Houk v. Williams Bros., Ltd.

Judgment for $678.57 was rendered in favor of the plaintiffs for their share of the purchase price of an asparagus crop to be produced in the year 1939, pursuant to the terms of a tripartite written contract therefor. From that judgment the defendant, Williams Bros., Ltd., has appealed.

It is contended the contract is void because the partnership name, under which plaintiffs were doing business, was substituted for the names of the second parties, C. Lee Jones and S. C. Legare, which appeared therein at the time the defendant signed the document. It is also asserted the finding that plaintiffs were the owners of the land in question is not supported by the evidence.

The plaintiffs, B. F. Houk and R. P. Houk, were conducting a farming business under the name of Houk Bros. November 19, 1934, C. Lee Jones and S. C. Legare owned the 100 acre ranch in Stanislaus County, which is involved in this suit. On that date they executed a twelve-year lease of that land to Thomas Gill for the purpose of raising asparagus, by the terms of which lease Mr. Gill agreed to pay them $2,000 per annum for the period of two years, after which the lessors were to receive in lieu of the cash rental thirty per cent of the asparagus produced. Prior to January 26, 1939, the plaintiffs acquired said property. The defendant corporation was engaged in buying and marketing farm produce. On the last-mentioned date Williams Bros., Ltd., as party of the third part, entered into a written agreement with Thomas Gill, as first party and the copartnership, Houk Bros., as second party, to purchase the crop of asparagus growing on said

“It is understood and agreed, that the third party [Williams Bros., Ltd.] is buying said crop standing in the field at the date hereof, title thereto now passing to and shall hereafter be vested in said third party, the harvest thereof to be at the cost and expense of said third party. Provided, however, that the first party [Thomas Gill] hereby promises and agrees to continue with and perform all necessary and normal operations of asparagus growers as to the care of the ground and the crop from the date hereof to the end of the harvest period, at his own cost and expense. If said party fails so to do, the third party may have any such necessary work done and charge the cost thereof against the account of the first party.”

The contract was negotiated between Thomas Gill and M. P. Williams, one of the members of the corporation. It was drawn in triplicate by the defendant’s attorney, after which each copy was immediately signed by Mr. Williams in behalf of the corporation on January 26, 1939, and delivered to Thomas Gill'to sign and to procure the signature of the said second parties. At the time these instruments were signed by Mr. Williams, it was erroneously recited that the former owners of the land, C. Lee Jones and S. C. Legare, were the parties of the second part. Probably this inadvertent statement occurred on account of the belief on the part of the members of the corporation or its attorney that the designated second parties owned the property since they executed the lease to Thomas Gill in 1934, and because they had no knowledge of the subsequent acquisition of the property by the plaintiffs. Mr. Gill, however, recognized Houk Bros, as the owners of the real property and the lease. Mr. Gill did not at first discover the error in the written instruments. He took the contracts to his attorney at Tracy for inspection, and subsequently signed each copy that same day. Two days later he presented them to B. F. Houk for acceptance and signature. Mr. Houk noticed the mistake in the names of the second parties in the contracts and told Gill they would have to be changed. He took the instruments to a notary public who at his request erased the names of Jones and Legare from

The cause was tried by the court sitting without a jury. Findings were adopted favorable to the plaintiffs in every respect. The court determined that plaintiffs were the owners of the land; that the contract was duly executed and accepted and adopted by the defendant corporation after the alteration of the instrument occurred, with full knowledge thereof; that the contract was therefore valid and binding, and that the defendant was indebted to plaintiffs in the sum of $678.57, no part of which had been paid. Judgment was accordingly rendered for that sum in favor of plaintiffs. From that judgment this appeal was perfected.

There is adequate evidence to support the findings that the plaintiffs were the owners of the ranch at the time of this action. B. F. Houk testified to that effect, without objection. The affidavit of F. M. Brack, filed in behalf of plaintiffs on a motion for new trial, avers that from and after December 18, 1936, the plaintiffs “were the owners of and entitled to all rents, issues and profits of all the land.” The letter, dated April 11, 1941, from Stanislaus County Title Co. to William B. Chaplin, attorney for the defendant, merely indicates that other relatives of the plaintiffs had undivided interests in the land. That letter, at most, creates a conflict of evidence on that issue. The other relatives are making no claim of interest to any part of the purchase price of the crop. They were not parties to the contract. The finding that the plaintiffs are the owners of the property is sufficiently supported by the evidence.

