Abercrombie v. Stoddard

228 P. 232, 39 Idaho 146, 1924 Ida. LEXIS 44

• Court: Idaho Supreme Court
• Decided: May 26, 1924
• Status: Published

Opinions

BUDGE, J.

On November 17, 1919, respondents entered into a contract in writing with appellants for the sale of certain real and personal property situated in Boise. The agreed purchase price was $10,250. Five thousand dollars of this amount was paid at the time. Two thousand five hundred and fifty dollars with interest thereon at the rate of seven per cent per annum, was to be paid on or before one year from December 1, 1919, and the remainder was to be paid by appellants’ discharge of a certain mortgage, the specific covenant being:

“It is understood and agreed that there is now a mortgage of Twenty-five Hundred and no/100 ($2500.00) Dollars against the above described property due and payable to Mary Sonna of Boise, Idaho, and the second parties hereto hereby assume and agree to pay the said mortgage when payment is required by the mortgagee with interest thereon at the rate of Seven (7%) per annum from this date.”

In addition there were the following covenants:

“And the said parties of the second part agree to pay all state, school and county taxes, or assessments of whatsoever nature, which are levied on the premises above described, for the year 1920 and thereafter. In the event of a failure to comply with the terms hereof, by the said parties of the second part, the said parties of the first part shall be released from all obligation in law or equity to convey said property, and said parties of the second part shall forfeit all rights thereto, and all payments made on said property. And the said parties of the first part, on receiving such payment at the time and in the manner above mentioned, agree to execute and deliver to the said parties of the second part or to their assigns, a good and sufficient warranty deed to said, premises free from all in-cumbrances, and it is understood that the stipulations aforesaid are to apply to and bind the heirs, executors, administrators and assigns of the respective parties.

“It is agreed that time is the essence of this agreement. The first parties agree to deliver to the second parties an Abstract of Title for the above property showing title vested in them, free and clear of any and all incumbrances suffered by the said first parties except the above mentioned mortgage and the unpaid balance due for city improvements, but with all yearly assessments thereon fully paid for the year 1919 and prior and to deliver title to same by proper warranty deed, when the full purchase price shall have been paid as herein agreed.”

Appellant having failed to pay the instalment of $2,750 'falling due December 1, 1920, the respondent, Y. H. Aber-crombie, on December 8, 1920, accepted a payment of $189 interest thereon, and delivered to appellants his receipt in words and figures as follows:

“$189.00. Boise, Idaho, Dec. 8, 1920.

“Received from J. M. Stoddard the sum of One Hundred Eighty-nine and no/100 Dollars as payment of interest on the sum of $2700 due me on sale of my residence property for the year ending December 1, 1920, payment of said sum of $2700 is hereby extended to the 15th day of March, 1921, on the understanding and agreement that the interest payable on said sum shall be at the rate of ten per cent per annum.

“Y. H. ABERCROMBIE.”

It will be noticed that the sum specified is $2,700 instead of $2,750 as provided by the contract, but inasmuch as both parties have pleaded the sum of $2,750 and also recited it in their briefs, it will be assumed that the respondents intended to extend payment of the full sum. Appellants failed to make the payment required on March 15, 1921, and on March 21st following respondents caused to be served upon them a written notice of forfeiture and demand for possession. Shortly thereafter and within the month they commenced this action to eject appellants from the premises. In their complaint they alleged that appellants had failed to pay the taxes, the interest dne on the Sonna mortgage 'and the final payment of $2,750 and interest as agreed, and they plead their notice of forfeiture and demand for possession served upon appellants on March 21st. Appellants demurred generally and specially, the special demurrer alleging:

“That said amended complaint is ambiguous, unintelligible and uncertain in that it fails to allege or set out in. the notice of forfeiture that defendants were given any time whatsoever in which to comply with the terms of the contract or a forfeiture would be declared; that no place in the said amended complaint does plaintiff allege the tender of a deed and abstract showing clear title with the exception of the mortgage on said premises at the time of the alleged sale.”

