Katemis v. Westerlind

• Decision Date: 02 October 1953
• Citation: Katemis v. Westerlind, 120 Cal.App.2d 537, 261 P.2d 553 (Cal. App. 1953)
• Parties: KATEMIS et al. v. WESTERLIND. Civ. 19721.
• Court: California Court of Appeals

Page 553

261 P.2d 553

120 Cal.App.2d 537

KATEMIS et al. v.WESTERLIND.

Civ. 19721.

District Court of Appeal, Second District, Division 2, California.

Oct. 2, 1953.

W. T. Stockman, Los Angeles, for appellants.

Obegi & High, Jack B. Clark, Van Nuys, for respondent.

FOX, Justice.

This is an appeal by plaintiffs from a judgment of nonsuit in an action for specific performance and damages.

The facts adduced below show that plaintiffs, who are husband and wife and longtime residents of Chicago, visited Los Angeles with the intention of making a capital investment there.Through the offices of Mr. Solon C. Solaris, a real estate salesman employed by the Atomic Realty Company and who served as plaintiffs' representative or agent in the transaction subsequently ensuing, plaintiffs were advised on February 23, 1952, of the availability for purchase of several income units, complete with designated furnishings, owned by defendant.On the same day plaintiffGeorge Katemis delivered to Mr. Solaris a check in the amount of $1,000 to be used as a down payment in the purchase of the above property.A receipt dated February 23, 1952, was thereupon prepared by Mr. Solaris which, although failing to acknowledge the receipt of the $1,000 as a deposit on account of the purchase price, contains a description of defendant's property and describes Mr. Katemis as the purchaser thereof for the sum of $35,000.The document states that the balance is to be paid into escrow with the Security Bank within two days.In blank lines contained on the receipt appears the following hand-written langauge: 'Seller to furnish rent schedule of all rents from the above mentioned property.No leases on any units which are on the above mentioned property.Termite clearance to be furnished by seller showing property free and clear of termites from a licensed termite operator.'

The rest of the writing consists of a printed series of terms embodying more fully the proposed agreement of the parties.The first of these terms provides, in part, for a forfeiture of the amounts paid on account by the purchaser in the event he should fail to pay the balance of the purchase price or complete the purchase as required.Number six states that the property is sold subject to the approval of the owner.Number seven reads: 'Time is the essence of this contract; but the time for any act required to be done may be extended not longer than 30 days by the undersigned agent.'(Mr. Solaris.)Underneath Mr. Solaris' signature appeared the following: 'I agree to purchase the above described property on the terms and conditions herein stated,' which plaintiffGeorge Katemis signed.Below this latter signature the instrument reads: 'I agree to sell the above described property on the terms and conditions herein stated and agree to pay the above signed broker as a commission the sum of Five hundred dollars, or one-half the deposit in case same is forfeited by purchaser, provided the same does not exceed the full amount of the commission.'This statement was signed by defendant seller.

On February 25, 1952, written duplicate escrow instructions were executed by the parties in counterpart on a form supplied by the escrow holder, the Security-First National Bank of Los Angeles.In the buyers' instructions appears the following pertinent language: 'Prior to March 1, 1952, I will hand you $20,100.00 and any additional funds and instruments required from me to enable you to comply with these instructions, which you are to use provided on or before the date set forth on line 1 above (March 1, 1952), as qualified by the provision at the top of page 2 hereof, instruments have been filed for record entitling you to procure Standard Coverage Form or Joint Protection policy of title insurance * * * on real property in the County of Los Angeles * * * (description of property) showing title vested in George Katemis and Tula Katemis, his wife, as joint tenants, free of encumbrances except all general and special taxes for fiscal year 1952, 1953, * * * and * * * Mortgage or Trust Deed securing an indebtedness * * * now of record * * * of $14,900.00 * * * and Seller herein will furnish a report from a pest control company, covering termites, dry rot and fungus * * * at (description of property.)If said report discloses infestation, seller agrees to eliminate such infestation and repair damage at his expense, but no preventive work shall be required.Seller authorizes payment for making inspection report if a bill is presented in this escrow * * * Seller will deposit in escrow for delivery to buyer at close of escrow * * * a Bill of Sale in favor of the buyer, covering furniture and fixtures situated in Apartments 2, 3 and 4 of the above described property * * *.'(Parenthesis added.)

