Country Club Oil Co. v. Lee

58 N.W.2d 247, 239 Minn. 148, 1953 Minn. LEXIS 611
CourtSupreme Court of Minnesota
DecidedApril 17, 1953
Docket35,851
StatusPublished
Cited by41 cases

This text of 58 N.W.2d 247 (Country Club Oil Co. v. Lee) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Country Club Oil Co. v. Lee, 58 N.W.2d 247, 239 Minn. 148, 1953 Minn. LEXIS 611 (Mich. 1953).

Opinion

Dell, Justice.

This is an appeal from an order denying plaintiff’s alternative motion for judgment notwithstanding the verdict or a .new trial.

On August 25, 1949, plaintiff and David E. Johnson, since deceased, (herein referred to as Johnson) entered into an option contract in writing. The portions of the contract material to this appeal provided:

“For and in consideration of the sum of one hundred Dollars ($100.00) to me in hand paid, the receipt whereof is hereby acknowledged, I [Johnson] hereby grant unto Country Club Oil Company of Excelsior, Minnesota an Option for 90 days from the 25th day of August, 1949, to purchase, for the sum of Three Thousand and no/100 Dollars ($3,000.00) the following described lands situated in the County of Hennepin and State of Minnesota to-wit:”

The remainder of the contract described the real estate; provided for Johnson’s obtaining a building permit; and' outlined the method in which the plaintiff was to exercise the option, the procedure for its termination if not exercised, and the manner by which it could be extended for 60 days to permit examination of title, execution *150 of conveyances, and closing the transaction. It also provided that, if the option was exercised and the sale completed, the remainder to be paid was $2,900. While not expressly so stated, it is clear from an examination of the instrument as a whole that the $100 which was paid at the time of the execution of the contract was, in the event of the exercise of the option, to be applied upon the purchase price of the property to complete the full payment of the purchase price of $3,000 provided in the contract. Plaintiff delivered its check to Johnson for $100 at the time of the execution of the contract, and the receipt of this amount was acknowledged in the instrument.

Subsequent to the execution and delivery of the instrument, Johnson went to the plaintiff’s office and left the check on a desk there. The date this occurred is in dispute. From the evidence it could be found that this occurrence took place either around the seventh or eighth of September, in the early part of October, or about the middle part of October 1919. Because of the statute prohibiting evidence of conversations with a party since deceased, and because one of the court reporters died during the course of the trial and the parties were unable to obtain a satisfactory translation of his stenographic notes, the record is not entirely satisfactory as to what transpired when the check was returned to the plaintiff by Johnson. There is, however, evidence that Johnson “slapped the check on the desk,” stated that he could not go through with the transaction “because he couldn’t get his wife to go through with it,” and then walked out. At that time Johnson was not married. He had been a widower for several years.

On October 7, 1919, Johnson by deed conveyed the real estate described in the contract together with other real estate to William Egeland. The deed was recorded in the office of the register of deeds of Hennepin county on October 19,1919. On October 21, 1919, plaintiff wrote a letter to Johnson advising him that it was exercising the option to purchase the property and waiving the provision of the contract requiring Johnson to obtain a building permit. Plaintiff did not return the $100 check to Johnson. Nothing *151 further having been done, the plaintiff on April 13, 1950, instituted action against Johnson to recover damages in the sum of $3,500 for breach of the option contract. Issue was joined and while the action was awaiting trial Johnson died on March 18, 1951. His administratrix was by order of the court substituted as the defendant in his stead.

At the conclusion of the trial the defendant moved for a directed verdict on the following grounds: (1) That the option was an offer, subject to withdrawal at any time, because it was not supported by an independent consideration and because the offer was withdrawn before acceptance by the plaintiff; (2) that the agreement was terminated by mutual consent; (3) that no adequate tender of performance was ever made by the plaintiff; and (4) that the evidence failed to establish a cause of action.

The court granted defendant’s motion and in directing the verdict specifically did so solely on the first ground urged by the defendant in its motion for the directed verdict. The court expressly held that, because the option contract provided that the $100 paid for the option was to be applied on the purchase price of the property if the option was exercised, the option was not supported by a valid consideration.

