Pangburn v. Sifford

Sharpe, J. Agreements, unless arrived at by cor- respondence, are the result of oral negotiations. When the minds of the parties have met, when an offer has been made by one and accepted by the other, a contract is thereby entered into. Unless required by some positive law, it need not be reduced to writing in order to be binding upon the parties. Defendants, through Davidson, their authorized agent, offered to sell the property in question to plaintiff for $2,500, with a down payment of $25 and — 155 — balance within 30 days. Plaintiff, after examining the premises, accepted this offer and paid the $25 to Davidson. All the essentials of a contract were agreed to. As thus made, however, it is declared by our statute of frauds (3 Comp. Laws 1915, § 11977) to be void1 “unless the contract, or some note or memorandum thereof, be in writing, and signed by the party by whom the * * * sale is to be made.” To comply with this requirement, Davidson prepared the memorandum in question and the defendants signed it. On being so notified by Davidson, the plaintiff at once took steps to raise the money to make the additional payment. This fact was known to defendants as the officers of the loan association visited the premises and made an appraisal thereof. Defendants were thus informed that plaintiff regarded the transaction as a binding contract of purchase and sale. The defense rests on the claim that plaintiff, riot having signed the memorandum or otherwise accepted it in writing, could not have been compelled to perform. In what way could he relieve himself from doing so? All that he promised to do was to pay money and there is no law requiring such a promise to be in writing to be enforceable. The writing does not purport to be an offer to sell real estate, requiring acceptance by the purchaser. It is a memorandum of a sale theretofore made. • It was prepared to meet the requirement of the statute. The contract as evidenced by the writing was not an option agreement. The $25 was not paid to secure plaintiff the option to purchase at any time within 30 days, but, as stated in the memorandum, it was “a part payment on the property.” In my opinion, a contract, binding upon both parties, was consummated and could be enforced by either party against the other. The confusion, if there be such, in the authorities, arises from the failure to bear — 156 — in mind that there is no statute on which plaintiff could rely as a defense to a suit brought to recover the balance of the purchase price in the event of a breach on his part. A different question would be presented if the memorandum provided that he should execute a mortgage back for a part of the purchase price, as an agreement on his part to do so would be within the requirement of the statute. The question is not a new one in this court. We have many times held that the omission of the vendee to sign the memorandum does not relieve him from liability to pay the balance of the purchase price. A review of these decisions seems justified. In the early case of Holland v. Hoyt, 14 Mich. 238, the holding is well stated in the syllabus as follows: “There is nothing in the statute of frauds which precludes recovery for the price of land actually conveyed, whether the agreement for the price is written or verbal.” In Scott v. Bush, 26 Mich. 418 (12 Am. Rep. 311), it is said: “The law does not require the purchaser to sign the agreement, and he is liable, therefore, upon the written contract, though his own assent is verbal.” In Burke v. Wilber, 42 Mich. 327, the court said: “The statute of frauds, as held in Holland v. Hoyt, 14 Mich. 238, does not require the agreement of a vendee to pay purchase money to be in writing.” In Wardell v. Williams, 62 Mich. 50 (4 Am. St. Rep. 814), the court points out the distinction when the purchaser is required to do anything other than to make the payment of money. If a mortgage is to be given back as part of the purchase money, this could not be enforced as it is within the statute, being an agreement relating to lands. — 157 — In Mull v. Smith, 132 Mich. 618, the defendant submitted the following written offer: “Forty acres for $650. Mortgage $250. Leaves balance $400. Will take cash $375 for my interest in place.” Mull accepted this orally and paid $100 down. Smith signed the following: “I agree to give Mr. E. M. Mull a warranty deed of the Burns farm upon payment of $275, subject to mortgage of $250.” He also signed the following receipt: “$100.00. “Received of E. M. Mull one hundred1 dollars to apply on payment of Burns farm.” Some time after, Smith tendered Mull a deed and demanded payment of the $275. Mull refused to pay and, assuming that the contract was void under the statute, sued to recover the $100 paid by him. The court said: “Our statute does not make all contracts for the sale of land void. It excepts those where the contract itself, or some note or memorandum thereof, is in writing and signed by the vendor. When the contract itself is in writing and signed by both parties, the writing is the contract. When the memorandum of the oral contract is in writing and signed by the vendor, it is not the contract, but a memorandum, which makes it binding upon him if accepted by the vendee. This is valid evidence of the contract. * * * “Here, then, was a valid1 contract for the sale of land. Defendant is proven to have made it by his writings signed and delivered. The plaintiff is shown to be a party to it by oral proof of his acceptance of defendant’s memoranda, and payment of $100 