Freeman v. Lawton

• Decision Date: 25 March 1946
• Citation: 353 Pa. 613,46 A.2d 205
• Parties: Freeman v. Lawton, Appellant
• Court: Pennsylvania Supreme Court

46 A.2d 205

353 Pa. 613

Freeman v. Lawton, Appellant

Supreme Court of Pennsylvania

March 25, 1946

Argued January 7, 1946

Appeal, No. 1, Jan. T., 1946, from judgment of C.P., Delaware Co., Sept. T., 1942, No. 206, in case of A. Freeman v. Walter Lawton. Judgment reversed.

Assumpsit. Before ERVIN, J., without a jury.

Findings and judgment for plaintiff. Defendant appealed.

Judgment reversed and here entered for defendant.

Guy W. Davis , for appellant.

Louis A. Bloom , with him Milton M. Bennett and Albert Blumberg , for appellee.

Before MAXEY, C.J., DREW, LINN, STERN, PATTERSON and STEARNE, JJ.

OPINION

MR. JUSTICE LINN

Defendant appeals from judgment for plaintiff in a trial by a judge without a jury. The plaintiff declared on a promissory note in the sum of $4,000 dated August 4, 1925, at Miami, Florida for payment in that city in thirty-six equal monthly installments, with interest, the first due September 4, 1925. The payee was the Commercial Bank and Trust Company, Trustee of Miami. The note was part of the consideration for a written agreement by which the payee agreed to convey to the defendant certain land in Florida; in this instrument defendant agreed to pay the sum of $5,000, of which $1,000 was to be paid in cash and the balance "evidence by one note of the said [defendant] of even date herewith..." in thirty-six equal monthly installments at the time specified in the note. Paragraphs 7 and 9 of the agreement provided: "7. It is further agreed that if default shall be made by the Vendee as to any of the payments above set forth, time being hereby made an essential part hereof, or if the Vendee shall breach any of these covenants as set forth in this agreement, and such default or breach shall continue for the space of 30 days, then and in that event all payments heretofore made upon said property by the Vendee shall be forfeited and the same may be retained by the Vendor as liquidated damages, and the Vendor shall be entitled to re-enter and take possession of the said premises as of its former estate without let, suit or hindrance on the part of the Vendee and the Vendee hereby waives any and all right of notice as to such default or breach and agrees that at the expiration of the period above named Vendee shall be deemed and held to have abandoned the said property and this contract shall be deemed cancelled and terminated."

"9. It is further agreed that the Vendee takes no title by this contract and acquires no interest or estate in said lands, whether of freehold or otherwise, until after the delivery of the deed of conveyance and until such time the title to said lands, in fee simple, is retained in the Vendor."

The note and the agreement were under seal. The defendant made the down payment of $1,000 and paid four installments aggregating $444.48 on account of principal and $102.22 on account of interest. The note matured August 4, 1928; after maturity it was transferred by the payee to A. Freeman, the plaintiff, subject to defenses good against the payee. Plaintiff tendered a deed on August 21, 1942.

The learned judge properly held that the note and the agreement must be considered as a single contract: compare Sprenger v. Litten , 142 Pa.Super. 194, 15 A.2d 527. The suit is for the recovery of the purchase price of real estate. Such a suit is in the nature of an equitable proceeding for specific performance and is governed by the same equitable principles applied to such suits in chancery. In Heights Land Co. v. Swengel's Estate , 319 Pa. 298, 300, 179 A. 431, we said, "... if either party wishes to enforce the contract, he must move to do so without unreasonable delay after the time for completed performance of the contract has passed; if he is guilty of lack of due diligence in failing to institute or prosecute his proceeding, the equitable doctrine of laches will apply: DuBois v. Baum, 46 Pa. 537; Kutz's Estate, 259 Pa. 548; Fidelity-Phila. Trust Co. v. Simpson, 293 Pa. 557, 585. These well-settled principles are conclusively determinative of the instant case."

Paragraph 7 of the contract, containing the forfeiture provision provided that the "vendee shall be deemed and held to have abandoned the said property and this contract shall be deemed cancelled and terminated." Mere default in payment of installments did not of itself constitute cancellation, though furnishing cause for such action; to produce that result express or implied assent of the vendor was necessary. The legal effect of the provision was to grant an option to the vendor to cancel and terminate the contract: Cochran v. Pew , 159 Pa. 184, 28 A. 219; Cape May Real Estate Co. v. Henderson , 231 Pa. 82, 79 A. 982, and the cases on the subject cited in those opinions. It is unnecessary to consider the exact date on which, by words or conduct, the vendor may be said to have terminated the contract or abandoned his rights under it. The plaintiff, having taken the note after maturity, is in the same position in which the vendor would have been if it had brought the suit.

As the suit is for specific performance and subject to equitable defenses, we next inquire whether equity will enforce this contract 16 years after the first default and 14 years after the last payment should have been made, no deed having been tendered until August 21, 1942, and no suit having been brought until October 13, 1942. Plaintiff contended that as the Florida statute of limitations allowed a period of 20 years his action was not barred. ^[1] But whether the suit was in time is not to be determined by the...