This complaint was not limited to the suggested additive of $7,500; it applied also to the original figure of $50,000. This provision was required by the defendants, was set out in a conspicuous place in the document, and was executed by plaintiff's representative. All parties to the contract were sui juris. Provisions of similar purport under similar circumstances have been sustained as legal to the extent of making "satisfaction" subject to the judgment of only one party to the contract except where not exercised in good faith or where exercised fraudulently.
The law in this jurisdiction is that where all of the parties are sui juris4 and there is no fraud or bad faith a provision of the contract of the type here involved, namely, "purchasing corporation will set aside sufficient assets to satisfy third trust holders.", is legal and enforceable to the extent required by the party -- in this case to the extent of $50,000. The contract here involved is not ambiguous. The construction of a plain contract is for the court. Tow v. Miners Mem. Hosp. Ass'n, Inc., 4 Cir., 305 F.2d 73, 76. There is no claim of, or evidence of, fraud or bad faith. The sole basis for challenging the provision is therefore that it is per se illegal -- without regard to bad faith or fraud. This is not the law in the District of Columbia.
Furthermore, as to questions 2 and 3 it is to be remembered that there is no definite evidence that defendants sought to require plaintiff to set aside assets in excess of the $50,000, nor as to what part of the $50,000 was to be required by them, nor any showing that the plaintiff attempted to settle on terms that it deemed reasonable.
But even assuming that it would be to the limit, namely, $50,000, without showing of bad faith or fraud, under the law and the facts here this would be legal and enforceable.
To require assets even to the full amount of $50,000 to protect defendants as third trust holders (with large first and second trusts) in the type of deal made between plaintiff and defendants, involving speculation in real estate, would not without more be proof of bad faith or fraud. It is common knowledge that an investment secured by third trust is risky business. Likewise it is a matter of common knowledge that with the tight money market, and hazards incident to financing and refinancing speculative real estate deals of the magnitude and type here involved, such a deal is a mighty hazardous undertaking -- not infrequently resulting in a "freeze-out". The provision in the contract shows merely an intent to fortify the third trust holders as to a surely speculative venture, particularly when preceded by first and second trusts of the size here involved. This is especially true where the purchaser is a corporation subject to dissolution (in fact did dissolve), and with no personal commitment by officer or director with established credit. It was clearly the intention of the defendants, agreed to by plaintiff's agent, that as a condition precedent to the entry by defendants into the contract the plaintiff purchasing corporation was to set aside assets sufficient to satisfy the third trust holders.
In this jurisdiction the case of Rondinella v. Southern R. Co., 33 App.D.C. 65, 78, 79, is particularly applicable. There the court said: "We are not concerned with the wisdom or folly of the plaintiff in making such a contract." See ARD Dr. Pepper Bottling Co. v. Dr. Pepper Co., 5 Cir., 202 F.2d 372, 376-377. It further went on to say, under circumstances similar to those here involved, that no question was presented for resolution by the jury. In the case of Bayer v. Cornell Co., 47 App.D.C. 146, 149, 150, the Rondinella case is followed.
In the case of Lanier v. N.Y. Life Ins. Co., 5 Cir., 88 F.2d 196 (cert. denied), the Circuit Court said: "but one who contracts that he shall be satisfied touching a matter of opinion or judgment is entitled to satisfaction." (citing Shepherd v. Union Central Life Ins. Co., 5 Cir., 74 F.2d 180, and authorities there cited). See also, Devoine Co. v. International Co., 151 Md. 690, 136 A. 37; ARD Dr. Pepper Bottling Co. v. Dr. Pepper Co., supra.
In the case of Tow v. Miners Mem. Hosp. Ass'n, Inc., 305 F.2d 73, 76, the United States Court of Appeals, Fourth Circuit, cites with approval the opinion of the Court of Appeals of New York in Brainard v. N.Y.C. R.R. Co., 242 N.Y. 125, 151 N.E. 152, 45 A.L.R. 751, relating to contract construction:
"* * * The construction of a plain contract is for the court. The intention of the parties is found in the language used to express such intention. (Citing case.) If the court finds as matter of law that the contract is unambiguous, evidence of the intention and acts of the parties plays no part in the decision of the case. Plain and unambiguous words, undisputed facts, leave no question of construction except for the court. The conduct of the parties may fix a meaning to words of doubtful import. It may not change the terms of a contract."
In Hansbrough v. Peck, 72 U.S. (Wall.) 497, 507, 18 L. Ed. 520, the Supreme Court said:
"And no rule in respect to the contract is better settled than this: That the party who has advanced money, or done an act in part performance of the agreement, and then stops short and refuses to proceed to its ultimate conclusion, the other party being ready and willing to proceed and fulfil all his stipulations according to the contract, will not be permitted to recover back what has thus been advanced or done. * * *"