Ford v. Hofer

• Decision Date: 19 October 1961
• Docket Number: No. 9854,9854
• Citation: 111 N.W.2d 214,79 S.D. 257
• Parties: Orville F. FORD, and Ida C. Ford, his wife, Plaintiffs and Appellants, v. Jacob G. HOFER, and Pauline Hofer, his wife, Arthur Quenzer and Katherine Quenzer, Gottlieb Schaffer, Edwin Beck and Albert G. Beck, Defendants and Respondents.
• Court: South Dakota Supreme Court

Page 214

111 N.W.2d 214

79 S.D. 257

Orville F. FORD, and Ida C. Ford, his wife, Plaintiffs and Appellants, v. Jacob G. HOFER, and Pauline Hofer, his wife, Arthur Quenzer and Katherine Quenzer, Gottlieb Schaffer, Edwin Beck and Albert G. Beck, Defendants and Respondents.

No. 9854.

Supreme Court of South Dakota.

Oct. 19, 1961.

W. M. Potts, Mobridge, for plaintiffs and appellants.

Homeyer & Robbins, Selby, for Jacob G. Hofer, and Pauline Hofer, defendants and respondents.

Erwin L. Wiest, Herreid, for Arthur Quenzer, Gottlieb Schaffer, Edwin Beck, and Albert G. Beck, defendants and respondents.

BIEGELMEIER, Judge.

On October 1, 1954, defendants Jacob G. Hofer and his wife, vendors, entered into a written contract for deed with plaintiffs, Orville F. Ford and Ida C. Ford, his wife vendees, for 560 acres of Campbell County land. The purchase price was $11,200 of which $1,200 was the down payment and the balance of $10,000 principal was to be paid $500 on October 1, 1955, and a like sum on each October 1st thereafter for twenty years with interest. The contract was on a printed form containing terms similar to those in Speer v. Phillips, 24 S.D. 257, 123 N.W. 722. The Fords who were tenants on the land continued to occupy and farm it until the fall of 1957, when they moved to a nearby town so the children, as Mrs. Ford explained, could go to school there; she further testified that it was their intention to go back and farm the land in the spring of 1958. Mr. Ford accepted employment in a garage there in the fall of 1957. The dates and amounts of some of the payments are in dispute; it is undisputed that when on October 1, 1955, payments of $500 of the principal and $400 interest were due, Ford paid $100 in cash and gave a note and chattel mortgage to Mr. Hofer for the balance of $800; two payments of $100, one of $75 and another of $300 were made by the fall of 1956 and in July 1957 a further payment of $531.26. Hofer testified that he applied this $1,206.26 all on the interest, which paid all of the interest in arrears and in advance to October 1, 1957; that fall he told Ford that he expected one payment on the principal and 'the taxes and the insurance had to be paid up'; and 'they (these payments) could have been made anytime'. After this conversation Mr. Ford paid Hofer $200 evidenced by a check of Ford's father cashed October 28, 1957. No time was set for payment of the $300 balance of this one principal. On December 21, 1957, Ford had a farm auction sale of most of his personal property. Hofers had consulted a lawyer and on December 11, 1957, executed a Declaration of Forfeiture addressed to Orville F. Ford and Ida C. Ford, which stated the land contract 'is hereby declared forfeited by reason of default in the payments therein * * * that the undersigned are the sole owners of the title to said lands * * *' which they recorded in the Register of Deeds office on December 18, 1957. No copy of this Declaration of Forfeiture or notice of its recording was ever served on either of the Fords. On December 16, Hofer released the chattel mortgage of record and on the 27th gave Mr. Ford a check for $200 marked Refund on land payment.

Between March 10 and 19, 1958, Hofer made efforts to sell the land to others and later in March 1958 he sold it in separate tracts to four different buyers for $15,270.

On August 28, 1958, plaintiffs commenced this action naming Hofers and the purchasers as defendants. Plaintiffs' pleadings prayed the court determine the amount due on the contract and other equitable relief. The answer of the Hofers was a general denial and a defense denominated a cross claim. An amended answer of the other defendants was a general denial with the further allegation that they purchased the property in good faith without notice of any claims of the plaintiffs therein.

The trial court's findings follow the facts above set out, were generally favorable to the defendants. A judgment quieting title in Hofers subject to the rights of the later purchasers and dismissing the plaintiffs' complaint followed.

Whether the Fords as vendees abandoned the contract for deed with the Hofers as vendors is decisive of the appeal.

Defendants contend that plaintiffs by accepting the note and cancellation of chattel mortgage and by accepting repayment of $200, plaintiffs knew that the contract had been cancelled, abandoned their rights under the contract and are estopped from asserting any rights in the property. As the elements of estoppel are not present, Lambert v. Bradley, 73 S.D. 316, 42 N.W.2d 606, the claim of abandonment remains to be considered.

