Patch v. Anderson

California Court of Appeal Sep 26, 1944 No. Civ. 3258Published

Before: Marks

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Holding. The court held that the parties did not form an enforceable contract because the writing was merely an executory agreement to enter into a future contract, and it lacked certainty regarding material terms.

Issues

Whether there existed an enforceable written contract for the sale of real property.
Whether the agreement contained sufficiently certain material terms to warrant specific performance.

Disposition. Affirmed

Quotations verified verbatim against the opinion

“It is fundamental that there must be a meeting of the minds on the material terms of a contract before it can be specifically enforced.”

“We have concluded that we do not have a final contract of the parties before us, but rather an executory agreement to execute a contract, all of the material terms of which had not been settled and agreed upon.”

MARKS, J.

These are actions to quiet title and for specific performance of a purported contract to sell real property, and for damages. Defendants had the judgments and

[64]

plaintiffs have appealed. The actions were consolidated for trial and on appeal.

The sole question presented is whether there existed an enforceable written contract for the sale of the property. Defendants urge and the trial court found, that there was no such contract but merely an agreement to enter into a contract after additional terms had been agreed upon.

Defendants, as joint tenants, owned a 40-acre orange grove in Orange County which they desired to sell. They were residents of the Island of Molokai, Territory of Hawaii, and by a special power of attorney had authorized L. P. Nichols, a real estate broker, to effect the sale.

Plaintiffs entered into negotiations with Mr. Nichols which resulted in escrow instructions and a contract of sale being-prepared which were sent to defendants for signature. The terms were not acceptable to defendants who informed Mr. Nichols of that fact by cable. This was followed by a letter signed by Robert S. Anderson, but not by his wife, and contained the following:

“My conditions are as follows:—-Eliminate farming equipment from the bill of sale; Require at least annual payments of $1000.00 with interest paid semi-annually; plus 75% of net profits; Append a schedule to limit expenditures; Prorate taxes to May 1st, 1942; Include that they shall not resort to the Lemke Frazier Act in the contract of sale; expect Patch to purchase my Farm Loan Bonds.

“Should Mr. Patch meet the above requirements, you are authorized to have new papers drawn and forward for my signature, otherwise drop negotiations.. . . Personally I do not think he will be able to carry the load, consequently the collateral they are depositing with the Title Co. is of doubtful value under post war conditions. .. .

“I also expect Mr. Patch to purchase my Farm Loan Bonds, I had to buy them from Arkley that is why it was necessary for me to borrow an additional $1000.00 from him.

Patch v. Anderson

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MARKS, J.

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