White v. Bott

158 S.E. 880, 158 Va. 442, 1931 Va. LEXIS 295

• Court: Supreme Court of Virginia
• Decided: June 18, 1931
• Status: Published

Opinions

Holt, J.,

delivered the opinion of the court.

In this action plaintiff sought to recover from the defendant $3,000.00 charged to be due to him on account of his services as a real estate agent. His claim grew out of this contract:

“June 25, 1928.

“M. D. White and Company,

“Norfolk, Virginia.

“Dear Sirs:

“I hereby submit the following offer for the Westover Terrace Apartments, together with all the land and appurtenances thereto belonging, including the part of the lot in the rear to the trellis thereof, also the frigidaires, awnings, screens, etc.

“Will give the property at the southwest corner of 31st street and Omohundro avenue, with the loan of seven thousand ($7,000.00) dollars thereon; the two-family No. 360 W. 13th street, with the loan of four thousand($4,000.00) dollars thereon; No. 1236 Westover avenue, with the loan of eleven thousand, five hundred ($11,500.00) dollars thereon, (all of said loans to be assumed by the owner of the West-over Terrace); also No. 525 Herman avenue, clear of all liens; and note for three thousand, five hundred ($3,500.00) dollars, second mortgage, secured on the ‘Harrison Apartments;’ will also assume the loan of forty-eight thousand ($48,475.00) dollars now on the ‘Westover Terrace’ and pay thirty-three thousand, five hundred ($33,500.00) dollars in cash.

“All rents, interest, taxes and insurance to be prorated as of date of settlement, which is to be on or before August 1, 1928.

“I enclose check for one thousand ($1,000.00) dollars to bind the bargain, same to be credited on the purchase price or returned if deal is not closed.

“Yours very truly,

“Norwood G. Carroll

“per J. Earnest Thacker (Seal)

“J. Earnest Thacker (Seal)

“I hereby accept the above offer, and acknowledge receipt of one thousand ($1,000.00) dollars; and agree to pay M. D. White and Company as agents, the regular real estate commission on 'Westover Terrace’ at $115,000.00, amounting to twenty-five hundred and 00/100 ($2,500.00) dollars.

“This good until Wednesday the 27th-1928 at noon.

“W. M. Bott.

“June 26, 1928.

“M. D. White and Company:

“It is understood I am due you an additional $500.00 (five hundred dollars) commission a/c sale Westover Terrace Apartment at time is consummated on or about August 1, 1928. This is in addition to that stated in contract.

“W. M. Bott.”

There was a verdict and judgment for the defendant. Plaintiff claims that they are contrary to the law and to the evidence. During the negotiations which accompanied the purchase, Mr. W. C. Etheridge represented the plaintiff and took Mr. Bott to see the various properties which he was to accept in part payment for the Westover Terrace Apartments. It is charged that Etheridge on that occasion misrepresented their physical condition, the terms upon which they were rented and the rent roll. This he denies, and here we have a sharp conflict of evidence. Since the evidence is in sharp conflict it is amply sufficient, if that verdict can be sustained on the issue of fact here submitted and decided, or on any other issue of fact properly submitted.

It was Bott’s duty to repudiate this contract when he ascertained that these misrepresentations had been made to him, and to state his reasons for such a repudiation.

“When a party intends to repudiate a contract on the ground of fraud, he should do so as soon as he discovers the fraud. If after the discovery of the fraud he treats the contract as a subsisting obligation, he will be deemed to have waived his right of repudiation. Prompt action is essential when one believes himself entitled to a rescission of a contract.” Finch v. Garrett, 109 Va. 114, 63 S. E. 417, 418. See, also, Wright, Inc. v. Shackelford, 152 Va. 635, 148 S. E. 807, where many authorities to this effect are cited.

In direct examination, Bott said:

“Q. After you found the condition of this property as it was, tell the jury whether or not you said anything to Mr. Etheridge about what you found?

“A. I didn’t say anything to Mr. Etheridge about the driveway especially because I stopped talking to him at that time.

“Q. What did you say to him about the condition of the premises and the tenancy?

“A. I told him he had misrepresented the property on Thirteenth street. We were walking up Granby street and I told him that and he said: 'Bott, if you want to back out of it and you will give me some commissions I will be glad to let you out of the deal,’and I said: 'No, I am not going to pay any commissions on it. I have not gotten to that point yet.’ ”

All that can be said of this is that Bott stated to Etheridge that he would pay no commissions. Manifestly he could not claim under his contract of purchase and refuse to pay.

That there was at that time no intention on his part to repudiate is made plain by the fact that he afterwards re* tained counsel to ’ examine these titles. Moreover, Mr. Smith, counsel for plaintiff, talked with Mr. Bott over the ’phone in reply to a suggestion from that gentleman, and then stated to him that they were willing to convey the Thacker property “to anyone he wished us to, that under the contract he was to assume all liens on all the property and that the contract was specific and if we conveyed it to any other person there would be no assumption by him, but if he could fix some way to assume the liens we would be perfectly willing to have another grantee in the deed.” This is out of harmony with any purpose to repudiate.

