Wineglass Ranches, Inc. v. Campbell

473 P.2d 496, 12 Ariz. App. 571, 1970 Ariz. App. LEXIS 718
CourtCourt of Appeals of Arizona
DecidedAugust 19, 1970
DocketNos. 1 CA-CIV 735, 1 CA-CIV 736
StatusPublished
Cited by2 cases

This text of 473 P.2d 496 (Wineglass Ranches, Inc. v. Campbell) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wineglass Ranches, Inc. v. Campbell, 473 P.2d 496, 12 Ariz. App. 571, 1970 Ariz. App. LEXIS 718 (Ark. Ct. App. 1970).

Opinion

HAIRE, Judge.

This appeal grows out of a protracted and many-sided controversy over rights in a 5,000 acre tract of land in Yavapai County. There were many parties to the litigation in the trial court, but this appeal involves only the appellant, Wineglass Ranches, Inc., hereinafter Wineglass, and the “Campbell group”, consisting of Gilbert A. Campbell, his wife, son, and daughter-in-law, the appellees.1 We shall only refer to such facts as are essential to disposition of the issues on appeal.

In 1959, Wineglass agreed to sell and the Campbells agreed to purchase the 5,000 acre tract under an escrow agreement of 15 years’ duration. The agreement contained a provision for the release of acreage to the purchasers, subject to the lien of an existing mortgage assumed by the Campbells, at the rate of $150.00 per acre, but the agreement did not clearly specify whether the Campbells’ release rights were to be based upon (1) every dollar paid, whether principal or interest, or (2) principal payments alone.

Also in 1959, the Campbells entered into a 15 year escrow agreement to sell 3,000 of the 5,000 acres to Coronado Land Company. Essentially, for its part, Coronado agreed to assume the Campbells’ obligations in their contract with Wineglass and the pre-existing mortgage. Coronado failed to meet its obligations, and in 1962 it assigned its vendee’s interest in the 3,000 acres to Cerene Properties, Inc. By another long term escrow agreement entered into in May 1962, to which Cerene Properties, the Campbells and Wineglass were parties, Cerene Properties also contracted with the Campbells to purchase the remaining 2,000 acres of the 5,000 acre tract. Wineglass had previously commenced a forfeiture proceeding against the Camp-bells, and in this May 1962 agreement concerning the 2,000 acre parcel it agreed to dismiss the forfeiture proceeding, essentially in return for the following option provision in the agreement:

“In event that rights of [Cerene Properties, Inc.] * * * as set forth herein are forfeited and cancelled the parties herein grant and agree that Wineglass Ranches, Inc. or nominees have 30 day notification of that event to purchase in . accordance with the terms herein for the then balance by paying the amounts unpaid which caused said forfeiture within said 30 days.”

At about the same time, without the knowledge of the Campbells, Cerene Properties and Wineglass entered into a “joint venture” agreement looking toward the possible development of the whole 5,000 acre tract.

The trial judge found and it is undisputed here that Coronado and Cerene Properties were in default in their obligations to the Campbells with respect to the 3,000 acres from and after October 1, 1963. The trial judge likewise found that Cerene Properties was in default in its obligations with respect to the 2,000 acre parcel from and after January 2, 1963. On July 22, 1963, the Campbells sent Cerene Properties and Wineglass a declaration of forfeiture with respect to the 2,000 acre parcel. Reference was made in the declaration to a $75,000.00 principal payment due in January 1963, and a portion of the instrument directly addressed to Wineglass stated that the latter’s 30 day option period would commence 10 days after posting unless the default was cured within that time. Another declaration of forfeiture was sent out about a year later, apparently because Cerene Properties had assigned its interest [574]*574subsequent to the July 22, 1963 notice. Wineglass did not take any steps to exercise the option granted to it under the May 1962 agreement.

Three separate lawsuits were consolidated for trial. In one lawsuit, No. 23836, the Campbells sought to have the forfeiture of Coronado and Cerene Properties and all those claiming under them judicially declared. The basic object of this suit, according to the Campbells, was to enable them to regain possession of the entire 5,000 acres, and to recover various elements of damage. Wineglass was not a party defendant in this suit No. 23836.

In a second lawsuit, No. 22598, Wineglass sought specific performance of its “joint venture” agreement with Cerene Properties. In this suit, Wineglass claimed the right to a conveyance of a one-half interest in the entire 5,000 acre tract from Cerene. The Campbells were not parties to this suit No. 22598.

The third and only suit in which Wineglass and the Campbells were adverse parties was No. 23822, a quiet title suit instituted by the Campbells against Wineglass, and also numerous other parties. The “First Cause of Action” in No. 23822 sought a declaration that the Campbells were the fee owners of some 450 acres of land in Section 4 which was a part of some 929 acres which had been deeded to them as a release of acreage by Wineglass in 1964. The Campbells’ “Second Cause of Action” in No. 23822 concerned another some 1150 acres of land within the 3,000 acre parcel. In this “Second Cause of Action”, however, the rights which the Camp-bells alleged in the quiet title action were expressly stated to be subject to the rights and interest of Wineglass under the original Wineglass-to-Campbells agreement. Wineglass counterclaimed against the Campbells in No. 23822, asserting alternatively an option right on all of the 5,000 acres or a right to the conveyance of a one-half interest from Cerene Properties if the latter still had a vendee’s interest in the land. None of the allegations in No. 23822, however indicated the presence of a controversy between Wineglass and the Campbells over the meaning and effect of the release provisions of their agreement.

After a trial lasting three weeks, the trial judge issued comprehensive findings of fact and conclusions of law and a judgment which generally resolved all of the issues in the Campbells’ favor. With respect to No. 23836, the interests of Coronado and Cerene Properties were found to have been forfeited. With respect to No. 23822, critical here, the Campbells were declared to be the fee owners of the 450 acres which was the subject of their “First Cause of Action”, and of all of the remaining 929 acres deeded to them by Wineglass. These holdings are not challenged on appeal. Nor is the ruling of the trial judge with respect to the allegations of the Campbells’ “Second Cause of Action”, in which it was held in accordance with such allegations that the rights of the Campbells in the 1150 acres in question were subject only to the rights of Wineglass under their 1959 agreement.

The counterclaim of Wineglass was denied (as was its claim for specific performance in No 22598). Denial of the counterclaim insofar as it asserts an existing optional right to purchase in Wineglass is disputed on appeal, but the sharpest controversy surrounds a further ruling by the trial judge, that the Campbells were entitled to a deed from Wineglass releasing more than 800 acres of land in addition to the 929 acres previously released. This ruling was predicated upon a construction of the release provisions of the Wineglass-Campbell agreement to mean that the Campbells were entitled to have released to them one acre for every $150.00 paid on the purchase price, whether principal or interest. This holding calling for release of additional land by Wineglass is embodied in paragraph 16 of the judgment.

[575]*575As to the portion of the judgment last referred to, appellant contends that the underlying issue was never presented by the parties in No. 23822 to the trial court for resolution. We are constrained to agree, and, in our view, the judgment must be modified in this one respect.

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Bluebook (online)
473 P.2d 496, 12 Ariz. App. 571, 1970 Ariz. App. LEXIS 718, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wineglass-ranches-inc-v-campbell-arizctapp-1970.