Thistle Mills Co. v. Bone

Jones, J., delivered the opinion of the Court: This is an appeal from a decree of the-Circuit Court for Baltimore County, dismissing the bill of the appellant (a corporation), which was filed in that Court to have enforced the specific performance of a contract which the appellant alleged it had made with the appellee, John M. Bone, for the sale to it by the said Bone of certain real property referrred to in the bill. The alleged contract was evidenced by a written paper which was set out in the appellant’s bill and is as follows: Ellicott City, Md., 18 — , ’99. Received of Thistle Mills Company, through Robert P. ⁵³ Deal, check for two hundred and fifty dollars as deposit on sale of mill, water-power, land in Howard County, and houses below mill, the sum of six thousand dollars — being purchase price. (Signed), John M. Bone.

After alleging the making of the contract set out therein, the bill states that shortly after the making of the same the appellant was notified by letter from the appellee Bone, that he had sold the property referred to in the contract to other parties and would be unable to carry out the agreement made with the appellant, and that when the letter conveying this notification was received, the appellant “was preparing to examine the title to the said property, and (upon finding the same clear and unencumbered), to make payment to the defendant (Bone) of the balance due under said contract of sale.” The bill was filed on the 24th of November, 1899, against John M. Bone as sole defendant. On the 5th of December, following, the appellee, James H. Gaither, intervened by petition in the case, alleging that on the 18th day of November, 1899, he had purchased from the appellee, John M. Bone, property which included that mentioned in the bill of complaint in the cause for the sum of fourteen thousand dollars, and had paid two hundred and fifty dollars as part of the purchase-price. For the terms of his contract of purchase, and the circumstances under which it was made, he referred to the answer of the appellee Bone, which was filed on the same day as the petition. He then asked to be made a party-defendant in the cause, with leave to answer and make defense for the protection of his rights.

He was accordingly made defendant by order of the Court. The answer of John M. Bone denies “that he ever made or entered into any agreement to sell ” the land mentioned in the bill of complaint to the appellant, except subject to a condition and reservation stated in his answer. He admits that he signed a receipt for a check for two hundred and fifty dollars and then proceeds to state the circumstances under which the same was signed as follows: Being possessed of ⁵⁴ certain property situated partly in Howard and partly in Baltimore County, generally known as “ Gray’s Mills ” and consisting “ of some acres of land with the improvements thereon, including a mill and several dwelling houses,” on the 6th day of November, 1899, he “entered into an agreement based upon a valuable consideration with „ . . . James H. Gaither, of Howard County, to sell the whole of said property to him for the sum of fourteen thousand dollars, provided said Gaither would take and pay for the same prior to the first day of January, 1900.” This “agreement took the form commonly known as an option ” and was evidenced by a written memorandum “made at the time and signed” by the respondent Bone, in the words following: “I hereby, for the sum of one dollar, give you, James H. Gaither, the option on all the property bought by me at sale of the Martha E. Gray estate until January 1, 1900.

