Watts v. England

Hart, J., (after stating the facts). It has been well said that there may be a sale of land, an agreement to sell land, and what is generally called an option. An actual transfer of title from the grantor to the grantee by 'deed, or other instrument in writing, is an executed contract. ' A contract to be performed in the future, which, if fulfilled, results in a sale, is an executory contract. In other words, an agreement to sell is preliminary to a sale, and is' not the sale itself. It'may be réseind'ed- by agreement between the parties, and the contemplated sale may never take place. An option is distinct from a sale of land, or an agreement to sell land. An option, in the proper sense, is a contract by which the owner of property agrees with another that he shall have the right to purchase the same át a fixed price within a certain time. 39 Cyc. 1232. -One of the distinguishing features between an exec-utory contract to isell land and an option is- that .the latter does not bind the second party to purchase the land. Indiana & Arkansas Lumber & Manufacturing. Co. v. Pharr, 82 Ark. 573. On the other hand, a contract in which the second party binds himself unconditionally to pay the purchase price is often, fop that reason, held to be a contract to purchase. Vance v. Newman, 72 Ark. 359, and Bonanza Mining & Smelter Co. v. Ware, 78 Ark. 306. ¡When the contract is considered as a whole, we think that -it is an executory contract for the sale of land, and not merely an option. The contract recites that T. J. Watts has contracted to sell to Charlie Haynie certain déscribed lands for an amount evidenced by eight promissory notes for $150 each, due. October 1, 1917, to October 1, 1924, inclusive. The contract further recites that, upon the payment of each note and the maturity of the last note, T. J. Watts agrees to grant to Charlie Haynie a warranty deed to said land. While the contract was only signed by Charlie Hay-nie, it will be seen that it imposed obligations upon Watts as well as upon Haynie. By the language of the contract Haynie promised to pay the notes as they fell due, and Watts promised to give Haynie a warranty deed when the last note was paid. By the terms of the agreement, Watts bound himself to execute a warranty deed to Charlie Haynie upon the payment of the purchase price, and Haynie bound himself to pay the purchase price in the time and in the manner specified in the contract. It is true that -the contract contained a provision. that, should any one or all of the notes not be paid when due, the contract should be void. The purpose of this provision, however, was to insure the prompt and faithful performance of the contract by the purchaser, and might be enforced or not at the election of the vendor. It was the undoubted intention of both parties, by inserting this clause, to provide a-penalty to insure the prompt performance of the contract by the purchaser. If Haynie paid the purchase money, no discretion in the matter was left to Watts. On the other hand, if he did not pay the purchase money, he left the option with the other party to avoid the contract- or not. Hence, there was no lack of mutuality. Compliance on the part of the purchaser vested him with the power to compel specific performance if the vendor failed to respond to the obligations - imposed upon him by the contract. Dana v. St. Paul Investment Co. (Minn.) 44 N. W. 55, and cases cited, and Griffith v. Stewart, 31 App. D. C. 29. It is true that the -notes recite that they are given for the rent of the land. Therefore it is insisted that the contract is a lease of land for the time, and for the price specified in the contract, with the option on the' part of the lessee to purchase the -land during’ the life of the lease. Such construction' as this would give no effect whatever to the language of the contract when considered in its usual and ordinary acceptation. We are of the opinion that, when considered as a whole, the contract was an executory contract for the sale of the land. As we have already seen, the contract itself was one for the purchase of real estate. The notes in question were executed pursuant to the provisions of'the contract,' and we do not think that the contract could be changed from an executory contract of sale to an option merely by the recital that the notes were'for- the rent of the land. Trieschmann v. Blytheville Steam Laundry, 148 Ark. 237, and other cases cited by counsel for the plaintiff, have no application, because the contracts in those cases, by their express terms, were option contracts, and not executory contracts for the sale of land-. This brings us to a consideration of the rights of J. E; England, Jr., trustee. The record shows that in September, 1922, Charlie Haynie and T; J. Watts agreed to rescind the contract. The record also showed that, on the-16fh day of July, 1919, Haynie and wife had executed to C. M. Martin an oil and gas lease to said land, which was duly filed for record -on the 28th day of July, 1919. J. E. England, Jr., trustee, became, by proper assignment, the owner of this lease. A conveyance of oil or gas in its natural state is a conveyance of an interest in land. Osborn v. Arkansas Territorial Oil & Gas Co., 103 Ark. 175. The lease in question contained no covenant against assigning it, and could therefore be assigned to J. E. England, Jr., trustee. Lawrence v. Mahoney, 145 Ark. 310. After the oil and gas lease had been executed and filed for record, neither the lessee nor his assignees could be affected 'by the subsequent agreement of Watts and Haynie to rescind the contract, without their consent. It is next claimed that the oil and gas lease was forfeited because the lessee failed to pay the rent due on July 16, 1923. This suit was filed on June 18, 1923. The filing of the suit was notice to J. E. England, Jr., trustee, that Charlie Haynie had parted with his interest in the land, and was not entitled to receive the rent. No useful purpose could have been served by tendering the rent to the plaintiffs in this case. Their whole conduct showed that they would not have received it. A tender is not required where it is evident that it will not be accepted. The law does not require vain and useless things. Dickinson v. Atkins, 132 Ark. 84. The rights acquired by England under the assignment of the lease to him gave him the right to protect his interest by paying off the balance of the purchase money due by Haynie. The record shows that the oil and gas lease was executed and filed for record before Watts claimed any forfeiture under the terms of the original contract. The result of our views is ■ that the decree of the chancery court was correct, and will be affirmed.