Chu v. Ronstadt
Court of Appeals of Arizona, Second Division
June 28, 1972
Sam CHU, Appellant,
v.
Karl G. RONSTADT and Marilyn H. Ronstadt, husband and wife, and New Pueblo Constructors, Inc., Appellees.
Page 561
[17 Ariz.App. 487] Whitehill, Berger, Gin & Karp, by David D. West, Tucson, for appellant.
Robertson, Molloy, Fickett & Jones, by Peter Johnson, Tucson, for appellees.
HATHAWAY, Judge.
securing
Appellant, Sam Chu, brought suit against appellees in the Superior Court of Pima County for an alleged breach of contract concerning an alleged farm land lease by Chu to appellees.
The primary issue at trial was whether a valid contract had been entered into by the parties. The case was tried to the court and judgment subsequently entered in favor of appellees. The trial court made the following pertinent findings of fact:
'2. That on or about July 4, 1969, at plaintiff's store in Marana, Arizona, plaintiff and defendant Karl G. Ronstadt entered into preliminary negotiations for the possible lease of plaintiff's land for the purpose of raising fall lettuce.
3. That defendant Karl G. Ronstadt disclosed to the plaintiff that he was agent for and acting on behalf of defendant New Pueblo Constructors, Inc.
[17 Ariz.App. 488]
Page 562
4. That the plaintiff and defendant Karl G. Ronstadt, failed on July 4, 1969, and any time subsequent thereto, to discuss and agree when payment for the land to be leased would be made to the plaintiff.
5. That defendant Ronstadt, on or about July 4, 1969, advised the plaintiff that another party from California would be involved in the raising of fall lettuce on plaintiff's land and that such individual would inspect plaintiff's land the following weekend and the parties would then proceed to finalize the lease.
6. That defendant Karl G. Ronstadt forwarded to the plaintiff by letter of July 7, 1969 a check in the sum of $500.00 for the purpose of securing an option from the plaintiff until Sunday or Monday of the next week within which to lease plaintiff's land.
7. By letter of July 14, 1969, after plaintiff's property had been inspected by the individual from California, defendant Karl G. Ronstadt advised the plaintiff that his land would not be leased.'
Appellant refutes finding No. 5 claiming that the condition, if any, was approval, rather than inspection, but admits that there is testimony in the record to support the finding. It is his position that appellees' course of conduct subsequent to the conversation of July 4, 1969, was entirely at variance with the disclosure. In particular, appellant relies on a letter of July 7, 1969, contending that it set forth the terms of the lease. The July 7th letter reads:
'Mr. Sam Chu
Marana,
Arizona
Dear Mr. Chu:
As discussed with you on July 4, 1969, with Dick Little and myself, we will enter into a lease on your 150 acres of plowed barley adjacent to your store.
It is our understanding you will lease this land for fall lettuce and that it is immediately available. The price for this land will be $50.00 per acre, and we will reimburse you for the plowing you have done at the rate of $8.00 per acre.
If these conditions are correct, attached hereto is our check of earnest money for $500.00 as you requested, which amount will be applied to the payments that will be due under the lease upon its conclusion.
The other party involved with us on this lease will be here Sunday or Monday next week and we will proceed then to finalize this lease.
Very truly yours,
NEWS PUEBLO CONSTRUCTORS, INC.
/s Karl G. Ronstadt
Karl G. Ronstadt
President
KGR/dg
Attachment'
Appellees' exhibit A is the voucher stub to the $500 check. It contains the following:
'7/7/69 Earnest money toward rental of 150 acres of farm land near Marana for fall lettuce crop. $500.' The trial court made the following conclusion of law:
'2. The July 4, 1969 meeting between the plaintiff and defendant Ronstadt, the July 7, 1969 letter of defendant Ronstadt to the plaintiff, and the July 7, 1969 telephone communication between plaintiff and defendant Ronstadt were all preliminary negotiations between the parties, not constituting an
agreement in presenti, but only an agreement to enter into an agreement or an option to lease plaintiff's land.'
Appellant contends the evidence does not support this finding or finding of fact No. 6, set forth above, and urges us to set aside the judgment.
This court will not set aside a judgment merely because there is a conflict [17 Ariz.App. 489]
Page 563
in the evidence. Evidence will be taken in the strongest manner in favor of the appellee, and if there is any reasonable evidence to support the judgment of the lower court, it will be sustained. Rossi v. Stewart, 90 Ariz. 207, 367 P.2d 242 (1961).
Findings of fact numbers four and five, properly supported by evidence, disclose that on July 4, 1969, the parties entered into preliminary negotiations without any intent to presently finalize a lease contract. The appellant does not dispute these findings of fact and this court must accept them. Sato v. First Nat'l. Bank, 12 Ariz.App. 263, 469 P.2d 829 (1970); Owen v. Mecham, 9 Ariz.App. 529, 454 P.2d 577.
Appellant relies heavily on the contents of the letter of July 7th as forming and representing the alleged contract. We must carefully scrutinize this letter in order to decide the existence or nonexistence of the alleged lease contract. The word used by appellees upon which appellant so strongly relies is 'earnest'. This word is defined in Black's Law Dictionary 598 (4th Ed.Rev.1968) as follows:
'The payment of a part of the price of goods sold, or the delivery of part of such goods, for the purpose of Binding the contract.' (Emphasis added)

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