Hackford v. Snow, 17067

• Decision Date: 23 November 1982
• Docket Number: No. 17067,17067
• Parties: Clifton J. HACKFORD, Sharon Hackford, Randolph G. Hackford, and Sandra H. Asay, Plaintiffs and Appellants and Cross-Respondents, v. Albert Leo SNOW and Corwin Barton Snow, Defendants and Respondents and Cross-Appellants. Albert Leo SNOW, Plaintiff and Respondent and Cross-Appellant, v. Randolph G. HACKFORD aka Randolph George Hackford, Clifton J. Hackford and Sharon Hackford, husband and wife; Clifton K. Hackford and Shirlene Hackford, husband and wife; and Sandra L. Asay, Defendants and Appellants and Cross-Respondents.
• Court: Utah Supreme Court

Page 1271

657 P.2d 1271

Clifton J. HACKFORD, Sharon Hackford, Randolph G. Hackford, and Sandra H. Asay, Plaintiffs and Appellants and Cross-Respondents, v. Albert Leo SNOW and Corwin Barton Snow, Defendants and

Respondents and Cross-Appellants.

Albert Leo SNOW, Plaintiff and Respondent and Cross-Appellant, v. Randolph G. HACKFORD aka Randolph George Hackford, Clifton

J. Hackford and Sharon Hackford, husband and wife; Clifton

K. Hackford and Shirlene Hackford, husband and wife; and

Sandra L. Asay, Defendants and Appellants and Cross-Respondents.

No. 17067.

Supreme Court of Utah.

Nov. 23, 1982.

Kathryn Collard, Salt Lake City, for Hackfords.

John C. Beaslin, Gayle F. McKeachnie, Clark B. Allred, Vernal, for Snows.

TIBBS, District Judge:

This matter involves two actions which were consolidated for trial. The Hackfords sued for unlawful detainer and the Snows sued for specific performance of an option to purchase included with a lease between the parties. The district court dismissed the unlawful detainer action and granted specific performance of the option. Both parties appeal. The Hackfords seek reversal of the judgment in its entirety while the Snows seek a remand with direction to enter judgment for treble damages and attorney fees. Because of the cross-appeals, the parties will be designated "appellants" (the Hackfords) and "respondents" (the Snows).

In April, 1975, appellants and respondents negotiated an agreement whereby respondents were to lease and have an option to purchase certain property owned by appellants and described in the agreement as: "Neola, (420 acre Hackford Farm), Uintah County, State of Utah." The agreement was drawn by a real estate agent on a standard earnest money receipt and offer to lease form. The agreement provided that appellants and respondents would execute "a written lease which will supercede and abrogate this agreement ... within 10 days after tender of a firm lease prepared by the landlord in a form consistent with the above provisions and containing other customary and reasonable general provisions." The parties never executed a formal written lease.

At the time of the negotiation of the agreement, appellants were not certain that they would retain more than 445 acres of the farm as a result of other pending litigation. Appellants therefore decided to lease 420 acres of the 445 to respondents and to retain a 5 acre parcel surrounding the appellants' home and 20 acres of hay ground. The agreement contains no reference or description of the 25 acres of land retained by appellants which were not subject to the agreement. Appellants testified that they did not discuss or determine where they would retain the 20 acres of hay ground until sometime after the agreement was signed. At that time, they determined to reserve the 20 acres of hay ground in the southeast of the southwest section where an oil well was subsequently and is now located. Respondents, on the other hand, testified that at the time the offer to lease was signed, appellants walked over the property and pointed out that they would retain 20 acres continguous to appellants' house.

Appellants testified that during 1975 and 1976, they and respondents entered into a verbal agreement whereby respondents were permitted to take hay from the 20 acres of appellants' hay ground not subject to the lease agreement, in exchange for providing a certain amount of hay to appellants for their livestock. Respondents also allegedly agreed to pay the taxes and assessments on appellants' hay ground. Respondents acknowledged the existence of this verbal agreement with appellants but stated that they believed that the agreement related to land near appellants' home. Appellants testified that they did not see respondents on the farm after the fall of 1976, and that the parties had no verbal agreement with respect to respondents' use of hay from appellants' hay ground thereafter.

On January 25, 1977, appellants entered into an oil and gas lease with Flying Diamond Oil Corporation and an oil well was erected on what appellants now claim to be the 20 acres of hay ground not subject to the lease agreement. Respondents did not take any action to contest the construction of the well.