Mr. Bott further testified that Etheridge “guaranteed” the title.

It is interesting to note the character of the defects relied upon, particularly those which it is said appear upon the face of the contract.

These objections in substance are that Mrs. Thacker did not sign the contract of June 25th, that Mrs. Bott did not sign it, and that Mr. Thacker did not appear to have had authority from Mr. Carroll to sign for him. Later it was said that legal title to three of these lots was in Mrs. Thacker and not in Mr. Thacker.

The court in its instructions told the jury: “The court instructs the jury that the fact that Mrs. Thacker did not sign the contract is immaterial in this case.”

It also told the jury: “The court instructs the jury that the fact that Mr. Bott’s wife had not signed the contract is immaterial in this suit.”

These instructions were not objected to and so in part make up the law of this case.

Judge Crump in C. G. Blake Co. v. Smith, 147 Va. 960, 133 S. E. 685, 691, said:

“The last instruction above transcribed, that drawn by the court, was not objected to by the plaintiff in error, and, therefore, became the law of the case.” Coopersmith v. Mahoney, 150 Va. 685, 143 S. E. 313; Southern Ry. Co. v. Cohen Weenen & Co., 156 Va. 313, 157 S. E. 563.

Mr. Thacker did have authority to sign for Mr. Carroll as is shown by his deposition and so these objections are without merit.

When counsel, later, in August, did examine title to these lots he reported the following defects.

It appears that there is a joint driveway seven feet wide between the Westover avenue lot and one which adjoins it. This driveway was for the benefit of these two lots and had not theretofore been regarded as a burden.

In the chain of title to another lot is a deed from Mrs. Ruth Branch Jones and all of her children. Mrs. Jones, who is sixty-one years old, and her children, took under a will in which the testator said: “I give to Ruth Branch Jones, my lot of land, No. 16, block 15, purchased and paid for to the Westover Company as per deed, see recorded, and at her death to all of her children living.” On the thirty-first street lot were two deeds of trust for $250.00 each. This lot was conveyed to the Methodist Church by Ira T. Holt to be used for church purposes and was after-wards sold by the church under ordinary statutory provisions enacted for the sale of church property.

The alleged defect growing out of the testamentary devise to Mrs. Jones was disposed of by the trial court in this instruction: “The court instructs the jury that under the will in evidence Mrs. Jones took a life interest, and her children living at the death of the testator took a fee simple remainder.”

The two $250.00 trust deed debts had been paid, and that fact counsel for Mr. Bott knew from an endorsement of record, but this endorsement was not in proper form.

The restrictive provisions in the deed from Ira T. Holt, even if we were to concede that they continue to operate, could have been cured by a quit claim deed, and he did in fact afterwards execute one. The wide use of automobiles has made private garages in many instances highly desirable so that reservations like this joint roadway are now quite common, but we will deal with it as a burden. As such it could, in all probability, have been cleared away, and in any event good faith required that an opportunity to clear it away should have been given.

The character of these defects now relied upon, though known to Mr. Bott, were not disclosed by him to anyone unless it be his counsel. Mr. Smith says that he heard of them for the first time three or four days before this case was called to trial in the court below.

Mr. Bott did tell his counsel that he desired to repudiate the contract and it is certain that this was his final purpose. Afterwards, Mr. Vivian Page, of counsel for Mr. Bott, saw Mr. Smith who then represented the plaintiff. This is, in part, his evidence as to what then took place:

“Mr. Smith came to my office and we discussed the matter pro and con and I told him Mr. Bott would not go through with the contract because of a number of reasons I cannot tell you just exactly what they were, because all of this was mixed, the title was bad, the property was not in Mrs. Thacker’s name, she had not signed the contract and he could not make her go through with any deal, and he at that time said to us that on the day it was to be consummated he was going to make tender in order to make the proposition so that they would be in position to enforce the contract, not for Etheridge and Company, as I understand it, but for Thacker. I told him frankly any number of times that Mr. Bott was not going through with it, and so then he said he was going to make tender to Mr. Bott of the deed. The next day the Bar Association was meeting, and I happened to be over with Mr. Martin at Newport News, at the Chamberlain Hotel, and I got a ’phone message, when I returned at three o’clock, that Mr. Smith, I think, had been to Mr. Bott’s office. I then called Mr. Smith’s office. He was out of town, had gone fishing, and I endeavored to locate him several places, and finally he called me at night. The contention over the matter of the deed was, in order to put ourselves in the best advantageous position we could be in, speaking as counsel, that we would offer him a deed from Mr. Bott without Mrs. Bott’s signature. We knew he could not make her sign and I knew that he would not take a deed without her signature any more than we would take their deed without Mrs. Thacker’s signature. That is what I remember about the case. We discussed it several times with Mr. Smith. He was in our office at least once because I recall seeing him in my office, and he was there also after the first of August. As to any particular time I would not swear to it. If Mr. Smith says he has something in his mind absolutely, I would not deny anything he says because I know him too well.”