Plaintiff has made no assignments of error. If defendant had not voluntarily joined issue with and argued the questions argued by plaintiff on this appeal, there would be nothing before us for review. The rule is well settled that in a civil action where the appellant makes no assignments of error in this court no question is presented to it for review; but notwithstanding the rule, if respondent voluntarily joins in arguing a question argued by appellant, this court will consider it. Erickson v. Mathwig, 226 Minn. 55, 31 N. W. (2d) 918. In view of defendant’s argument in this court of the questions argued by appellant, we have examined the record to determine whether the directed verdict was justified.

It is an elementary principle of law that a contract must be construed as a whole. The intention of the parties must be gathered from the entire instrument and not from isolated clauses. As far *152 as is reasonably possible it is to be construed so as to' harmonize all of its parts. 4 Dunnell,- Dig. (8 ed.) § 1823.

Applying this rule to the option contract here, it appears clear that the $100 was paid by plaintiff to Johnson as consideration for the 90-day option granted to the plaintiff within which to purchase the real estate described in the contract. While the contract does not expressly provide that in the event of the failure of the plaintiff to exercise the option the $100 was to be forfeited and belong to Johnson, nevertheless construing the contract as a whole, as we must do, the conclusion is inescapable that such was the intention of- the parties.

' That brings us to the question of whether, because the $100 paid for the option was to be applied as a part of the purchase price of-the real estate in the event the option to purchase was exercised, the option was left without a valid consideration. Where the only consideration for the option is the obligation of the optionee to pay the stipulated purchase price of the property in case he elects to exercise the option and purchase the property, that is not a sufficient legal consideration for the option since the consideration for the option must be separate and distinct from the obligation of the optionee to pay the stipulated purchase price in case he elects to purchase the property. 6 Dunnell, Dig. § 10016; Morrison v. Johnson, 118 Minn. 313, 181 N. W. 915. But where, as here, a valuable consideration is paid for the option to purchase property, the option is binding and enforceable during the period stipulated in the option contract notwithstanding that the contract provides that in the event of the exercise of the option the sum paid for the option is to be applied as a part of the purchase price of the property. In the case of Ide v. Leiser, 10 Mont. 5, 12, 21 P.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Sayer v. Minnesota Department of Transportation
790 N.W.2d 151 (Supreme Court of Minnesota, 2010)
McLellan v. Charly
2008 WI App 126 (Court of Appeals of Wisconsin, 2008)
Good v. Ameriprise Financial, Inc.
248 F.R.D. 560 (D. Minnesota, 2008)
Allan Block Corp. v. County Materials Corp.
239 F.R.D. 523 (W.D. Wisconsin, 2006)
Drewitz v. Motorwerks, Inc.
706 N.W.2d 773 (Court of Appeals of Minnesota, 2005)
Mclamb v. T.P. Inc.
619 S.E.2d 577 (Court of Appeals of North Carolina, 2005)
Dayton Park Properties, L.L.P. v. Pacific Life Insurance
370 F. Supp. 2d 869 (D. Minnesota, 2005)
Smith v. State Farm Fire & Casualty Co.
656 N.W.2d 432 (Court of Appeals of Minnesota, 2003)
First Security Bank of Utah, N.A. v. Northwest Airlines, Inc.
43 F. Supp. 2d 136 (D. Massachusetts, 1999)
Nimis v. St. Paul Turners
521 N.W.2d 54 (Court of Appeals of Minnesota, 1994)
Nichols v. Metropolitan Bank
468 N.W.2d 84 (Court of Appeals of Minnesota, 1991)
Levin v. C.O.M.B. Co.
441 N.W.2d 801 (Supreme Court of Minnesota, 1989)
Johnson Bros. Corp. v. Rapidan Redevelopment Ltd. Partnership
423 N.W.2d 725 (Court of Appeals of Minnesota, 1988)
American Warehousing & Distributing, Inc. v. Michael Ede Management, Inc.
414 N.W.2d 554 (Court of Appeals of Minnesota, 1988)
Davis Ex Rel. Davis v. Outboard Marine Corp.
415 N.W.2d 719 (Court of Appeals of Minnesota, 1987)
Boe v. Christlieb
399 N.W.2d 131 (Court of Appeals of Minnesota, 1987)

Cite This Page — Counsel Stack

Bluebook (online)
58 N.W.2d 247, 239 Minn. 148, 1953 Minn. LEXIS 611, Counsel Stack Legal Research, https://law.counselstack.com/opinion/country-club-oil-co-v-lee-minn-1953.