Opinion
Meer & Wolf, John B. Carraher, Albert B. Wolf, Denver, for plaintiffs in error.
Davis, Graham & Stubbs, John M. Sayre, Denver, for defendant in error.
PIERCE, Judge.
This case was originally filed in the Supreme Court of the State of Colorado and was subsequently transferred to the Court of Appeals under authority vested in the Supreme Court.
The parties appear here in reverse of their order of appearance below and will be referred to as they appeared at trial or by name.
This is an action by plaintiff for a declaratory judgment that an option agreement with defendants was still in full force and effect. On February 6, 1964, plaintiff and defendants entered into an option agreement under which defendants granted to plaintiff a one-year option to purchase approximately 365 acres of undeveloped property in Boulder County, hereinafter referred to as Parcel A. It further provided that upon the exercise of this option to buy Parcel A, plaintiff had the right for eight more years to buy an undivided one-half interest in approximately 40 acres of undeveloped land in Boulder County, hereinafter referred to as Parcel B. The purchase price of Parcel A was fixed in the option agreement. The purchase price per acre of Parcel B depended upon the zoning the parties were able to procure.
Plaintiff paid defendants $3,000 when the option was executed. Under its terms, he could extend his option to buy Parcel A for up to three additional years by payments of $3,000, $3,000, and $5,000, respectively. There were several additional terms in the option to purchase, some of which are material to this appeal. Foremost among these was that plaintiff was required to use his 'best efforts' to obtain commercial zoning of Parcel B. The parties also agreed that no particulars of this option agreement would be disclosed to any other person or parties, except those to whom such information was essential for the proper conduct of the transactions and operations thereon of either the optionor or optionee.
In February of 1965, plaintiff extended his right to buy Parcel A for an additional year by payment of $3,000 to defendants. In February of 1966, plaintiff extended his right to buy Parcel A for a second additional year by payment of $3,000 to defendants.
In January of 1967, when plaintiff attempted to extend his right to buy Parcel A under the option agreement for a third additional year, defendants refused to accept the $5,000 payment and returned it to plaintiff. Defendants declared the option agreement void for plaintiff's failure to meet his obligations thereunder.
Plaintiff filed a complaint for declaratory relief, praying for a declaratory judgment holding the option to purchase to be valid and enforceable. Payment of $5,000 for the third additional year under the option agreement was paid into the trial court pending determination of the case.
On January 22, 1968, shortly before the trial of the first case, plaintiff exercised his option to purchase Parcel A by tendering $40,000 down payment to defendants, pursuant to the terms of the option to purchase. Defendants refused to accept tender and refused to convey the land. Plaintiff moved for leave to supplement his complaint with these allegations, and to seek specific performance and damages for delay by defendants in conveying. The court denied plaintiff's motion, and the case went to trial solely on the issues regarding the declaratory judgment. The issues involved in a second action on plaintiff's Petition for Further Relief, requesting specific performance of defendants' obligation to convey Parcel A, are not before this Court on appeal.
I.
The most significant assignment of error alleged by defendants is that the trial court erred in granting a declaratory judgment which did not, and could not, terminate the uncertainty or controversy giving rise to the proceeding. It is argued that this action resulted in a piecemeal proceeding as evidenced by plaintiff's petition for further relief, seeking specific performance of the option agreement after plaintiff exercised his rights thereunder. The exercise of the option to purchase, alleged in the complaint in the second action, purportedly occurred nearly a year after the institution of the declaratory judgment action. We rule, however, that declaratory relief was properly granted in this case.
The Colorado Declaratory Judgment Act, C.R.S.1963, 77--11--1, et seq., incorporated in the Colorado Rules of Civil Procedure, is found in R.C.P.Colo. Rule 57. Rule 57(f) reads as follows:
'The court May refuse to render or enter a declaratory judgment or decree where such judgment or decree if rendered or entered, would not terminate the uncertainty or controversy giving rise to the proceeding.' (Emphasis supplied.)
