Darby v. Keeran

• Decision Date: 20 January 1973
• Docket Number: No. 46543,46543
• Citation: 211 Kan. 133,505 P.2d 710
• Parties: Howard DARBY, Jr., et al., Appellees, v. Elizabeth KEERAN, Appellant.
• Court: Kansas Supreme Court

Page 710

505 P.2d 710

211 Kan. 133

Howard DARBY, Jr., et al., Appellees, v. Elizabeth KEERAN, Appellant.

No. 46543.

Supreme Court of Kansas.

Jan. 20, 1973.

Syllabus by the Court

1. Under the provisions of K.S.A. 60-256 the trial court is authorized to render summary judgment when there is no genuine issue of material fact. Such a judgment may be entered on the court's own motion and without any motion being made by either of the litigants.

2. In considering a contract which is unambiguous and whose language is not doubtful or obscure, words used therein are to be given their plain, general and common meaning, and a contract of this character is to be enforced according to its terms.

3. A purchaser under a contract for the sale of real estate who has performed or tendered performance of his obligations is entitled to specific performance against the seller.

4. Where the seller agrees to furnish an abstract showing merchantable title and the buyer agrees to make a payment on the purchase price upon approving the merchantability of title, payment of the installment is not a condition precedent to the furnishing of the abstract, but the converse is true.

5. The terms 'merchantable title' and 'marketable title' are interchangeable when used in the context of a contract for the sale of real estate and they denote the same quality and character of title to be furnished.

6. A marketable title is one which is free from reasonable doubt and will not expose the party who holds it to the hazards of litigation.

7. It is not necessary that a title be bad for it to be unmarketable; it is sufficient if there is doubt, based on reasonable grounds, which would cause a prudent man, familiar with the facts, to reject it in the usual course of business.

8. Where real estate is subject to liens for such taxes as estate, transfer or inheritance taxes, the title is not merchantable within the meaning of a provision in a contract which requires the seller to furnish an abstract showing merchantable title.

9. Where an abstract does not disclose that federal estate taxes and state inheritance taxes have been paid or waived, it cannot be said to show a merchantable title in the owner.

10. Delay, by itself, does not constitute laches and an action generally will not be defeated by laches alone unless some prejudice has resulted therefrom to the rights or interests of the adverse party.

11. The record is examined in an action by the purchasers for the specific performance of a contract for the sale of real estate, and for reasons shown in the opinion it is held the trial court did not err in entering a judgment enforcing the contract.

J. J. B. Wigglesworth, Topeka, argued the cause, and John M. Cogswell, Denver, Colo., and Charles A. Sparks, Goodland, were with him on the brief for appellant.

Jack Burr, of Zuspann, Soward & Whalen, Goodland, argued the cause, and Selby S. Soward, Goodland, was with him on the brief for appellees.

FONTRON, Justice:

This is an action for the specific performance of a real estate contract. The court entered judgment enforcing the contract and the present appeal was taken from that judgment.

On September 20, 1969, a contract was executed for the sale of a tract of land, containing approximately 1.24 acres, abutting Highway I-70 in Sherman County, Kansas. Elizabeth Keeran, the defendant in this case, was the seller and the plaintiffs, Howard Darby, Jr., M. G. Trabue and George T. Heumann d/b/a T.D.H. Company, a partnership, were the buyers. We shall refer to the parties as plaintiffs or T.D.H. or buyers, on the one hand and as defendant or Keeran or seller, on the other hand.

The sale price was $7,000, payable as follows: $350 cash in hand, $1400 'upon approval of the merchantability of the abstract', and the balance in 10 equal annual installments of $525 each plus 7% interest.

As a part of the bargain Keeran agreed to convey the tract by warranty deed clear of encumbrances and to furnish an abstract showing a good merchantable title. The contract further provided that the buyers should have a reasonable time to examine the abstract and that the seller should then have a reasonable time to satisfy the requirements and make the title merchantable. Possession of the land was to be given when the $1400 payment was made. The deed was to be placed in escrow in a Goodland bank and was to be delivered upon full compliance with the agreement. Provision was made for proration of all taxes to date of possession and time was declared to be of the essence.

Miss Keeran executed the contract both individually and as executrix of the estate of Almeda Keeran, her mother, which was then in process of administration. We glean from the record that the defendant had inherited a one-half interest in the tract from her father, and that the other half had been willed to her by her mother.

