Michael v. Towers

251 A.2d 878, 253 Md. 114, 1969 Md. LEXIS 946
CourtCourt of Appeals of Maryland
DecidedApril 3, 1969
Docket[No. 195, September Term, 1968.]
StatusPublished
Cited by9 cases

This text of 251 A.2d 878 (Michael v. Towers) is published on Counsel Stack Legal Research, covering Court of Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Michael v. Towers, 251 A.2d 878, 253 Md. 114, 1969 Md. LEXIS 946 (Md. 1969).

Opinion

Singley, J.,

delivered the opinion of the Court.

This is an appeal from a decree entered by the Circuit Court for Prince George’s County, sitting in equity, which rescinded two contracts for the sale of real estate. The chancellor found, and we think quite properly, that the contract purchaser had failed to act with the diligence and expedition which the contracts required.

On 19 August 1964, Mrs. Bessie F. Brown, one of the plaintiffs below and an appellee here, entered into a contract with Irving Karnins, one of the defendants below, under which Mrs. Brown agreed to sell 34.29 acres of land in Prince George’s County for $203,000. The contract provided that a deposit of $5,000 would be held by Kurt Berlin. On 22 December 1964, Mr. and Mrs. G. Chester Towers, also plaintiffs below and appellees here, entered into a substantially identical contract with Karnins for the sale of 7.16 acres for $88,600. A deposit of $3,000 was similarly to be held by Berlin.

The contracts contained provisions with respect to survey, adjustments of purchase price and the terms of the mortgage which would secure the payment of that part of the consideration not to be paid in cash, none of which is significant here. What is important, however, is the following provision which appeared in both of the contracts:

“This contract of sale is contingent upon the Purchaser being able to procure rezoning of the property described herein for R-18 zoning classification. Purchaser shall apply for resoning immediately and shall prosecute the application for resoning with due diligence *116 and as expeditiously as possible, with all expense therefor being charged to the Purchaser without obligation to the Seller. (Emphasis added)

Each contract provided for settlement within 60 days of the granting of R-18 zoning.

More than two years slipped by during which Mrs. Brown and the Towers heard nothing, and on 1 March 1967 Kenneth E. Pruden, their counsel, wrote to Mr. Berlin, who held the deposits :

“This letter is to inquire as to whether or not you hold such a check, whether or not the check has been cashed, the name of the maker and the name of the Bank upon which the check is drawn.
“Also, would you advise as to whether or not you represent the Purchaser in this matter and in the event you do not, would you advise as to who does represent the Purchaser.”

When no reply was received, Mr. Pruden wrote again on 15 March. On 20 March, Berlin replied:

“In regard to your letter of March 1, 1967, please be advised that subsequent to your phone call before March 1, 1967, I had in my possession a check from Irving Kamins, which I, at your request, was going to deposit to be held in escrow. Since the check was over one year old I called Mr. Kamins and received from his assigns a cashier’s check drawn on the United Community Bank in the sum of $8,000 which has now been deposited.
“I furthermore advise you that Orie Seltzer, 1111 Massachusetts Avenue, Northwest, is the person to whom you should talk in regard to this matter * *

On 16 May 1967, Mrs. Brown and the Towers filed identical bills of complaint against Kamins, seeking a declaration that the contracts were null and void and of no legal effect. Kamins answered by generally denying the allegations.-

*117 Ten months after the suits had been filed, Murray H. Michael intervened in the proceedings. It was then that Mrs. Brown and the Towers learned for the first time that Kamins had assigned his interest in the contracts to Michael, although Kamins had testified in a deposition taken in November of 1967 that the contracts had been assigned to Orie Seltzer on 28 January 1965. At that time, Kamins had refused to produce the assignment. Michael filed an answer and Mrs. Brown’s case and the Towers’ case were consolidated for trial.

Richard J. Castaldi, a principal clerk for the Maryland-National Capital Park and Planning Commission (the Planning Commission) was called as a witness on behalf of the Towers and Mrs. Brown. He testified that applications for rezoning of the Brown and Towers properties had been filed with the Planning Commission on 29 January 1965 by Orie Seltzer, as agent for the owners, and he stated that there had been no notice or demand that the applications be forwarded to the District Council.

Michael testified that Seltzer acted as his agent in filing the application for rezoning on 29 January 1965; that subsequent to the filing he made “numerous phone calls” and was “in constant touch” and had “meetings” with the Planning Commission.

The chancellor concluded that Michael, as assignee of the Kamins’ contract, had not met his contractual obligation to act “with due diligence and as expeditiously as possible” in pursuing the zoning application and entered the decree rescinding the contracts, from which Michael took this appeal.

In support of his appeal, Michael advances three contentions: First, that Mrs. Brown and the Towers failed to make out a prima facie case; second, that they failed to meet the burden of proof; and finally, that they were estopped from complaining of lack of diligence when they chose to treat the contracts as continuing obligations.

We shall consider the last of these points first. While it is true that a right to rescind may be waived by unreasonable delay or by continuing to treat a contract as a subsisting obligation, 17 Am. Jur. 2d Contracts (1964) § 510 at 992; Cooper *118 smith v. Isherwood, 219 Md. 455, 462, 150 A. 2d 243 (1959); Kemp v. Weber, 180 Md. 362, 24 A. 2d 779 (1942), the lower court chose to regard Mr. Pruden’s letter of 1 March as an inquiry and chose not to accept Berlin’s account of a telephone conversation with Mr. Pruden:

“He [Mr. Pruden] wanted to know if I was holding the checks or cash, or whether I had deposited the cash. I told him I only had checks, and that if he wanted me to I would, since they had expired, get new checks and deposit them. He said yes, and he wanted to know on what bank they were drawn, and he then followed that up with the letter of March 1.”

as indicating that it was anything more than an inquiry. We cannot say that the conclusion reached by the chancellor, who had an opportunity to see and hear the witness, was clearly erroneous. Maryland Rule 886 a.

Michael’s complaint with respect to the sufficiency of the evidence adduced can be readily disposed of. In Allview Acres, Inc. v. Howard Investment Corp., 229 Md. 238, 182 A. 2d 793 (1962), where we considered a contract which was interpreted by the parties as requiring the contract purchaser to use reasonable efforts to obtain rezoning, we said:

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Bluebook (online)
251 A.2d 878, 253 Md. 114, 1969 Md. LEXIS 946, Counsel Stack Legal Research, https://law.counselstack.com/opinion/michael-v-towers-md-1969.