Smith v. Star Petroleum Co.

California Court of Appeal Jan 9, 1930 No. Docket No. 6267.Published

Before: Thompson

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Holding. The court held that the parties' escrow instructions constituted a valid, binding contract and that the thirty-day performance deadline applied to the receipt of the lease in escrow, not to the completion of the title guarantee.

Issues

Whether separate escrow instructions executed at different times constitute a valid contract.
Whether the thirty-day performance period required the escrow holder to complete the title guarantee and record the lease within that timeframe.

Disposition. affirmed

Quotations verified verbatim against the opinion

“It is apparent from an analysis of the entire document that the thirty-day period had reference to the receipt in escrow of the lease and the time for recordation was fixed upon the fulfillment by the title company of a condition”

THOMPSON (IRA F.), J.

This is an appeal from a judgment for plaintiffs in an action brought to recover from the defendant the sum of $4,500 agreed by defendant to be put in escrow to be delivered to plaintiffs for an oil lease upon property belonging to the latter. While stated in different ways, the appellant urges two reasons why the judgment should be reversed: First, that there was no written contract between the parties, and second, assuming a sufficient contract, that there was a failure to perform by the respondents within the time provided.

The points raised necessitate a brief statement of the facts. On April 16, 1925, the appellant gave to the California Title Insurance Company its instructions, the ma

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terial portions of which are as follows: “We hand you herewith our check for the sum of five hundred dollars ($500,00) and we will hereafter hand you the sum of four thousand dollars ($4000.00) which you are authorized to pay to the order of Isaiah H. Smith, Maude L. Patrick, Cora Hillerman and Alvira Paisley, jointly or to divide the same between them as they may agree upon, provided that within thirty (30) days from the date hereof, you receive for us an oil lease upon the property hereinafter described” (here follows certain terms of the lease not in dispute in this action) “which said lease you will record for us and show in your guarantee of title' when you can write the same showing title in said lessors, free and clear of encumbrance except current year’s taxes and showing said title to be free from any conditions, reservations or restrictions which would prevent the drilling of an oil well on said property.

“Upon recording said lease, you will deliver a duplicate copy thereof executed by the said lessors and the undersigned to the said lessors.

“Your guarantee of title shall be written with a maximum liability of $1,000.00, The undersigned will pay one-half (

½)

of the cost of escrow charges, for recording lease, and the lessors will pay the balance of your charges.”

(Here follows description of property.)

Smith v. Star Petroleum Co.

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THOMPSON (IRA F.), J.

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