George v. Fritsch Loan & Trust Co.

• Decision Date: 04 May 1927
• Docket Number: 4490
• Citation: 69 Utah 460,256 P. 400
• Parties: GEORGE v. FRITSCH LOAN & TRUST CO
• Court: Utah Supreme Court

256 P. 400

69 Utah 460

GEORGE v. FRITSCH LOAN & TRUST CO

No. 4490

Supreme Court of Utah

May 4, 1927

Appeal from District Court, Third District, Salt Lake County; Wm. M McCrea, Judge.

Suit by Louis George against the Fritsch Loan & Trust Company, in which defendant interposed an affirmative defense.Judgment for defendant, and plaintiff appeals.

REVERSED and remanded, with directions.

James D. Pardee, Creighton King, and Louis E. Callis, all of Salt Lake City, for appellant.

Clarence Baird and Dan B. Shields, both of Salt Lake City, for respondent.

HANSENJ. THURMAN, C. J., and CHERRY and Straup, JJ., and CHRISTENSEN, District Judge, Concur.FRICK, J., did not Participate.

OPINION

HANSEN, J.

Plaintiff brought this action to enforce the specific performance of a written contract for the sale of real estate.Defendant answered, admitting that it had executed the written contract sued upon and that it was obligated to convey to plaintiff the land described in his complaint, but alleged that the written contract sued upon does not express the intention of the parties in that by mutual mistake of the parties there was omitted from the written contract various provisions to the effect that there is not to be constructed upon the premises any building except a residence or apartment house and that said real estate should not be used for manufacturing purposes or any work of an offensive, dangerous, or noisy nature; nor should any garage, service station, gasoline, or oil distributing station be maintained thereon; nor should any mercantile institution of any sort whatsoever be established or maintained upon said premises.The defendant prayed judgment for a reformation of the written contract so that it would contain these restrictions.Plaintiff replied to the answer and denied that there was a mutual mistake, and also set up as an affirmative defense to the claim for a reformation of the contract of sale that defendant was negligent in the execution of the contract; that it had waived such defense if it ever had any by reason of the fact that it had received payments on the contract for a period of 23 months in a total sum of $ 1,800; that plaintiff had erected a garage upon said property at a cost of $ 1,000 during the month of April, 1924; and that defendant had made no claim that said contract did not express the intention of the parties thereto until after this action was brought by plaintiff for the specific performance of said contract, and that therefore defendant is now estopped from asserting any right or claim for a reformation of the contract.

A trial was had to the court sitting without a jury, and upon the issues affecting the reformation of the contract a decree was entered containing these provisions:

"That the contract entered into between plaintiff and defendant on the 11th day of December, 1923, be reformed by the addition thereto of a restriction clause to the effect that the property described as all of lots 1 and 20 and the south 10 feet of lot 19, block No. 1, Dieter and Johnson Main street addition, Salt Lake City, Utah, shall not be used by plaintiff, or his heirs, executors, administrators or assigns, for a manufacturing plant, or engaging in any work of an offensive, dangerous, or noisy nature, nor anything which shall become an annoyance or a nuisance, nor shall there be established thereon any garage, service station, gasoline or oil distributing station, and that said plaintiff, his heirs, executors, administrators or assigns are hereby restrained from the use of said premises for any of the purposes hereinbefore set forth."

The plaintiff appeals and assails the findings of fact, conclusions of law and judgment as they affect the reformation of the written contract.

The evidence without conflict shows these facts: That the property involved in this controversy is located on the west side of State street near Fourteenth South street where Kensington avenue intersects State street in Salt Lake City, Utah, and is described as lots 1 and 20, and the south 10 feet of lot 19, block 1, Dieter and Johnson Main street addition; that the property in the immediate vicinity of the tract here involved is improved and that the west side of State street is devoted for the most part to manufacturing and business purposes; that in 1923plaintiff, Louis George, was operating a store and gasoline tank across the street from the property covered by the contract of sale; that he informed one Byron S. Kershaw that he, George, desired to purchase the property involved in this action to keep out competition; that Kershaw, after ascertaining that defendant company was the owner of the property, took up negotiations with the company for the purchase of the property; that Kershaw and George met W. J. Penner, who was the general manager and secretary of the defendant corporation, and that such corporation was engaged in the real estate business; that in the oral conversations between George, Kershaw, and Penner it was agreed that George would purchase and the company would sell the property in question for $ 2,500, of which sum $ 500 was to be paid down and the remainder of the purchase price was to be paid at the rate of not less than $ 25 per month, all deferred payments to bear interest at 7 per cent per annum; that it was also agreed that Penner would have a written contract drawn up and they would meet the next day and execute the contract; that Penner requested Webster Green, the bookkeeper of defendant company, to prepare the contract, and that the same was prepared by Green; that a printed form of contract was used in which the names of the parties, the description of the property, the amount and terms of payment, together with the rate of interest on deferred payments, and a provision that the seller was to give a marketable title and furnish an abstract, were filled in on the typewriter; that Louis George and Byron S. Kershaw came to the place of business of the defendant company according to appointment on the day following the conversation about the sale of the property; that the contract was then read over by Kershaw to George, and at the request of George the time that each installment must be paid to avoid a forfeiture of the contract was changed from 10 to 30 days; that the contract was then executed by Louis George and the defendant company, Penner signing for the company; that the contract was retained by the defendant, and defendant gave Kershaw a commission for making the sale; that in April, 1924, George erected a frame building on the property at a cost of $ 1,000, and when erected he used the same as a garage; that plaintiff made payments on the contract promptly (23 in number), and the defendant accepted the same without objection; that in August, 1925, plaintiff tendered to defendant the remainder owing upon the contract and demanded a deed to the property; that defendant company informed plaintiff that if he would pay the remainder of the money it would make conveyance as soon as the mortgage then on the property was paid; that later plaintiff again made tender of the amount unpaid on condition that he receive his deed, but defendant company again failed to deliver the same; that it was not until February, 1926, when the amended answer was filed by defendant company, that any claim for a reformation of the contract was made; that defendant owns other property in the vicinity of the property which is the subject-matter of this action, and that the agent of the company from time to time passed by the property here involved.

In the following particulars the evidence is in conflict.

Byron S. Kershaw was called as a witness by defendant and testified that at the time the negotiations were in progress for the sale of the property Mr. Penner said he would sell the property provided there was not any garage or some other unsightly building placed on the premises; that George said he wanted to buy the property to protect his store from competition and that he would buy it with the understanding that he would not place a garage on it; that he, Kershaw, was not clear as to whether it was a gasoline vending station or other unsightly building, but they did talk about a garage.Webster Green, bookkeeper for defendant company, testified that on two occasions preceding the execution of the written contract he overheard conversations between Mr. Penner and Mr. George and that these conversations were to the effect that there was to be no garage, oil station, or unsightly building erected on the property; that in drawing the contract it was an oversight on his part that these provisions were not put in the contract.W. J. Penner, the general manager of the company, testified that when he talked to Mr. George on the day before the contract was executed Mr. George said he had a grocery store and wanted to protect himself from competition; that when Penner asked George what he wanted to build on the property he George, said, "Well, I don't know yet"; that he told George that he, Penner, did not want any garage, service station, oil station, or any manufacturing plant of any nature on the property that would be detrimental to the restricted residential district across the street; that he, Penner, bought the property that George wanted to buy as a protection as some one wanted to buy it for a garage; that it would be impossible to say just the words George used, because he just nodded and said yes to whatever he was asked; that Penner told George that he, Penner, allowed the Intermountain Art to build their building after they had shown Penner the plans for the exterior of the building to be erected; that no...