E. M. Goodwin, Inc. v. Stuart

On Motion for Rehearing. Upon a full reconsideration of the facts in the case, we have reached the conclusion that it was erroneously held that the pleadings or evidence disclosed a contract capable of being specifically enforced in a judicial proceeding. Appellant had not performed his part of the contract, but had allowed the limit for the existence of the contract to be reached. Appellant had not performed services for which he could demand payment, and the contract was executory and incapable of specific performance. We have considered a number of authorities on the subject, and some of them have been fully reviewed and quoted from herein.

There is a full statement of the allegations of the petition in the former opinion, which is retained, and it is therefore unnecessary to make another statement.

It is perfectly obvious that Hartnagel and Marks selected and employed Goodwin as their agent to sell their land because of his experience, training, and presumed skill in such projects. He was to use diligence in the sale of the land, to advertise it, to locate and interest prospective buyers in northern states who were disposed and financially able to purchase the lands in small tracts; he was to assemble these prospects into trainloads, move them to the site of the lands, convert them into buyers at prices which would net Hartnagel and Marx $62.50 per acre. He was to perform innumerable personal services which could be efficiently performed only by those trained and skilled in such matters. The contract is purely executory, since Goodwin has sold none of the land.

Let us suppose, now, that Goodwin should lose interest in the project, or was diverted into other fields of activity more to his liking, or which promised greater or quicker or more pleasing returns. What, in such case, could Hartnagel and Marks do to prevent him from abandoning the project for the new venture? Certainly they could not exact specific performance of any of his obligations. They would be utterly helpless before his inaction or indifference or refusal or failure, for any reasons, to perform.

The remedy of specific performance being therefore unavailable to one of the parties, because of the nature of the contract, it is not available to the other party.

This rule is specifically applicable to a contract of agency to sell land, which "could not be specifically enforced by either party against the other" — it was an employment of Goodwin "as agent to sell the land," and therefore "specific performance could not be had." Chief Justice Brown in Ansley Realty Co. v. Pope Smith, 105 Tex. 440,151 S.W. 525, 527.

The contract being for the personal services of Goodwin, upon whose personal will the performance thereof rests, it cannot be specifically enforced against him; and, since it cannot be enforced against him, it lacks essential mutuality and cannot be enforced against the other party. 4 Pom.Eq.Jur. pp. 2760, 2765, §§ 1401, 1402, note 1; 6 Pom.Eq.Jur. §§ 759, 769; 36 Cyc, pp. 581, 621, 629; 25 R.C.L. pp. 232, 305; Rutland Marble Co. v. Ripley, 10 Wall. 339, 359, 19 L. Ed. 955; Ansley Realty Co. v. Pope Smith, 105 Tex. 440, 151 S.W. 525; Prusiecke v. Ramzinski (Tex.Civ.App.) 81 S.W. 771, 773; Carrico v. Stevenson (Tex.Civ.App.) 135 S.W. 260, 261; Galbreath v. Farrell (Tex.Civ.App.) 249 S.W. 277, 280; Parrish v. Weber (Tex.Civ.App.)17 S.W.2d 106.

It is said by Mr. Pomeroy that "as an almost universal rule contracts for personal acts will not be directly enforced" (4 Pom. Eq. Jur. note 1, § 1402); that courts "cannot enforce a decree" of specific performance in "contracts for personal services, where the full performance rests upon the personal will of the contracting party" (note 10, § 1406); that it "follows, therefore, that the remedial right" of specific performance, "if it exists at all, must be mutual; each party must be able to enforce the remedy against the other" (note 1, § 1401); that "if for any reason" either of the parties to a contract "is not bound, he cannot compel performance by the other" (note 3, § 1405).

Mr. Pomeroy says, further, on this point: "It is a familiar rule that contracts for personal services, where the full performance rests upon the personal will of the contracting party, will not be specifically enforced against him. It is also generally true that they will not be enforced where the plaintiff is the one who has contracted to render the services, and there has been no full performance on his part, since mutuality in the equitable remedy is then lacking." 6 Pom.Eq.Jur. § 759.

And again: "If, at the time of the filing of the bill in equity, the contract being yet executory on both sides, the defendant, himself free from fraud or other personal bar, could not have the remedy of specific performance against the plaintiff, then the contract is so lacking in mutuality that equity will not compel the defendant to perform but will leave the plaintiff to his remedy at law." Id. § 769.

The rule is thus stated in 36 Cyc. 581: "Although the contract may be one that is otherwise proper to be specifically enforced, if, at the time of the decree, there remain to be done, on plaintiff's side, personal services or other acts of a kind which, in accordance with the general rule, the court cannot compel to be done, specific performance is usually refused on the principle that the remedies in equity must be mutual."

And again (36 Cyc. 629) it is said that "relief (of specific performance) is refused where * * * the contract calls for * * * business services, such as agent, manager * * etc."

Further (36 Cyc. 579) the rule is more elaborately stated:

"Personal Services or Business Employment — a. In General. In cases of this character a decree for specific performance is open not only to the objection that it calls for an undue amount of supervision by the court, but to still graver objections, which are well stated in a very recent case: `Any system or plan by which the court could order or direct the physical coercion of the laborer would be wholly out of harmony with the spirit of our institutions, and his imprisonment would take away his power to make specific performance. Even if such authority existed its exercise would be undesirable. If the relation of employer and employee is to be of value or profit to either it must be marked by some degree of mutual confidence and satisfaction, and when these are gone and their places usurped by dislike and distrust, it is to the advantage of all concerned that their relations be severed.'"

