Cummings v. Nielson

129 P. 619, 42 Utah 157, 1912 Utah LEXIS 110

• Court: Utah Supreme Court
• Decided: December 4, 1912
• Docket: No. 2393
• Status: Published

Opinions

FRICK, C. J.

Appellants brought this action for specific performance of the agreement hereinafter set forth. After hearing appellants’ evidence, the district court, upon motion of all the respondents, granted a nonsuit and entered judgment dismissing the action, from which this appeal is prosecuted.

The pleadings are very voluminous; but, in view of the course of the proceedings and the result reached in the district court, we do not deem it necessary to set them forth. Nor is it deemed necessary to refer at length to the evidence adduced at the trial. We shall, however, refer to such parts of the pleadings and evidence, in the course of the opinion, as we may deem necessary to afford a full understanding of the points decided. The material parts of the agreement declared on are as follows:

“Salt Lake City, Utah, October 5, 1901. This agreement, made and entered into between Horace H. Cummings and Barbara M. Cummings, his wife, first part, and1 Christian Nielson and Sarah E. Nielson, his wife, second part, all of Salt Lake City, Salt Lake County, Utah, witnesseth: That the said second party hereby sells and conveys to the first party all their right, title and interest in the Cummings-Nielson Co. represented by fourteen shares of the capital stock (one share of their original investment having been sold to James Nielson) and also to give an option on all their or either of their interest in the estate of Julian Moses, deceased, or refusal to purchase the same at a price as low as any other bona fide offer for it or any portion of it, for tbe sum of five hundred eighty ($580) cash, the receipt of which is hereby acknowledged, and four hundred thirty ($430) within six months from date hereof. The said second party s shall also see that the ten shares of stock which is now held as security of certain payments to be made to Euth Moses shall be liberated before the said second, payment is made. In consideration of the transfer of stock and the fulfilling of the aforesaid covenants and conditions, the first party agrees to make the payments as aforesaid.” (Italics ours.)

The agreement was signed by all the parties named therein. It was either admitted by respondents, or proved by appellants at the hearing, that the appellant B. M. Cummings and the respondent Sarah E. Nielson and one Esther B. Swain are sisters and children of the Julian Moses, deceased, named in the agreement aforesaid, and were the sole heirs of his estate, subject, however, to a life estate of one Euth Eidge Moses, who was the surviving widow of said Julian Moses, deceased, and the mother of said three sisters; that the appellant Horace H. Cummings is the husband of the appellant B. M. Cummings, and the respondent Christian Nielson is the husband of the respondent Sarah E. Nielson; that on the 11th day of July, 1908, the respondents Christian and Sarah E. Nielson sold their interest in the estate of said Julian Moses, deceased, to Eorest N. Stillman, and the other respondent was made a. party merely as the wife of said Forest N. Stillman; that the Niel-sons sold their said interest and conveyed the same by proper deed of conveyance to said Forest N. Stillman for the sum of $3,000; that said sale was made without the knowledge or consent of appellants, and that said Stillman purchased with full knowledge of the agreement aforesaid and of appellants’ Tights; that appellants always were ready, willing, and able to pay, and, according to their testimony, are “now (at the time of trial) able, ready, and willing to pay into this court (district court), or to sucb person as tbis court may adjudge, tbe sum of $3,000, or any larger sum that any other bona fide purchaser would have paid for this property at the time of the sale to Mr. Stillman on July 11, 1908.” The' property mentioned' in the agreement as the estate of Julian Moses, deceased, was fully identified in the pleadings and by the evidence at the trial.

It was also shown, through correspondence and conversations had between the parties to the contract, after the sale of the interest aforesaid, that all the parties to the agreement fully understood its meaning and' general purport, and that the transaction between the Nielsons and Stillman was entered into, not because of the grounds now urged as heref-inafter stated, but because the Nielsons insisted that the appellants did not want the property, or had waived their right to the same, or for some similar reason. When appellants had made proof of such matters as were denied and not admitted in the answers, all of the respondents made a motion for a nonsuit upon the following grounds:

“(1) That the offer or option, as contained1 in Exhibit A introduced herein as the basis for this action, is unfair, unreasonable, and unconscionable. (2) That the same is uncertain as to description of property, as to price and as to the time within which it may be accepted, and as to all other matters and elements. (3) That any offer contained in said instrument, Exhibit A, has never been accepted by the plaintiffs or either of them, .and for the further reason that there has not been a tender to comply with the terms thereof, or to pay any price thereunder. (4) The plaintiffs have not brought themselves within any of the equitable rules entitling them to the specific performance of the contract, if any, here in question.”

In granting the motion, the court said:

“The motion will be sustained on the grounds set forth by defendants’ attorneys in their motion for nonsuit and dismissal.”

It is thus made apparent upon wbat grounds the court granted the nonsuit. It is manifest that both the rulings and the motion are based entirely upon the language contained in the agreement, and1 not because of any evidence adduced, or for lack of evidence. We, therefore, need not discuss the evidence.