It is true that a material alteration of a contract without the consent of a party who has already signed and delivered it, renders the instrument voidable as to such non-consenting party. (Sec. 1580, Civ. Code; Walsh v. Hunt, 120

“Ratification, subsequent to the alteration, has as full effect as authority originally granted, and ratification may be shown by any conduct from which assent can fairly be implied. Silence may be enough. It has been well said, ‘ The rule is just and supported by the authorities that, where a document has been altered and notice of such alteration is brought to the attention of the parties affected, it is their duty to disavow it at once, or within a reasonable time after learning thereof, or they are bound by the document as altered. ’ ’ ’

The foregoing rule is applicable to either sealed or unsealed instruments, in jurisdictions where that distinction has been abolished by statute. In California the distinction between sealed and unsealed instruments has been abolished. (See. 1629, Civ. Code.) Ordinarily, not only are the signatures of the parties to a sealed instrument necessary, but there must also be a delivery of the document to give it validity. A redelivery of a sealed instrument by the obligor after it has been altered will make it binding in its altered form. But redelivery after the alteration is implied when the obligor subsequently ratifies the instrument. Section 1897 of 6 Williston on Contracts, supra, says in that regard: “There is always a delivery when the maker of a deed indicates his assent to be bound by it as a completed instrument.” It is further said in that section that there is “no difficulty in finding delivery when the maker after an alteration has been made ratifies it.”

In the present case the alteration was made to recite the fact, as the court found, that Houk Bros, was the real owner of the ranch and entitled to an interest in the purchase price of the asparagus crop. It was evidently to the advantage of the defendant to execute its contract of purchase with the real parties who were interested in the crop. No fraud was alleged or proved or relied upon with respect to that substitu

The case of Walsh v. Hunt, supra, upon which the appellant relies, was a suit to foreclose a note secured by mortgage. In that case the defendant, Emma E. Hunt, after signing the note and mortgage containing figures in lead pencil, representing the principal amount of the indebtedness and the rate of interest to be charged, delivered it to Hughes, a real estate agent, to procure the due execution of the instruments by the plaintiff, Walsh, without authorizing an alteration of those lead pencil figures. Both the principal sum and the rate of interest were subsequently changed by erasing the lead pencil figures and inserting others to the detriment of the payer. For the period of a year thereafter, Emma E. Hunt was unaware of those alterations. She never accepted or ratified those alterations. In spite of the foregoing facts, the court rendered judgment for the plaintiff in accordance with the unauthorized alterations of the note and mortgage. The Supreme Court properly reversed the judgment on the theory that the alterations were material and that they were neither authorized nor ratified. That case is not in point.

The case of Woodard v. Grover, supra, upon which the appellant also relies, was suit for tresspass on timber land in San Mateo County. The defendants answered, attempting to justify the cutting and removal of timber under the terms of a “purported contract.” That proposed contract was signed

That case is not in point. It is readily distinguishable from the present case, in which it satisfactorily appears that with full knowledge of the alteration complained of the defendant accepted and ratified the contract as altered, by both declarations and conduct.

In the present ease there is ample evidence to support the conclusion that M. P. Williams, who was an officer of the corporation, had authority to accept and ratify the alteration of the contract. He negotiated the contract to purchase the crop in the first instance, and he signed the contract in behalf of the corporation.

Moreover, there is a serious question as to whether the defendant may not be deemed to have admitted the genuineness and due execution of the contract, under section 447 of the Code of Civil Procedure, by its failure specially to plead in the answer a lack of genuineness and due execution. That section provides:

“When an action is brought upon a written instrument, and the complaint contains a copy of such instrument, or a copy is annexed thereto, the genuineness and due execution of such instrument are deemed admitted, unless the answer denying the same be verified. ’ ’

Paragraph IV of the second amended complaint alleged merely that “plaintiffs and defendants entered into a written contract of sale, a copy of which contract is attached hereto, marked Exhibit 'A’, and made a part hereof.” The answer failed to deny specially that the contract, which appears on its face to be genuine and duly executed, was defective for either of those reasons, or at all. The answer merely denied

“This contention [of a lack of due execution] is based upon the fact that Suzy Nieto’s signature to both the note and mortgage is by mark and there is only one witness to her mark. (Sec. 17, Code Civ. Proc.) The complaint is verified and contains a copy of the note and mortgage. The answer is also verified, hut does not deny the execution of either the note or mortgage. Therefore, the genuineness and due execution of both the note and mortgage are admitted.”

However, it is not necessary for us to determine that the lack of genuineness and due execution must be specially pleaded under the circumstances of this case, and we refrain from doing so, because there is ample evidence to show that the defendant approved and accepted the contract as genuine and binding, after the names of the second parties were changed.

The judgment is affirmed.

Adams, P. J., and Peek, J., concurred.