In. passing it may be noted that there is here no reference to the Etheridge representations.

Mr. Smith, as we have seen, states absolutely that he knew nothing about these defects in title now relied upon until after this action was instituted. They are not impressive but independent of their weight it was Mr. Bott’s duty to make them known that they might be corrected or at least that an opportunity to correct them might be given.

What has been said about Etheridge’s statements as to the physical condition of these properties applies in principle to these defects in title afterwards discovered.

In a suit for specific performance of a contract for the sale of real estate where time is not of the essence, it is well settled that a vendor whose title is not perfect will be given a reasonable time to perfect it. Michie’s Digest, volume 8, page 1061, where the authorities are collected.

It is true that this is an action at law, but Bott knew before the date set for final execution of the contract of June 25th, what these objections to title were. He did not disclose them and contented himself with saying that the title was bad. If time for the consummation of a contract can be extended that title may be perfected, then for a stronger reason the vendor should have an opportunity to perfect title when that time has not yet arrived.

It would be a reflection upon the administration of justice to permit a vendee to say to his vendor: “I have found a defect in your title but I will not tell you what it is because you might correct it and deprive me of this defense should you sue upon your contract.”

Looking at the substance of things this is the situation here.

When we come to the date set for the execution of the contract, still another reason was advanced to defeat it. For the vendors a-tender was made, the sufficiency of which is not questioned. It was not refused because of misrepresentations and it was not refused because the title was bad. Mr. Bott was willing to go forward provided the Thackers, on their part, would accept a deed not signed by Mrs. Bott.

From Mr. Smith’s evidence this appears:

“A. He (counsel for Mr. Bott) said he understood I had made a tender and, of course, he was going to tender a deed signed by Mr. Bott alone, and I said: 'You need not do that because we will not accept it and I waive formal tender.’

“Q. The only reason given at that time was because Mrs. Bott would not sign a deed, and, of course, you would not take a deed not signed by her?

“A. I never heard of any other reason at that time.”

On cross examination this appears in Mr. Page’s testimony:

''Q. If he (Mr. Smith) had a letter of that date by which he can refresh his memory, as you said, you knew he is very accurate and correct?

“A. I say if he makes a statement he is positive of, I would not dispute him.

“Q. You just stated that you would not expect him to take a deed without Mr. (sic) Bott’s signature?

“A. Yes. I might say in explanation that Mr. Bott never said one word about it, but it was simply a proposition to put Mr. Bott in the best legal position he could be in.”

As a matter of fact Mrs. Bott had not refused to sign the deed for she had never been asked to sign it although she could not have been made to do so because she was not a party to the original contract of purchase and exchange.

The inevitable inference to be drawn from the face of his proposition was that Air. Bott was willing to abide by the contract of June 25th, but that his wife was not. Not only is this an inevitable inference, but it is the intended inference. As Mr. Smith puts it: “I never heard of any other reason at that time.”

This was a plain waiver of any misrepresentations which had been made to the defendant as to the physical condition of these properties or of any defects in title, assuming that they were at one time sufficient to invalidate the contract.

“Where a party gives a reason for his conduct and decision touching anything involved in the controversy, he cannot, after litigation has begun, change his ground, and put his conduct upon another and different consideration. He is estopped from doing it by a settled principle of law.” Ohio & M. Railway Co. v. McCarthy, 96 U. S. 258, 267, 24 L. Ed. 693; Oakland, etc., Co. v. Wolf Co. (C. C. A.), 118 Fed. 239; Goodman v. Purnell (C. C. A.), 187 Fed. 90; Heckscher v. Blanton, 111 Va. 648, 653, 69 S. E. 1045, 37 L. R. A. (N. S.) 923; Arwood v. Hill’s Adm’r, 135 Va. 235, 243, 117 S. E. 603; Robinson v. Shepherd, 137 Va. 687, 120 S. E. 265; Nagle v. Syer, 150 Va. 508, 143 S. E. 690.

From what has been said it follows that the jury’s verdict should have been set aside, and this notwithstanding the fact that the evidence may have warranted it in believing that Etheridge had in fact made misrepresentations and that the titles were as Bott claimed they were.

Since the plaintiff is entitled to recover there is no occasion to consider those assignments of error which' deal with instructions.

The amount of the judgment, if there can be a recovery at all, is not in dispute. It is $3,000.00 with interest from August 1, 1928, and under authority of Code, section 6365, judgment must be entered for him in said sum.

The judgment appealed from must be reversed and it is so ordered.

Reversed.