Gates v. Parmly

66 N.W. 253, 93 Wis. 294, 1896 Wisc. LEXIS 2
CourtWisconsin Supreme Court
DecidedMay 22, 1896
StatusPublished
Cited by33 cases

This text of 66 N.W. 253 (Gates v. Parmly) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gates v. Parmly, 66 N.W. 253, 93 Wis. 294, 1896 Wisc. LEXIS 2 (Wis. 1896).

Opinion

The following opinion was filed February 18, 1896:

PiNNey, J.

1. The defendants’ counsel contend that this is a legal action, in which they were entitled, as a matter of right, to a trial by jury; that the provision in the contract requiring the delivery of a complete abstract of title to the lands described in the contract and deed by August 15,1889, and that in case of failure to furnish it, or if it failed to show a perfect title in the plaintiff at the date of the conveyance he had made to the defendant Parmly, trustee, or to have been made perfect in him prior to the making of such abstract, then no further sum of money should be held due to the plaintiff under the contract or otherwise, but that the said Parmly, trustee, could hold said lands free and discharged of any further claim for purchase money, and the $22,500 already paid should be the full price and consideration for the lands, was a condition precedent to the right to Recover the second payment of $22,500 of purchase money, or any part thereof; and, as it was stated that such condi[306]*306tion had not been performed within the time limited, the plaintiff could not recover any sum whatever, either in a legal or equitable action.

The allegations of the complaint and prayer for relief show conclusively that the action is an equitable one, in the nature of an action for specific performance and for relief from a condition precedent, by way of a penalty or forfeiture, as security for performance on the part of the plaintiff, and not a provision for liquidated damages. A vendor may maintain an equitable action against a vendee for specific performance of a contract for the sale and conveyance of lands when he agrees to convey to the vendee, and the latter merely promises to pay a certain sum as the price. Since the latter may, by a suit in equity, compel the execution and delivery of a deed of the premises, the vendor may also, by a similar equitable action, enforce the undertaking of the vendee, although the substantial part of his relief is the recovery of money. Pomeroy, Spec. Perf. § 6. As the vendor in this action seeks relief from a penalty or forfeiture imposed by a condition precedent in the contract and to enforce a vendor’s lien for unpaid purchase price, the jurisdiction of equity is undoubted, for in such a case he cannot have a complete and adequate remedy at law, as of these questions a court of law has no jurisdiction.

2. The rule is universal at law that the failure to perform a condition precedent is a perfect bar, and, in general, the rule is the same in equity unless there is some peculiar ground of equity to take the case out of the general rule. In Davis v. Gray, 16 Wall. 229, 230, it was said: “There is a wide distinction betwreen a condition precedent where no title is vested and none is to vest until condition performed, and a condition subsequent operating by way of defeasance. In the former case equity can give no relief. Failure to perform is an inevitable bar.” And the case of Wells v. Smith, 2 Edw. Ch. 78, 83, was referred to. But the case of Davis v. [307]*307Gray was that of a condition subsequent, and it was held that equity would interfere in such, a case, and relieve, upon the principle of compensation, where that principle could be applied, giving damages if damages should be given and the proper amount could be ascertained. Equity will relieve against a penalty or forfeiture, and the authorities are quite generally agreed that it will do so even where it is in the form of a condition precedent, where it is evidently intended merely as a security for the payment of money or the performance of any act where failure to perform it may be compensated in money. It is not necessary that the penalty or forfeiture should be specified to be such in express terms; it is enough if such is the clear nature and substance of the provision. And, although the distinction between conditions precedent and conditions subsequent is known and often mentioned in courts of equity, yet the prevailing though not the universal distinction as to condition there is between cases where compensation can be made and cases where it cannot be made, without any regard to the fact whether they are conditions precedent or conditions subsequent.” Story, Eq. Jur. §§ 1314 — 1316. And the same learned author says: “ In cases of this sort, where the stipulation is in the nature of a security, and specific performance is sought to be enforced, and yet the party has not punctually performed the contract on his own part but has been in default, and admitting of compensation, there is rarely any distinction allowed in courts of equity between conditions precedent and conditions subsequent.” Story, Eq. Jur. §§ 1315 et seq.; Id. § 1320.

Upon the execution of the contract, the defendants became, in the estimate of a court of equity, the owners of the land, and the plaintiff the equitable owner of the purchase money which they held in trust for him; and the condition in the contract operated as an imperfect mortgage or pledge of his equitable ownership of the purchase money, that he [308]*308Would furnish and deliver, on or before the time specified, an abstract of title showing .perfect title to the lands, and such imperfect mortgage or pledge would become redeemed or avoided upon what would be regarded as an equitable performance on his part. If the vendee obtains title to the lands or damages which can be regarded as compensation for partial failure, he gets all that, in justice, he is entitled to. This doctrine has been applied to many cases of breach of condition precedent where the parties could be put in the same situation as if the condition had been performed, and so it would seem that where the condition is security for the payment of money or the performance of any particular act, or in the nature of a penalty or forfeiture for nonperformance of such condition, such relief may be granted. Pom-eroy, Spec. Perf. §§ 391, 392; Waterman, Spec. Perf. § 435; Grigg v. Landis, 21 N. J. Eq. 494; Edgerton v. Peckham, 11 Paige, 352, 363; Sanders v. Pope, 12 Ves. 282; In re Dagenham Dock Co. 8 Ch. App. 1022. But, where there cannot bo any just compensation decreed for the breach, equity will not interfere. It is insisted by the plaintiff’s counsel that the defendants had, by their contract, waived the condition in question; but we Alo not find any evidence that would justify such a conclusion, and we think that, upon well-established equitable principles, the relief sought from the breach of the condition precedent in this case may be properly granted.

3. As the provision of the contract in question was evidently intended by way of security, quite as much so as if the penalty or forfeiture had been expressly provided for and named as such, we think it clear that the doctrine in respect to stipulated or liquidated damages is not applicable to the case. The contract sufficiently indicates that it was not intended that, in case of a breach of the condition, title to lands in excess of two thirds or three fourths or seven eighths of the entire quantity of the lands to which title had [309]*309passed to Parmly, trustee, under the deed, was to be retained, and the second instalment, $22,500, of the purchase price, as well, should be considered or held as liquidated damages.

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Cite This Page — Counsel Stack

Bluebook (online)
66 N.W. 253, 93 Wis. 294, 1896 Wisc. LEXIS 2, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gates-v-parmly-wis-1896.