Flynn v. Wallace

• Decision Date: 23 June 1971
• Parties: Joseph F. FLYNN. v. Monte J. WALLACE et al., trustees.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 919

270 N.E.2d 919

359 Mass. 711

Joseph F. FLYNN. v. Monte J. WALLACE et al., trustees.

Supreme Judicial Court of Massachusetts, Plymouth.

Argued April 7, 1971.

Decided June 23, 1971.

Herbert P. Wilkins, Boston (Reginald H. Howe, Boston, with him), for defendants.

James P. Lynch, Jr., Boston (Henry G. Stewart, Boston, with him), for plaintiff.

Before TAURO, C.J., and SPIEGEL, REARDON, QUIRICO and BRAUCHER, JJ.

TAURO, Chief Justice.

This is an appeal by the defendants Monte J. Wallace and Neil W. Wallace, trustees of the Arlington Trust, from a final decree of the Superior Court ordering the conveyance of certain land to the plaintiff.

The facts as found by the trial judge are summarized. On December 18, 1965, Joseph F. Flynn entered into a purchase and sale agreement with the Prosperity Development Corporation of Braintree, Massachusetts, to purchase for $120,000 a 438 acre tract of undeveloped land situated in the towns of Braintree, Holbrook and Weymouth. ¹ The agreement recited that '(s)aid land is to be conveyed on or before February 15, 1966, by a good and sufficient quitclaim deed.' At all times Flynn was acting as agent and nominee for one Ralph Tedeschi. Of the purchase price, $5,000 was to be paid as a deposit, leaving the balance due to be paid in cash upon delivery of the deed. After Joseph A. Della Valle, president of Prosperity, had signed the agreement on behalf of Prosperity, an internal dispute arose among the stockholders of Prosperity as to corporate control and as to the authority of Della Valle. This issue was resolved at a stockholders' meeting on February 23, 1966, when the purchase and sale agreement between Flynn and Prosperity was ratified.

On February 15, 1966, the agreement was extended in writing: '* * * on the same terms and conditions up to and including March 15, 1966.' On March 11, 1966, the agreement was extended 'up to and including' March 22, 1966, on payment of an additional deposit of $5,000 on or before March 15, 1966. During this time, Flynn had encountered difficulty in tracing the chain of title for the land and, at the suggestion of Prosperity's counsel, Mr. Lane, he engaged Gale Engineering Company to prepare a plan of the locus. Mr. Lane agreed that in preparing the deed he would 'work up' a description of the property from the plan prepared by Gale. This plan was completed by Gale on March 25 or 26 and was delivered by Flynn to Mr. Lane's office on the same day. At that time Flynn and Mr. Lane discussed the preparation of the deed.

On March 25, 1966, Della Valle called Mr. Lane and said he wanted the second $5,000 deposit, which was mentioned in the extension to the purchase and sale agreement. By prearrangement a check for this sum was delivered to Mr. Lane on March 25 and he, in turn, sent it to Della Valle in Florida, where it was deposited to the account of Prosperity on March 28, 1966. No prior demand for this payment had been made. Mr. Lane completed the deed on April 25 and mailed it to Della Valle in Florida on April 26. On April 28, Prosperity, by formal vote, authorized execution of the deed to Flynn. About this time Mr. Lane received information concerning a 'possible third-party sale' from one Dodd, a real estate broker who had offices in Ohio and Florida. At that time Mr. Lane informed Dodd of the impending sale to Tedeschi. The land was subsequently sold to Arlington Trust, acting through its two cotrustees, defendants in this suit, for the sum of $160,000.

The final page of the deed executed by Prosperity to Arlington contained the typewritten words 'April, 1966,' indicating that the deed had been prepared for conveyance of the locus to a grantee in April, 1966. The closing was held at 7 A.M. on May 6, 1966, at the offices of Arlington in Boston and the deed was recorded in the registry of deeds at Dedham at 9:45 A.M. that same morning.

The judge made certain findings and rulings which were later adopted as the statutory report of material facts. See G.L. c. 214, § 23. In his report, the judge found and ruled that, inter alia, the plaintiff was ready, able and willing to purchase the land from Prosperity in accordance with the terms of their agreement, as extended by mutual consent; that Prosperity violated its agreement to sell the locus to the plaintiff; and that the defendants, the trustees of the Arlington Trust, were not bona fide purchasers, having had either knowledge of the existence of a valid and enforceable agreement between the plaintiff and Prosperity concerning the land, or knowledge of an outstanding claim of right in conflict with their proposed acquisition. A final decree was entered ordering the defendants to execute a conveyance of the land to the plaintiff upon payment of $110,000, the remainder of the purchase price specified in his contract with Prosperity, from which decree the defendants appealed. The evidence is reported.