Price fourteen thousand dollars cash; no commissions.” The sum of one dollar, mentioned in this agreement, was actually paid to the respondent by said Gaither. The answer then avers that at and before the time of the handing to the respondent of the check and the obtaining from him of the receipt referred to in the bill of complaint, the appellant well knew that the respondent had made a contract to sell the property mentioned in the agreement with Gaither above recited, and had given an option thereon which was “ then still in force ;” that the appellant had, through its agent, previously made offers to the “respondent for said property — and several attempts to purchase the same,” which offers had been declined by the respondent, he giving as his reason for so declining that he had already agreed to sell the property in question as has been stated ; that the appellant had been informed of Gaither’s rights in the premises by Gaither himself; that when the agent of the appellant offered to the respondent as part payment for the property, which is the subject of the alleged contract of purchase by the appellant, the check referred to in the bill of complaint, the said agent was “distinctly informed” by the respondent that the acceptance thereof must be subject to the condition that the holder “of the option which has been ⁵⁵ mentioned ” would consent to relinquish his said option, and that he (the respondent) signed ” the receipt mentioned in the bill of complaint “with that understandingthat immediately after signing said receipt, the respondent informed James H. Gaither of what he had done and asked Gaither “whether he would relinquish his claim under his said contract,” and Gaither “promptly declined to do so and notified” the respondent “ that he insisted upon his rights under the said contract, and had decided to exercise the samethat the respondent immediately notified the appellant of “ Gaither’s action ” and returned the check that he had received from appellant’s agent; and then upon receipt of two hundred and fifty dollars paid him by Gaither executed and delivered to said Gaither the following contract for the sale to him of the property upon which Gaither had previously held the option which has been recited. “This agreement, made this 18th day of November, 1899, between John M. Bone, of the first part, and James H. Gaither, of the second part: Witnesseth, that the said party of the first part does hereby bargain and sell unto the said party of the second part, and the latter doth hereby purchase from the former the following described property, situated and lying in Baltimore and Howard Counties, better known as Gray’s, and conveyed to said Bone by executors of Martha E. Gray, at and for the price of fourteen thousand dollars, of which, two hundred and fifty dollars have been paid prior to the signing hereof, and the balance is to be paid as follows : As soon as title is finished, and upon payment as above of the unpaid purchase-money, a deed for the property shall be executed at the vendee’s expense by the vendor, which shall convey the property by a good and merchantable title to the vendee. Taxes to be adjusted to day of sale, to be paid or allowed .for by the vendor to November 18th, 1899.” c.Wf1 / J°HN M- Bone> CSea1-] ^ [ James H. Gaither, [Seal.] Test: J. H. Leishear. It is then alleged that “Gaither has declared himself fully ⁵⁶ satisfied with the title to the said property, and has demanded of the respondent a transfer of the same, at the same time tendering the purchase-price called for by the said contract of sale.” The appellee Gaither, filed an answer to the bill to the effect that he had read the answer of John M. Bone, and, believing the same to be true, he adopted “ said answer as his own in so far as the same is applicable to him.” Testimony was taken by both sides from which it appeared that the facts alleged in the pleadings were substantially free from dispute with the exception of the conflict shown by the evidence as to the allegation in the answer of JohnM.

Bone, that when he received the check mentioned in the appellant’s bill, and gave the receipt therefor set out in the bill, he informed the agent of the appellant, through whom the transaction was made, that his acceptance of the check must be subject to the condition that the holder of the option, of which he had informed this agent, would consent to relinquish the same, and that he signed the receipt therefor with that understanding. With reference to this allegation, the only parties who could have any knowledge of the facts upon which it was based were the defendant, John M. Bone, and the agent of the plaintiff (Deal), who delivered to Bone the check and took the receipt therefor. Bone testified there was an understanding as alleged in his answer accompanying the transaction in question. Deal denied that there was such an understanding, and testified that Bone told him at the time that he (Bone), had given a previous option upon the whole property “that he owned,” but that he had the privilege of selling the part thereof which is the subject of controversy here.

It maybe further said, in reference to the proofs in the case, that it does not distinctly appear, as alleged in the answer of Bone, that the plaintiff had been informed by ” Gaither himself,” of his (Gaither’s) rights under any previous contract of sale or option of purchase affecting the property which was the subject of the alleged contract of the plaintiff, though there is evidence tending to prove this. But it does distinctly appear that the plaintiff, through the agents who conducted ⁵⁷ the negotiations resulting in the alleged contract which the plaintiff is seeking to have enforced, had notice before and at the time of the making of the same that there was an outstanding option contract, which had been entered into by-Bone, that affected the property the plaintiff sought to purchase ; and it further appears that on the same day, but before the plaintiff’s contract was consummated as alleged, the appellee Gaither, had decided to avail of and close his option, and had made the attempt to communicate with the appellee Bone, to that effect — moreover that he had incurred obligations upon the faith of its being carried out. Upon this state of pleading and proof the Court below refused, and we think properly, to decree to the plaintiff the specific performance of the contract it is seekiug to have enforced. It will be seen that the only defense upon which the defendants have relied, or have opposed to the plaintiff’s claim to relief, is the equity raised against it by the existence and the circumstances in connection therewith as set out in the answer of Bone, between the appellees, of the contract of the 6th of November, 1899, and