Nance v. Schoonover

521 P.2d 896, 1974 Utah LEXIS 549

• Court: Utah Supreme Court
• Decided: April 23, 1974
• Docket: 13471
• Status: Published

Opinions

TUCKETT, Justice:

The plaintiffs and the defendants entered into an option agreement on January 29, 1972. The plaintiffs filed these proceedings in the court below seeking a decree of specific performance of the option. From an adverse decision the plaintiffs appeal.

The material portion of the option is as follows:

KNOW ALL MEN BY THESE PRESENTS: That we, Eldon Schoon-over and Evelyn B. Schoonover, husband and wife, of Pleasant Grove, Utah, the parties of the First Part, in consideration of the sum of One Thousand Dollars, ($1000.00) to them in hand paid by Farrell Nance and Juanita Nance, his wife, who are now moving to Pleasant Grove, Utah, the parties of the Second Part, hereby give, bestow and grant unto the said parties of the second part, and their assigns, the irrevocable option and right to purchase at any time before January 30th, 1973 at 12:00 o’clock P.M. the real property hereinafter described, together with all improvements thereon. The agreed purchase price for said real property is $18,000. If parties of the Second Part exercise this option and purchase said property, they shall be entitled to credit for the option price of $1000.00 making the remaining purchase price to be paid in cash $17,000.00. Should they fail to exercise this option then the said $1000.00 option price shall be forfeited to the First Parties as liquidated damages.'

The parties of the First Part, before said payment is required to be made and before this option shall terminate or the term expire, shall deliver to Second Parties, an abstract of title showing title in themselves in fee, together with a good and sufficient warranty deed conveying the title to said parties of the Second Part free and clear of all liens and encumbrances.

Time is of the essence of this agreement.

The day prior to the expiration of the option the plaintiffs through their attorney notified the defendants of their intention to exercise the option. The plaintiffs’ attorney requested Eldon Schoonover to furnish an abstract of title in sufficient time so that it could be examined prior to the completion of the transfer of title. The abstract was delivered a few minutes before noon, January 30, 1973. It would appear that there was some uncertainty in the minds of the parties as to whether the option expired at noon. After it became apparent that midnight was the time of expiration, the parties arranged a meeting during the evening. Plaintiffs and their lawyer and the defendants and their counsel met at the home of one of the parties for the purpose of completing the option agreement. At that time Mr. Nance told the defendants and their counsel that he intended giving them a personal check in the amount of $17,000 to pay for the property and to obtain the deed. The defendants, through their attorney informed the plaintiffs that the personal check was not acceptable as it did not constitute legal tender. In this connection Mr. Schoonover testified that on January 29 he had informed the plaintiffs’ attorney that a cashier’s check would be necessary to complete the transaction. However, that testimony was disputed by plaintiffs’ attorney. No further tenders were made by the plaintiffs.

The trial court found the $17,000 had not been tendered in cash prior to midnight January 30, 1973, that the option had expired and refused to decree the specific performance.

It is the plaintiffs’ contention that their tender of a personal check was sufficient to exercise the option and further that their tender in their complaint is sufficient tender to entitle them to specific performance. We are of the opinion that the court’s finding that the option had not been exercised in the period specified in the option must be upheld. This court has long adhered to the rule that an option must be exercised in accordance with its terms.¹ The option here under consideration obligated the plaintiffs to pay the $17,000 in cash within the period specified and the tender of a personal check in lieu of cash did not comply with the terms of the agreement. An option of almost identical language was before this court in the case of Gibbs v. Morgan² wherein the court reached a similar decision. An earlier case of Kelsey v. Crowther ³ dealt with an option of similar import and a similar fact situation and with similar result that we have reached here.

Affirmed. Costs to respondents.

CALLISTER, C. J., and HENRIOD, J„ concur.

1 . Sieverts v. White, 2 Utah 2d 351, 273 P.2d 974; Lincoln Land and Development Co. v. Thompson, 26 Utah 2d 324, 489 P.2d 426; Miller v. Carmody, 152 Colo. 353, 384 P.2d 77; Coombs v. Ouzounian, 24 Utah 2d 39, 465 P.2d 356.

2 . 101 Utah 66, 118 P.2d 128.

3 . 7 Utah 519, 27 P. 695.