CW ROSENSTOCK (as admin of estate of HW ELSER) v

EDWIN BURKE, THE COOPER COMPANY

1924
Ponente: Avancena, J.
FACTS
1. Burke owned a yacht called Bronzewing purchased in Australia
for sale
2. Burke mortgaged it for a loan of 100k from Mr Avery (manager of
Asia Banking Corp), which he was unable to pay
3. Elser wanted organize a yacht club and sell the yacht to
members of the club for 120k
4. Elser would keep 20k as commission and 100k would go to Burke
5. Burke acquired a written option saying that Elser confirmed his
verbal offer of 120k for the yacht, with the offer open for 30 days
from 12 Feb 1922
6. Elser proposed conducting a pleasure cruise the south, with
prominent businessmen aboard the yacht as a means to
advertise the yacht
7. To fix the yacht, Elser incurred expenses of 6k because Burke had
no money
8. Elser attempted to loan 20k from Mr Avery but the latter refused,
in view of the subsisting debt
9. Elser notified Burke that he was now unwilling to purchase the
yacht for more than 70k and that he should talk to Mr Avery
10.
Elser wrote a letter (3 April 1922) stating that he would pay
80k for the yacht, with 10k downpayment and 5k monthly
installments, and would use 80k worth of stocks from Pickering
Inc as security, signed by Burke, Elser, Avery
11.
Current action is for Elsers recovery of 6k used to fix the
yacht
ARGUMENTS
1. Burke
a. Agreement was that Burke would pay for repairs in
exchange for gratuitous use of the yacht
b. Cross-complaint: comply with letter stating sale, and give
downpayment of 10k
TRIAL COURT
1. With respect to Burke: Pay 6k to Elser, pay 1k to Cooper
Company for unpaid repairs

2. With respect to Elser: Purchase the yacht (appealed by Elser to

SC)
ISSUE
WON letter written on 3 April 1922 was a valid contract of sale binding
on Elser
RULING
1. No
a. A common man would use I am willing to buy, I intend to
purchase
b. Elser was a prosperous merchant and so his specific words
should be presumed to have been chosen for specific
effect. Thus his statement that I am willing to entertain
the purchase shows that he did not intend to buy the
yacht, but merely ENTERTAINED the idea
c. Esler never wanted to buy the yacht for himself, only sell it
to members of a yacht club
d. Elser only considered purchasing the yacht when he
negotiated with Avery to obtain a 20k loan to replace the
engine. Since he had not yet acquired the 20k to replace
the engine, it can be assumed that he was not yet willing
to purchase the yacht
e. 3 April 1922 letter was made by stenographer who
supports Elsers claim that Elser refused to remove
entertained even when Burke asked to remove it
*Also reversed ruling on Burke paying for repairs it was Elser who
initiated and ordered repairs, and it was Elsers word against Burke in
this situation, so follow logic: Whoever asked for repairs, and got
something in return (use of yacht) liable to pay for repairs.