upon it. He cannot recover the $100 as money paid for his use.” This opinion is quoted from approvingly in the — 158 — recent case of Ogooshevitz v. Sampson, 211 Mich. 180. The syllabus in Smith v. Mathis, 174 Mich. 262, reads: “Having accepted the memorandum signed by the vendor, the purchaser was bound by the instrument even if he did not, as claimed by the vendor, sign the writing until a later date.” In Bushman v. Faltis, 184 Mich. 172, it was claimed that the instrument lacked mutuality and was unenforceable because not signed or accepted in writing by the lessee. The court said: “The failure of the lessee to sign this instrument, it is now conceded, is not material, and no point is made of it by the appellant. Smith v. Mathis, 174 Mich. 262; Mull v. Smith, 132 Mich. 618.” In Walsh v. Oakman, 199 Mich. 688, the memorandum was signed by the vendor alone. A $200 down payment was made. The vendor filed a bill to have the contract declared invalid and the record thereof removed as a cloud on his title. One of the claims of plaintiff was thus stated: “Plaintiff further^ claims that the said paper is merely an offer, which he revoked before it was accepted by said Oakman; that a.check was given for the down payment which was not legal tender, and therefore no payment on said land; that said paper does not satisfy the statute of frauds.” By cross bill the vendee asked specific performance. It was held “that the contract, or memorandum thereof, was sufficient to constitute a good and valid contract,” and specific performance was decreed. In Tattan v. Bryant, 198 Mich. 515, cited by Mr. Justice Bird as sustaining the claim that the agreement was an option contract, the memorandum was signed by both parties. No payment had been made thereon until after the vendor had advised the vendee that “the — 159 — deal is therefore declared off.” The holding that the. writing was but an option rested on the language employed therein. It was but an offer to sell on certain terms and conditions and these had not been complied with at the time of the withdrawal of the offer by the vendor. As none of the above cases was in any way referred to, we apprehend that they were not considered applicable to the facts there presented. The case of Wilkinson v. Heavenrich, 58 Mich. 574 (55 Am. Rep. 708), in my opinion, is in no way controlling. The action was for damages for breach of a contract of hiring. It was based on a memorandum signed by the defendants only, in which they agreed to pay plaintiff a stipulated wage for three years. As pointed out by Mr. Justice Stone in Smith v. Mathis, supra: “The decision was based upon another section of the statute of frauds which requires the writing to be signed by the parties to be charged therewith. We have sought to show that, in the case of the sale of real estate, the statute only requires the contract or memorandum to be signed by the vendor.” ■ Hollingshead v. Morris, 172 Mich. 126 (41 L. R. A. [N. S.] 310), also relied on, was decided on facts entirely different from those here presented. The action was brought for damages for breach due to the vendor’s refusal to convey. In the opinion, written by Chief Justice Moore, it is said: “There are four important facts that stand out unquestioned in this case: First, that the defendant had sold the property to Mr. Shapiro before Mr. Doying ever received any communication from defendant; second, that no written acceptance was shown to the defendant before he notified both.Mr. Keyes and Mr. Hollingshead that he had sold the property; third, that no written acceptance was delivered to him or tendered to him before he revoked his offer to sell: fourth, no money was tendered to him, to apply on the contract before he revoked his offer to sell.” — 160 — In. disposing of the case, it was said: “In the absence of any payment by Mr. Doying or the delivery of any written acceptance signed by him, how can it be said Mr. Doying is bound to perform upon his part so as to make the contract mutual?” The failure of the plaintiff to make the additional payment within the 30 days may well be said to have been due to the action of defendants’ agent, Davidson, who, on being advised within such time that plaintiff was ready to close the deal, fixed Saturday, the day after such time had expired, to do so. He sent word to Mr. Sifford to come to his office at that time and, when he did not appear, telephoned to his house and otherwise tried to find him. Mr. Sifford was down town, knew of the arrangement as made by Davidson, but did not go to his office. While the writing provides for a forfeiture of the $25 if the balance be not paid within the 30 days, such a provision is usual in all land contracts but is rarely enforced unless the contract itself makes time the essence thereof. Performance within the time was waived by Davidson, defendants’ agent, with Mr. Sifford’s knowledge and apparent consent. The binding effect of such a waiver and the rule of law applying to such forfeitures are so fully considered by Mr. Justice Stone in the recent case of Waller v. Lieberman, 214 Mich. 428, that I do not further discuss them. The conclusions reached by the trial court and the decree rendered granting specific performance were fully justified by the proofs. The decree, will be modified by inserting the words “November 1, 1921,” in the place of “10 days” in the provision for payment and delivery of deed and as thus modified affirmed, with costs to plaintiff. Steere, C. J., and Moore, Wiest, Fellows, Stone, and Clark, JJ., concurred with Sharpe, J.