Hatfield v. Mixon Realty Co., CA

• Citation: 269 Ark. 803,601 S.W.2d 894
• Decision Date: 18 June 1980
• Docket Number: No. CA,CA
• Parties: Herbert HATFIELD et ux., Appellants, v. MIXON REALTY CO. et al., Appellees. 80-57.
• Court: Court of Appeals of Arkansas

Page 894

601 S.W.2d 894

269 Ark. 803

Herbert HATFIELD et ux., Appellants, v. MIXON REALTY CO. et al., Appellees.

No. CA 80-57.

Court of Appeals of Arkansas.

June 18, 1980.

William Russell Gibson of Pettus & Johnson, Fayetteville, for appellants.

Hartman Hotz, Fayetteville, Penix, Penix & Mixon by Donn Mixon, Jonesboro, for appellees.

WARREN WOOD, Special Judge.

The basic facts resulting in this litigation were stipulated to by counsel and can be summarized as follows: In the month of September, 1969, Rosa Marinoni entered into a land sale and escrow agreement with Herbert Hatfield involving property located on College Avenue in Fayetteville, Arkansas. Under the agreement Hatfield was to pay seller the sum of $53,000 $3,000 of which was a down payment, with the balance of $50,000 to be paid in 120 monthly instalments plus interest. McIlroy Bank & Trust Company was named escrow agent to receive the monthly payments, and when the balance was paid in full, was to deliver an executed warranty deed and abstract of title to Mr. Hatfield.

On the 9th day of February, 1972, Mr. Hatfield and wife contracted to sell the College Avenue property to H. D. Mixon and Carolyn M. Whatley for a consideration of $75,000, to be paid by a down payment of $15,000; payment of $22,083.43 in monthly instalments directly to the Sellers, and a balance of $37,916.57 to be paid to McIlroy Bank & Trust for the purpose of liquidating the amount yet owed by Herbert Hatfield to Rosa Marinoni or her estate. When such balance was paid, the escrow agent was to deliver an executed warranty deed to the purchasers.

In the Marinoni contract with Mr. Hatfield she reserved the right, in case of delinquency for more than 30 days, to declare the contract terminated and retain all sums paid prior thereto as liquidated damages. The Hatfield/Mixon and Whatley agreement provided that upon non-performance by the vendees, the vendors "may declare this contract terminated and at an end, take possession of the property and retain any and all sums paid under this contract as rents for the use of the property." Mixon and Whatley later assigned their interest in the contract to Mixon Realty Company, who accepted same subject to all obligations assumed by the assignors.

The above assignment is dated August 23, 1974. Counsel agree that the direct obligation to Mr. Hatfield and wife was paid in full by assignee before this suit was instituted.

The problem resulting in litigation arose in January, 1979, when a representative of Rosa Marinoni's estate (she having died in the year 1970) wrote a letter to the escrow agent calling attention to default in the payment of instalments due under Rosa Marinoni's contract of sale with Mr. Hatfield and demanding that the escrow be terminated with all documents held by such agent to be returned. (The delinquency will be mentioned in more detail later on.) Upon receipt of said letter, an officer of the escrow agent by letter dated January 22, 1979, advised Mr. Hatfield of the communication received from the Marinoni representative and stated therein that:

"Unless there is a mutual settlement before January 31, 1979, I will deliver all documents into Court in order for a decision to be delivered to this agent. If any monies are held by this agent on the deadline dated above, they will be turned over to the Court along with the documents."

In response to the above-mentioned letter, Mr. Hatfield issued a check dated January 25, 1979, to McIlroy Bank and the Marinoni Estate in the amount of $20,290.39 in full payment of the balance due said estate. Also, the Hatfields redeemed said property after a tax sale for non-payment of taxes in prior years. The redemption certificate and treasurer's receipt evidencing such redemption were filed of record on March 7, 1979.

On or about March 7, 1979, counsel for Herbert Hatfield wrote a letter to Mr. Don Mixon, executor of the Estate of H. D. Mixon, Mixon Realty Company, stating that he had been retained by Herbert Hatfield to represent him in obtaining possession of the property at 355 North College Avenue, Fayetteville, Arkansas, for failure of Mixon and Whatley to comply with the contractual agreement and declaring said contract to be terminated and the property considered to be in the possession of the Hatfields. Enclosed in said letter was a copy of the redemption certificate above mentioned.

In March of 1979 the escrow agent filed a bill of interpleader in the chancery court of Washington County, seeking guidance as to its further course of action in the matter. For some unexplained reason Mixon Realty Company was not served with process until late September, 1979. The Hatfields and the executor of the estate of Rosa Marinoni, having been served, filed responsive pleadings wherein each pled forfeiture and prayed for termination of their contracts with their respective vendees. In a response to the pleading filed by the Marinoni Estate, Hatfields pled that Marinoni had agreed to waive strict performance of the contract and was estopped from pleading forfeiture. The Marinoni Estate accepted the amount owed and was dismissed from the lawsuit.

A pre-trial hearing was held by the trial court on October 3, 1979, and at such hearing all of the facts and documents mentioned herein were stipulated to by counsel. At the conclusion of said hearing the Court stated that if Mixon Realty Company tendered to Herbert Hatfield and wife all...