Marcrum v. Embry

282 So. 2d 49, 291 Ala. 400, 1973 Ala. LEXIS 1114
CourtSupreme Court of Alabama
DecidedAugust 30, 1973
DocketSC 201
StatusPublished
Cited by31 cases

This text of 282 So. 2d 49 (Marcrum v. Embry) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marcrum v. Embry, 282 So. 2d 49, 291 Ala. 400, 1973 Ala. LEXIS 1114 (Ala. 1973).

Opinion

*402 McCALL, Justice.

The appellant filed his bill for a declaratory judgment in this case on the equity side of the court, praying to have declared null and void several written instruments that were contemporaneously executed by the appellant and the appellee, involving the lease of a gasoline filling station.

The parties, through their solicitors made and entered into, and filed in the cause, at the trial, a written stipulation upon which they submitted the case for a final decree. From this stipulation, and the record, it appears that on May 13, 1966, the appellant and the appellee, contemporaneously executed reciprocal leases covering a common lot or parcel of real property with the improvements thereon. The appellant who owned the real property executed the prime lease to the appellee, a distributor and dealer in gasoline and oil products. The initial term of the prime lease was for ten years with an option to extend the lease for an unstated number of additional years. The appellee lessee was granted the option of cancelling the lease at any time by giving the lessor sixty days notice. No such option to cancel was accorded the appellant lessor. The appellant lessor agreed to maintain the improvements on the real property. The filling station equipment-thereon was to remain the property of the appellee lessee, he having the right or privilege of painting the buildings and improvements on the leased property in a color scheme in common with that of his service stations generally. The lessee was given the right to assign the lease or sublet the property.

In return for this lease agreement, the appellee paid an agreed rental of 'twenty dollars a month. These payments were stated to be sufficient consideration also for all options granted in the lease by the lessor to the lessee. As a further consideration for the lease of the premises as set out in a supplemental agreement of even date, and pursuant to it, the appellee promised to deliver and did deliver to the appellant two thousand dollars for the purpose of making improvements on the leased property, repayment of which, was to be amortized at the rate of two hundred dollars per year over a period of ten years, with repayment to be made through purchases of gasoline and oil products under an exclusive dealership between the parties, or, to be repaid on any default by the appellant as to the unamortized amount.

On the same day, the appellee leased the same property back to the appellant, under an instrument described as a Dealer Lease Agreement, and for the same initial term of ten years, and for an extended term of an unstated number of years after the initial terms, subject to being terminated at the end of the initial term, upon sixty days prior notice, at the option of the appellant. However, the appellant sublessee was without option to cancel the dealer lease prior to the expiration of the initial term of ten years. In return for the dealer lease, the appellant promised to pay the same amount of rent to the appellee as provided for in the prime lease. The appellant also agreed to maintain the buildings, structures, improvements and equipment in good condition and repair, and in addition, to pay all charges, licenses, permits and inspection fees, occupation and license taxes, and utility bills incurred in connection with the use and occupation of the premises. The appellant agreed therein not to assign or sublease the premises without the appellee’s written consent, and to hold the appellee harmless against any and all claims or liability on account of personal injury or death arising out of the use or occupation of the leased premises, not caused by the appellee’s own negligence. The dealer lease further provides that it is subject to all the terms and conditions of any lease under which the appellee, is entitled to possession of the premises, and if for any reason whatsoever the sublessor’s tenancy is cancelled, terminated or surrendered then said dealer lease shall automatically terminate and end without further action by either party and without any liability on the part of the appellee sublessor.

*403 The same day that the parties executed the aforementioned leases, the appellant also executed a written assignment to the appellee of the monthly rentals to become due him under the prime lease. This assignment by the appellant was for the purpose of convenience, and it compensated the rentals under the prime lease against those under the dealer lease. The parties also note in their stipulation that the appellant has sublet the premises to third parties under the terms of the agreements and has collected and retained the rentals, and the appellee has sold gasoline and oil products to the appellant and his assigns.

The parties stipulated that these agreements or undertakings constituted their entire agreement, which hereafter will be referred to as the agreement. They complied with all of the terms and provisions of the agreement and operated thereunder from May 13, 1966, until April 15, 1972, when the appellant became dissatisfied and requested the appellee to remove his equipment and other property from the leased premises, which the appellee failed or refused to do. Failing in his purpose, the appellant instituted this suit in equity to have the agreement declared null and void for lack of mutuality, lack of consideration, and as being in illegal restraint of trade.

