Harrington v. Eggen
| Decision Date | 23 May 1924 |
| Court | North Dakota Supreme Court |
Appeal from the District Court of Cass County, Englert, J.
Affirmed.
Lyman Miller, for appellant.
If a vendee fails to perform his contract for the purchase of real estate, various appropriate remedies are open to the vendor and he may elect which he will pursue;
1. He may keep his tender of performance good, and may demand the balance of the purchase price and sue for specific performance.
2. He may terminate the contract because of the breach of the vendee, and he may keep his land, and sue for damages for the breach.
3. He may rescind the contract in toto. Waters v. Pearson, 144 N.W. 1026.
The vendor, by selling the property to another, exercises his option and rescinds the contract, and thereafter the parties stand as if no contract existed between them. Eaton v Redick, 1 Neb. 305.
If while contracts to convey were still in force, the vendor conveyed to a third person, the conveyance, if assented to by the purchaser, effected a rescission of the contracts, and such rescission was by mutual consent, entitling the purchaser to a return of the money paid under the contract. Treat v. Smith, 139 Ill.App. 262, affirmed in 234 Ill. 552, 85 N.E. 289.
Where a party under contract to sell lands to one, conveys the same without his consent to another, the original vendee is clearly entitled to regard his contract as rescinded by his vendor, and is entitled to have restored what he had paid upon the contract, subject to such deductions as equity should require. Atkinson v. Scott, 36 Mich. 18.
Where a vendor upon the purchaser's breach elects to rescind in toto, such election restores the status quo, and entitles each party to a restoration, so that the purchaser would be entitled to recover back his advance payments. Waters v Pearson, 144 N.W. 1027; Fowler v. Johnson, 19 Ind. 207; Christy v. Arnold, 4 Ariz. 263, 36 P. 918; Warren v. Richmond, 53 Ill. 52; Little v. Thurston, 58 Me. 86; Smith v. Rogers, 42 Hun, 110, affirmed in 118 N.Y. 675, 23 N.E. 1146.
Where a party has contracted for land, and made payments upon it, he may recover back what he has paid, with interest, if the vendor has put it out of his power to perform his contract, by having sold the same land to another. Morton v. Tenny, 16 Ill. 492.
When the vendor, availing himself of the vendee's default, elects to put an end to the contract, the vendee may recover back the money he has paid in part performance, with interest from the date of rescission. Eaton v. Redick, 1 Neb. 305.
Where the vendor in contract of sale of land conveys land to a third person without vendee's consent, and under such circumstances that vendee's rights are not protected, vendee may abandon contract and recover money paid. Kerr v. Reed, 179 P. 399; Dantzeiser v. Cook, 40 Ind. 65; Atkinson v. Scott, 36 Mich. 18; Treat v. Smith, 139 Ill.App. 262, affirmed in 234 Ill. 552, 85 N.E. 289; Fowler v. Johnson, 19 Ind. 207.
Pierce, Tenneson, Cupler & Stambaugh, for respondents.
"Where the time fixed or limited for the payment of the purchase money is of the essence of the contract of sale and the covenants are mutual and dependent, the purchaser must make an actual tender at or within the time fixed or limited, unless it is excused or waived, as by the vendor's refusal before the time limited to accept performance or tender; or unless he is prevented from making tender within such time by the vendor's neglect or default." 39 Cyc. 1565, and cases cited in notes 87 to 91.
"Where the covenants in a contract of sale are mutual and dependent, in order to put the vendor in default, it is not only necessary that the purchaser make a tender of the purchase money, but he must also demand performance by the vendor." 39 Cyc. 1567, and cases cited in notes 9 & 10.
"A failure to tender on the date fixed is not excused by a refusal of the vendor to perform after such date." 39 Cyc. 1563, note 62; Hein v. Treadwell, 72 Cal. 217, 13 P. 503.
The complaint in order to state a cause of action must not only show a tender of performance by the plaintiff, but also a demand for performance upon the defendants. 39 Cyc. 1551, notes 67, 70, 71, 1561, notes 40 to 44, 1562, notes 57 to 60, 1563, note 67.
It is not necessary that the vendee execute a reconveyance in order to affect a rescission of the contract. Miller v. Shelburn, 15 N.D. 182.