Three principal issues are presented for determination: (1) whether there existed a valid contract between Flynn and Prosperity at the time of the conveyance to Arlington; (2) whether Arlington was a bona fide purchaser of the locus and as such entitled to retain the property; and (3) which party should pay the real estate taxes from 1966 onward should the judge's decree for conveyance be upheld. They will be treated sequentially.

1. The defendants claim that Flynn's failure to pay the second deposit of $5,000 on March 15 as stipulated in the extension to the purchase and sale agreement constituted a breach of the agreement and rendered any subsequent oral extension of the agreement inoperative as within the statute of frauds.

Mr. Lane, however, did not request the $5,000 deposit before March 15 or March 22. The judge found and ruled on these facts that 'the time for payment was waived by Prosperity since it accepted, without any reservation, and deposited a check from * * * Tedeschi in said sum ($5,000) after the date specified in the extension addendum.' The judge further found that the parties had waived the date for passing papers until such time as the preliminaries mutually agreed upon by the parties had been completed, namely, '(a) the completion by Gale Engineering Company of engineering work and preparation of a plan for the locus; (b) the completion of the deed by Lane (to be 'worked up' by him from the engineering plan); and (c) the execution and return to Lane of the deed to be signed by Mr. Della Valle in behalf of Prosperity.'

The parties to an agreement may agree upon a time for passing papers different from that provided in the agreement. Johnson v. Kelley, 342 Mass. 724, 726, 175 N.E.2d 391. Mutual agreement on a new date for performance can be inferred from the conduct of the parties and from the attendant circumstances. See Grant v. Carlisle, 328 Mass. 25, 29, 101 N.E.2d 376; W. A. Snow Iron Works, Inc. v. Chadwick, 227 Mass. 382, 390, 116 N.E. 801. The modified time and manner of performance is a question of fact. Moskow v. Burke, 255 Mass. 563, 566--567, 152 N.E. 321. Porter v. Harrington, 262 Mass. 203, 208, 159 N.E. 530.

Here, the agreement contained no provision that time was of the essence. It was extended twice, at least in part due to the inability of Prosperity to comply with the terms of the original agreement because of questions concerning corporate control. At no time did Mr. Lane choose to test the plaintiff's ability and willingness to perform by tendering the deed and demanding payment. There was evidence that Flynn was ready, willing, and able to tender the purchase money at the time set for performance. Ability and readiness to perform according to the terms of the provisions of the purchase and sale agreement are sufficient, without actual tender of the purchase price. Marlowe v. O'Brien, 321 Mass. 384, 73 N.E.2d 589. In order to put the purchaser in default, it is normally required that the vendor tender a proper conveyance on the date set for performance. Welch v. Matthews, 98 Mass. 131. Manifestly, this was not done here.

In Gentile Bros. Corp. v. Rowena Homes, Inc., 352 Mass. 584, 589--590, 227 N.E.2d 338, 342, we stated: 'Nowhere does it appear that either party * * * intended that the failure to pass papers on June 5 should spell the end of the agreement. Rather, the conversations * * * prior to June 5 show that the parties intended that the agreement should be carried out at a later date. * * * There was an effective waiver of the provision.' In Porter v. Harrington, 262 Mass. 203, 207, 208, 159 N.E. 530, 531, we stated: 'Waiver may be manifested by acts as well as by words. * * * It is difficult to frame a contract so as to foreclose the operation in equity of the doctrine of waiver in order to prevent an injustice.' We cannot say 'that the findings made by the judge who saw the witnesses and heard them testify is plainly wrong.' Berman v. Coakley, 257 Mass. 159, 162, 153 N.E. 463, 465. Barnum v. Fay, 320 Mass. 177, 69 N.E.2d 470. Willett v. Willett, 333 Mass. 323, 130 N.E.2d 582. In the instant case conduct of the parties indicated a clear intention that the original agreement was to be consummated within a reasonable time.

On the basis of all the facts it seems clear that the manifest intention of the parties as evidenced by their communications and their conduct was that the date for passing papers was dependent on the preparation of a plan by Gale in order that a proper description for a deed could be drawn by Mr. Lane as counsel for Prosperity. At all times the plaintiff was able, ready and willing to consummate the deal when a deed was ready. The additional $5,000 payment due on March 15 was never considered by the parties as a condition to the continuing validity of the contract. The judge's finding that payment of the $5,000 by the plaintiff on April 28 and its acceptance by Prosperity ratified an extension of the agreement does not preclude a further finding that the initial written agreement was nonetheless in full...