Howard v. Bar Bell Land & Cattle Co.

• Decision Date: 29 April 1959
• Docket Number: No. 8697,8697
• Citation: 340 P.2d 103,81 Idaho 189
• Court: Idaho Supreme Court
• Parties: Marie HOWARD, Executrix of the Will and Estate of Ross Howard, deceased; Marie Howard and Madeline Walter, a single woman, Plaintiffs-Appellants, v. BAR BELL LAND & CATTLE CO., an Idaho Corporation; Foxley & Co., a corporation; Vernon C. Klamper and Celo H. Williams, d/b/a M. & K. Food Store; Gary I. McIntosh d/b/a McIntosh Veterinary Clinic; Chester R. Wilson and Jane Doe Wilson, husband and wife; Carey Mercantile Co., a corporation; Erb Hardware Co., Ltd. a corporation; Howard R. Clinger and Jane Doe Clinger, husband and wife; Millie Stilinovich and John Doe Stilinovich, wife and husband; Mike Krznovich and Jane Doe Krznovich, husband and wife; Clinger's Inc., a corporation; Eldon J. Facer and Louise G. Facer, husband and wife; Harold W. Bentley and Verna D. Bentley, husband and wife and First Security Bank of Idaho, National Association, Defendants-Respondents.

Page 103

340 P.2d 103

81 Idaho 189

Marie HOWARD, Executrix of the Will and Estate of Ross Howard, deceased; Marie Howard and Madeline Walter, a single woman, Plaintiffs-Appellants, v. BAR BELL LAND & CATTLE CO., an Idaho Corporation; Foxley & Co., a corporation; Vernon C. Klamper and Celo H. Williams, d/b/a M. & K. Food Store; Gary I. McIntosh d/b/a McIntosh Veterinary Clinic; Chester R. Wilson and Jane Doe Wilson, husband and wife; Carey Mercantile Co., a corporation; Erb Hardware Co., Ltd. a corporation; Howard R. Clinger and Jane Doe Clinger, husband and wife; Millie Stilinovich and John Doe Stilinovich, wife and husband; Mike Krznovich and Jane Doe Krznovich, husband and wife; Clinger's Inc., a corporation; Eldon J. Facer and Louise G. Facer, husband and wife; Harold W. Bentley and Verna D. Bentley, husband and wife and First Security Bank of Idaho, National Association, Defendants-Respondents.

No. 8697.

Supreme Court of Idaho.

April 29, 1959.

Rehearing Denied June 18, 1959.

Russell S. Randall, Lewiston, Ralph R. Breshears, Boise, for appellants.

Cox, Ware & Stellmon, Clements & Clements, Lewiston, for respondents.

TAYLOR, Justice.

November 5, 1951, plaintiffs (appellants) entered into a contract to sell to Frank S. Hofues and R. Dean Hawn a cattle ranch consisting of fee and leasehold estates approximating 75,000 acres of land in Nez Perce and Lewis counties, together with improvements, water rights, and certain equipment. The purchase price was $374,000, payable as follows:

'The sum of $20,000.00, in cash, immediately upon execution hereof, the receipt of which is hereby acknowledged by first parties.

'The further sum of $60,000.00, in cash, on or before the 30th day of December, 1951.

'The further sum of $35,000.00 in cash, on or before the first day of October, 1952.

'The further principal sum of $17,266.66 on the first day of November, 1953, and the same amount on the first day of November of each year thereafter until the full purchase price herein mentioned shall have been paid.'

The deferred balance bore interest at 4 1/2% per annum.

All payments were made to and including the installment due November 1, 1953. The contract was modified by agreement of May 22, 1954, reducing the annual payments to $10,000, principal, commencing November 1, 1954.

The contract provided that the first parties, appellants, 'do hereby expressly reserve and except from the real property herein agreed to be sold all timber on said properties and that first parties shall have full right and privilege of entering upon the said premises or any part thereof at any time for the removal of said timber and in conjunction therewith the right to construct such roadways and camps as may be deemed necessary or proper in protecting said timber or in carrying on logging operations'. The contract further provided:

'Time is agreed to be of the essence of this agreement and in case of default or failure of the second parties to make all payments as above mentioned at the time and in the manner above described, and such default or failure to make such payments shall continue for a period of sixty days after notice thereof and demand for performance or fulfillment shall have been given to second parties, first parties may at their option declare forfeiture of any right, title or interest that second parties may have in or to said premises, and in such event, the moneys theretofore paid by second parties to first parties shall be retained by first parties as full and liquidated damages to first parties for non-performance of this agreement, * * *.'

