Lewis v. Boehm

947 P.2d 1265, 89 Wash. App. 103
CourtCourt of Appeals of Washington
DecidedDecember 9, 1997
Docket15974-4-III
StatusPublished
Cited by8 cases

This text of 947 P.2d 1265 (Lewis v. Boehm) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lewis v. Boehm, 947 P.2d 1265, 89 Wash. App. 103 (Wash. Ct. App. 1997).

Opinion

Burchard, J. *

Victor Lewis sued Emma Boehm for breach of contract. He claimed that she owed him a commission on the sale of a piece of property. Both parties moved for summary judgment. The court granted summary judgment in favor of Ms. Boehm. Mr. Lewis appeals contending the court should have granted summary judgment in his favor. We affirm.

The facts of this case are not in dispute. In 1978, Harold and Pauline Lundy and Robert Millheisler entered into a real estate sale and purchase contract with D.G. Construction & Development Company, Inc. for the purchase of real property located at the intersection of Dakota and Holland Streets in Spokane (hereinafter the Holland Street Property). Victor Lewis was the real estate broker for this contract. The parties owed Mr. Lewis a commission for this transaction, but due to the small down payment, the commission was not paid at the time of the execution of the real estate contract. Then, a dispute arose between the parties concerning the terms of the contract. To settle the dispute, the parties entered into an agreement titled “Offer to Option for Purchase and Offer to Settle Pending Legal Action.” This agreement gave D.G. Construction an option to purchase the piece of property involved at a fixed price. The agreement also stated that upon the exercise of the option Mr. Lewis would have an exclusive right to sell the property for a 10 percent commission. The agreement *105 was signed by the Lundys, Mr. Millheisler, and D.G. Construction.

In 1980, D.G. Construction purchased some property located in Odessa, Washington from Emma Boehm. As partial consideration for the purchase, D.G. Construction quit-claimed and assigned its interests in the Holland Street Property option agreement to Ms. Boehm. A supplemental agreement was recorded and specifically stated that D.G. Construction agreed to retain the liability for payment of the real estate commission contemplated in the Option Agreement.

In 1981, Ms. Boehm executed a quitclaim deed and release of option back to the Lundys and Mr. Millheisler. Ms. Boehm was to be given $95,000 for the release of the option.

In 1985, the Lundys and Mr. Millheisler filed for bankruptcy. Pursuant to the bankruptcy action, a notice to sell real property, including the Holland Street Property was entered. Ms. Boehm objected to the sale of the Holland Street Property because she had not received the $95,000. In response to her objection, Ziegler Lumber Company, the proposed purchaser of the Holland Street Property, agreed to recognize an option in favor of Ms. Boehm to purchase the Holland Street Property. This agreement was reduced to writing.

In 1990, Ziegler had developed the property and gave Ms. Boehm six months notice to exercise her option to buy the property. Ms. Boehm purchased the property in 1991.

Subsequently, Ms. Boehm, a former real estate agent, attempted to sell the Holland Street Property herself. When she was not successful she enlisted an ERA Heritage Properties real estate broker to sell the property. In 1993, Ms. Boehm sold the property to Richard and Bonnie Vandervert for $300,000.00.

In April 1995, Mr. Lewis filed a complaint against Ms. Boehm claiming he had the exclusive right to sell the property, and she owed him $30,000 as commission for the sale to the Vanderverts. Both parties moved for summary judg *106 ment. The court granted Ms. Boehm’s motion and denied Mr. Lewis’ motion. The court also denied Mr. Lewis’ motion for reconsideration. He now appeals.

Mr. Lewis claims the court erred by granting summary judgment in favor of Ms. Boehm. When reviewing an order of summary judgment, the appellate court engages in the same inquiry as the trial court. Yakima County (W. Valley) Fire Protection Dist. No. 12 v. City of Yakima, 122 Wn.2d 371, 381, 858 P.2d 245 (1993). After considering the facts in the light most favorable to the nonmoving party, an appellate court will affirm an order of summary judgment only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Id.; CR 56(c).

The first issue is whether Mr. Lewis is a third-party beneficiary to the original contract between the Lundys and Millheisler and D.G. Construction. The creation of a third-party beneficiary contract requires that the parties intend that the promisor assume a direct obligation to a third party at the outset of the contract. Burke & Thomas, Inc. v. International Org. of Masters, Mates & Pilots, 92 Wn.2d 762, 767, 600 P.2d 1282 (1979). To determine if a third-party beneficiary exists the court should consider the terms of contract and determine if performance of the contract necessarily and directly benefits a third party. Del Guzzi Constr. Co. v. Global NW Ltd., 105 Wn.2d 878, 886-87, 719 P.2d 120 (1986). The original contract provided that Mr. Lewis would be paid his commission upon the exercise of the option. It is clear from the facts that Mr. Lewis was a third-party beneficiary to the contract.

The next issue is whether Ms. Boehm is liable to Mr. Lewis for the commission as a result of the assignment. A contract which has not yet been fully completed or performed, or in which the obligation relates to some future event is an executory contract. Felt v. McCarthy, 130 Wn.2d 203, 212, 922 P.2d 90 (1996) (Sanders, J., concurring). The option to purchase the Holland Street Froperty was based upon a future event, and thus is an executory contract.

*107 Generally an assignee stands in the shoes of the assignor. Paullus v. Fowler, 59 Wn.2d 204, 212, 367 P.2d 130 (1961). However an assignee in an executory contract is not liable on the underlying obligations absent an express assumption of those obligations. Hardinger v. Fullerton, 165 Wash. 483, 490, 5 P.2d 987 (1931); Bimrose v. Matthews, 78 Wash. 32, 37, 138 P. 319 (1914); Lonsdale v. Chesterfield, 19 Wn. App. 27, 30, 573 P.2d 822, aff’d, 91 Wn.2d 189, 588 P.2d 217 (1978); Higgenbotham v. Topel, 9 Wn. App. 254, 259, 511 P.2d 1365 (1973). Thus, Ms. Boehm as the assignee is not obligated under the underlying contract unless she expressly assumed that obligation. Ms. Boehm made no such express assumptions. On the contrary, she specifically entered into a supplemental agreement under which D.G. Construction explicitly retained the obligation to pay Mr. Lewis his commission.

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Bluebook (online)
947 P.2d 1265, 89 Wash. App. 103, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lewis-v-boehm-washctapp-1997.