Dlug v. Wooldridge
| Decision Date | 21 July 1975 |
| Docket Number | No. C--549,C--549 |
| Citation | 538 P.2d 883,189 Colo. 164 |
| Parties | Leon J. DLUG and Patricia L. Dlug, Petitioners, v. Charles O. WOOLDRIDGE, Respondent. |
| Court | Colorado Supreme Court |
Sonheim & Helm, Dale H. Helm, Arvada, for petitioners.
Stitt, Wittenbrink & Roan, P.C., R. J. Wittenbrink, Denver, for respondent.
Certiorari was granted by this court for purposes of reviewing the Court of Appeals' decision in Dlug v. Wooldridge, 34 Colo.App. 186, 525 P.2d 1185 (1974).
On September 8, 1969, the petitioners, Leon J. and Patricia L. Dlug (purchasers), and the respondent, Charles O. Wooldridge (seller), entered into a written contract for the purchase and sale of unimproved mountain property for the sum of $14,500. The subject property was described in the contract as '(t)hat portion of land in the NW 1/4 of the NE 1/4 of Section 20, T. 6 S., R. 70 W. of the 6th P.M. consisting of 26.5 acres, more or less . . ..' Although the contract originally contained a provision requiring the respondent to provide a survey of the property, this provision, at the time of execution, was deleted at the respondent's insistence and with petitioners' consent. At the time the contract was entered into, the petitioners executed a promissory note to the order of the realtor as an 'earnest money deposit on 26.5 acres . . ..'
On October 2, 1969, the respondent conveyed the subject property to the petitioners by a warranty deed. The warranty deed's description of the property (identical to the contract) was based on the Oehlmann Park map, but omitted the reference to the quantity of the acreage being conveyed. A subsequent survey determined that instead of 26.5 acres, the subject property contained 16.5 acres. This discrepancy resulted from the fact that in platting Oehlmann Park in 1923, the NW 1/4 corner of section 20 had been mistakenly moved approximately 300 feet west of the point it had been located in the original United States survey of 1873.
The petitioners commenced this action seeking an abatement of the purchase price for the shortage of approximately ten acres. Trial was to the court. The court found, as a matter of fact, that the parties had been mutually mistaken as to the quantity of acreage contained in the subject property, both believing that the property contained 26.5 acres. The court also found that the property had been purchased on a Per-acre basis of $547.19 per acre, rather than 'in gross,' and that under the equitable doctrine of unjust enrichment, the petitioners were entitled to an abatement of the purchase price in the amount of $5,471.90.
One further fact is material to the equities involved in this case. The abatement ordered by the trial court resulted in the respondent losing in excess of $3,000, he having purchased the tract as containing 26.5 acres for $12,500 two years previously.
On appeal, the Court of Appeals, in a two to one decision, concluded that where The Court of Appeals concluded that rescission was the proper remedy under the circumstances of the case. However, the Court of Appeals went on to hold that
'since (the) buyers object to granting rescission in connection with this appeal, See Berryman v. Berryman, 115 Colo. 281, 172 P.2d 446, the judgment is reversed and the cause remanded with directions to the trial court to dismiss the buyers' complaint.'
This holding had the effect of recognizing the inequity of the contract to both parties, but leaving the petitioners with a bargain they would not have made in the first instance had they known of the sellers' inability to deliver the quantity of land stated in the various preliminary documents.
We agree, under the circumstances appearing here, that rescission is the proper remedy, but we do not concur in the Court of Appeals' direction to the trial court to dismiss the petitioners' complaint. On appeal, the petitioners, not surprisingly, argued for the affirmance of the judgment of the trial court. The mere assertion of the correctness of 'abatement' as the proper remedy was not tantamount to demanding abatement or nothing. The petitioners did not lose their entitlement to rescission by insisting on the correctness of the trial court judgment.
I.
This appeal presents no material issues of fact. Very simply, both parties acted upon a mutual mistake of substantial proporations as to the quantity of land involved in the subject transaction. The only issue before us today concerns the proper remedy to be afforded under the circumstances of this case.
Although the Court of Appeals recognized that rescission was the proper remedy, the petitioners were denied the right to their bargain even though it may now be more appropriate than rescission. In our opinion, the petitioners should have been provided the opportunity to choose between the alternatives of (1) rescission or (2) retention of the original contract.
The respective decisions of both the trial and appellate courts were the result of their resolution of the question whether the parties' contract was one for the sale of land 'in gross' or 'by the acre.' While we recognize the utility of this dichotomy, it is axiomatic that in the realm of equity, no formulation is absolute and no rule is without exception.
This court, in Barth v. Deuel, 11 Colo. 494, 19 P. 471 (1888), announced the general rule applicable in this type of situation, stating:
'Equitable relief will be granted in cases of mistake when the fact concerning which the mistake is made is material to the transaction, affecting its substance and not merely its incidents, and the mistake itself is so important that is determines the conduct of the mistaken parties.'
In the Barth case the court pointed out that one of the circumstances to be considered is that the mistake related to a material fact, which constituted the only basis for the payment by plaintiff to defendant of the money sought to be recovered back. We adhered to this judicial philosophy in Tilbury v. Osmundson, 143 Colo. 12, 352 P.2d 102 (1960).
Here the parties were mutually mistaken as to the amount of land which was the subject of their...
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