Heinzeroth v. Bentz

116 N.W.2d 611, 1962 N.D. LEXIS 79
CourtNorth Dakota Supreme Court
DecidedAugust 17, 1962
Docket8000
StatusPublished
Cited by15 cases

This text of 116 N.W.2d 611 (Heinzeroth v. Bentz) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Heinzeroth v. Bentz, 116 N.W.2d 611, 1962 N.D. LEXIS 79 (N.D. 1962).

Opinion

STRUTZ, Judge.

This is an action to quiet title to certain real estate in McLean County. The plaintiff Dale G. Heinzeroth was to acquire title to such land in the probate proceedings of the estate of his mother, and he, with his wife, brings this action for the purpose of determining the adverse claims or interests of the defendant to such land.

In January 1954 the late C. L. Foster was appointed executor of the last will and testament of Bertha Heinzeroth, deceased. The property involved in this lawsuit was devised by the deceased to the plaintiff Dale G. Heinzeroth, an only child. During the probate of the estate, the devisee and his wife, the plaintiff Helen L. Heinzeroth, requested and received numerous advances from Foster. Many of these advances were in the form of loans made by Foster out of his personal funds. In 1959, the loans had mounted to a point where Foster felt that he could make no further advances and he advised the plaintiffs to mortgage or sell the land in question if any further money were required. An attempt was made to sell it at public auction but, after advertisement of the land, no bids were received from any of the persons who attended the sale.

C. L. Foster’s health was not good, and, in December of 1959, when the plaintiffs requested more money for house payments and for living expenses, he called on them personally and arranged for the sale of the land. On or about December 27, in the company of the defendant, A. A. Bentz, Judge Foster went to Fargo to meet with the plaintiffs. At the ensuing conference, it was orally decided by all of the parties concerned that the plaintiffs would sell the land to the defendant at the agreed price of $37.50 an acre; that Foster would, upon returning to Bismarck, prepare a deed to effect such transfer and would mail such deed to the plaintiffs in Fargo where they would execute it before a notary public and then return it. Foster was then to hold the deed in escrow until a decree of distribution had been entered in the Bertha Heinze-roth estate. On the entry of such final decree, Foster, as escrow agent, would deliver the deed to the defendant, Bentz, and the defendant would pay the full purchase price.

On his return to Bismarck from Fargo Judge Foster prepared a deed and mailed it to the plaintiffs. The deed was thereafter executed by the plaintiffs before a notary public and was returned to Foster, who received it shortly before January 5, the date of his death.

*613 The plaintiffs attended Foster’s funeral on January 8. At that time, they had a conversation with the defendant and stated that they were not going through with their agreement to sell the land to the defendant. The defendant thereupon informed the plaintiffs that he had the deed in his possession and that he was ready to complete the transaction as agreed.

The record discloses, and the undisputed evidence of all of the parties, is that Foster, as escrow agent, was to hold the deed in his possession until final decree had been entered in the Bertha Heinzeroth estate. Nevertheless, the deed somehow came into the possession of the defendant, together with the abstract of title to the land. The defendant explains his possession by saying that, although the escrow agent was to retain possession of the deed until final decree had been entered in the Bertha Heinze-roth estate, Foster had given the deed and the abstract to the defendant temporarily for the sole purpose of having the deed and the title examined by the defendant’s attorney; that the deed was in defendant’s possession for that purpose, and that purpose only, at the time the escrow agent died, on January 5.

The trial court, ordering the title quieted in the plaintiffs and holding that the defendant had no interest in the land, pointed out that the escrow agent, Judge Foster, was an experienced practitioner; that Foster would have known that, as escrow agent, he would invalidate the escrow agreement by making an unauthorized delivery of the deed to the defendant. Therefore, the court found that there had been no delivery by the escrow agent, Foster, to the defendant; that the defendant, having offices in the same room with Judge Foster, had come into possession of the deed in some way other than by a delivery of it to him by the escrow agent. The court thereupon made a specific finding that there had been no delivery of the deed, for purposes of examination or otherwise. The trial court obviously did not believe the defendant’s story, that the delivery of the deed to the defendant by the escrow agent, Foster, was in the nature of a temporary loan for the purpose of permitting the defendant to have the title examined and the deed approved by the defendant’s attorney.

From the judgment entered for the plaintiffs, quieting title to the land in question as to all claims of the defendant, or of anyone claiming under the defendant, and forever barring the defendant from asserting any right to the land, the defendant has appealed to this court and has demanded a trial de novo.

Numerous issues are raised on this appeal. The first question for this court to determine is whether the deed executed by the plaintiffs and delivered to Judge Foster, as escrow agent, was a sufficient memorandum to take the agreement of the plaintiffs to sell the land to the defendant out of the statute of frauds. If it was not, then the transaction is barred by the statute of frauds and all other questions, such as the question of wrongful delivery of the deed by the escrow agent, are immaterial.

Our statute provides that certain contracts are invalid unless the same, or some note or memorandum thereof, are in writing and signed by the party to be charged, or his agent. Included in these contracts is—

“4. An agreement for the leasing for a longer period than one year, or for the sale, of real property, or of an interest therein. Such agreement, if made by an agent of the party sought to be charged, is invalid unless the authority of the agent is in writing subscribed by the party sought to be charged.” Sec. 9-06-04, N.D.C.C.

What must be in writing, therefore, is not the escrow agreement, which may be established by parol. 19 Am.Jur., Escrow, Sec. 12, pp. 429-430. But there must be proof of a valid and sufficient memorandum containing substantially the provisions of the oral contract of sale of the *614 land. The weight of authority supports the proposition that if a deed containing substantially the provisions of an oral contract of sale of land is delivered in escrow, in the true sense of that term, so that it has passed into the possession of a stranger for delivery to the grantee upon the happening of some event or the performance of some condition, and is beyond the control of the grantor, the contract is taken out of the statute of frauds, at least as against the party or parties who executed the instrument. 19 Am.Jur., Escrow, Sec. 12, p. 428; 37 C.J.S. Frauds, Statute of, § 181, p. 666.

See also 100 A.L.R., p. 210, et seq.

To be sufficient the entire agreement must be in writing and the contract cannot rest partly in writing and partly in parol. The memorandum agreement must contain all of the essential or material terms and conditions of the contract.

This court has followed the majority rule cited above. In the case of Kunick v.

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Cite This Page — Counsel Stack

Bluebook (online)
116 N.W.2d 611, 1962 N.D. LEXIS 79, Counsel Stack Legal Research, https://law.counselstack.com/opinion/heinzeroth-v-bentz-nd-1962.