The demurrer was overruled and appellants answered denying any default on their part, and affirmatively pleading that respondents had given them an extension of time for thirty or sixty days beyond said March 15, 1921, which time bad not expired at the time of the service of the notice of forfeiture; that prior to filing such answer they had tendered respondents in writing an offer to pay the last in-stalment with interest, and all other sums found to> be due under the contract and extension; that they were ready and willing to pay all such sums; that respondents had failed to satisfy a certain judgment against the property as provided in said contract, and had also failed to deliver to them the abstract as agreed or to tender them a deed. On these issues the cause was tried before a jury, resulting in verdict and judgment for respondents. An appeal has been taken, specifying numerous errors. Appellants contend that their demurrers should have been sustained, insisting that the conditions of the contract as to payment and delivery of deed and abstract were mutual, concurrent and dependent covenants; and that before a forfeiture could be had or fully plead, it was incumbent upon respondents to make a tender and plead the same.

Under the terms of the contract the vendors agreed to execute and deliver the deed on receiving such payment at the time mentioned. This identical language employed in a similar contract was construed by the California court in Freeman v. Griswold, 4 Cal. Unrep. 256, 34 Pac. 327, to be mutual and dependent with the covenant of payment. The same verbiage received a like construction in Cleary v. Folger, 84 Cal. 316, 18 Am. St. 187, 24 Pac. 280. This court so construed the expression “upon the payment” in Kessler v. Pruitt, 14 Ida. 175, 93 Pac. 965. A leading case supporting this construction is Hill v. Grigsby, 35 Cal. 656. The concluding paragraph of the contract here in question asserts that the vendors will deliver abstract of title “when the full purchase price shall have been paid as herein agreed.” Unquestionably this means “immediately after,” “as soon as.” Webster defines “Whefi.” as “at what time,” “at, during or after the time that,” “at or just after,” “the moment that.” In Hill v. Grigsby, supra, where time was of the essence, the court held that a covenant to “execute a deed to”, the vendee “as soon as” the purchase price was paid was mutual and dependent. And this court so held in Rischar v. Shields, 26 Ida. 616, 145 Pac. 294, where abstract and deed were to be delivered upon the completion of the contract. To hold in the case at bar that the covenant of payment was a condition precedent to the delivery of the abstract and deed and was so to be understood by the parties would be to outrage common sense. As was said in Kessler v. Pruitt, supra:

“It is not reasonable to suppose that a party purchasing real property, where the contract provides for an abstract of title, would be required to pay the purchase, money, and depend thereafter upon the seller discharging the encumbrances and procuring and delivering to him abstract of title.”

This principle is strongly supported by the supreme court of Iowa in Martin v. Roberts, 127 Iowa, 218, 102 N. W. 1126. The covenants being mutual, the respondents could not declare a forfeiture until they had tendered the deed and abstract. (Kessler v. Pruitt, supra; Hill v. Grigsby, supra; Walsh v. Coglan, 33 Ida. 115, 190 Pac. 252.) In the latter case this court said:

“The record discloses that all the unpaid instalments of purchase price were due at the time the action was commenced. Therefore, in order to be in a position to demand a forfeiture of appellant’s interest, or to waive it and recover judgment for the purchase price, it was necessary for respondents to allege and prove they tendered a deed conveying the property to the purchasers, together with an abstract showing title as mentioned in the contract.”

In the minority opinion in that case the rule is stated to the same effect as follows:

“The omission to plead or prove a tender of the deed and abstract, which were to be delivered upon the completion of the payments specified in the contract, deprived respondents of the right to claim a forfeiture thereof.”

In the case of Frink v. Thomas, 20 Or. 265, 269, 25 Pac. 717, 719, 12 L. R. A. 239, in the course of that opinion it is said:

“As a general rule, a party who asks for the rescission of a contract for the sale of real estate must be himself without fault, and when, as in this case, the payment of the purchase money and the making or tender of the deed are to occur simultaneously, they are regarded as mutual and concurrent acts, which disable either party from putting an end to the contract, without performance or a valid offer to perform on his part, and so far as the question of time is concerned, both parties, after the day provided for the consummation, may be considered equally in default, and neither can hold himself discharged from the obligation of complete performance, until he has tendered performance on his own side and demanded it on the other. (Powell v. Railroad, Co., 14 Or. 356, 12 Pac. 665; Knott v. Stephens, 5 Or. 235; Rummington v. Kelley, 7 Ohio, pt. 2, 97.)

