Paulson v. Weeks

Mr. Justice Harris

delivered the opinion of the court.

1. Reducing the pleading to its substance, it discloses a situation where Weeks agreed to sell 11,250 shares of stock; 7,500 shares were delivered and paid for on February 26, 1907, and the remaining 3,750 shares were delivered and paid for on February 2, 1909. The agreement for the sale provides that “if plaintiff should at any time thereafter become dissatisfied with the purchase,” the defendant would repay the purchase money, with interest. Paulson became dissatisfied on July 1, 1911, but it does not appear that he gave notice of his dissatisfaction until November 25, 1914, when he says he became fully aware of the worthlessness of the stock and demanded repayment of the purchase money. This action was commenced on January 8,'1915.° For the purposes of *472 this discussion we must assume that the amended complaint speaks the truth when the pleading is challenged by a demurrer.

This action does not involve an attempt to rescind a contract on account of misrepresentation or fraud, but the plaintiff is seeking to recover money which he alleges the defendant agreed to repay if the plaintiff became dissatisfied with the stock at any time. It is true that averments of fraud and misrepresentations are found in the pleading, and yet it is obvious that they are not employed as the foundation for a rescission of the sale and the recovery of damages. The allegations of fraud and misrepresentation are probably designed to inform Weeks of the circumstances upon which Paulson contends that he was honestly and in good faith dissatisfied, and that his dissatisfaction was not capricious and arbitrary: Lumberman’s Nat. Bk. v. Minor, 65 Or. 412 ( 133 Pac. 87 ); 9 Cyc. 624; 6 R. C. L., p. 952. The plaintiff rests his asserted right to rescind upon an express stipulation, which is a component part of the only contract which the parties entered into.

2. The contract was legal and. binds the parties. It violates no statute, and is not against public policy; and, since the parties had the right to enter into the agreement, courts cannot unmake the contract merely because it may have been unwisely made: Johnston v. Trask, 116 N. Y. 136 ( 22 N. E. 377 , 15 Am. St. Rep. 394 , 5 L. R. A. 630); Fitzpatrick v. Woodruff, 96 N. Y. 561 ; Wooster v. Sage, 67 N. Y. 67 ; Morgan v. Struthers, 131 U. S. 246 ( 33 L. Ed. 132 , 9 Sup. Ct. Rep. 726); Schultz v. O’Rourke, 18 Mont. 418 ( 45 Pac. 634 ); 35 Cyc. 128.

3-5. The contract relied upon by the plaintiff is not a conditional contract-for the sale or return of stock, *473 but it embraces a completed sale with an option to the buyer to rescind if he becomes dissatisfied: 35 Cyc. 127. Since Paulson plants his right to rescind upon a stipulation in the agreement of sale, it necessarily follows that the stipulation which confers the right to rescind must also be taken as the measure of that right. The terms of the contract permit Paulson to rescind if he becomes dissatisfied with the purchase “at any time thereafter.” The agreement involves two elements: (a) The quality of the right to rescind; and (b) the time within which the right must be exercised. The right to rescind exists when Paulson is honestly and in good faith dissatisfied. The time within which the right may be exercised depends upon the meaning of the words “at any time thereafter.” The plaintiff argues that the quoted language means time without limit, while the defendant contends that it implies a reasonable time. Primarily the word “any” implies .unlimited choice as to the particular unit, number or quantity, and generally signifies an indeterminate unit or number of units out of many or all: Century Dictionary. Like most general terms, however, the word may have one of several meanings, according to the subject which it qualifies, and the meaning is often restrained and limited by the context or subject matter: 3 C. J. 230. The words “any time,” when employed in agreements analogous to the one presented here, are almost universally construed to mean a reasonable time: Fletcher v. Lyon, 93 Ark. 5 ( 123 S. W. 801 ); Park v. Whitney, 148 Mass. 278 ( 19 N. E. 161 ); Ellis v. Durkee, 79 Vt. 341 ( 65 Atl. 94 ); Raynor v. Syracuse University, 35 Misc. Rep. 83 (71 N. T. Supp. 293); Shellar v. Shivers, 171 Pa. 569 ( 33 Atl. 95 ); Perry v. Acme Oil Co., 44 Ind. App. 207 ( 88 N. E. 859 ); Hill v. Hill, 113 Mass. 103 ( 18 Am. *474 Rep. 455 ); St. James v. Erskine, 155 Mich. 606 ( 119 N. W. 897 ). No adjudicated case has been called to our attention,- nor have we been able to discover one after making an independent search, where the words “any time” have been held to import perpetuity, when used in a contract similar to the agreement relied upon by the plaintiff. Furthermore it must be remembered that the parties were dealing in mining-stock, a kind of property which is liable to great fluctuation in value; and consequently the very character of the property purchased by Paulson furnishes an added reason for adhering- to the construction usually adopted, and holding that the words “at any time thereafter” imply a reasonable time. The contract, therefore, gave to Paulson a reasonable time only within which to become dissatisfied and rescind the sale.

6, 7. Ordinarily, the question of what is a reasonable time must be submitted to the jury, but sometimes the court is enabled to say as a matter of, law that a reasonable time has expired: McGregor v. Oregon R. & N. Co., 50 Or. 527, 537 ( 93 Pac. 465 , 14 L. R. A. (N. S.) 668). The facts relating- to the instant case are few and simple. Paulson received and paid for 7,500 shares on February 26, 1907, and the remaining 3,750 shares were delivered and the sale completed on February 2, 1909. Paulson became dissatisfied on July 1, 1911, but there is no suggestion or intimation that he communicated notice of his dissatisfaction to Weeks until November 25, 1914. If Paulson had demanded a rescission of the sale shortly after he became dissatisfied, perhaps the court could not say that a reasonable time had elapsed; but he waited for more than seven years from the date of the contract, more than five years from the completion of the sale, and *475 more than three years from the time he became dissatisfied, before he demanded a rescission of the sale. Manifestly, the delay was unreasonable. Paulson did not exercise his right within a reasonable time. The statute of limitations has no application. The right to rescind was available within a reasonable time, but the right was extinguished the "very moment the reasonable time period expired. The contract gave to Paulson the right to rescind if he became dissatisfied, but he was obliged to exercise that right within a reasonable time, and, having failed to use his right within a reasonable time, the right was irretrievably lost.

Moreover, the right of rescission must be exercised promptly, whether it be conferred by the law or by a contract. Instead of demanding a rescission in July, 1911, when he became dissatisfied and entitled to a rescission, Paulson stood by for more than three years without taking any steps toward placing the parties in statu quo. Again the court can say as a matter of law that the delay was unreasonable: 2 Mechem on Sales, p. 686.

The judgment of the Circuit Court is correct, and it is affirmed. Affirmed.

Mr. Chief Justice Moore, Mr. Justice Bean and Mr. Justice Benson concur.