It is clear that the language of Rule 57(f) is permissive rather than mandatory. 4 V. Dittman, Colorado Practice 345. Although there are no Colorado cases directly on point, federal decisions interpreting a similar federal declaratory judgment rule indicate that a trial judge has broad discretion in determining when a declaratory judgment is an applicable remedy. 3 W. Barron & A. Holtzoff, Federal Practice & Procedure s 1265. The mere pendency of another suit between the parties, without more, does not render relief by way of declaratory judgment improper. Yellow Cab Co. v. City of Chicago, 7 Cir., 186 F.2d 946; Chicago Metallic Mfg. Co. v. Edward Katzinger Co., 7 Cir., 123 F.2d 518.
Defendants also contend that a declaratory judgment was improper since all the necessary parties were not before the court. People, ex rel. Inter-Church Temperance Movement v. Baker, 133 Colo. 398, 297 P.2d 273. This contention, however, was not raised in defendants' motion for new trial and we therefore will not consider it now. R.C.P.Colo. Rule 59(f); Platte Valley Elevators Co. v. Gebauer, 127 Colo. 356, 256 P.2d 903.
II.
Defendants further allege that the trial court erred in ruling that plaintiff had exercised his best efforts toward having a portion of the land rezoned for commercial use as required by the option agreement. They base much of their argument to this point on the fact that plaintiff failed to make formal application for a zoning change with the Boulder County Commissioners. Although the record is marked with a substantial amount of conflicting evidence on this point, there is ample evidence to justify the trial court's conclusion that plaintiff had exercised his best efforts in this regard. There was sufficient testimony, expert and otherwise, to establish that a formal application at the time would have been premature.
III.
Defendants next claim that the trial court erred when it failed to find a breach of the terms of the option provision prohibiting a disclosure of the particulars thereof to any third persons. Paragraph XV of the option agreement provided as follows:
'The parties hereto do mutually agree to withhold any particulars regarding the price, terms, or plans for the development of the tract to any person or party other than those to whom such information is essential or required for the proper conduct of the transaction and operations thereon of either the optionee or optioners.'
The only evidence of the alleged disclosure adduced at trial was that plaintiff sold a 49% Interest in the option to another party. Defendant asked the trial court to infer that such a sale would have been improbable, if not impossible, without disclosure of any 'particulars' of the option agreement. In the light of contrary evidence, the court's failure to make this inference was well within its power as finder of fact. There has been no showing that the court's finding was clearly erroneous. Baumgartner v. Tweedy, 143 Colo. 556, 354 P.2d 586.
IV.
Defendants further contend that the trial court erred by failing to consider all issues of vagueness and uncertainty presented in the option. The only issue of uncertainty presented to the court, however, was whether plaintiff had an option to buy Parcel B, or whether he would be required to buy Parcel B even if he should fail to get commercial zoning on that property. In view of the court's ruling that plaintiff was taking all reasonable steps to obtain this zoning, any other uncertainty was not an existent legal controversy in this proceeding, even though other areas of uncertainty might be the subject of future litigation. Taylor v. Tinsley, 138 Colo. 182, 330 P.2d 954. Accordingly, the court ruled properly in refusing to consider any issues not before it muder the pleadings. Equitable Life Assurance Society of United States v. Hemenover, 100 Colo. 231, 67 P.2d 80.
V.
We find defendants other assignments of error, except one, to be without merit. The trial court struck a number of defendants' defenses, among which was their sixth defense alleging that the option to purchase was null and void for failure of consideration. Even though this defense was stricken from the pleadings, the court allowed testimony on the matter and failure of consideration became one of the primary issues heard at trial. Since defendants' contentions in this regard were thoroughly considered by the court, no prejudicial error was committed by the striking of this defense. Dick v. Petersen, 90 Colo. 83, 6 P.2d 923.
Judgment affirmed.
SILVERSTEIN, C.J., and DUFFORD, J., concur.