Taking up respondents’ objections in the order stated in the motion for nonsuit, we first inquire, What, if anything, makes the agreement “unfair, unreasonable, and unconscionable,” as contended for by counsel ? Counsel, in referring to this point in their brief, say:

“Appellants, according to the language used, are entitled to buy the property without any time limit being fixed either for the ascertainment of the price or for. the purchase of the property at a price as low as anyone else may in good faith offer for it. The offer is not to sell a,t the highest price offered in good faith by another person, but in fact the offer is to sell at the lowest price that might be offered in good faith by another person. In other words, if a person in good faith offered to buy the property from the Nielsons for one dollar at any time while the property existed, even though the Nielsons did not care to sell at that price, the appellants would be entitled1, under the letter of this option, to come in and buy the property for that sum. This is highly unfair and inequitable.”

It is quite apparent that whether counsel’s contentions are sound or not hinges upon the meaning to be given to the language of the agreement which we have italicized. Giving the language found in the agreement its ordinary and usual meaning when applied to the subject-matter and nature of the agreement and apparent object or purpose of the parties, as must be done, what was their intention as the same is ascertained from the language found1 in the agreement ? In our judgment it is quite clear that, in addition to the sale of the corporate stock mentioned in the agreement, it also contained an option in favor of appellants in which they were given the right or option to purchase certain interest in certain real estate.

1 Counsel contend that it appears from the face of the agreement that it is unfair because it contains no limit of time within which the option should be exercised. This objection has no merit, because no time limit was necessary under the terms of the agreement. The option was to become effective only in ease the Nielsons desired to sell their interest in the land mentioned in the agreement. If they did not wish to sell, they were not bound to do so; but, if they did intend to sell, then under the agreement they bound themselves for a valuable consideration expressed therein to give the appellants the option, or, as it is expressed in the agreement, “refusal to purchase,” the interest mentioned “at a price as low as any other bona fide offer1 for it.” If the Nielsons desired to sell, they were thus required to give Mr. and Mrs. Cummings an opportunity to purchase — that is, the refusal to purchase the interest in the lands. This is too plain for cavil, because by the term “refusal to purchase” everybody knows what is meant, although the condition may not be fully expressed. What is meant thereby is that, if the owners of the interest in question desired to sell it, they must communicate that fact to the party holding the option to purchase, and thus give the latter an opportunity to purchase or to refuse to do so. If the latter refuses, he has fully exercised his option. If, however, he then expresses his willingness to purchase, the question of price arises. Counsel urge, and it seems the district court so held, that in this case the price mentioned in the contract is unreasonable because it means the lowest price that any one might offer for the property in good faith, although the amount offered was entirely out of proportion to the actual or market value of the property. This was obviously not the intention of the parties, nor is it necessarily the usual or natural meaning of the language used. While it is true that the language in that regard is not as apt as as it might have been made, yet we think its meaning is reasonably clear and was well understood by all the parties to the 'agreement. In view that appellants were to have the right of refusing to purchase the property in case the Nielsons desired to sell, it became their duty to notify the appellants that they were ready to sell; and, if they had an offer for the property for which they were willing to and could sell, it also was their duty to make such offer known to appellants. If appellants then were offered the property, if they paid for it the lowest price for which the Nielsons were willing to sell it to another, then appellants had the right either to refuse to purchase it at that price or to purchase it for that price. In no other way could the right of the refusal to purchase, provided for in the agreement, be made effective.

2 In determining the meaning that should be given to language used in an agreement in order to ascertain the intention of the parties, all the words or terms used must be given their ordinary and usual effect, when considered in the light of the subject-matter and! the nature of the agreement. In the agreement before us, no effect could be given to appellants’ right of refusal to purchase, except as indicated above. In this connection we cannot agree with respondents’ counsel that if the agreement is thus construed, something must be read into it which was not in the minds of the parties. The duty we have imposed upon the Nielsons is clearly implied from all the terms that are used in the agreement. The language used by Mr. Page, in discussing the rules applicable to the construction 'of contracts is applicable here. He says:

“Since a contract is to be construed as a whole, terms which, can he inferred from a consideration of the entire instrument are as much a part of the contract as if expressly set forth therein.” 2 Page on Contracts, sec. 1118.

3 It is a cardinal rale of construction that that which is implied is always as much a part of any writing as that which is expressed. Nor can we agree with counsel that the term, “at a price as low as any other bona fide offer for it” — that is, for the property — should be given the meaning contended for by them, namely, that any offer, however low, if made in good faith and not for ulterior purposes, is binding on tbe Nielsons. Snob a construction would, to our minds, not only be wholly unreasonable, but would lead! to a clear absurdity.

4 Courts will always, incline towards giving language a reasonable construction, and will 'avoid if possible, an absurdity if tbe language is susceptible of some other meaning. In this case tbe language used is not only susceptible of another meaning, but we think it is manifest that tbe natural and ordinary meaning of tbe terms employed, when applied to tbe subject-matter and nature of tbe contract, clearly mean what, we have construed them to mean, and that such was the manifest intention of tbe parties. From what was said1 ‘and done by tbe parties, as tbe same is gleaned from tbe pleadings and tbe evidence adduced at tbe bearing, tbe meaning we have given to tbe terms used was also tbe meaning tbe parties to tbe contract gave them.