And: "On the same principle the direct specific performance has been refused of contracts to act as agent, manager, or superintendent, or in other business capacity, although the employment may not be one calling for skill and judgment."

In 25 R.C.L. (p. 303) it is said that "Chancery will not as a rule enter an affirmative decree directing the performance of personal services by an adult. Nor will it in this manner enforce contracts requiring either continuous acts involving skill, judgment and technical knowledge, or, as the rule is sometimes stated, those which require special skill, judgment and discretion. This is especially true where the contracts are continuous in their nature and run through a number of years or an indefinite period of time. This rule is based on the futility of the attempt by a court to command one person to render personal services to another, or to direct the performance of duties which it is impossible for the court to superintend."

And that (page 305) "By reason of the doctrine of mutuality, a court of equity will refuse to decree the specific performance of an executory contract wherever it creates a duty from the plaintiff of such confidential or personal nature that the court could not have enforced it at the instance of the defendant."

Again (Id. p. 232): "It is frequently stated as a general principle of equity that a contract will not be specifically enforced unless it has such mutuality that it may be enforced by either party, and the language adopted by numerous courts is to the effect that equity will grant a decree of specific performance only in cases where there is a mutuality of obligation and of remedy. In accordance with this doctrine of mutuality it is held that when a contract for any reason cannot be enforced against one of the parties such party will not be permitted to enforce it specifically against the other party, although except for this particular rule the contract would otherwise have been enforceable."

In the case of Rutland Marble Co. v. Ripley, supra, the Supreme Court of the United States said that: "It is a general principle that when, from personal incapacity, the nature of the contract, or any other cause, a contract is incapable of being enforced against one party, that party is equally incapable of enforcing it specifically against the other, though its execution in the latter way might in itself be free from the difficulty attending its execution in the former."

It was said by Judge Neill, of this court, in Prusiecke v. Ramzinski, supra: "When a contract is of such a character that a court of equity is without power to enforce it as against one or the other of the parties, the party against whom it cannot be enforced cannot, until he has fully performed his part of the agreement, though the other party could be forced to perform his, obtain a decree of specific performance. Ikerd v. Beavers, 106 Ind. 483, 7 N.E. 326, 328. For a court of equity will not attempt to enforce a contract specifically unless it can be done mutually and completely, and so as to secure substantially beyond question all that the parties contemplate. If this is impracticable, the remedy, if any exists, is to be found elsewhere."

We quote from the opinion in Carrico v. Stevenson, supra: "But we think it is an insuperable objection to the relief by specific performance prayed for by appellant that, on account of the nature of the work required by the contract to be done by him, the court could not properly compel him to perform it. It is entirely clear that the court could not properly compel appellant to perform his part of the contract. It involved, not only personal service by him, but, independent of this, the character of the work to be done, that is, the clearing of a large body of land, about 25,000 acres, as stated in the contract, which by the terms of the contract was to extend over a considerable period of time, with many complicated provisions regarding the details of the work, would require of the court such supervision of the work to be done by appellant as it could not properly undertake. We think that it is universally held that a court of equity will not undertake to decree specific performance of contracts of this nature. 6 Pom.Eq.Juris. (3d Ed.) §§ 757-760. This is not controverted by appellant, but he seeks to avoid the application of this principle upon the ground that he is ready, able, and willing and offers to perform. This is not sufficient for appellee's protection. If the contract on the part of a plaintiff who seeks this remedy is not such as he can be compelled to perform, if he has in fact done so, he would be in a position to require specific performance on the part of the defendant, who would not be allowed to defend on the ground that plaintiff could not, on account of the nature thereof, be compelled to perform his part, but that is as far as the plaintiff's rights extend on this point. `Before plaintiff has performed the personal service, he could not have specific performance, but after his part is executed he can get the land.' 6 Pom.Eq.Juris. (3d Ed.) § 771. That equity will not compel one party to a contract to perform, where it cannot also compel specific performance by the other party, is, we think, well settled. 6 Pom.Eq.Juris. § 769 et seq.; Waterman, Sp. Perf. § 198; Redwine v. Hudman [104 Tex. 21], 133 S.W. 426; [Rutland] Marble Co. v. Ripley, 77 U.S. [10 Wall.] 359, 19 L. Ed. 955."

The rule is thus stated in Galbreath v. Farrell, supra: "As we understand the rule under the authorities in cases of this kind, before a court of equity will enforce affirmative promises made by defendant in behalf of the plaintiff, it must also be able to enforce the affirmative promises made by plaintiff in behalf of the defendant. Such court never deems it wise or just to enforce one or more of the promises in a contract until it can enforce all of the contract outstanding at the time of the suit, including the promises of the plaintiff as well as those of the defendant. Northern Texas Realty Construction Co. v. Lary (Tex.Civ.App.) 136 S.W. 843; Williston on Contracts, vol. 3, § 1430."

Being fully convinced that our judgment of reversal is not sustained by the authorities, it is set aside, and the judgment of the trial court will be affirmed.