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Lawskills.com Georgia Caselaw
CAUSEY v. MATSON et al.
20545.
Specific performance. Bibb Superior Court. Before Judge Long. April 23, 1959.
HEAD, Justice.
The allegations of the defendant's answer were insufficient to state a defense to the action for specific performance of the option to purchase.
R. G. Matson, Sr., and R. G. Matson, Jr., filed a petition against S. B. Causey for specific performance of an option to purchase described real estate. The petition as amended alleged: On January 30, 1951, the defendant entered into a lease agreement with Reginald Trice, Inc., which agreement included the consent of the defendant to the subleasing of the property, and an option to the lessee to purchase the property for $25,000. On February 28, 1955, Reginald Trice, Inc., transferred and assigned the lease to Sinclair Refining Company. On October 14, 1958, Sinclair Refining Company transferred and assigned the option rights contained in the lease to the petitioners. The petitioners notified the defendant of their option to purchase the property and their ability to comply with its terms. On January 7, 1959, the defendant's attorney notified the petitioners' attorneys that he would not convey the property to the petitioners, and assigned as his reason for the refusal that he had signed the original lease agreement, containing the option, under duress exercised by Reginald R. Trice. The petitioners are now ready, willing, and able to perform their obligations necessary to the execution of the option to purchase the realty. The petitioners have been in possession of the property since the execution of the contract on January 30, 1951. They have paid to the defendant the rentals provided for in the lease agreement, and such rentals have been accepted and retained by the defendant.
No demurrer was filed to the petition. The answer admitted all of the allegations set out above. In an amendment to his answer, the defendant alleged: Immediately prior to the execution of the contract of January 30, 1951, there was in force a series of agreements between the defendant and R. R. Trice, copies of which are attached to the answer. These agreements placed title to the property in the defendant; the defendant leased the property to Trice; and Trice subleased the property and the business thereon, a filling station, to the defendant. One of the provisions of the deed from Trice to the defendant (which placed the title of the property in the defendant) was that the defendant would be prohibited from selling any gasoline products other than the brand being distributed by Trice, and, in the event the prohibition against the sale of other products was violated, the property would be forfeited to Trice. The defendant has assigned his position as subtenant to R. G. Matson, Sr., one of the petitioners. The contract of January 30, 1951, resulted from a collusive and fraudulent scheme between R. G. Matson, Sr., and Trice, whereby Matson would sell petroleum products other than the brand being distributed by Trice, in order to force the defendant to enter into a new agreement detrimental to him and favorable to Trice and Matson, by threats of the loss of the defendant's property. Matson sold such other products, and Trice presented the agreement of 1951 to the defendant with the demand that he sign it or forfeit his property. The defendant had no voice in the formation of the agreement. The defendant had no knowledge of the collusive and fraudulent scheme between R. G. Matson, Sr., and Trice until December, 1958. The fraudulent scheme, accompanied by the threats of the loss of the defendant's property, amounted to duress and made the defendant incapable of exercising his free will in the execution of the contract of 1951, and the defendant was without that quality of mind essential to the making of a valid contract. At no time since the execution of the agreement of 1951 has the defendant ratified it, either by express or implied consent.
The exhibits attached to the answer of the defendant show a series of contracts between the defendant and Reginald R. Trice involving the same tract of land, a part of which tract is the subject matter of the present action. A contract dated May 17, 1938, recited that Trice was the owner of land on which he had erected a filling station, that on the same date Trice had leased the filling station to Sinclair Refining Company, which, in turn, had leased it to the defendant. The contract provided that the defendant was to sell only the petroleum products distributed by Trice, and gave a right to the defendant to purchase the property at a price of $5,012.78. A lease agreement was executed on the same date between the defendant and Trice, to become operative if the option to purchase was exercised. The defendant agreed to lease the property to Trice, and Trice agreed to sublease it to the defendant; the defendant covenanted to sell only the petroleum products distributed by Trice.
On the same date Reginald R. Trice conveyed the property to the defendant for a consideration of $4,732.53. This deed recited: "For a period of 13 years from date there shall be maintained on said land a filling or service station for the purpose of storing, handling and selling only the petroleum products handled, distributed or sold by party of the first part, or to be handled, distributed, or sold by party of the first part, regardless of whether party of the first part shall change the brand of such products handled, distributed or sold by him; and on said land no other petroleum products shall be stored or sold during said period of time. The provisions in this paragraph shall be a condition upon which said land is held and upon a breach thereof the title shall revert to the grantor, his heirs, administrators, executors or assigns, who shall be entitled to reenter and take possession of said land."
A lease agreement was entered into between the parties on the same date, in which the defendant leased the property to Trice for a period of 13 years, with renewal rights, and Trice subleased the property to the defendant. The agreement contained the express covenant that the defendant should keep the station open for the purpose of selling only the petroleum products distributed by Trice.