Nor is tbe contention sound that tbe agreement is unfair because no time limit was fixed for tbe “ascertainment of tbe price” for tbe sale of tbe property. Here, again, no time limit was necessary, and no precise price could1 well have been fixed under the circumstances. Tbe parties, however, provided a method by which tbe price could be fixed; and, unless and until tbe Nielsons were ready and willing to sell, it was quite unnecessary to fix a price; and, when they were ready and willing to sell, then all they were required to do was to sell to appellants for as low a price as they were willing to sell the property to anyone else. There is nothing unfair or unjust about such a provision. If tbe property increased in value after tbe contract was entered into, tbe Nielsons would obtain tbe benefit of tbe increase; and, if tbe value or price declined, they were not bound to sell at any price to appellants unless willing to sell to another. All tbe Nielsons were bound to do under tbe terms of tbe contract was to give tbe appellants a reasonable opportunity to exercise tbe option to purchase, for which they bad paid- a valuable consideration.

5 Nor is tbe contention sound that the agreement is uncertain because no time is fixed within which appellants were required to exercise their option after the Nielsons apprised them of their willingness to sell for a stated price. In view that the contract is silent as to time, the law supplies the omission by compelling appellants to act within a reasonable time. What would be a reasonable time would ordinarily be a question of fact, under all the circumstances. That question is, however, not involved here, since the Nielsons did not give appellants any opportunity to purchase at any price or at any time.

6 The second ground for nonsuit is clearly untenable. It is elementary that in equity that is certain which can be made certain. In case a certain farm or certain lands are mentioned by name merely in a contract, without giving a definite description, the farm or lands intended in the contract may always be shown by extrinsic, pa-rol, or documentary evidence. For a concrete application of the doctrine, see Easton v. Thatcher, 7 Utah, 99, 25 Pac. 72. The other objection contained in the second ground for nonsuit has already been discussed in connection with counsel’s argument we have heretofore set forth.

7 The objection urged in the third ground for nonsuit, namely, that the offer contained in the agreement “has never been accepted” by appellants, is without merit. In signing and delivering the agreement, all the parties thereto clearly accepted all of its provisions and1 conditions'. All that remained to be done after that was the- execution of the agreement in accordance with its terms and conditions. ■ Counsel are in error when they insist that the agreement in this case is a mere offer on the part of the Nielsons, which appellants were required to accept within a reasonable time, and which they have never manifested an intention to accept. The offer of the Nielsons to sell the property upon the conditions named in the agreement was accepted by the appellants when they signed the contract. As the time when the sale should be made, and the price for which the Nielsons were willing to sell, depended upon the latter’s will, it became tbeir duty to apprise appellants of their willingness to sell, and of the price they were willing to sell for and could obtain for the land in question. It was then the duty of appellants either to take the property or to refuse it; and, haying done either, they would have exercised their option, and1 the contract would' thus have become mutually binding upon all the parties.

8 The objection that no tender has been made clearly cannot prevail. Manifestly no tender could either have been made or contemplated until the Nielsons apprised the appellants that the land was for sale and that they had an offer or were willing to take a certain price for it. Under the facts of this case, however, they by their own acts, made a tender unnecessary, if not impossible; and hence they cannot now insist upon one as a condition precedent. The law never requires things that are unnecessary or that have been waived by the parties, either expressly or by clear implication. The offer in the pleadings, to pay the amount for which the Nielsons sold the land to Stillman is quite sufficient under the circumstances. Moreover, the fact that the Nielsons were not only willing to sell, but have in fact sold the property in question for a specified sum, which sum appellants alleged and proved they were and are able, ready, and willing to pay, eliminates from this case all question of how the Iona fides of the offer, or the price for which the Nielsons were bound to sell, was to be ascertained. That question, therefore, is of no further concern.

Finally, the fourth and last ground of objection, namely, that appellants have not “brought themselves within any of the equitable mies entitling them to a specific performance of the contract,” is entirely too indefinite to require discussion. In our judgment, the contract in question, when fairly construed, is not vulnerable to the objections urged against it by the respondents. We also are of the opinion that appellants have made out a prima facie case, and are entitled to a decree of specific performance of the contract, unless some facts are shown which overcome their prima facia case. The district court should therefore proceed to hear the defenses set up by respondents in their answers, and make findings of facts and conclusions of law upon all of the issues presented by the pleadings, and enter a judgment or decree in accordance therewith.

For the reasons stated, the judgment is reversed, and the cause is remanded to the district court, with directions to overrule the motion for nonsuit and to grant appellants a new trial, and to proceed with the case in accordance with the views herein expressed. Appellants to recover costs on appeal.

McOARTY and STRAUP, JJ"., concur.