Patrick v. Kuske

348 P.2d 414, 55 Wash. 2d 517, 1960 Wash. LEXIS 527
CourtWashington Supreme Court
DecidedJanuary 21, 1960
DocketNo. 35124
StatusPublished

This text of 348 P.2d 414 (Patrick v. Kuske) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Patrick v. Kuske, 348 P.2d 414, 55 Wash. 2d 517, 1960 Wash. LEXIS 527 (Wash. 1960).

Opinion

Rosellini, J.

The appellant is lessee of certain premises in the city of Wenatchee; the respondents operate a busi[518]*518ness known as the “Peter Rabbit Store” on' the adjoining premises. Desiring to acquire the appellant’s leased property for a parking lot facility, the respondents entered into a contract with him, dated October 5, 1956, whereby the appellant acknowledged receipt of $500 and agreed to convey, within forty-five- days, his leasehold interest to the respondents upon payment by them of the further sum of $8,200, which latter payment was to be made not later than January 10,1957.

The contract further provided that the appellant would, within thirty days, remove all of his personal property from a designated portion of the lot; and that upon completion of this removal, the respondents would pay a monthly rental of $163 until such time as they should enter into a new lease with the owner.

The paragraph on which the controversy centers, reads:

“Fifth. It is mutually understood and agreed by the parties hereto that in the event that Second Party is unsuccessful in negotiating a new lease on the above described premises with the fee owner, Mrs. Grace L. Zufall Boston within forty-five (45) days from date of execution hereof, for a period of forty-nine (49) years, at a monthly rental of Two Hundred Fifty Dollars ($250.00), with option to renew said lease for fifty (50) years at a rental to be then determined, that this agreement shall be of no force and effect and that First Party shall retain the Five Hundred Dollars ($500.00) herein provided to be paid as liquidated damages.”

At the end of the forty-five days, a new lease had not been negotiated, and the appellant extended the time in which the respondents’ performance could be completed. Early in January, they notified him that they would not complete the purchase. The evidence shows that they had attempted, through their attorney, to negotiate a lease, but that the owners were not willing to give a lease which did not provide for adjustment of rent on the eighteenth and thirty-fifth anniversaries of the lease. A proposed lease was prepared and submitted to the respondents’ attorney. This lease provided for adjustments in rent, on the basis of appraisals, upon the application of either party; and provided [519]*519that such adjustments should hot exceed fifteen per cent of the then existing rental.

These terms were not acceptable to the respondents, and no further negotiations were conducted. They paid the rent due under the appellant’s lease for the months of November, December, and January. Early in January, their attorney notified the appellant that no lease would be taken by the respondents. Thereafter, this suit was instituted. The action was tried to the court, which found that the respondents had “waived” the forty-five day limitation, but were unable to obtain a lease containing the stipulated rental provision and, therefore, were not obligated to take an assignment of the lease.

The appellant contends that the respondents were required, under the contract, to diligently negotiate for a lease which would contain the terms set out in the fifth paragraph of their contract with the appellant. They further insist that the evidence shows, and the trial court should have found, that they failed in this duty because they made no attempt to induce the owners to change their minds after a proposed lease was submitted to them.

The respondents’ duty to take an assignment of the appellant’s lease and pay $8,700 therefor was, by the terms of the lease, conditioned on their successful negotiation of a new lease from the owners within forty-five days, said lease to provide for a rental of $250 per month for forty-nine years, with an option to renew for fifty years at a rental to be then determined. The appellant contends that the respondents impliedly promised that they would exert every effort to obtain such a lease.

The applicable rule is stated in 1 Restatement, Contracts, 366, § 257:

“Failure of a condition to exist or to occur even though the condition is some performance by a party to the contract, is not a breach of contractual duty by him unless he has made an enforceable promise that the condition exists or shall occur. Whether he has done so is a question of interpretation.”

[520]*520In accord with this rule, is 3 Corbin on Contracts 205-206, § 570:

“Contractual promises are very generally conditional promises, the duty of rendering immediate performance being subject to some condition precedent, express, implied, or constructive. This condition precedent may be some other performance by the promisor himself; in some such cases the promisor has been held to have made, by implication, an additional promise to perform the condition precedent to the duty that he undertook in express words, while in other cases no such inference is justified.”

Our research has disclosed six cases having factual situations similar to the one involved in this case. In three of them, Slack v. Munson (La. App.), 61 So. (2d) 618, Lach v. Cahill, 138 Conn. 418, 85 A. (2d) 481, and Carlton v. Smith, 285 Ill. App. 380, 2 N. E. (2d) 116, an implied promise was found. In the other three, Britschgi v. McCall, 41 Cal. (2d) 138, 257 P. (2d) 977, Shaper v. Gilkison (Tex. Civ. App.), 217 S. W. (2d) 878, and Reinert v. Lawson (Tex. Civ. App.), 113 S. W. (2d) 293, the courts did not recognize that such an implied promise could exist.

In Slack v. Munson, supra, a contract for sale of realty was conditioned on the purchaser’s being able to negotiate a ten thousand dollar loan on the property. The agreement was executed with knowledge on the part of the vender that the purchaser had been assured he could get a ten thousand dollar loan at four and one-half per cent interest for a period of fifteen to twenty years. The court held that this plan and understanding inferentially became a part of the agreement, and when the vendee was unable to negotiate such a loan, he was relieved of his obligation under the contract even though he could have obtained the money from other sources with more onerous conditions attached. The court said:

“In order to fulfill his obligations in good faith under the provisions of this contract, the plaintiff was required to make a reasonable effort to obtain a loan similar to the one contemplated . . . and it is shown by the evidence that he did not cease his efforts to secure such a loan.”

[521]*521In Lach v. Cahill, supra, it was held that a provision in a contract for sale of realty making the purchaser’s ability to secure a mortgage a condition precedent to his performance, implied a promise by the purchaser that he would make a reasonable effort to secure a suitable mortgage. The purchaser unsuccessfully applied for a mortgage loan at five different banks and loaning institutions. Although the seller subsequently offered to take back a purchase-money mortgage payable on demand, the court held that this type of mortgage was not contemplated by the parties and that the purchaser had made a reasonable effort to secure a suitable mortgage. The return of his earnest-money deposit was decreed.

Carlton v. Smith, supra,

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Related

Britschgi v. McCall
257 P.2d 977 (California Supreme Court, 1953)
Slack v. Munson
61 So. 2d 618 (Louisiana Court of Appeal, 1952)
Lach v. Cahill
85 A.2d 481 (Supreme Court of Connecticut, 1951)
Reinert v. Lawson
113 S.W.2d 293 (Court of Appeals of Texas, 1938)
Shaper v. Gilkison
217 S.W.2d 878 (Court of Appeals of Texas, 1949)
Carlton v. Smith
2 N.E.2d 116 (Appellate Court of Illinois, 1936)

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Bluebook (online)
348 P.2d 414, 55 Wash. 2d 517, 1960 Wash. LEXIS 527, Counsel Stack Legal Research, https://law.counselstack.com/opinion/patrick-v-kuske-wash-1960.