Western Union Tel. Co. v. Brown - 253 U.S. 101 (1920)
U.S. Supreme Court
Western Union Tel. Co. v. Brown, 253 U.S. 101 (1920)
Western Union Telegraph Company v. Brown
Argued January 20, 21, 1920
Decided May 17, 1920
253 U.S. 101
One who, in repudiation of a contract which binds him to make a certain payment, sends a telegram to stop a draft previously dispatched to meet the obligation cannot recover the amount from the telegraph company because of its negligent failure to deliver the telegram in time. P. 253 U. S. 113.
P and C agreed to sell and deliver, and H and L to buy, take, and receive certain shares of mining stock, "upon the following terms and conditions:" the price stated was to be paid part down and the remainder in equal payments on stated future dates; upon the making of the first payment, the shares, endorsed in blank, were to be deposited with a bank under an escrow agreement for delivery to H and L when the last payment was made; the bank was constituted the agent of P and C to receive the payments, and, in event of default by H and L, was authorized by the terms of the deposit to deliver all the shares to P and C, whereupon all payments theretofore made should be forfeited to them, and "all rights of each of the parties should forever cease and terminate." Held not an option terminable at the will of the vendees by failure to meet deferred payments, but an absolute agreement on their part to buy, the provision for forfeiture of past payments and termination of the agreement in case of their default being intended for the protection of the vendors, and exercisable at the vendors' election. P. 253 U. S. 110. Stewart v. Griffith, 217 U. S. 323.
The provision in such contract that, upon nonpayment of stipulated sums, the rights of each of the parties shall cease and determine is the equivalent of a provision that, in case of such default, the contract shall be "null and void." P. 253 U. S. 112.
248 F. 656 reversed.
The case is stated in the opinion.