“When the vendor insists that the vendee is in default, to such an extent as to entitle him to have the contract rescinded, he must allege and prove that he has tendered to the vendee a deed conveying to him all the land according to the terms of the agreement, and demanded performance on the part of the vendee, and must have notified him that the contract would be rescinded unless purchase money was paid within a reasonable time. The mere failure to pay the purchase money according to the terms of the agreement will not he held a repudiation of the contract so as to authorize a suit by the vendor to have it rescinded. (Gregg v. English, 38 Tex. 139; Johnson v. Jackson, 27 Miss. 498; 2 Warv. Vend. 849, 880.)

“Ordinarily, in a contract of this character, the vendee is entitled to a deed conveying to him the entire land according to agreement, as soon as the purchase money is paid, and he is under no obligation to pay the money except on receipt of the deed. The obligation of the defendant to pay the purchase money is dependent on the duty of the plaintiff to convey the land, so far as to disable him from putting an end to the contract, without performance or a valid offer to perform on his part. (Walker v. Wilson, 30 Miss. 576.) In this case plaintiff does not allege or claim that he ever offered to perform the contract on his part, and without such an allegation, this complaint fails to state a cause of suit against the defendant for a rescission of the contract, nor is he under such a complaint, entitled to a decree for specific performance.”

In the case of Marshall v. Gilster, 34 Ida. 420, 428, 201 Pac. 711, 713, it is said:

“In the contract between appellant and respondents the expression that, ‘upon payment or tender of the purchase price to respondents, they shall execute and deliver to appellants a good and sufficient warranty deed’ might malre it appear at first hlush that payment is a condition precedent. The expression in the preceding paragraph that ‘appellants agree to receive said property and pay the balance of the purchase price on or before September 17, 1917,’ malíes it appear that the conditions are concurrent. In case of doubt and where it can be done without doing violence to the language of the contract, the courts hold that the conditions of payment and conveyance are concurrent. (2 Williston on Contracts, sec. 835; San Diego Construction Co. v. Mannix, 175 Cal. 548, 166 Pac. 325.) That is the construction which we place upon the contract in this case.”

We think the rule to be correctly stated in the case of Reese v. Westfield, 56 Wash. 415, 419, 105 Pac. 837, 838, 28 L. R. A., N. S., 956, where it is said:

“We desire now for the sake of certainty to lay down the rule that where land is sold under a time contract calling for payment by instalments, and every instalment has been paid except the last one, the vendor may, if he act with reasonable promptness, declare a forfeiture, unless by the terms of the contract he has agreed to perform some act necessary to the complete performance of his agreement, as, for instance, the giving of an abstract or the tender of a deed, in which event his power to forfeit depends upon his offer and ability to perform; for, as this court has said, his duty to tender performance depends upon, and is concurrent with, the duty of the vendee to meet the final payment.”

Other authorities to the same effect might be added but we deem it unnecessary.

While we are of the opinion that the complaint did not state a cause of action for the reason that respondents failed to allege that they had complied with the terms of the contract as to the tender of an abstract and deed, it was admitted upon the trial that the terms of the contract in this respect were not complied with. It follows, therefore, that the respondents neither alleged a cause of action nor proved one that would entitle them to a forfeiture by reason of the failure on the part of appellants to pay the $2,750 on the 15th day of March, 1921. However, it is insisted that the complaint stated a cause of action by reason of the failure of appellant to pay the 1920 taxes as provided for in the contract and that such taxes were delinquent at the time of the forfeiture on March 21, 1921. We think the complaint stated a canse of action in this respect and the court did not err in overruling the general and special demurrers. However, we think there was a failure of proof as the evidence showed that the first half of the taxes for 1920, due and payable on the fourth Monday of December, 1920, under the provisions of C. S., sec. 3234, were paid (by appellant. The second half of the taxes for 1920 were payable up to and including the fourth Monday of June, 1921, and did not become delinquent till after that date. This action was brought in March, • 1921, long prior to the time the second instalment of taxes would become delinquent. The failure to pay the taxes as alleged in the complaint was not supported by the proof, and the taxes were not delinquent within the terms of the contract and failure to pay them could not be urged as a basis for forfeiture.

