Hardee's Food Systems, Inc. v. Hicks

Annotate this Case

169 S.E.2d 70 (1969)

5 N.C. App. 595

HARDEE'S FOOD SYSTEMS, INC. v. Clawson A. HICKS.

No. 697SC312.

Court of Appeals of North Carolina.

August 13, 1969.

Certiorari Denied October 7, 1969.

*72 Spruill, Trotter & Lane, by DeWitt C. McCotter, Rocky Mount, for plaintiff appellee.

Jordan, Morris & Hoke, by Charles B. Morris, Jr., Raleigh, and Eugene Hafer, for defendant appellant.

BRITT, Judge.

Defendant appellant contends that the trial court erred in failing to find that the verbal agreement had the effect of extending the option. The conclusions of law made by the trial court were as follows:

"1. That the paperwriting executed on 22 October, 1965 was an option and not a contract for the purchase and sale. 2. The plaintiff, having been informed that the sale could not be consummated on 5 November, 1965 as provided in the option, was under no duty to tender the balance of the purchase price nor demand deed. 3. The verbal agreement made in the telephone conversation between the vice-president of the plaintiff company and the defendant did not have the effect of continuing the option in force or extending it. And the letter of 23 November, 1965, is not a memorandum of the agreement in such form as to comply with the statute of fraud. 4. According to the terms of the agreement of 22 October, 1965 the defendant having failed to furnish fee simple title to the property to the plaintiff under the terms of the option, he is bound by the terms of the option to return the $5,000.00 option payment."

There was before the court a letter dated 23 November 1965, signed by plaintiff's executive vice-president and received by defendant, pertinent portions of which were as follows:

"* * * Since we have encountered a delay in your being able to furnish a deed to us on the property on Western Boulevard in Raleigh, we request that you return at least $4,500 of the initial $5,000 that we gave to you as advance payment. Upon receipt of your check for $4,500, we will then owe you a balance of $52,250 at the time you are able to furnish us with a deed to the property in fee simple title. We think you will agree that the sum of $5,000 is far in excess of a normal option in relation to the length of time that will be required for you to furnish us a deed. * * * * * * If you have any questions on any of the above, please feel free to contact me. We look forward to as early a date as possible to finalize the Western Blvd. transaction. *73 * * *"

It was not necessary that the memorandum have been signed prior to 5 November 1965, since the agreement, as stipulated, was made prior to that time. The memorandum was sufficient, when combined with the earlier document, to take the agreement out of the operation of G.S. § 22-2. Millikan v. Simmons, 244 N.C. 195, 93 S.E.2d 59; 4 Strong, N.C. Index 2d, Frauds, Statute of, § 2, p. 62.

The additional legal fees and any other expenses incurred by the defendant in continuing his efforts to acquire the property after 5 November 1965 were sufficient consideration, as a detriment to the defendant, to support the agreed extension. Carolina Helicopter Corp. v. Cutter Realty Co., 263 N.C. 139, 139 S.E.2d 362; Johnson v. Noles, 224 N.C. 542, 31 S.E.2d 637.

The original agreement was dated 22 October 1965 and provided for performance on 5 November 1965. The extension specified no definite time. On 29 December 1965, defendant notified plaintiff that he would be ready to close the transaction on 5 January 1966. Where the duration of the contract is not specified, it will continue for a reasonable time, taking the purposes of the parties into account. Scarborough v. Adams, 264 N.C. 631, 142 S.E.2d 608. The question arises as to whether the two-month period here was an unreasonable time in light of the fact that the original agreement had specified a two-week period.

"Reasonable time is generally conceived to be a mixed question of law and fact. `If, from the admitted facts, the Court can draw the conclusion as to whether the time is reasonable or unreasonable by applying to them a legal principle or a rule of law, then the question is one of law. But if different inferences may be drawn, or the circumstances are numerous and complicated and such that a definite legal rule cannot be applied to them, then the matter should be submitted to the jury. It is only when the facts are undisputed and different inferences cannot be reasonably drawn from them, that the question ever becomes one of law.' [Citations]" Quoted from Rocky Mount Savings & Trust Co. v. Aetna Life Insurance Co., 199 N.C. 465, 154 S.E. 743, in Apostle v. Acacia Mut. Life Insurance Co., 208 N.C. 95, 179 S.E. 444.

Considering the stipulations and evidence before the trial court, we think it erred in its conclusions of law and particularly the conclusion that the letter of 23 November 1965 "is not a memorandum of the agreement in such form as to comply with the statute of fraud." The judgment does not disclose that the court considered the question as to whether a two-month additional period for defendant to tender a good and sufficient deed was a reasonable time. We think an answer to this question is vital to a just determination of the controversy. It would not be proper for us to answer the question as the authority of this Court, under the facts presented, is limited to a review of the proceedings and rulings in the trial court. 1 Strong, N.C. Index 2d, Appeal and Error, § 2, p. 105.

For the reasons stated, the judgment of the superior court is vacated and a new trial is ordered.

New trial.

MALLARD, C. J., and FRANK M. PARKER, J., concur.