Opinion
Rehearing Denied March 25, 1975.
Page 223
Charles E. Withers, Norwood, Brown & Brown, James D. Brown, Delta, for plaintiff-appellee.
Myers, Woodford & Hoppin, Charles T. Hoppin, Denver, for defendant-appellant.
VanCISE, Judge.
Defendant, Mildred M. Hohl, appeals from a judgment decreeing specific performance of an agreement for sale of land by her to plaintiff, Robert E. Applebaugh. We reverse.
Mrs. Hohl, a retired teacher living in California, acquired the subject property in 1963. On or about June 13, 1972, she stopped in Telluride to investigate the feasibility of selling the property located in that area. Once on the 14th, twice on the 15th, and twice more on the 16th, Applebaugh talked to her about purchasing the lots. Their last discussion occurred just as Mrs. Hohl was about to leave the campground where she had been staying. At that last meeting, Mrs. Hohl accepted a check from Applebaugh and gave him a memorandum signed by her and in her handwriting which read:
16 June, 1972
'Received of Robert E. Applebaugh the sum of One Thousand Dollars ($1,000.00) earnest money on purchase of Lots 49, 58 and 66 of Fall Creek Subdivision #2 in San Miguel County, Colorado pending a mutually acceptable contract to be furnished by buyer. Total selling price is $11,000.00.
/s/ Mildred M. Hohl
421 Siesta Drive
Aptos, California 95003
Tel. 1--408--688--6298
Until June 22nd
c/o Mrs. Elsye Frank
509 1/2 Grand Avenue
Spencer, Iowa'
Immediately thereafter, Mrs. Hohl departed for Kansas and Iowa. She endorsed and deposited Applebaugh's check.
On or about July 7, 1972, Mrs. Hohl returned to Telluride. By letter dated and mailed July 9, 1972, she advised Applebaugh that she felt there was 'no deal at all' because she had not received a contract by June 22. On July 10, again by letter, she returned his $1,000, which he refused to accept. On July 12, 1972, Applebaugh's attorney presented to Mrs. Hohl two proposed contracts for the sale and purchase of the property, but she refused to examine them.
On July 21, 1972, Applebaugh filed this suit based on the handwritten memorandum. In his complaint, he offered to pay the $10,000 balance remaining on the purchase price. The money was paid into court the first day of trial, September 25, 1973. On this evidence, the trial court concluded that the document was an agreement for sale and purchase of this property and that Applebaugh was entitled to specific performance thereof. There is no dispute as to the contents of the memorandum or as to the facts above stated. Therefore, we are not bound by the conclusions of the trial court on the issues of law involved herein, Grant Investments Co. v. Fuller & Co., 171 Colo. 86, 464 P.2d 859, or by its interpretation of the memorandum. Sentinel Acceptance Corp. v. Colgate, 162 Colo. 64, 424 P.2d 380.
Mrs. Hohl contends, and we agree, that this memorandum was unilateral and not a mutually binding, enforceable contract of sale at the time it was signed. Since Applebaugh, by the memorandum, had not contracted to do anything, Mrs. Hohl could not then have compelled specific performance by Applebaugh, nor would she have had a cause of action against him for damages for a breach of contract if he had refused to purchase the property. See Miller v. Hiett, 133 Colo. 576, 298 P.2d 394; Stelson v. Haigler, 63 Colo. 200, 165 P. 265.
The memorandum contains many of the terms that would be included in an option. However, it includes the clause, 'pending a mutually acceptable contract to be furnished by buyer.' Mrs. Hohl contends that this clause shows that a formal contract was to be prepared and executed and that the memorandum was not an option but merely an invitation to negotiate further. Under the circumstances of this case, we agree.
To have an enforceable contract or option, it must appear that further negotiations are not required to work out important and essential terms. See American Mining Co. v. Himrod-Kimball Mines Co., 124 Colo. 186, 235 P.2d 804; Pierce v. Marland Oil Co., 86 Colo. 59, 278 P. 804. Essential terms relative to a sale of the property that are not stated in the memorandum include (1) condition and kind of title to be transferred, (2) the type of deed to be given, (3) the manner in which the purchase price is to be paid and the terms on any deferred payment, and (4) the time and place of performance. Most of these could be supplied by 'presumption, rule, or custom and usage.' See Shull v. Sexton, 154 Colo. 311, 390 P.2d 313; Micheli v. Taylor, 114 Colo. 258, 159 P.2d 912. However, it appears that here the parties intended to resolve these matters themselves in later bargaining sessions. This is evidenced by the testimony (1) that both parties wanted a formal contract to be drawn by their attorneys, (2) that Mrs. Hohl contemplated receiving 29% Down payment and not all cash, and (3) that, even after repudiation, Applebaugh had his lawyer prepare and submit two proposed contracts.
We hold that here the furnishing of a 'mutually acceptable contract' was required before there could be any enforceable sales agreement. No such contract having been agreed upon, there is nothing that can be specifically performed.
This opinion being based on issues raised in Mrs. Hohl's original motion for new trial, we need not consider Applebaugh's objections to the filing of an addition to that motion.
Judgment reversed and cause remanded for further proceedings not inconsistent with this opinion.
SILVERSTEIN, C.J., and COYTE, J., concur.