The acts of the parties to a written contract for deed in order to constitute abandonment must be positive, unequivocal and inconsistent with the continuance of the contract. Golden v. Cornett, 154 Ky. 438, 157 S.W. 1076; Douglass v. Brooks, 242 N.C. 178, 87 S.E.2d 258; Mood v. Methodist Episcopal Church South, Tex.Civ.App., 289 S.W. 461; Sammons v. Hodges, Tex.Civ.App., 95 S.W.2d 734; Linscomb v. Goodyear Tire & Rubber Co., 8 Cir., 199 F.2d 431. In Ely v. Jones, 101 Kan. 572, 168 P. 1102, the Supreme Court of Kansas, referring to a well-known text writer quoted with approval as follows:

'In 2 Warvelle on Vendors (2d Ed.,) Sec. 826, it is said:

"It has been held in some of the earlier cases that an agreement to rescind is as much an agreement concerning land as the original contract, and hence should be in writing; but all the later cases, both in England and the United States, are unanimous in affirming that a contract in writing, and by law required to be in writing, may in equity be rescinded by parol, and this even though the contract may have been under seal. Such rescission may be effected, not only by an express agreement, but by any course of conduct clearly indicating a mutual assent to the termination or abandonment of the contract. It may consist either of words or acts, and all the circumstances attending the transaction may be shown to prove intention; but if evidenced by acts alone they must be such as leave no doubt as to such intention."

Accord: Gaido v. Tysdal, 68 Wyo. 490, 235 P.2d 741; where abandonment is relied upon, some of the courts require that a clear intention to abandon be shown. Kennedy v. Neil, 333 Ill. 629, 165 N.E. 148; Fulton v. Chase, 240 Iowa 771, 37 N.W.2d 920; Collins v. Collins, 348 Mich. 320, 83 N.W.2d 213, 68 A.L.R.2d 575. It may be the courts have adopted this standard because abandonment of a contract by a vendee has the same result as a forfeiture. They are referred to and regarded with disfavor in the same terms. 'Abandonments and forfeitures are abhorrent to the law and all intendments are against them', Stockmen's Supply Co. v. Jenne, 72 Idaho 57, 237 P.2d 613, 617, where the court held the evidence of abandonment of the written contract was insufficient to counteract the requirement of notice to forfeit it. Cf. Carr v. Troutman, 125 Ind.App. 151, 123 N.E.2d 243.

Forfeitures are considered as odious in the law, Barnes v. Clement, 12 S.D. 270, 81 N.W. 301, and are not favored by the courts. Courts of equity will seize upon slight circumstances to relieve a party therefrom. Pier v. Lee, 14 S.D. 600, 86 N.W. 642. This court has said abandonment of a water right results from a concurrence of an intention to surrender and the actual relinquishment thereof. While conduct may support an inference of an intention to abandon a property right, it should not be lightly implied. Cundy v. Weber, 68 S.D. 214, 300 N.W. 17. The trial court's finding of abandonment is to be viewed in the light of these principles. The finding is Hofer's December 27, 1957 check of $200 to Orville F. Ford was received with the knowledge that Hofer had declared the contract forfeited and at that time plaintiffs had abandoned all interest in the property. The evidence does not sustain this finding. Plaintiffs were then delinquent in making some payments required under the contract, yet they had paid all interest due and Hofer had extended the time of payment of the principal installments, thus waiving strict compliance thereof as the trial court found. The fact Fords moved to Herreid and abandoned the 'premises' as alleged in the answer, was not an allegation of abandonment of the 'contract' nor were their efforts to sell. In Floren v. Larson, 29 S.D. 63, 135 N.W. 672, 674, this court stated: 'But evidence tending to prove that he (buyer) intended to sell his interest in the land and had bought land in Minnesota did not prove, or tend to prove, an abandonment of the contract * * *, or an intent on his part not to comply with the conditions of said contract.' As there indicated, plaintiffs had the right to live on and farm the property, but no obligation to do so, and the right to sell and dispose of it or their personal property for their own best interests. Another indication of their intentions was that on October 28, over a month after the move, Fords paid Hofers $200 on the principal sum. Neither was Hofer's return of the $200 by his check to Mr. Ford on December 27, 1957, sufficient to show abandonment. It does not appear and is perhaps immaterial why Hofer returned it after having filed the Declaration of Forfeiture. It is not claimed that Mr. Ford said anything or received it as consideration for a release of the contract. He could assume that Hofers would proceed to enforce the contract, if they desired, by the rather speedy remedy of strict foreclosure or other appropriate action to determine the amount due and require payment of the balance due or vest title of the property in them and was returning the money with that in mind. This refund was not made to Mrs. Hofer and she did not know of it until a week later; she referred to it as not paid back but given or 'fired back' as part of a mixup on the farm deal that was hard to understand. Her reference to her husband doing the dealing was about the subject of getting money from his ...