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Reed v. Eller

664 P.2d 515, 33 Wash. App. 820, 1983 Wash. App. LEXIS 2146
CourtCourt of Appeals of Washington
DecidedJanuary 31, 1983
Docket5037-4-II
StatusPublished
Cited by5 cases

This text of 664 P.2d 515 (Reed v. Eller) is published on Counsel Stack Legal Research, covering Court of Appeals of Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reed v. Eller, 664 P.2d 515, 33 Wash. App. 820, 1983 Wash. App. LEXIS 2146 (Wash. Ct. App. 1983).

Opinion

Reed, J.

A real estate vendor repeatedly, but unwittingly, permitted his purchaser to make late payments on an earnest money agreement. Can he enforce a "time is of the essence" clause and declare a forfeiture? The trial court answered in the affirmative. The vendee maintains that strict performance was waived or that the vendor is estopped from enforcing the "time is of the essence" provision. We agree and reverse.

In the spring of 1977, Sidney Reed was shown a small parcel of Lewis County land by Mr. Hayertz, an agent for Sundown Land Brokers, Inc. Reed decided to purchase the property for $7,950 but lacked funds for a substantial down payment. Consequently, Mr. Hayertz drafted an offer in the form of a "continuing earnest money agreement" to present to the owners, Carson and Linda Eller. The agreement was dated March 18, 1977 and, after receipting for a cash down payment of $200, called for monthly payments of $75 per month, including principal and interest. Payments on the deferred balance were to commence April 14, 1977, and *822 continue until the contract balance was reduced to $7,000. Then, a real estate contract was to be executed. All the particulars of the contract to be executed were agreed upon; a standard form of such a contract was printed on the reverse side of the earnest money agreement and made a part thereof. The earnest money agreement provided that "time is of the essence," and a handwritten provision gave the Ellers the right to declare a forfeiture in the event of default, with the right to retain, as liquidated damages, all monies theretofore collected.

Mr. Hayertz selected Banner Escrow Company (Banner) to close the transaction and collect the monthly payments. Under the terms of the agreement, Banner was to distribute one-half of each payment to Sundown Land Brokers, Inc., to apply on its commission, and one-half to the Ellers. 1 The confusion giving rise to this lawsuit was initiated when Hayertz waited until March 31 to deposit Reed's $200 down payment with Banner and establish the escrow. For reasons unknown, Banner deducted interest and applied the balance of $142.03 against the first payment due on April 14, 1977. When Reed made his first $75 payment on April 15, it was credited against the May 14 payment. Thereafter payments were made as reflected by Banner's ledger sheet, which is reproduced herein. Although Reed's March 1978 check was returned marked "insufficient funds," Banner's officer testified that the check was later honored.

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Bluebook (online)
664 P.2d 515, 33 Wash. App. 820, 1983 Wash. App. LEXIS 2146, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reed-v-eller-washctapp-1983.