Opinion
35750, 35755.
DECIDED JULY 12, 1955.
Action on contract. Before Judge Arnold. Fulton Civil Court. April 19, 1955.
McCord Cooper, for plaintiff in error.
Parks Eisenberg, contra.
A contract for the sale of real estate which is conditioned upon the buyer procuring a loan, the terms of which are not specified, is too indefinite to be enforceable, and the proposed vendee thereunder may elect not to perform under the contract, and recover the earnest money paid to the broker.
DECIDED JULY 12, 1955.
The petition of Novak against Scarborough alleged in substance that the defendant is indebted to the plaintiff in the sum of $1,000 for money had and received, the plaintiff having paid this sum as a deposit in connection with the purchase of real property. Attached to the petition marked Exhibit A and made a part thereof is a copy of the contract which recites: "Buyer making this offer subject to getting a $40,000 loan." The terms of this loan are not specified and it is not otherwise referred to in the contract. The petitioner alleges that he was unable to obtain the $40,000 loan; that he has demanded repayment of the sum by the defendant, who has failed and refused, and that said sum of $1,000 in equity and good conscience should be returned to the plaintiff by the defendant. The defendant interposed general and special demurrers to this petition, and filed an answer in which he denied that he was indebted to the plaintiff. Otherwise, the answer admits the receipt of the $1,000, admits the execution of the contract attached to the petition, and contends that the plaintiff could have secured the $40,000 loan.
The plaintiff demurred to the defendant's answer on the ground that it set forth no defense. The trial court overruled the general demurrer to the petition, sustained certain special demurrers, and struck from the petition the paragraphs thereof which sought to predicate a cause of action on the contract, but left in the petition the allegations that the plaintiff paid the defendant $1,000; that this sum was paid pursuant to the contract; that he had demanded its return, and that in equity and good conscience the defendant should have returned it. The trial court also sustained the general demurrer to the answer and struck it as failing to set forth any defense. The case then proceeded to trial as though in default, and after introduction of evidence a judgment was entered for the plaintiff.
The exception in the main bill of exceptions is to the judgment of the trial court overruling the general demurrer and certain special demurrers to the petition, and in sustaining the general demurrer to the answer. The exception in the cross-bill is to the sustaining of certain grounds of special demurrer, reference to which has hereinabove been made.
As the petition and answer stood after sustaining the demurrers, the answer admitted the factual transaction set out in the petition — that is, that the broker obtained the $1,000 sought to be recovered by the plaintiff, who was the purchaser in the contract of sale; that the subject matter of the contract was 428-450 McDonough Blvd., S.E., Atlanta; that the contract contained the provision that the $1,000 earnest money was to be applied by the broker to commissions "at the consummation of this sale"; that the sale was not consummated; that the contract also contained a provision "buyer making this offer subject to getting a $40,000 loan"; and that the buyer did not procure that loan.
This contract is not valid and enforceable and creates no rights between the parties for the reason that it is contingent upon the obtaining of a loan not in fact obtained, and also because the terms and conditions of the loan to be obtained are not specific enough to be enforceable. F C Investment Co. v. Jones, 210 Ga. 635 ( 81 S.E.2d 828); Wehunt v. Pritchett, 208 Ga. 441 ( 67 S.E.2d 233); Stanaland v. Stephens, 78 Ga. App. 68 ( 50 S.E.2d 258); Williams v. Gottlieb, 90 Ga. App. 438 ( 83 S.E.2d 248); Teague v. Adair Realty Loan Co., ante, p. 463.
For the reason that no valid and enforceable contract between the parties existed, the trial court did not err in sustaining demurrers to the allegations of both petition and answer which either sought to predicate a cause of action upon, or to defend against a cause of action upon the theory that there was any enforceable contract between the parties. After the demurrers were sustained the petition was left with factual allegations sufficient to show that the broker had $1,000 of the plaintiff's money, obtained in the manner above described, which he was not in equity and good conscience entitled to retain. Accordingly, the petition set out a cause of action for money had and received. Scottish Union National Ins. Co. v. Peoples Credit Clothing Co., 64 Ga. App. 147 ( 12 S.E.2d 474). The answer, although it denied that the defendant was indebted to the plaintiff in any amount, did as above noted admit the factual situation under which the plaintiff was entitled to recover for money had and received. Accordingly, no valid defense to the cause of action is set out in the answer, after elimination of the non-sustainable defense predicated upon the contract which was itself void. Since no defense is set out, it was not error for the trial court to treat the answer as stricken and proceed as in cases of default.
The judgment of the trial court overruling the general demurrer and certain of the special demurrers of the defendant is without error. Also the judgment of the trial court striking the answer and proceeding to judgment for the plaintiff as in cases of default is without error.
Judgment affirmed on the main bill of exceptions. Cross-bill dismissed. Townsend and Carlisle, JJ., concur.