There was no testimony taken in the trial of the cause, orally or otherwise, and the case was submitted to the court for a final decree upon the abovementioned stipulation filed in the cause. The court found that the agreement, under which the parties had operated for nearly six years, was valid and entered a final decree in favor of the appellee.

The appellant’s primary argument for reversal is that since the agreement is terminable at appellee’s will, it must be terminable at the appellant’s will also, in order to give the agreement mutuality, without which the agreement would be unenforceable.

While the stipulation of the parties provides that the several instruments, executed by them represent their entire agreement, and, it is the law that where two or more instruments are executed contemporaneously by the same parties, in reference to the same subject matter, they generally are taken as one contract, and will be interpreted together, Evans v. Kilgore, 246 Ala. 647, 21 So.2d 842 (1945), Ingalls Iron Works Co. v. Ingalls, 256 Ala. 124, 53 So.2d 847; Montgomery Enterprises v. Empire Theater Co., 204 Ala. 566, 86 So. 880 (1920); Restatement Contracts, § 235(c); Corbin on Contracts, § 549, we nonetheless are still confronted with the question of whether a lease, which gives one of the parties thereto the option to cancel or terminate it on a specified notice, is so lacking in mutuality as to be unenforceable.

A contract, lacking in mutuality, is unenforceable, because there is an absence of consideration moving, from one party to the other, Hill v. Rice, 259 Ala. 587, 67 So.2d 789 (1953), but when the promise of each party is legally sufficient consideration for the other’s promise, there is no lack of mutuality, Lindner v. Mid-Continent Petroleum Corp., 221 Ark. 241, 252 S.W.2d 631.

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

Related

315 Corley CW, LLC v. Palmetto Bluff Development, LLC
Court of Appeals of South Carolina, 2024
Merida v. Olin Corporation
S.D. Alabama, 2023
Cherry v. Pinson Termite & Pest Control, LLC
206 So. 3d 557 (Supreme Court of Alabama, 2016)
McGuffie v. Mead Corp.
998 F. Supp. 2d 1232 (N.D. Alabama, 2014)
Rearick v. Sieving
103 So. 3d 815 (Court of Civil Appeals of Alabama, 2012)
Ryan's Family Steakhouse, Inc. v. Kilpatric
966 So. 2d 273 (Court of Civil Appeals of Alabama, 2006)
McGough v. Nalco Co.
420 F. Supp. 2d 556 (N.D. West Virginia, 2006)
Bowdoin Square, LLC v. Winn-Dixie Montgomery, Inc.
873 So. 2d 1091 (Supreme Court of Alabama, 2003)
Orkin Exterminating Co., Inc. v. Larkin
857 So. 2d 97 (Supreme Court of Alabama, 2003)
Ex Parte AB/Wildwood Ltd. Partnership
793 So. 2d 784 (Supreme Court of Alabama, 2000)
Wright v. Circuit City Stores, Inc.
82 F. Supp. 2d 1279 (N.D. Alabama, 2000)
Wbt v. A.B./wildwood Limited Part.
793 So. 2d 779 (Court of Civil Appeals of Alabama, 1999)
Randolph v. Green Tree Financial Corp.
991 F. Supp. 1410 (M.D. Alabama, 1998)
Crown Pontiac, Inc. v. Charley
710 So. 2d 435 (Court of Civil Appeals of Alabama, 1997)
Goodwin v. Ford Motor Credit Co.
970 F. Supp. 1007 (M.D. Alabama, 1997)
Kelly v. UHC Management Co., Inc.
967 F. Supp. 1240 (N.D. Alabama, 1997)
Northcom, Ltd. v. James
694 So. 2d 1329 (Supreme Court of Alabama, 1997)
WMX Technologies, Inc. v. Jackson
932 F. Supp. 1372 (M.D. Alabama, 1996)
Gilley v. Barnett
624 So. 2d 572 (Supreme Court of Alabama, 1993)

Cite This Page — Counsel Stack

Bluebook (online)
282 So. 2d 49, 291 Ala. 400, 1973 Ala. LEXIS 1114, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marcrum-v-embry-ala-1973.