Gerbaz v. Hulsey, 17638

• Decision Date: 03 October 1955
• Docket Number: No. 17638,17638
• Citation: 132 Colo. 359,288 P.2d 357
• Parties: Orest E. GERBAZ, Plaintiff in Error, v. Arthur B. HULSEY, Zella E. Sadler, Maurice C. Johnson, Fernetta M. Johnson, and C. Z. Buckles, Defendants in Error.
• Court: Colorado Supreme Court

Page 357

288 P.2d 357

132 Colo. 359

Orest E. GERBAZ, Plaintiff in Error, v. Arthur B. HULSEY, Zella E. Sadler, Maurice C. Johnson Fernetta M. Johnson, and C. Z. Buckles, Defendants in Error.

No. 17638.

Supreme Court of Colorado, En Banc.

Oct. 3, 1955.

Rehearing Denied Oct. 24, 1955.

Petre & Zimmerman, Glenwood Springs, for plaintiff in error.

Robert Delaney, Kenneth Balcomb, Jr., Glenwood Springs, for defendants in error.

KNAUSS, Justice.

For convenience defendants in error Arthur B. Hulsey, Zella E. Sadler, Maurice C. Johnson and Fernetta M. Johnson will be referred to as plaintiffs, and where necessary to distinguish between them, by his or individual name. Plaintiff in error, Gerbaz, will be referred to as defendant, or by name. C. Z. Buckles, another defendant in error, will be referred to by name or as third party defendant.

On January 6, 1954 Orest E. Gerbaz, plaintiff in error, entered into a written contract with Arthur B. Hulsey, Zella E. Sadler, Maurice C. Johnson and Fernetta M. Johnson, whereby Gerbaz agreed to sell and Hulsey, Sadler, Maurice Johnson and Fernetta Johnson agreed to purchase certain ranch property in Pitkin County, Colorado, for $55,255 to be paid as follows: $3,115 paid on signing the contract, $10,250 to be paid 'on or about February 1, 1954' and the balance of $41,890 to be paid at the rate of $2,000 per annum, together with interest at five per cent per annum, for a period of fourteen years, and the remaining balance to be paid on or before fifteen years after January 6, 1954. The contract contained provisions for the execution of a deed of trust to secure the balance, and the usual provisions for the delivery of abstract of title and conveyance of a merchantable title. In addition, Hulsey agreed to assign to Gerbaz 'as additional security' a contract of sale dated December 22, 1953 between Hulsey and one E. B. Howard 'covering nine rental units and the residence of Arthur by Hulsey in San Simon, Arizona, upon which there is a principal balance of $60,000 plus $15,000 interest due and owing.' It was 'understood and agreed, however, that so long as the second Parties [Hulsey and associates] are not in default under the terms of this contract that the said Arthur B. Hulsey shall collect all payments made under said contract.' It further provides that 'the failure of the second parties [Hulsey and associates] to make the payments herein provided for or to perform any of the covenants and agreements herein contained shall render this contract void, and the first party [Gerbaz] shall retain all payments as liquidated damages.'

This contract of purchase and sale was negotiated by C. Z. Buckles, a licensed real estate broker with whom Gerbaz had the property listed.

Hulsey and his associates instituted this action against Gerbaz alleging the execution of this contract and that, notwithstanding their performance of and readiness to perform all terms thereof by them to be carried out, Gerbaz refused to convey the property and they sought as damages against Gerbaz for breach of the contract the sum of $3,115 by them paid, together with the further sum of $1,000 in favor of Maurice C. Johnson and Fernetta M. Johnson for loss by them sustained in removing from Iowa to Colorado in reliance on the contract and its performance by Gerbaz.

Gerbaz made Buckles a third party defendant and alleged the $3,115 down payment had been paid to Buckles and was by him held, and Gerbaz sought judgment against Buckles 'for all sums that may be adjudged against defendant [Gerbaz] in favor of plaintiffs' together with other and further relief.

Gerbaz put in issue the allegations of the complaint and by two counterclaims filed by him sought to have the contract declared void and that he recover the sum of $3,115 as liquidated damages. He also alleged Hulsey falsely represented that the December 22, 1953 contract respecting the Arizona property was free from encumbrance, and that there was then payable to Hulsey $60,000 and '$15,000 representing interest accrued on said dates under said contract of sale' and that said contract was 'good paper'.

Buckles, third party defendant, by appropriate pleadings admitted he had received the $3,115 down payment made by Hulsey and associates; alleged he was entitled to $2,100 commission as broker in said transaction, for which he sought judgment against Gerbaz. He paid into court the sum of $1,015, being the balance of the deposit in his hands.

After issue joined and conclusion of all evidence offered by the respective parties, the trial judge took the case from the jury; entered judgment in favor of plaintiffs and against defendant for $3,115, together with the further sum of $406.70 in favor of plaintiff, Maurice C. Johnson, and against defendant; and a judgment in favor of C. Z. Buckles and against defendant in the sum of $2,100. From these judgments defendant brings the case here by writ of error, seeking reversal.

It is urged the trial court erred (1) in overruling defendant's motion for an order requiring plaintiffs 'to make...