On October 10, 1969, some twenty days after the contract was signed, a title opinion was given to T.D.H. by Charles G. Dockhorn, of Goodland, Kansas, a member of the bar of this state in good standing. The opinion pointed out that the estate of Almeda Keeran should be appraised and valued for tax purposes; that the federal estate tax and the state inheritance tax should be paid or released and the same shown on the abstract; and that the abstract should be returned for further examination.

A second title opinion was rendered on February 10, 1970, in which Mr. Dockhorn stated that the requirements made in his first letter regarding the payment of taxes had not been met and that he did not feel the title was merchantable until the federal and state taxes were determined and paid. Nothing appears to have been done so far as the abstract is concerned from that date to this.

Under date of March 9, 1970, Miss Keeran wrote the real estate agent handling the transaction inquiring what was holding up the deal. In his response, the agent advised it would be 3 or 4 months before the estate would be settled.

On July 20, 1970, the defendant, on the pretext that she was fed up with the delay, caused her Denver attorney to inform the plaintiffs that she had elected to treat the contract as a nullity because of their failure to make the $1400 payment. At this time she offered to return the $350 earnest money already paid.

Counsel for T.D.H. responded to the defendant's Denver attorney on July 23, 1970, stating that Keeran had not yet complied with the title requirements; that the plaintiffs were ready, willing and able to comply with the terms of the contract when Keeran performed as required by the contract; that T.D.H. did not consider that the contract was terminated or that Keeran had the right to terminate it unilaterally; and that T.D.H. would comply with the terms of the agreement promptly on proof that the liens were released. The letter also stated that a return tender of the $350 earnest money would not be accepted.

It appears from the record that about May 20, 1970, the defendant paid a substantial part of the federal tax due on her mother's estate and that on or about July 22, 1970, after her anticipatory breach of the agreement, she paid a balance of $2,113. The Kansas inheritance taxes were paid on or about July 29, 1970, which was also after the breach. No final determination or lien waiver was received from the internal revenue service until April 29, 1971. Neither the payments nor the waiver was made known to plaintiffs until June 14, 1971, long after this suit was filed, and no showing in regard thereto has ever been placed on the abstract so far as we can determine.

The present action asking for specific performance was commenced December 10, 1970. A motion was filed by Keeran to dismiss the petition and the same was overruled. On June 14, 1971, at a pretrial hearing, summary judgment was entered in plaintiff's favor for the enforcement of the contract.

For her first point, the defendant contends it was improper for the trial court to enter summary judgment at a pretrial hearing when no motion therefor had been made. We find no merit in this contention. Miss Keeran states in her brief that 'Both parties have expressly or impliedly agreed from the outset that there were no genuine issues of fact' and we agree with this assessment of the record.

Under the provisions of K.S.A. 60-256 the trial court is authorized to enter summary judgment when there is no genuine issue of material fact. (Brick v. City of Wichita, 195 Kan. 206, 403 P.2d 964; Evans v. Lynch, 200 Kan. 331, 333, 436 P.2d 867; Harter v. Kuntz, 207 Kan. 338, 341, 485 P.2d 190.) We have also held that the trial court may enter summary judgment on its own motion even though no motion therefor has been made by either litigant. (Green v. Kaesler-Allen Lumber Co., 197 Kan. 788, 789, 420 P.2d 1019; Knapp v. Unified School District, 209 Kan. 237, 240, 496 P.2d 1400.) Assuming that the plaintiffs were entitled to judgment in this case as a matter of law, the trial court was correct in entering judgment on its own motion. We shall therefore proceed to consider the merits of this case.

This is a simple contract for the sale of real estate. It is a plain and unambiguous contract whose language is neither doubtful nor obscure. The words are to be given their plain, general and common meaning (United States v. Kansas Gas and Electric Company, D.C., 215 F.Supp. 532) and the contract is subject to enforcement according to its terms. (Hazelton v. Chaffin, 109 Kan. 175, 197 P. 870.)

By the express terms of the contract, the seller was to furnish an abstract showing merchantable title. The buyers were to pay the purchase price in installments. The second payment was due on approval of merchantable title. The seller refused to furnish an abstract showing merchantable title. Under these circumstances we believe the remedy of specific performance is available.

On July 20, 1970, Keeran informed T.D.H. she would no longer be bound by her contract, and she has...