Dundas v. Foster

274 N.W. 731, 281 Mich. 117, 1937 Mich. LEXIS 848

• Court: Michigan Supreme Court
• Decided: September 1, 1937
• Docket: Docket No. 91, Calendar No. 39,554.
• Status: Published

Opinion

Sharpe, J.

Isaac Foster and Eugene Foster were owners of an 80-acre farm in Buckeye township, Gladwin county, and on December 3, 1927, sold it to plaintiffs on a land contract. The. purchase price was $700 with $100 as a down payment; the balance to be paid at the rate of $100 per year with interest at six per cent, on the unpaid balance. The contract Avas in the usual form and contained the folloAving, ‘‘notice to quit and deliver up possession is hereby waived.” The plaintiffs took possession of the farm by virtue of the land contract in March, 1928, and have since remained in possession; they cleared some land, improved and built fences, and added to the buildings.

Eugene Foster, one of the vendors, died in 1929'. His surviving heirs Avere Cora Foster, widow, Jessie L. Foster, sister, and Isaac F. Foster, brother. His estate was probated in Gladwin county and the real and personal property was assigned to the above-mentioned heirs. Prior to the trial in the above case, Cora Foster quitclaimed all of her interest in and to the above-mentioned property. Isaac Foster, the other vendor, died in May, 1933, and his surviving heirs are Caryl F. Johnson and Dorothy F. Sharrar. Caryl F. Johnson is executrix of the Isaac Foster estate. No further payments were made upon the principal and on September 15, 1933, a notice of forfeiture of the contract was served upon Ivel Dundas, hut no such notice was served on William Dundas, the other vendee.

In the spring of 1934, William Dundas and Jessie Foster discussed the inability of plaintiffs to comply with the terms of the contract, resulting in plaintiffs entering into a lease of the premises for one year beginning April 1, 1934, at an annual rental of $40. Similar leases were entered into for the years 1935 and 1936. In September, 1936, plaintiffs filed their bill of complaint offering to pay the balance found to he due on the contract and asking for its specific performance. The defendants Jessie L. Foster, Caryl F. Johnson and Dorothy F. Sharrar filed an answer to plaintiffs’ hill of complaint and allege that plaintiffs are occupying the premises as tenants under a written lease. These defendants also filed a cross-hill asking that the land contract he cancelled and the title quieted as to cross-plaintiffs. The cause came on for trial and the court dismissed plaintiffs’ hill of complaint, holding that plaintiffs surrendered their contract and all rights thereunder when they entered into three successive leases of the property.

Plaintiffs appeal and allege that the so-called forfeiture of the land contract was a nullity as no service was made upon William Dundas, one of the vendees; and that the so-called lease was not a surrender of the land contract by operation of law as, at the time -of its execution, it was entered into with the understanding that plaintiffs could later continue their payments on the land contract.

The record discloses that the underlying cause of the present litigation is the possibility of oil in the premises. Both parties have entered into oil leases; and but for plaintiffs’ oil lease, plaintiffs would not be able to complete the unpaid payments on the land contract. We do not find it necessary to pass upon the validity of the notice of forfeiture served upon one of the vendees as the conduct of all parties hereto is inconsistent with the continuance of the land contract and amounts to an abandonment of the same.

“Abandonment by the purchaser is shown * * * where he positively and absolutely refuses to perform the conditions of the contract, such as a failure to make payments due, accompanied by other circumstances, * * or where by his conduct he clearly shows an intention to abandon the contract. * * * As a general rule whether or not the purchaser’s acts and conduct amount to an abandonment of the contract is a question for the jury; but such acts and conduct may be so decisive and unambiguous as to justify the court in deciding the question as a matter of law.” 66 C. J. p. 731, et seq.

The learned circuit judge, who saw the witnesses, determined that lease agreements were entered into and that subsequently the- plaintiffs occupied the premises as tenants. This act upon the part • of plaintiffs was a surrender of their rights under the land contract. In Miner v. Boynton (syllabus), 129 Mich. 584, it was held:

“A vendee in a land contract, who, having failed to comply with its terms, and having been served with notice to vacate, leases the premises from the vendor, thereby surrenders his rights under the contract.”

The decree of the trial court is affirmed. The defendants may recover costs.

Fead, C. J., and North, Wiest, Butzel, Bttshnell, Potter, and Chandler, JJ., concurred.