Clayton v. Fletcher Sav. & Trust Co.
| Decision Date | 10 March 1927 |
| Docket Number | No. 12528.,12528. |
| Court | Indiana Appellate Court |
| Parties | CLAYTON v. FLETCHER SAVINGS & TRUST CO. et al. |
OPINION TEXT STARTS HERE
Appeal from Superior Court, Marion County; James M. Leathers, Judge.
Action by Charles M. Clayton against the Fletcher Savings & Trust Company and another for specific performance of a contract for the sale of lots. From a decree for defendants, complainant appeals. Reversed, with directions.Emil C. Stroeh and White & Jones, all of Indianapolis, for appellant.
John V. Wilson and Slack, Rinier & Anderson, all of Indianapolis, for appellees.
Action by appellant against Fletcher Savings & Trust Company and Plymouth Realty & Investment Company for the specific performance of a contract, wherein appellees sold and agreed to convey to appellant lots 50, 51, and 52, in “Blue's Overlook, an addition to the city of Indianapolis,” Marion county, Ind. The contract was executed in July, 1917, and by its terms the trust company as trustee agreed to convey said three lots to appellant for $2,245, $20 of which was paid at the time the contract was executed. The balance of the purchase price was to be paid as follows: $20 on the 1st day of August, 1917, and a like amount on the 1st of each succeeding month until the whole amount was paid. Appellant was to pay an increment charge, to cover the agreed future enhancement in value, of 6 per cent. per annum to be calculated on the unpaid purchase price.
The contract among other things provided:
The contract was signed by the trust company and by the realty company, for whom the former was acting as trustee. Each appellee filed an answer of general denial. From a decree in favor of appellees this appeal is prosecuted.
Appellee's contention is that the contract was canceled and all of appellant's rights thereunder forfeited on account of his failure to pay the installments of purchase price in accordance with the provisions of the contract. Appellant admits he did not pay the installments in the amounts and at the times as provided in the contract, but says that appellees, after the several defaults and delinquencies by him in the payment of the installments, habitually accepted payments of such installments long after they had become delinquent. Appellant insists that appellees by so accepting payments on account of the purchase price at irregular times and in irregular amounts waived their rights to cancel the contract on account of his failure to pay the installments when they became due within the 60 days of grace provided for in the contract. There was a decree denying appellant any relief. Appellant contends the decision is not sustained by sufficient evidence and is contrary to law.
The evidence without conflict shows that appellant made payments totaling $1,220, in the amounts and at the times as follows:
+----------------------------+
¦July, 1917 ¦$ 20 00 ¦
+------------------+---------¦
¦August 21, 1917 ¦20 00 ¦
+------------------+---------¦
¦October 5, 1917 ¦20 00 ¦
+------------------+---------¦
¦November 20, 1917 ¦20 00 ¦
+------------------+---------¦
¦July 8, 1918 ¦20 00 ¦
+------------------+---------¦
¦October 21, 1918 ¦40 00 ¦
+------------------+---------¦
¦November 13, 1918 ¦40 00 ¦
+------------------+---------¦
¦January 7, 1919 ¦80 00 ¦
+------------------+---------¦
¦March 24, 1919 ¦80 00 ¦
+------------------+---------¦
¦June 16, 1919 ¦100 00 ¦
+------------------+---------¦
¦August 5, 1919 ¦80 00 ¦
+------------------+---------¦
¦March 2, 1920 ¦150 00 ¦
+------------------+---------¦
¦October 30, 1920 ¦100 00 ¦
+------------------+---------¦
¦March 14, 1921 ¦200 00 ¦
+------------------+---------¦
¦December 1, 1921 ¦100 00 ¦
+------------------+---------¦
¦November 27, 1922 ¦150 00 ¦
+------------------+---------¦
¦Total ¦$1,220 00¦
+----------------------------+
The first $20 was paid on the execution of the contract, and was paid to R. A. Goldrick, who was the secretary of the realty company, and who shortly thereafter died. After his death his widow became secretary and treasurer of the realty company. She owned the majority of the capital stock of that company. Prior to January 7, 1919, appellant had made seven payments on the purchase price, the amount so paid being $180. Appellant on said day was delinquent in the sum of $200. There is a conflict in the evidence concerning a rescission or cancellation of the contract which took place about this time. There is some evidence to the effect that there was a cancellation and reinstatement of the contract in 1918. Appellant testified he rescindedthe contract January 7, 1919; that when he so informed Mrs. Goldrick she urged him to keep up his payments to the best of his financial ability and that he then paid $80 on the contract to Mrs. Goldrick. Mrs. Goldrick denies having received this payment and says she never received any of the payments from appellant. She says she on numerous occasions telephoned him and called his attention to the fact that he was delinquent; that the last time she called him was in November, 1922. Appellant paid $100 on account of the contract December 1, 1921. The next payment was on November 27, 1922, when he paid $150. This last payment as well as a number of previous payments were accepted long after they were due.
[1] It is quite clear appellees had waived the provisions in the contract requiring payments the 1st of each month and making time of payments of the essence of the contract. Indeed, appellees, while not admitting such waiver, make no claim they had not waived such provisions. Their contention is that they on June 29, 1923, notified appellant that if he did not make a “substantial” payment on the contract on or before July 11 following they would cancel the contract, and that, no further payments having been made by appellant, they did cancel the contract July 12, 1923. The determination of this appeal depends upon the validity and effect of this cancellation. No question has been raised as to whether this defense was available to appellees under the general denial, or whether rescission or cancellation should be specially pleaded when relied on as a defense. The evidence on this question was introduced without objection, and for the purpose of this appeal we assume it was properly introduced.
Paragraph 5 of the contract as heretofore set out provides that if the monthly installments become delinquent for a period of 60 days, the vendor may at its option, after ten days' notice, rescind the agreement. The effect this provision for notice had on the clause making time of the essence of the contract is not material to a consideration of the question involved, although it would seem to have a nullifying effect. Ordinarily when time of payment is of the essence of the contract and there has been a failure to pay at the time named in the contract, and no waiver of such provision, no notice of an intention to cancel or forfeit the contract is required.
Under the contract in the instant case no such action could be taken until there was a delay or default of 60 days, and then to make time of the essence of the contract and to give appellees the right to exercise the option to rescind a ten days' notice was required. As before stated, if the provision requiring notice of the intention to rescind had been omitted from the contract, no notice would have been required, and when an installment became delinquent for a period of 60 days the right to forfeit the contract under the law would have been absolute, if the parties had not by some act waived their right to declare a forfeiture. If, for instance, it had been their custom and habit to accept payments of purchase price at irregular times and in irregular amounts, more than ten days after a 60-day default in paying the installments, the right to declare a forfeiture of the contract without doubt would have been waived, and could not ordinarily have been exercised without a personal notice giving the purchaser a reasonable time within which to make payment of the delinquent installment or installments. Of course circumstances might arise that would excuse notice, but no claim is made that notice was not required in the instant case. The notice so required by law is a personal notice. And the ten days' notice which appellees were, under paragraph 5 of the contract, required to give before they could rescind must be construed to be a personal notice, in the absence of some provision...
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