Manning v. Foster

Root, J. This was an action to enforce specific performance of an alleged escrow agreement. On the 18th of December, 1905, the defendant Henry Foster executed a deed for the land in question, at a consideration of $4,500, and by [542] agreement with plaintiff placed said deed in escrow with certain bankers in Chehalis. With the deed there was deposited cash in the sum of $2,854.63, a promissory note for $500, and certain warrants amounting to $1,145.37, a total of $4,500. It was understood that the wife of defendant was to come and sign and acknoAvledge the deed, and that the warrants were to be indorsed by one J. R. Welty. When Mrs. Foster should sign the deed and the warrants should be indorsed by Mr. Welty, the deed was to be delivered to the appellant and the money, note, and warrants were to be turned over to respondents. The deposit of these instruments and money was accompanied Avith a memorandum as follows: Deposited with Coffman, Dobson & Co., Bankers, Chehalis, Washington. Special Deposit. By Henry Foster, December 18, 1905. Patent & Warranty Deed for delivery (when signed) to Frank A. Manning on payment of Cash ..................................$2854.63 Note ...;.............................. 500.00 3 R & B Warrants No. 2611, 2610 & 2609.................. 1145.37 Total .........................4500.00 J. W. A . Some days after the deposit, Mrs. Foster called and signed and acknowledged the deed. Mr. Welty, being a state official Avith office at Olympia, Avas seldom in Chehalis, but was expected to be there some time during the Christmas holiday season. He came on Christmas, but the bank not being open, was unable to sign the warrants at that time, and returned to Olympia Avithout doing so. A feAV days afterward, Avithout the consent of the appellant, the respondent Henry Foster AvithdreAV the deed from said bankers. Shortly thereafter said Welty indorsed said Avarrants, and the appellant demanded of respondents the delivery of the deed. They refused to deliver the deed; whereupon this action was commenced. Upon the trial the facts as hereinbefore set forth [543] were established by the evidence of appellant. Thereupon a motion for nonsuit was made by respondents, and the same sustained by the trial court. From a judgment of dismissal, this appeal is prosecuted. We are unable to reach the conclusion announced by the honorable trial court. It is urged that this was community property, and that there was no evidence that Mrs. Foster had any knowledge or information of the agreement between the plaintiff and Henry Foster, her husband. The fact that she came to the bank and signed and acknowledged the deed, after it had been left there pursuant to the agreement between her husband and appellant, would seem to be satisfactory evidence that she understood and was assisting to carry out the agreement. It is urged that there was no valid or written contract by the defendants, or either of them, to convey the lands, and that there was no sufficient memorandum to satisfy the statute of frauds. In the case.of Nichols v. Oppermann, 6 Wash. 618, 34 Pac. 162, this court said: “The condition upon which a deed is delivered in escrow may rest in and be proved by parol.” In Bronx Inv. Co. v. National Bank of Commerce, 47 Wash. 566, 92 Pac. 380, this court held that an escrow agreement need not be in writing. At page 586, 16 Cyc., it is said: “Parol evidence is permissible to prove the condition upon which the instrument'is deposited.” In the case of Gaston v. Portland, 16 Ore. 255, 19 Pac. 127, the court said: “Nor is it necessary that the condition upon which the deed is delivered in escrow be expressed in writing; it may rest in parol, or be partly in writing and in part oral. The rule that a contract in writing inter partes must be deemed to contain the entire agreement or understanding has no application in such case.” In 11 Am. & Eng. Ency. Law (2d ed.), at page 334, it is said: “It may be stated as a general rule that no particular form of words is necessary to constitute an escrow.” [544] In Cannon v. Handley, 72 Cal. 133, 13 Pac. 315 the court spoke as follows: “But it is said there was nothing in writing authorizing Cox to hold or deliver the deed. There is nothing in the statute which requires this to be in writing The statute only requires a note or memorandum in writing as evidence of the contract. Nothing in it has reference to any arrangement for the delivery of the deed in escrow, or its subsequent delivery by the parties so holding it to the grantee.” In Stanton v. Miller, 58 N. Y. 192, the court used this language : “The condition upon which a deed is delivered in escrow may be expressed in writing or rest in parol, or be partly in writing and part oral. The rule that an instrument or contract made in writing inter partes, must be deemed to contain the entire agreement or understanding, has no application.” Of course this does not mean that a written escrow agreement can be varied by parol. Pacific Nat. Bank of Tacoma v. San Francisco Bridge Co., 23 Wash. 425, 63 Pac. 207. See, also, Carstens v. McReavy, 1 Wash. 359, 25 Pac. 471; Glenn v. Hill, 11 Wash. 541, 40 Pac. 141; Horr v. Hollis, 20 Wash. 424, 55 Pac. 565; Monfort v. McDonough, 20 Wash. 710, 54 Pac. 1121; Western Timber Co. v. Kalama River Lumber Co., 42 Wash. 620, 85 Pac. 338, 114 Am. St. 137; Peirce v. Wheeler, 44 Wash. 326, 87 Pac. 361; 16 Cyc. 570, 576-7; Daniel, Negotiable Instruments, § 68; Thoraldson v. Everts, 87 Minn. 168, 91 N. W. 467; Lindley v. Groff, 37 Minn. 338, 34 N. W. 26; Brown v. Munger, 42 Minn. 482, 44 N. W. 519; Perry v. Paschal, 103 Ga. 134, 29 S. E. 703; Engler v. Garrett, 100 Md. 387, 59 Atl. 648; Browne, Statute of Frauds (5th ed.), 366. In the case at bar the deed of conveyance having been duly executed by the defendants and deposited at the same time plaintiff deposited his money, note, and warrants, all accompanied by the written memorandum above set forth, and said [545] warrants having been properly indorsed within a reasonable time, we think there was a legal escrow agreement and a compliance by appellant with his part thereof, and that defendants should be held to their agreement, unless then can show other reasons than now appear in the record for not so doing. We think oral testimony was permissible under the circumstances of this case to show what the agreement of the parties was as to delivery of the deed, and that the evidence introduced establishes an escrow agreement binding upon the parties. The judgment of the honorable superior court is reversed, and the cause remanded for further proceedings not inconsistent with this opinion. Hadley, C. J., Dunbar, Mount, Crow, and Rudkin, JJ., concur.