Summary of Petterson v. Pattberg
Ct. of App. NY, 1928
Relevant Facts: Pl was the female executor, exercising the Will of John Petterson, the owner of a parcel of land. Df owned a bond executed by John P. which was a 3rd Mortgage on the real property, with an unpaid balance of $5450, with $250/mo. due for 3 mo. Five years remained on the notes remaining balance. John attempted to pay as specified at the DF’s home. The Df had sold the bond and mortgage to a 3rd Party. This passed an additional cost onto the PL of $780.
Legal Issue(s): Whether, as the Pl in approaching the Df intending to perform, and before actual performance is tendered, the offer can be withdrawn?
Court’s Holding: Yes
Procedure: App. Division and trial ct found for the Pl, reversed. PL action dismissed with costs to Df.
Law or Rule(s): The offeror may see the approach of the offeree and know that an acceptance is contemplated. If the offeror can say “I revoke," before the offeree accepts, however brief the period between the two acts, there is no escape from the conclusion that the offer is terminated.
Court Rationale: PL Petterson stated to the Df that he had come to pay off the mortgage. Before a tender of necessary money was made, the Df informed Pl that he had sold the mortgage. This was a definite notice that the Df could not perform his offered promise. The Df’s offer was withdrawn before its acceptance had been tendered. An offering party has the right to name the precise act that performance of would convert his offer into a binding promise. The offer of the Df was withdrawn prior to the performance of the necessary act to make this promise binding. In effect a revocation of offer and no binding contract existed.
Minority View – The df made performance of the condition impossible. If the promisor is the cause of the failure of performance either of an obligation due him or of a condition upon which his own liability depends, he cannot take advantage of the failure. The Pl had made partial payment under the terms and therefore partial acceptance was tendered.
Plaintiff’s Argument: The letter constituted a promise to accept payment to pay off the mortgage prior to the specified date, a condition precedent.
Defendant’s Argument: The original offer was withdrawn before acceptance of the terms.