Cochran v. Taylor

Brief Fact Summary.

Taylor (Defendant) executed an agreement under which he gave William B. Chenault (Chenault) an option to buy certain real and personal property for $115,000 within 120 days, provided that the assignee give a written notice of his intention to buy.  Defendant notified Chenault that she revoked the offer, and Chenault subsequently assigned his interest in the contract to the Plaintiff.

Synopsis of Rule of Law.

.  The general rule is that contracts are freely assignable. 

Facts.

The Plaintiff notified Defendant of her intention to buy, and Defendant refused to perform under the contract.  The Plaintiff sued for specific performance.

The trial court found that there was no valid acceptance or tender of performance by the Plaintiff or by Chenault and sustained two of Defendant’s defenses.  It further said that the option was nudum pactum, the Defendant could revoke the option, and that it was specific to Chenault and unassignable without a bond executed by Chenault.  The Plaintiff’s complaint was dismissed. 

Issue.

Was the option without consideration, not assignable, and not accepted according to its terms?

Held.

Reversed and a new trial granted.

When the assignee Plaintiff gave written notice within the time specified that he elected to buy, the condition was fulfilled and the unilateral option was thereby converted into a bilateral contract

Dissent.

None

Concurrence.

None

Discussion.

·         The option carried with it a presently existing contract right as valuable as the property to be conveyed.

·         The option was not specific to Chenault.

·         Assignment was not barred by any express terms in the instrument, nor forbidden by statute or public policy.