Whalen v. Owens

Singley, J., delivered the opinion of the Court. This is an appeal from an order of the Circuit Court for Montgomery County sustaining Owens’ demurrer to the bill of complaint filed by C. M. Whalen and Robert J. Whalen (Whalen) for specific performance of a contract. During argument of the case before us, counsel for the parties conceded that the order entered by the court below was intended to sustain the demurrer without leave to amend, and was therefore a final order from which an appeal would lie. Maryland Rules 373 d, 345 e.

The contract sought to be specifically enforced as set out in full below incorporates the changes and interlineations made prior to signing: “THIS AGREEMENT made this 18 day of April, 1966, by and between C. M. Whalen and Robert J. Whalen, hereafter collectively called Whalen and T. Calvin Owens hereafter called Owens, WHEREAS, Whalen and Owens entered into an agreement dated April 15, 1965 wherein Whalen agreed to purchase from Owens the stock of Owens in T. Calvin Owens, Inc., in the Brooks Construction Company, and WHEREAS, disputes have arisen under said contract concerning the balance due Owens on the said contract, Whalen’s obligation to pay a certain promissory note owing to the Riggs National Bank, and Owens’s obligation to indemnify T. Calvin Owens, Inc., from a judgment rendered in the United States District Court for the District of Columbia in favor of Charles W. White Associates, Inc., and WHEREAS, the parties have agreed to settle said disputes on the terms and conditions hereinafter mentioned, NOW THEREFORE, it is agreed— 1. Owens shall deliver to Whalen a negotiable promissory note in the amount of $50,000.00, payable three ²⁸¹ years from date or sooner in the event of sale of the security and secured against the twenty-five (25 %) interest of Owens in Glen Ridge Project, a real estate joint venture in Prince George’s County, Maryland, or such other adequate security acceptable to Whalen. 2. Whalen shall release Owens from all obligations to pay the judgment in favor of White Associates, Inc., and indemnify and save harmless Owens from all obligations as surety under a certain payment and performance bond issued on the Mayfair Construction Project, Washington, D. C. In the event T. Calvin Owens, Inc., goes into default on said project, voluntarily or otherwise, Owens agrees to cooperate with Whalen with the surety and the owner, to have said contract assigned to or relet to a nominee of Whalen, 3. Owens shall assume sole responsibility for the payment of the promissory note owing to the Riggs National Bank and shall release Whalen from any obligation to pay said note, 4.

Each of the parties do hereby release the other from any further obligation under said agreement including the payment of any sums to or from the other.” Whalen’s bill of complaint, filed 27 April 1967, averred that the contract had been executed and that it had been performed by him, but not by Owens. The bill prayed: “That the provisions of the contract * * * be specifically enforced and that the defendant [Owens] be ordered to deliver unto plaintiffs [Whalen] a promissory note in amount [of] Fifty Thousand ($50,000.00) Dollars to be secured against his interest in the Glen Ridge joint venture.” Owens demurred and assigned as his reasons that the contract lacked clarity, certainty and definiteness, and that there was an adequate remedy at law available to Whalen. The chancellor sustained the demurrer and this appeal followed. As we see it, the demurrer should have been overruled.

It follows that the order of the lower court sustaining the de ²⁸² murrer must be reversed and the case remanded in order that Owens may answer and that the case may be heard on its merits. For purposes of a hearing on demurrer, the truth of the facts alleged in the bill of complaint is admitted. Bio-Ramo Drug Co. v. Abrams, 229 Md. 494, 499 , 184 A. 2d 831 (1962). As a consequence, for the purposes of the hearing below, Owens must be regarded as having admitted: (i) that he was the owner of an interest in a real estate joint venture known as the Glen Ridge project; (ii) that the agreement was supported by consideration; (iii) that Whalen had fully performed his part of the agreement; and (iv) that Owens has failed to perform his obligations.

In our view, these allegations adequately state a cause of action for the relief sought, which is not barred by Whalen’s ability to obtain a money judgment at law. Board of County Comm'rs v. MacPhail, 214 Md. 192 , 133 A. 2d 96 (1957). There remains only the question, does the agreement have sufficient clarity and certainty to warrant the granting of specific performance, assuming that the facts alleged could be proved at trial? We do not share the chancellor’s view that the phrasing of the agreement “* * * is so inarticulate as to defy interpretation; * * * is so ambiguous, in fact, that a narration of the ambiguities * * * would be superfluous.” The critical paragraph of the agreement provides: “Owens shall deliver to Whalen a negotiable promissory note in the amount of $50,000.00, payable three years from date or sooner in the event of sale of the security and secured against the twenty-five (25%) interest of Owens in Glen Ridge Project, a real estate joint venture in Prince George’s County, Maryland, or such other adequate security acceptable to Whalen.” Maryland follows the rule of Restatement, Contracts (1932) § 370 at 673 : “Specific enforcement will not be decreed unless the terms of the contract are so expressed that the court ²⁸³ can determine with reasonable certainty what is the duty of each party and the conditions under which performance is due.” Compare Foard v. Snider, 205 Md. 435 , 109 A. 2d 101