The complaint alleged that appellants “refused to make the payment of the interest due upon the mortgage payable to Mary Sonna of Boise, Idaho, as provided in said contract.” However, the contract introduced in evidence by respondents at the trial contains the covenant that the Sonna mortgage together with the interest should be paid by the vendees “when payment is required by the mortgagee.” Inasmuch as the complaint fails to allege that demand for payment was made by the mortgagee it is insufficient in this respect and subject to demurrer. However, there being several breaches of the contract relied upon, if any one of them constitutes a ground for forfeiture the complaint stated a cause of action and was not subject to a general demurrer. The special demurrer was properly overruled'for the reason that the complaint was not unintelligible, uncertain and ambiguous.

Forfeitures are not favored either in law or in equity, and provisions for forfeitures are to receive, when the intent is doubtful, a strict construction against those for whose benefit they are introduced. Courts are reluctant to declare and enforce a forfeiture, if by reasonable interpretation it can be avoided. (6 R. O. B., p. 906.)

After the introduction of the contract, respondents sought to sustain the allegations of nonpayment of the mortgage interest by the introduction of testimony by the mortgagee that she had notified appellants of the maturity of the interest, and that it had never been paid by them. This testimony was admitted over appellant’s objection. Under the terms of the contract, the vendees were obligated to pay this interest only when required by the mortgagee. In the absence of such requirement, they were not in default for failure to pay it when due. Respondents did not ash to amend, and the evidence clearly inadmissible went to the jury on an issue not raised in respondents’ complaint. (Sweeney v. Johnson, 23 Ida. 530, 130 Pac. 997.) It may be said that such error was cured by the general verdict, but it must be remembered that respondents relied on separate breaches, a favorable finding on any one of which would have supported the verdict. It is impossible to determine upon which of the separate issues the jury found. On the interest issue no evidence should have been before the jury at all. On the issue involving the payment of taxes there was no conflict, respondents having admitted that the first half of the taxes for 1920 had been paid. On the issue of tender there was no conflict, respondents having admitted that they did not tender a deed or abstract. The jury may have returned its verdict upon the interest issue after having found for appellants on the others. The general rule is that, where several issues are presented in one count, a general verdict will be sustained. But this rule fails when error is committed in the admission of evidence on any issue. This exception is positively announced in Maryland v. Baldwin, 112 U. S. 490, 5 Sup. Ct. 278, 28 L. ed. 822, where Justice Field declared:

“On the trial evidence was introduced bearing upon all the issues, and, if any one of the pleas was, in the opinion of the jury, sustained, their verdict was properly rendered, but its generality prevents us from perceiving upon which plea they found. If, therefore, upon any one issue error was committed, either in the admission of evidence, or in the charge of the court, the verdict cannot be upheld, for it may be that by that evidence the jury were controlled under the instructions given.”

Appellants complain of the court’s refusal to give their proffered instructions. No such instructions appear in the record. However, the court instructed the jury that:

“The jury are instructed that under the law of this state that where time is made the essence of a contract of sale of real property and the contract of purchase provides for forfeiture if the terms and stipulations are not complied with by the purchaser and the purchaser has made default in the payment of the purchase money as-stipulated and provided in the contract or any extension thereof to a fixed and definite date agreed upon by the parties, and if you so find under the evidence in this case, then you are instructed that no notice to quit nor any demand of the amount due or of possession of the property or tender of a deed or abstract of clear title to the property was necessary upon the part of the plaintiffs in this case, nor was it necessary for the plaintiffs in this case to give the defendants any notice of the amount due under the contract nor to give the defendants any further time in which to make payment of the amount due under the contract.”

In view -of what has been said this instruction is erroneous and the court erred in giving the same.

The brief argues insufficiencies of the evidence without any specifications of insufficiency, and concludes with a plea that this court find in damages for appellants on what appears to be a cross-complaint in the record. Jury duty is no province of an appellate tribunal. Neither is there place in an ejectment suit for a cross-action in damages based on a breach of contract. The remaining specifications of error are without merit.

The judgment should be reversed and the cause remanded, and it is so ordered. Costs are awarded to appellants.

William A. Lee, J., concurs. Dunn, J., concurs in conclusions reached.