Hill v. Goodwin
| Decision Date | 01 October 1986 |
| Citation | 722 S.W.2d 668 |
| Parties | Mike HILL, Plaintiff-Appellee, v. Milton GOODWIN and wife Maude Goodwin, Defendants-Appellants. 722 S.W.2d 668 |
| Court | Tennessee Court of Appeals |
James T. DuBois, DuBois & Graham, Columbia, John A. Day, Boult, Cummings, Conners & Berry, Nashville, for plaintiff-appellee.
O.B. Hofstetter, Jr., Hofstetter & Hofstetter, Nashville, for defendants-appellants.
Mike Hill, a real estate agent in Columbia, sued Mr. and Mrs. Goodwin for specific performance of a contract to sell a farm in Spring Hill. The chancellor granted summary judgment to Mr. Hill, finding that he had completely or substantially complied with the contract terms.
On July 3, 1985, Mike Hill and Milton and Maude Goodwin executed a contract in which the Goodwins agreed to sell their farm in Maury County to Mr. Hill. The agreement contained the following with respect to the payment of the purchase price:
The following statement was also written on the face of the contract in longhand:
"Earnest money will be forfeited if buyer does not close by September 3, 1985."
Mr. Hill, who prepared the contract, brought with him a check in the amount of $5,000.00 made payable to Mr. and Mrs. Goodwin and drawn on the account of "L.D. Hill and Sons Realty and Auction Sales." However, after Mr. and Mrs. Goodwin signed the agreement Mr. Hill did not deliver the check to them but told them he was going to deposit it in an escrow account. Two days later Mr. Hill delivered a deposit slip to Mr. Goodwin showing that two checks totaling $5,000.00 had been deposited in the escrow account of "L.D. Hill and Sons Realty and Auction."
Mr. Hill testified in his deposition that he intended to give the Goodwins the check at the signing of the contract. Instead, however, he told them that wasn't really the way to handle it "businesswise", and that the check should be placed in escrow for the sake of all concerned. According to Mr. Hill, placing the money in escrow was fine with Mr. Goodwin so long as he (Mr. Goodwin) got a copy of the deposit slip.
Mr. Goodwin's recollection of the various transactions differs slightly from that of Mr. Hill. Mr. Goodwin testified as follows:
"And he came out, brought the papers out. He had the check attached to it or stapled to it. I believe it was a clip, I think. Made out to me, five thousand. Handed me the paper and out with a pen, and I signed, my wife signed. And my daughter read it, she was there at the time. So I passed it back to him. I said don't I get this check. And he said no that's for the escrow account. And I repeated again. I said I thought to understand I was to get it. No, we put this in the escrow account. So he raised it up and put it in his file. So I reared back. I said don't I even get a copy. So he gave me a copy like this one, unsigned. He handed it to me.
* * *
Q. (By Mr. Day) Mr. Goodwin, you saw a check there that was attached in someway to the contract, probably with a paper clip, for five thousand dollars.
A. Right.
Q. And it was made payable to you?
A. Right.
Q. Mr. Hill did not give you the check that night?
A. He did not.
Q. Did he tell you that he was going to put that money in the escrow account for L.D. Hill and Sons?
A. He didn't--he said it would go in our escrow account. He didn't say whether it was L.D. Hill or his or mine or who. I said I thought to understand I was to get the check.
Q. Okay. Did you ask him for a deposit slip reflecting that the money had in fact gone into an escrow account?
A. Not that night. He said he would bring back a deposit slip.
Q. Did he volunteer to give you the deposit slip, or did you ask him to bring you a deposit slip?
A. I guess he brought it. Now, I won't exactly say on that end of it.
Q. Was it your understanding when he left your home that night that he was going to bring you back a deposit slip?
A. That was my understanding. But I didn't know what--I thought it would be in my name as escrow account. I didn't know what an escrow account was at the time. But when he give me the deposit slip, it was in his escrow account, or L.D. Hill and Sons."
On August 9, 1985, Mr. Goodwin delivered a letter to Mr. Hill repudiating the agreement on the ground, among others, that Mr. Hill had not paid the $5,000.00 called for in the agreement.
Mr. Hill filed this action on August 20, 1985 seeking specific performance of the contract or in the alternative damages for its breach. Mr. and Mrs. Goodwin raised several defenses including Mr. Hill's failure to make the down payment called for in the contract. Both sides made motions for summary judgment. The chancellor held that by depositing the $5,000.00 in the escrow account, Mr. Hill had satisfied all the requirements of the contract. He also found as a fact that Mr. Hill had substantially performed the requirements of the contract. Therefore, he ordered Mr. and Mrs. Goodwin to convey the property to Mr. Hill.
The first issue on appeal questions the chancellor's finding that the escrow deposit satisfied all the requirements of the contract. We think that finding is clearly erroneous unless the chancellor first found that the contract had been modified to allow the down payment to be deposited in the L.D. Hill and Sons escrow account, or that the requirement for a down payment had been waived altogether. We will treat the waiver and modification issues separately below. However, the contract plainly calls for the purchaser to pay $5,000.00 down to Mr. and Mrs. Goodwin at the time the agreement was signed. It might be contended, that since Mr. and Mrs. Goodwin were required to...
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