The petitioners filed general demurrers to the answer, which were sustained. On the stipulation of counsel for the defendant that fraud and duress were the only defenses available to him, the trial judge entered an order requiring him to perform his contract to sell the property. The bill of exceptions assigns error on the order sustaining the demurrers to the defendant's answer, and on the order decreeing specific performance.
The defendant made no question by demurrer as to the sufficiency of the allegations of the petition to show that the purchase price was adequate, and the option to purchase fair, just, and equitable. See Ogletree v. Ingram & LeGrand Lumber Co., 207 Ga. 333 (2) (61 S. E. 2d 480); Wehunt v. Pritchett, 208 Ga. 441, 444 (67 S. E. 2d 233); Almand v. Williams, 208 Ga. 703, (69 S. E. 2d 271); Alexander v. American Legion Post No. 28 of Chamblee, 209 Ga. 285 (2) (71 S. E. 2d 627); Sikes v. Sims, 212 Ga. 391 (7) (93 S. E. 2d 6).
The answer of the defendant alleges that he was "induced to enter into a contract detrimental to his own interest," and "has been forced to rent his property at a price for less than the fair rental value of the same," but it is not alleged in the answer that the price of $25,000 was inadequate, and that the option to purchase was unfair because of inadequacy of consideration. Bailey v. Bell, 208 Ga. 715 (2) (69 S. E. 2d 272). From the trial judge's order it appears that the defendant stipulated that he had no defense to the action for specific performance other than his allegations of fraud and duress.
"The free assent of the parties being essential to a valid contract, duress, either of imprisonment or by threats, or other acts, by which the free will of the party is restrained and his consent induced, Will render the contract voidable at the instance of the injured party. Legal imprisonment, if not used for illegal purposes, is not duress." Code 20-503. "Duress consists in any illegal imprisonment, or legal imprisonment used for an illegal purpose, or threats of bodily or other harm, or other means amounting to coercion or tending to coerce the will of another, and actually inducing him to do an act contrary to his free will." Code 96-209.
The provisions of our Code in regard to duress "essentially modify the strictly defined doctrine of duress at common law." Whitt v. Blount, 124 Ga. 671, 673 (53 S. E. 205). However, the broad language in Code 96-309, "or other means amounting to coercion or tending to coerce the will of another, and actually inducing him to do an act contrary to his free will," is to be construed in a restricted sense. Mallory v. Royston Bank, 135 Ga. 702, 705 (70 S. E. 586).
The defendant in his answer asserts that his subtenant, R. G. Matson, Sr., conspired with Trice to sell products other than those distributed by Trice, so that Trice could threaten the defendant with a forfeiture of the land conveyed by Trice to the defendant, and force the defendant to sign the contract executed in 1951. It is not asserted that there was any fraud or duress in any of the other contracts between Trice and the defendant, including the 1940 deed to the defendant, which provided for such a forfeiture in the event any products other than those distributed by Trice were sold at the filling station during a period of 13 years.
If there was a written lease or contract between the defendant and R. G. Matson, Sr., subleasing the station to him, there is no copy of the lease attached to the answer. It would seem that the defendant, knowing that his ownership of valuable property was contingent on the continued sale of the products distributed by Trice, would have protected himself in his contract with Matson against the loss of his property by the acts of his subtenant. If the defendant negligently failed to require his subtenant to observe the covenants of the defendant's lease contract, and his subtenant brought about a forfeiture of the defendant's title, then it was within the legal right of Trice to declare a forfeiture of the title. It is a general rule that an act must be wrongful to constitute duress, and it is not duress to threaten to do what one has a legal right to do. 17 C. J. S. 532, 172; 17A Am. Jur. 580, 18. The threat to bring a civil proceeding against a person is not duress in a legal sense. Perryman v. Pope, 94 Ga. 672 (21 S. E. 715); Bond v. Kidd, 122 Ga. 812 (50 S. E. 934); Hinkle v. Hinkle, 148 Ga. 250 (2) (96 S. E. 340); King v. Lewis, 188 Ga. 594, 598 (4 S. E. 2d 464).
The deed executed in 1940 from Trice to the defendant recited a consideration of $4,732.53. The defendant asserts that Matson and Trice conspired together to have Matson cause a forfeiture of the terms of this deed, that Trice did not thereupon repossess the property, but required the defendant, by the threat of the forfeiture of his property, to sign a contract providing a purchase price of $25,000 for a part of the property. There is certainly no indication of fraud against the defendant on the face of the contracts attached to the petition and answer.
The allegations of the defendant's answer were insufficient to state a defense to the action for specific performance of the option to purchase, and the trial judge did not err in sustaining the demurrers thereto.
Harris, Russell, Weaver & Watkins, contra.
Clarence H. Clay, Jr., Harry F. Thompson, for plaintiff in error.
ARGUED JULY 13, 1959 -- DECIDED SEPTEMBER 11, 1959.
Saturday May 23 00:34 EDT


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