The provision at the top of page two, previously referred to, is as follows: 'If the conditions of this escrow have not been complied with prior to the date set out on line one (March 1, 1952), or any extension thereof, you are nevertheless to complete the escrow as soon as the conditions, except as to time, have been complied with, unless written demand shall have been made upon you not to complete it.'(Parenthesis supplied.)

The seller's instructions, which follow immediately after the buyers' and were signed at the same time, read in part as follows: 'I Hereby Approve And Agree To Be Bound By The Foregoing Instructions And Provisions, Prior To the date set out on line 1 herein.(March 1, 1952.)I will hand you all instruments and money necessary for me to comply therewith, including a deed of the property described * * *.'(Emphasis added.)Except for the further instruction to pay a commission of $500 to the Atomic Realty Co., seller's instructions were of a formal and conventional nature and require no recitation.

At the time the escrow was opened, plaintiffs' check for $1,000, previously deposited with Mr. Solaris, was placed in escrow, leaving a cash balance due of $19,100.Prior to March 1, 1952, defendant deposited with the escrow holder all instruments called for on her part by the instructions save a termite report.Meanwhile, plaintiffs had departed for Chicago immediately upon the opening of escrow on February 25, 1952, in order to procure the funds required of them.In the early afternoon of February 29, 1952, plaintiffs posted in the United States post office in Chicago, Illinois, a registered air-mail letter addressed to the escrow holder containing a cashier's check in the amount of $19,350.March 1st and 2d, 1952, being respectively a Saturday and a Sunday, the escrow-bank was closed.The said cashier's check was therefore not applied to plaintiffs' escrow account until Monday, March 3, 1952.Similarly, the termite report to be furnished by seller, which was dated February 29, 1952, was received in escrow on March 3, 1952.This report disclosed a degree of dry rot and infestation with a suggestion as to corrective measures recommended and offered to perform the necessary work for $925.

On March 5, 1952, defendant wrote to the escrow holder instructing it to cancel the escrow because the 'purchasers did not comply with their agreement in said escrow to deposit with you the sum of $20,100.00 prior to March 1, 1952.'

On May 15, 1952, plaintiffs filed the present suit for specific performance and damages, appending as exhibits to their complaint the deposit slip constituting the offer and acceptance and the escrow instructions as evidence of the entire agreement between the parties.Upon plaintiffs' presentation at the time of trial of the evidence previously related, the court granted defendant's motion for a judgment of nonsuit, from which plaintiffs prosecute this appeal.Since the oral and documentary evidence developed below establish plaintiffs' prima facie right to specific performance, the judgment of nonsuit is clearly erroneous.

It may be well to advert here to several prefatory propositions of law relevant to the determination of this appeal.It is well settled that where an agreement is expressed through the medium of a series of writings such documents must be construed collectively in ascertaining the whole contract between the parties.Civ.Code, § 1642.Escrow instructions which are merely a customary and conventional means of consummating an underlying executory contract for the sale of real property do not supplant such agreement but merely serve to carry it into effect.King v. Stanley, 32 Cal.2d 584, 589, 197 P.2d 321;Keelan v. Belmont Co., 73 Cal.App.2d 6, 12, 165 P.2d 930.Thus, where the terms of an executory agreement for the sale of real property are clarified and elucidated by the provisions contained in escrow instructions, both instruments are to be considered together in arriving at the total understanding of the contracting parties and in fixing their correlative rights and obligations.Tetenman v. Malekov, 90 Cal.App.2d 625, 266 P. 367;Hawes v. Lux, 111 Cal.App. 21, 294 P. 1080;Pigg v. Kelley, 92 Cal.App. 329, 332, 268 P. 463;Thompson v. Walsh, 76 Cal.App.2d 188, 194, 172 P.2d 745.It is also to be borne in mind that where, as here, a judgment of nonsuit is granted, an appellate court in reviewing such judgment must construe the evidence most strongly against defendant and indulge in every inference and presumption fairly arising from the evidence in favor of plaintiff.Slater v. Shell Oil Co., 39 Cal.App.2d 535, 539, 103 P.2d 1043.

It is beyond cavil that plaintiffs herein who are seeking specific performance have tendered in full the entire balance due on the purchase price.Defendant contends that since the time fixed for such performance in the escrow instructions was prior to March 1, 1952, the arrival of plaintiffs' funds on March 3, 1952, was too late and thus defeats their right to specific performance.This argument is untenable, since nowhere is it clearly manifest that deposit of the money by plaintiffs prior to March 1, 1952, is...