Pursuant to the "lease," respondents agreed to pay real property taxes and water assessments and to maintain the fences and water system on the property subject to the agreement. In 1975, the water assessment was paid a month late, only after appellants made several telephone calls to respondents. Although appellants made numerous requests and demands, respondents failed to pay the 1976 water assessment which remained due and delinquent as of February, 1977. At that time, appellants received a notice from the Uintah and Ouray Indian Agency, United States Department of the Interior, that they would receive no further water during 1977 until the assessment for 1976 was paid. Respondents thereafter paid the 1976 water assessment. Appellants were billed penalty charges and interest on the 1976 assessment which they were required to pay in order to obtain water for the 1977 season.

In 1976, appellants mended the fences on the property and telephoned respondents and reminded them of their obligation to maintain the fences on the property. Appellants also testified that respondents failed to pay the property taxes on the 420 acres, subject of the lease agreement, when the taxes fell due in November, 1976. Finally, the taxes were advertised as delinquent in a local newspaper.

Appellants testified that on or about April 17, 1977, respondents came to the farm to make the annual lease payment. Appellants informed respondents that the water assessment for 1977 had not been paid. Appellants said that they were going to terminate the agreement on April, 1975 for respondents' repeated breach of the agreement by failing to make timely payments of the property taxes and water assessment on the property. Respondents promised that they would perform their obligations under the agreement and pay the outstanding water assessments for 1977, together with the interest thereon, within three days. Appellants accepted the annual lease payment on the condition that respondents follow through on their representations.

Appellants testified that at the time they accepted the 1977 lease payment, respondents asked appellants to take a water turn on the leased property in May, 1977. When appellants went to the ditch to release the water in May, 1977, they were unable to take the water turn because the ditches had become filled with dirt and debris during the previous fall. The spring runoff in 1977 had washed over the ditch and created large gullies and washouts over a large area of appellants' property. After discovering the extensive erosion and damage to the property, appellants telephoned respondents and informed them that their failure to maintain the ditches had resulted in extreme damage to the property and that appellants were going to terminate the agreement of April, 1975. Respondents promised that they would have the ditches cleaned but did nothing in this regard. Finally, appellants cleaned the ditches themselves.

Respondents also failed to pay the 1977 water assessment as promised. In June 1977, appellants were contacted by the Uintah and Ouray Irrigation Office and advised that unless water assessments were paid, appellants would not receive any water on their property after July 1, 1977. Appellants needed water for the hay on their 20 acres and a garden on the 5 acre parcel surrounding their house. They therefore paid the 1977 water assessment on June 30, 1977. Respondents admitted they never paid the 1977 water assessment despite their repeated promises to do so.

On July 7, 1977, appellants directed their attorney formally to notify respondents of the termination of the 1975 agreement. The attorney sent a letter to respondents so advising them on the same date.

On July 15, 1977, respondents and their attorney appeared at the home of appellants and attempted to deliver a check for the 1977 water assessment. The attorney also informed appellants that respondents were prepared to pay appellants the full purchase price, but did not attempt to tender payment. Appellants led respondents and the attorney through the field and indicated the extensive washouts and gullies that had been created as a result of respondents' failure to maintain the ditches, and further indicated that respondents' failure to pay the water assessments and taxes had created considerable hardship to the appellants. Considering that respondents had continued to breach the parties' agreement, appellants said they had terminated the lease and would accept no further payments from respondents.

Respondents continued in possession and removed hay from the property that summer. On September 27, 1977, appellants served respondents with a Notice of Termination of Lease Agreement and Notice of Eviction and Requirement to Vacate Premises within three days.

On October 17, 1977, respondents filed a complaint seeking specific performance of the lease and option provisions of the agreement of April, 1975. On February 6, 1978, appellants filed an action for unlawful detainer and other damages against respondents. On April 11, 1978, a pretrial conference was held for both actions. On that occasion, respondents filed a tender offer for the full purchase price of the property with the court.

Following a trial to the court, it was found as follows: (1) the earnest money agreement dated April 15, 1975, was a valid lease and option to purchase, binding on all parties; (2) the lease had not been terminated when the option was exercised by respondents; (3) the alleged breaches by respondents prior to exercising the option were not substantial. The court held that since the lease agreement had no terms for termination, it could only be terminated pursuant to provisions of the unlawful detainer statute. Since...