August 24, 1954, the purchasers Hofues and Hawn executed a written agreement with the defendant (respondent) Bar Bell Land and Cattle Company by the terms of which they sold to the latter company their interest in the lands covered by their contract with plaintiffs. All timber upon the lands was also excepted from this contract. The contract further expressly provided:

'The parties hereto agree that this contract is subject to all of the terms and conditions of the aforementioned contract between the said Ross Howard and Marie Howard, husband and wife, and Madeline Walter, a single woman, as sellers and Vendors herein as purchasers, and Vendee acknowledges it has read said contract and is familiar with the terms and conditions thereof, and Vendee agrees it will perform at the time and in the manner required in said contract all covenants and conditions therein to be kept and performed by the Vendors herein as purchasers and that any default by Vendee in the performance of the Howard contract shall constitute a default in the performance of this contract, * * *.'

Time was also declared to be of the essence of this contract.

The consideration for the sale by Hofues and Hawn to the Bar Bell company, in addition to certain property, was $35,000, payable $5,000 on the 1st day of December, 1955, and $5,000 on the 1st day of each December thereafter until $35,000 was paid, with interest on deferred balance. The Bar Bell company being unable to make the $10,000 payment on the Howard contract due November 1, 1954, that payment was made by Hofues and Hawn, for which the Bar Bell company gave to Hofues and Hawn its note for $10,000, payable in three annual installments of $3,333.33, commencing November 1, 1955.

Both contracts were placed in escrow with a bank at Lewiston.

December 10, 1955, the Bar Bell company assigned its contract to the defendant (respondent) Foxley & Co., as security for an obligation of $41,500. In August, 1956, the plaintiffs purchased from Hofues and Hawn all of their right and interest in the contract of August 24, 1954, and received an assignment of the contract and of the notes for $35,000 and $10,000 made by Bar Bell company.

The Bar Bell company failed to make the payments due on November 1st and December 1st, 1956, on the contracts and also the payment on the $10,000 note due November 1, 1956. At the time of these defaults, payments made on the original contract amounted to $152,266.66, principal, and $34,481.60, interest, leaving a balance unpaid of $221,733.34, principal. $5,000, principal, and $2,231.25, interest, had been paid on the contract of August 24, 1954, leaving a balance unpaid of $30,000, principal.

November 7th and December 5th, 1956, plaintiffs gave notice of these defaults to all parties to both contracts and the assignees, including Foxley & Co., and demanded that the defaults be removed within sixty days, as provided by the contracts.

The defaults not having been cured, on February 5, 1957, plaintiffs gave notice of their election to terminate and forfeit the contracts and the interest of all of the purchasers and their assignees. This notice was also given to all parties and their counsel, and contained a demand for surrender of the escrow and possession of the property.

The purchasers had been given possession October 1, 1952, and continued in possession until March 1957, when Howards claim to have taken possession. The respondents claim they retained possession until approximately May 1, 1957.

There were other conveyances and reconveyances to and from other parties affecting the property which are not now involved in the issues presented.

February 21, 1957, plaintiffs commenced this action, praying that the contracts be cancelled and their title be quieted to the property involved.

By its answer and cross-complaint the Bar Bell company claimed the right to redeem and prayed the allowance of a reasonable time within which to pay the balance due on the contracts and, in the alternative, a judgment against the plaintiffs for the excess of purchase money paid over the reasonable rental value of the property.

June 15, 1957, Foxley & Co. tendered payment by check of the balance due on the contract. In its answer and cross complaint Foxley & Co. prayed that plaintiffs be required to accept payment of the balance due within a reasonable time to be fixed by the court. Foxley & Co. also alleged that the provision of plaintiffs' contract reserving the timber applies only to timber which was marketable on the date of the execution of the contract; that timber which was not marketable at that time was not reserved; that plaintiffs had removed timber which became merchantable after the date of the contract, and prayed for accounting thereof; and that the logging privilege be limited to a period of time reasonably necessary to afford an opportunity to log merchantable timber in existence on the date of the contract.

Subsequent to a pre-trial conference held on January 13, 1958, the district court on February 14, 1958, rendered an opinion in which it concluded that the defendants, Bar Bell company and Foxley company, should have the right to redeem from the forfeiture of the contracts within a period of sixty days by the payment of the balance of principal and interest due upon the contract to the date of redemption, plus advances made by plaintiffs, together with their...