This is a suit for $29,066.30 damages for an alleged breach of an executory contract to sell real estate. Plaintiff avers
As a further alternative, plaintiff pleads that, in the event the defendants should be held not liable for damages ex contractu, the said Jones, having proximately caused the damages, is responsible in tort.
Availing themselves of the privilege accorded by Article 175 of the Code of Practice, defendants appeared and prayed for oyer of the writings upon which plaintiff bases its claim. In response to this demand, plaintiff produced five letters and also an unsigned instrument styled "Option to purchase". Upon their production, defendants interposed separate exceptions of no right of action and no cause of action. And, alleging in their exception of no right of action that these documents, together with other evidence, written and verbal, would reveal that plaintiff was without right to sue because, among other things, Jones was not authorized by the St. Denis Securities Co. Inc. to sell the land, they prayed that a hearing be had for the purpose of receiving evidence in support of their contention.
In accordance with this request, the judge heard evidence on the so-called exception of no right of action, following which he maintained this exception and dismissed plaintiff's suit, being of the opinion that any offer made by Jones was ineffective as it had never been ratified or approved by the Board of Directors of St. Denis Securities Co. and that Jones was not responsible because, at the time he made the offer, plaintiff knew that he did not own the land. Wherefore this appeal.
At the outset, counsel for plaintiff complains that the trial judge was without authority to consider, on the hearing of the exception of no right of action, evidence showing that Jones was without power to offer to sell the real property belonging to defendant corporation for the reason that the question of Jones' authority, or his lack of it, was a matter for the merits of the case.
This contention is without merit because (1) the evidence, which was received at the hearing of the exception without objection, had the effect of enlarging the pleadings, Rheuark v. Terminal Mud & Chemical Co., 213 La. 732, 35 So.2d 592, compare Duplain v. Wiltz, La.App., 174 So. 652, and (2) the authority of Jones to bind the defendant corporation for the sale of its real estate without a mandate in writing was not merely a matter of defense but one vital to plaintiff's cause of action. Jones v. Shreveport Lodge No. 122 B.P.O.E., 221 La. 968, 60 So.2d 889 and cases there cited.
We say "cause of action" as distinguished from "right of action" for the reason that these two exceptions have been the subject of some confusion as they are invariably employed indiscriminately by members of the bar. Generally speaking, an exception of no right of action serves to question the right of a plaintiff to maintain his suit, i. e., his capacity to
In the case at bar, the defendants make practically the same contentions under their exception of no cause of action as under their so-called exception of no right of action. Those contentions, substantially stated, are that Jones was not authorized by the Board of Directors of St. Denis Securities Co. to offer to sell the land and that the letters relied on by plaintiff evidence mere preliminary negotiations and do not establish a written promise of sale.
These points are properly presented under the exception of no cause of action, the legality of which is to be governed, not by plaintiff's allegations, but upon the documents which he has filed in response to the prayer for oyer. Noble v. Plouf, 154 La. 429, 97 So. 599. This is so because plaintiff's demand, being founded on a breach of contract to sell real estate, must be supported by written evidence of a sale or promise of sale, in order to be actionable. Articles 2275, 2440 and 2462 of the LSA-Civil Code; Davidson v. Midstates Oil Corporation, 211 La. 882, 31 So.2d 7 and Bordelon v. Crabtree, 216 La. 345, 43 So.2d 682.
Guild by these fundamental principles, we address our attention to the correspondence relied on by plaintiff for its cause of action. Mutual promises to sell and purchase are alleged to have resulted from three letters dated March 26th, 27th and 28th 1951, which are said to be the culmination of earlier negotiations.
The letter of March 26th 1951 was written by the defendant, Jones, at Natchitoches, addressed to Norman K. Martin, % Roy O. Martin Lumber Co., Alexandria. It states:
On the following day, March 27th 1951, Roy O. Martin, President of plaintiff corporation, wrote to Jones as follows:
The next day, March 28th 1951, Jones addressed another letter to Norman Martin, % Roy O. Martin Lumber Company, which reads:
It is perfectly plain to us that the foregoing letters are insufficient to constitute a binding contract to sell and purchase. Whereas, the letter of March 26th is undoubtedly an offer by Jones to sell the land stated therein for $18,000,
But, above this, the letter of March 27th 1951, while stating that Jones should consider it as "a definite deal", declares that Norman Martin, who was not in Alexandria at the time, would endeavor to contact Jones upon his return "to meet and draw up a contract covering these matters until the title is checked, which should be only a short time". Thus, as the letter indicates, the negotiations and arrangements are tentative and incomplete and are to culminate in a written contract for the sale and purchase of the land to be executed when Norman Martin returned. Such being the understanding, neither party could be bound until the envisioned contract was signed. Laroussini v. Werlein, 52 La.Ann. 424, 27 So. 89; Ferre Canal Co. v. Burgin, 106 La. 309, 30 So. 863; Barrelli v. Wehrli, 121 La. 540, 46 So. 620; Timken v. Wisner Estates, 153 La. 262, 95 So. 711 and Evans v. Dudley Lumber Co., 164 La. 472, 114 So. 101.
Not only did the letter of March 27th 1951 contemplate the execution of a formal contract to sell and purchase but it is clear that Jones understood that such a contract would be made—for, in his letter of March 28th addressed to Norman Martin, he says that he will be expecting to meet him "here on Friday of this week, to arrange a contract of sale and will ask that the consumation of the sale be arranged to be completed as early date as convenient". And it is further shown by the correspondence that, in conformity with these two letters, Norman Martin went to Natchitoches and presented to Jones the so-called Option to Purchase, which had been prepared by his attorney but which, as aforesaid, was never executed by defendants. This, in itself, evidenced Norman Martin's intent not to bind either himself or plaintiff or Martin Development Co. absolutely but, rather, to obtain for $250 (the price of the option) the right to purchase the land for $18,000.
The foregoing factors suffice to demonstrate that plaintiff has no actionable claim against either St. Denis Securities Company or Jones individually. However, counsel maintains that Jones is personally liable to plaintiff for damages because he wrongfully represented that he, as President of defendant corporation, was vested with full power to dispose of the lands. Since we find that there was never a binding contract, the question of Jones' authority, or lack of it, is immaterial.
The judgment appealed from is amended by dismissing plaintiff's suit on the exceptions of no cause of action and, as thus amended, is affirmed.