"The vendee in a contract for the sale of lands may abandon his unperfected equitable title." Mathwig v. Ostrand (Minn.) 157 N.W. 589.
Where the purchaser is in default, the fact that the vendor resells the property does not give the purchaser the right to recover the price paid, unless the contract has been rescinded by the vendor. 39 Cyc. 2029, notes 66, 67.
Before a purchaser of real estate who has made partial payment on the price can repudiate and recover the sum paid if no question of fraud or misrepresentation is involved, he must show that the vendor is unable or unwilling to perform, or has committed some act warranting rescission. Burton v. Ryther (S.D.) 161 N.W. 350.
A vendee, who defaults in the payments due under such a contract and announces his inability to perform the same, is not entitled, unless the contract so provides, to a return of a payment made when the contract was entered into; nor has the court, in the absence of a statute to that effect, authority in equity to require a return of the money by the vendor as a condition to a cancellation of the contract. Nelson Real Estate Agency v. Seeman, 180 N.W. 227.
Where by laches the remedy at law under contract for the conveyance of land is barred, and the right to specific performance forfeited, there can be no recovery of what has been paid on the contract of purchase. 39 Cyc. 2031, note 75.
This is an appeal from a judgment entered in the district court of Cass county in an action brought to recover certain payments made under a contract for the purchase of land. At the conclusion of the testimony both parties moved for a directed verdict, whereupon the trial court made findings of fact and conclusions of law and an order for judgment, in pursuance of which a judgment was entered dismissing the plaintiff's action. There is no statement of the case and the appeal is on the judgment roll.
The findings of fact may be summarized as follows: The defendants M. G. and N. G. Eggen were, in severalty, on July 11, 1919 the owners each of a half section of land in Cass county and were in possession of the same. On that date they agreed to sell the land to the plaintiff for $ 67,500 payable as follows: $ 2,000 cash; $ 3,000 on or about November 1, 1919, without interest; $ 20,000 on March 1, 1920; $ 30,000 in ten years at 6 per cent annual interest, secured by first mortgage, and $ 12,500 in annual installments of $ 1,250 each, payable on the first of March annually, beginning in 1921, with 6 per cent interest, secured by second mortgage. The $ 2,000 cash payment was made, and the $ 3,000 payment due November 1, 1919, was not paid by plaintiff but by one Paul E. Simmons who became interested with the plaintiff in the purchase of the land, which payment was made on December 27, 1919. It was agreed between the plaintiff and Simmons that one half of the purchase price of the lands would be paid to each of the defendants who would execute separate deeds and each of the defendants would receive $ 2,500 of the payments so made. On or about November 1, 1919, the defendants executed warranty deeds to the lands agreed to be conveyed, in which the plaintiff was grantee, which deeds were deposited with the Scandinavian American Bank of Fargo for delivery to the plaintiff upon performance of the conditions of the contract, and on or about February 2, 1920, the defendants delivered to the plaintiff's agent and to Simmons abstracts of title to the land, showing good, merchantable title in the defendants, which abstracts were likewise delivered to the Scandinavian American Bank to accompany the warranty deeds. On March 1, 1920, the defendants tendered the deeds and abstracts to the plaintiff and offered to deliver the same upon the payment of $ 20,000 and the execution of the mortgages for the balance of the purchase price, and demanded that plaintiff perform the contract on his part, and the tender was maintained by the defendants who, on numerous occasions subsequent to March 1st, offered to deliver the deeds and abstracts on the conditions stated and demanded performance by plaintiff. The plaintiff failed, neglected and refused to perform and he is and at all times since March 1, 1920, has been in default under his contract. On or before April 12, 1920, the plaintiff, through his agent the Amerland Company or Simmons, stated to the defendants that he, the plaintiff, was not financially able to perform said contract or to take possession of and farm the land, and that the plaintiff abandoned the contract and any rights he had therein or in the land. The plaintiff was not, on March 1, 1920, or at any time thereafter, ready and willing to perform the conditions of the contract and never offered to perform. During the year 1919 the market for farm lands such as the defendants' was brisk and values inflated over normal times, but by March 1, 1920, the values of farm lands in general and of the defendants' farm had dropped. Since March 1, 1920, the market had become more depressed and dull, and the plaintiff was unable to resell the land and would have sustained a loss if he had performed the conditions of the contract. He refused and still refuses to...
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