 133 Conn. 389, 393 ( 51 A.2d 922, 171 ALR 1009); Fischer v. Kennedy, 106 Conn. 484, 490 ( 138 A 503); Webb v. Moeller, 87 Conn. 138, 141 ( 87 A 277); 3 Williston, Contracts (Rev ed), § 675; 1 Restatement, Contracts, § 257. Whether a provision in a contract is a condition the nonfulfillment of which excuses performance depends upon the intent of the parties, to be ascertained from a fair and reasonable construction of the language used in the light of all the surrounding circumstances when they executed the contract. New Haven Sand Blast Co. v. Dreisbach, 102 Conn. 169, 180 ( 128 A 320); Sugrue v. Champion, 128 Conn. 574, 577 ( 24 A.2d 890); 3 Corbin, Contracts, p 544; 5 Page, Contracts (2d ed), § 2579."
In Front Street, M. O.R. Co. v. Buller, 50 Cal. 574, in holding that monthly payments under a construction contract were not conditioned on performance by the payee, it was said:
"Courts are disinclined, as was observed by the court of appeals of New York ( 20 N.Y. 432), to construe the stipulations of a contract as conditions precedent, unless compelled by the language of the contract plainly expressed. The reason of this disinclination is that such a construction prevents the court from dealing out justice to the parties according to the equities of the case."
Tipton v. Feitner, 20 N.Y. 423, 432. — REPORTER.
See, also, Inland Construction Company v. City of Pendleton, 116 Or. 668 ( 242 P. 842); Benes v. Hickox Bldg. Co. (Court of Appeals of Ohio), 89 N.E.2d 315.
The will of Mrs. Knox made provision for the payment of all "just debts and funeral expenses." This record discloses no reason, either of fact or of law, why plaintiff might not have filed a claim against the estate of his mother, and have obtained allowance thereof, for the sums advanced by him for her support and medical treatment, as well as for the funeral expenses. The availability of such remedy did not, however, preclude him from relying on his contract with the defendant. The fact that he might have recovered from the estate had he sought to do so is not a defense in the present action.
It should be noted that the agreement between plaintiff and defendant contained expressions indicating that the parties had in contemplation that plaintiff would make a showing before the probate court, in the proceeding relating to his mother's estate, as to the amounts that he had expended and the bills that had been paid by him in full. As before mentioned, the agreement was drawn by defendant's attorney. Obviously a determination of the matter by said court could not have been obtained other than by plaintiff's filing a claim for reimbursement and submitting it to the court. Such action would have left him in an anomalous situation insofar as his right to recover from defendant was concerned. Under the circumstances it seems scarcely possible that there was any actual intent on the part of either party that plaintiff should pursue his remedy against the estate. It may be assumed that defendant and his counsel desired that plaintiff should establish the total amount that he had expended for his mother by a sufficient showing as to the facts. However, it does not appear that at any time defendant has questioned such expenditures or any of them. Submission of the matter to the probate court may not be regarded as a condition precedent to plaintiff's right to maintain the present action.
In 12 Am Jur, p 848, it is said:
"A contract will not be presumed to have imposed an absurd or impossible condition on one of the parties, but will be interpreted as the parties must be supposed to have understood the conditions at the time."
Of like import is 3 Williston on Contracts (Rev ed), § 665, where it is said:
"Especially words literally appropriate for condition have not been given their natural meaning where the consequence would lead to injustice and a violation of the probable intent of the parties."
In the early case of Clay v. Ballard, 9 Rob (La) 308, the plaintiff sought to recover the sum of $4,000 which defendant had agreed to pay him as an attorney fee in a certain case pending before the supreme court of the United States. Payment of such fee was resisted on the ground that the promise was conditioned on the decision in such case settling fully the question as to the validity of all contracts for the sale of slaves in the State of Mississippi during a certain period of time. It was claimed that such questions were not fully determined and that certain issues were left to the decision of the State courts. In reaching the conclusion that the defense was not tenable, it was said:
"It cannot be imagined that the defendant intended to impose either an absurd, or an impossible condition; and to make the payment of the additional fee depend upon the fact, that the judgment to be pronounced by the court in the case of Groves v. Slaughter, to which the defendant Ballard was not a party, should, in all courts, and between all parties, whenever a similar question should arise, carry with it the absolute authority of the thing adjudged. No man in his senses would enter into any such engagement."
15 Pet (40 US) 449 ( 10 L ed 800). — REPORTER.
In view of the foregoing conclusions, it is unnecessary to consider incidental matters discussed by counsel in their briefs. The judgment of the trial court is affirmed. Plaintiff may have costs.
DETHMERS, C.J., and ADAMS, BUTZEL, BUSHNELL, BOYLES, and REID, JJ., concurred with CARR, J.
SHARPE, J., concurred in the result.