Dolan v. Hudson, 10416

• Citation: 83 S.D. 144,156 N.W.2d 78
• Decision Date: 30 January 1968
• Docket Number: No. 10416,10416
• Court: Supreme Court of South Dakota
• Parties: Raymond B. DOLAN and M. Theresa Dolan, Plaintiffs and Respondents, v. Douglas M. HUDSON and Arlene E. Hudson, Defendants and Appellants. Douglas M. HUDSON and Arlene E. Hudson, Cross-Complainants and Appellants, v. Raymond B. DOLAN, M. Theresa Dolan and Pfeifer-Drake & Dodge Company, Defendants under the Cross-Complaint and Respondents.

Page 78

156 N.W.2d 78

83 S.D. 144

Raymond B. DOLAN and M. Theresa Dolan, Plaintiffs and Respondents, v. Douglas M. HUDSON and Arlene E. Hudson, Defendants and Appellants.

Douglas M. HUDSON and Arlene E. Hudson, Cross-Complainants and Appellants, v. Raymond B. DOLAN, M. Theresa Dolan and Pfeifer-Drake & Dodge

Company, Defendants under the Cross-Complaint and

Respondents.

No. 10416.

Supreme Court of South Dakota.

Jan. 30, 1968.

Rehearing Granted April 11, 1968.

Jones & Matthews, E. G. Jones, Sioux Falls, for defendants and appellants.

May, Boe & Johnson, Sioux Falls, for plaintiffs and respondents.

HANSON, Presiding Judge.

Plaintiffs, Raymond B. Dolan and wife, as owners and sellers brought this action for specific performance of a contract to sell residential property against Douglas M. Hudson and wife, defendants and buyers. Defendants answered alleging principally that the purchase agreement was not specifically enforceable because: Their assent was given under a mistake of fact; their assent was obtained by unfair practice; the purchase agreement is ambiguous; plaintiffs have not performed their undertakings under the purchase agreement; and title insurance tendered was not performance. By cross complaint defendants also sought recovery of $1,000 paid down under the purchase agreement from the plaintiffs and their realtor, Pfeifer-Drake & Dodge Company.

Trial to the court resulted in entry of an interlocutory judgment in favor of plaintiffs decreeing specific performance of the contract with a direction to sell the property at execution sale if defendants failed or refused to pay the purchase price within the time prescribed. Defendants failed to pay and demanded sale of the property. It was sold to a third party. The sale was confirmed and a deficiency judgment entered in favor of plaintiffs in the amount of $18,059.93. Defendants appeal from both the interlocutory and deficiency judgments alleging fifty-two assignments of error.

The equitable remedy of specific performance is always addressed to the sound discretion of the court to be granted or denied according to the facts and circumstances in each instance. Vermeulen v. Meyer, 238 Iowa 1033, 29 N.W.2d 232. The ultimate issue in this case, therefore, is whether or not the trial court abused its discretion in granting specific performance of the contract of sale. Renner v. Crisman, 80 S.D. 532, 127 N.W.2d 717. In reviewing the evidence for this purpose we 'must accept that version of the evidence, including the inferences which can be fairly drawn therefrom, which is favorable to the trial court's action. This is so because it is for the trial court to select the testimony and draw the inferences which he relies on. Because his participation in the trial reveals to him many things that are helpful and sometimes essential in deciding fact issues, it is presumed that his findings are correct. Consequently, we are not free to disturb them unless satisfied that they are contrary to a clear preponderance of the evidence.' Beatty v. Depue, 78 S.D. 395, 103 N.W.2d 187, 1 A.L.R.3d 531. The findings in this case are further fortified by a view of the premises and area involved by the trial court. Although not evidence, a view does afford the trier of facts a means of more satisfactorily understanding and evaluating the record evidence and we must assume this view 'was of some value in assisting the judge to determine the issues of fact.' Weidmeier v. Edelman, 75 S.D. 29, 58 N.W.2d 306.

In summary, it appears that plaintiff, Raymond B. Dolan, came to Sioux Falls, South Dakota in 1963 as Agency Manager for the Equitable Life Assurance Society. Upon arrival he purchased a suburban home in Cactus Heights, a development located a few miles northeast of Sioux Falls in a hilly wooded area. This development is located in Sioux Falls Township on the North Half of the Southwest Quarter of Section 12, Minnehaha County and includes a golf course and a club house occupied by the Sioux Falls American Legion Post. The plat of the area contains lots and streets designated as Fairway Place, Fairway Drive, and Cactus Drive. For the purpose of keeping the area desirable and uniform the owners filed a Declaration of Restrictions in the nature of covenants running with the land containing limitations and restrictions on the use of the lots and tracts within the development such as a restriction against using, improving, or occupying lots except for private one-family residence purposes.

