App v. Class

• Citation: 75 N.E.2d 543,225 Ind. 387
• Decision Date: 24 November 1947
• Docket Number: 28367.
• Parties: APP et al. v. CLASS et al.
• Court: Indiana Supreme Court

75 N.E.2d 543

225 Ind. 387

APP et al. v. CLASS et al.

No. 28367.

Supreme Court of Indiana

November 24, 1947

Appeal from Johnson Circuit Court; Grant Rogers, Judge.

Kivett Chambers, Vernon & Kivett, of Indianapolis, for appellants.

Rappaport Kipp & Lieber and Davis Harrison, all of Indianapolis for appellees.

O'MALLEY Chief Justice.

The appellees commenced an action against the appellants to recover a discount because of a claimed prepayment of part of the purchase price of certain real estate. By agreement the appellees paid in full the amount demanded by the appellants, but reserved the right to litigate the question of their right to a discount under the terms of the written contract.

The issues were raised by an answer in terms of a special denial; an affirmative answer which was stricken on motion of the appellees; a cross complaint requesting reformation of the contract; and an answer to the cross complaint.

There was a special finding of facts and conclusions of law which were as follows (omitting finding number one which is the contract):

'2. That pursuant to the terms of said agreement, plaintiffs on the 11th day of March, 1938, conveyed to the defendants, their farm consisting of 98.20 acres, more or less, described in said written agreement, and that the agreed net value of said farm, less the amount of the mortgage thereon, was five thousand two hundred and fifty-five ($5,255.00) dollars.

'3. That plaintiffs, to receive a conveyance from the defendant of their farm consisting of two hundred and thirty-five (235) acres, more or less, fully described in said written agreement, were required to pay the defendants twenty-five hundred ($2500.00) dollars on or before three years from the date of said written agreement and the balance of the purchase price on or before five years from the date of said written agreement.

'4. That under the terms of said written agreement, defendants had the right to mortgage said real estate pending the conveyance of the same, and that plaintiffs had the right to assume such mortgage as a part of the purchase price.

'5. That pursuant to the terms of said written agreement, the plaintiffs, on the 28th day of February, 1941, paid the defendants twenty five hundred ($2500.00) dollars, due on or before three years from the date of the agreement.

'6. That the plaintiffs paid the defendants the balance of the purchase price of said defendants' farm, to-wit: Twelve thousand three hundred forty five ($12,345.00) dollars on the 28th day of February, 1941, which amount was due and payable on or before five years from the date of said written agreement.

'7. That said payment of twelve thousand three hundred forty-five ($12,345.00) dollars was made by paying the defendants two thousand twenty five dollars and twelve cents ($2025.12) by paying the unpaid balance of the mortgage in the amount of nine thousands six hundred ninety-one dollars and eighty-eight cents ($9,691.88), and by receiving credit in the amount of six hundred twenty-eight (628.00) dollars previously paid defendants by the Indiana State Highway Commission under condemnation proceedings.

'8. That on said 28th day of February, 1941, the plaintiffs claimed they were entitled under the terms of said written agreement, to a discount of five (5) per cent per year for two years on said twelve thousand three hundred forty-five ($12,345.00) dollars, and that the defendants disputed the right of the plaintiffs to such discount, and that thereupon the plaintiffs and defendants agreed that if plaintiff would pay the full amount of twelve thousand three hundred forty-five ($12,345.00) dollars, the respective rights of the parties could be subsequently judicially determined in the same manner as if said payment had not been made or accepted.

'9. That subsequently, the plaintiffs made formal demand upon the defendants to pay said discount, to which they claimed they were entitled, and that payment was refused by the defendants.

'10. That plaintiffs paid to the defendants the sum of one thousand $1,000) dollars per year, due prior to February 28th, 1941, designated as rent in said written agreement, and which actually represented taxes, insurance premiums and interest at five (5) per cent per annum on the unpaid balance of the purchase price of defendants' farm, the last of such payments being in the amount of four hundred fifty-two dollars and ninety-one cents ($452.91).

'11. That on or about February 28th, 1941, the defendant conveyed to the plaintiffs their farm which was the subject of said written agreement of March 11th, 1938.

'And as conclusions of law upon the facts, the Court states:

'1. That the law is with the plaintiffs.

'2. That the plaintiffs recover from the defendants the sum of Twelve hundred thirty-four dollars and fifty cents ($1234.50) with interest thereon at the rate of six per cent (6%) per annum from the 28th day of February, 1941, totaling three hundred ninety-five dollars ($395.00) and the costs of this action.

'3. That defendants take nothing on their cross-complaint.'

In number ten of the above finding, the court stated as a fact that the rent of $1000 per year, which was provided under the terms of the contract, actually represented taxes, insurance and interest. That indicated that the court construed that item according to the evidence offered on the cross complaint, but that change in interpretation does not essentially alter the effect of the contract as a whole.

The appellants have abandoned all claim of any right to reformation by omitting all reference thereto in the propositions, points, authorities and argument. There was no finding on any issue raised by the cross complaint, and the failure of the court to find thereon must be considered as a finding against the appellants who had the burden of proof on the issues so raised. Wolverton v. Wolverton, 1904, 163 Ind. 26, 32, 71 N.E. 123, 125.

The striking out of the affirmative answer and the failure to find on the issues raised in the cross complaint having been abandoned, there remains only the construction of the contract.

The first proposition and points thereunder are addressed to the conclusions of law and that treatment assumes that the facts are well found. It is true that in the points, above referred to, it is asserted that the contract, which is finding number one, forces the conclusion that there were no prepayments. In finding number six the court stated that the due date was five years from the date of the contract, which is in conformity with the plain terms thereof. To follow the appellants' claim would force an interpretation in conflict with that finding and the plain terms of the contract.

The particular section of the contract which caused this litigation is as follows:

'The purchase price of said tract, if the option is exercised, shall be and is $20,100.00 to be paid as follows:--$5,255.00 by the equity in the real estate to be conveyed by the party of the second part to the party of the first part, and the balance of $14,845.00 as follows, $2500.00 thereof on or before three years from this date; the balance in full on or before five years from this date. In the event that payments shall be made before the due date fixed herein, in the final settlement a discount at the rate of 5 per cent per annum for the prepayments made shall be allowed for said prepayments. Also, in the final settlement a deduction on the $2500.00 paid shall be made to cover interest from the time of said payment until the final settlement at the rate of 5 per cent per annum.'

It has been claimed that the above section does not provide for a discount on prepayments. It provides for a due date which is five years from the date of the contract and also provides for a discount on payments made prior to the due date. There is no ambiguity and it matters little whether the contract is called an option to purchase or a contract to sell or to trade. In any event the parties had the right to provide for discounts if they so desired and intended. The lower court refused to reform the contract to fit the claims of appellants. In order to get the intent of the parties we can look to the instrument only, in the absence of ambiguity. Hamilton v. Meiks, 1936, 210 Ind. 610, 616, 4 N.E.2d 536, 538, 539, 107 A.L.R. 1165. We have held that rules of construction are resorted to only when the intention of the parties cannot be ascertained from the language of the instrument itself. Hamilton v. Meiks, supra. In Haworth v. Hubbard, 1943, 220 Ind. 611, 614, 615, 44 N.E.2d 967, 968, 144 A.L.R. 887, this court said:

'It is everywhere agreed that words used in a contract are to be given their usual and common meaning unless, from the entire contract and the subject-matter thereof, it is clear that some other meaning was...