The Dolan property faces east and abuts on Fairway Place. It consists of Lot 4 and the Northeasterly 36 Feet of Lot 5 in Block 1 of Cactus Heights with easements relating to a well and easements of ingress and egress over and upon Fairway Place, Fairway Drive, Cactus Drive, and the South 66 Feet of the N 1/2 of the S.W. 1/4 of Section 2, Township 101, Range 49. The latter easement describes an access road to Cactus Heights from U.S. Highway 16. From the south end of Cactus Drive it extends west for about 1/2 mile and then south 1/4 mile on a township road. This road runs along side the golf course and conforms to the hilly terrain it traverses. It was referred to as the 'legal', 'scenic', or 'roller coaster' road. Another access route called the McLiman road runs about 1/4 mile straight south to Highway 16. Both roads were constructed, graveled, maintained and are kept open in the winter by the Cactus Heights developer. The McLiman road, however, is not appurtenant to the Cactus Heights property and is located on land belonging to Mr. R. L. McLiman. It leads directly to the American Legion Club House and carries the bulk of that traffic. There are utility poles and wires located on one side of the road. It has been used as a road since 1958 by permission and under a rental agreement cancelable at the end of any year after 1963. Mr. McLiman claims the right to stop the use of this road by the public and residents of Cactus Heights at any time, but has no present intention of doing so. Although the McLiman road provides a shorter route to Highway 16 the other access road comes out on Highway 16 one half mile closer to Sioux Falls so the distance from Cactus Heights to the City of Sioux Falls is approximately the same over either route.

In October 1965 Dolan was notified of his transfer to the home office of his company so he listed his home for sale with the Sioux Falls Multiple Listing Service. This is an association of realtors whereby one listing constitutes a listing with all. The cross complainant defendant. Pfeifer, Drake & Dodge Company, is a member and W. J. Comstock is one of their agents. Comstock was a long time friend of defendants, Douglas Hudson and his wife, who owned and resided in a home at 2222 South Main in Sioux Falls. Mr. Hudson was General Agent for the Paul Revere Life Insurance Company in South Dakota. When the Dolan residence came on the market Comstock contacted the Hudsons and arranged for an inspection. He took them out on Tuesday, October 19, 1965. Both Mr. and Mrs. Dolan were at home and took the Hudsons on a tour of the house. This was the first time Comstock met the Dolans. The next day the Hudsons again inspected the house by themselves. The day following they made another trip out with Mr. Comstock. In addition the Hudsons drove out to Cactus Heights several times that week by themselves.

The Dolans listed their home for sale for $52,500. On Saturday, October 23, 1965 there were some preliminary negotiations handled by Comstock whereby the Hudsons offered to trade in their home as part of the purchase price. The Dolans refused the trade offer, but reduced their asking price to $47,500. This offer was accepted by the Hudsons on the following day which was Sunday, October 24, 1965, by the preparation and execution of a Real Estate Purchase Agreement. The Agreement was prepared by Mr. Comstock at his home in the presence of Mr. and Mrs. Hudson. Comstock went over the terms of the contract with the Hudsons before they signed. Afterwards it was accepted and signed by the Dolans.

The Purchase Agreement provided the closing date of the sale and possession was to be given on January 15, 1966 or as agreed with the buyers' option of an earlier closing date. After agreeing to purchase the Dolan residence the Hudsons then offered their Sioux Falls home for sale. However, they were apparently unable to find a buyer prior to January 15, 1966.

The Hudsons did not elect to have the sale closed early so the Dolans waited until after the close of the year to have the abstract continued. On January 6, 1966 the abstract was delivered to the First National Bank of Sioux Falls where the Hudsons expected to make a loan. The bank had the abstract examined by attorney E. G. Jones. His opinion was rendered on January 11th, finding title of the premises to be in the Dolans, as joint tenants, subject to some exceptions and objections requiring correction. Significantly the opinion did not find the title to be unmerchantable in any particular.

After the attorney's opinion was rendered Mr. Hudson conferred with Tom Barron and Orville Bonacker, both Vice Presidents of the First National Bank. Barron testified he advised Hudson the bank was not in a position to make a loan on the property chiefly because of lack of direct access to Highway 16 over the McLiman road as pointed out in the attorney's opinion. However, Mr. Bonacker told Hudson the exceptions to the Dolan title would have to be corrected before a loan could be made. Time to make these corrections was requested of and refused by Hudsons' attorney.

On January 14 the Abstract together with an affidavit, Release of Lease, and Release of Easement were delivered to the Getty Abstract Company and a policy of title insurance was procured. Sometime prior the Dolans had moved out and vacated the premises. They had purchased a new home in Connecticut. On the day of closing the sale, plaintiffs tendered a warranty deed to the...