Kimm v. Andrews

• Decision Date: 03 January 1974
• Docket Number: No. 71,71
• Citation: 313 A.2d 466,270 Md. 601
• Parties: Lloyd C. KIMM et ux. v. Michael W. ANDREWS.
• Court: Maryland Court of Appeals

Page 601

270 Md. 601

313 A.2d 466

Lloyd C. KIMM et ux. v. Michael W. ANDREWS.

No. 71.

Court of Appeals of Maryland.

Jan. 3, 1974.

Vincent A. Mulieri, Annapolis (Thomas J. Wohlgemuth and Smtih & Wohlgemuth, Annapolis, on the brief), for appellants.

Marvin H. Anderson, Annapolis (Anderson & Anderson, Annapolis, on the brief) for appellee.

Argued before MURPHY, C. J., and BARNES, McWILLIAMS, SINGLEY, SMITH, DIGGES and LEVINE, JJ.

BARNES, Judge.

This appeal involves two written contracts for the sale of the same 53 acres of land and the improvements thereon in Gambrills, Anne Arundel County (the subject property), signed by the owners, J. Maurice Dicus, Jr. and his wife, Doris E. Dicus. The first contract was signed on December 10, 1970, with the appellants, Lloyd C. Kimm and his wife, Diana C. Kimm, as purchasers. The second contract was dated April 5, 1971 (but agreed upon and signed on April 4, 1971), with the appellee, Michael W. Andrews, as purchaser. The Circuit Court for Anne Arundel County (Wray, J.) granted specific performance of the Andrews contract by its decree of September 22, 1972, in which it also declared null and void the deed from the Dicuses to the Kimms for the subject property and the purchase money nortgage from the Kimms to the Discuses, both dated May 4, 1971, and recorded May 6, 1971. The principal issues in the case involve the validity of the first contract at the time the second contract was signed, the status of Mr. Andrews as a bona fide purchaser, and the determination of whether the Dicuses and the Kimms waived the provision in the first contract that time was of the essence and, if so, whether such a waiver was effective against Mr. Andrews.

The metes and bounds description of the subject property appearing in the deed of May 4, 1971, indicates that it is an irregularly shaped tract with eight corners. The improvements on the land consist of the home of the Dicuses and four other houses.

The first contract of December 10, 1970, was prepared by Ira J. Wagonheim, a member of the Bar, who acted as the attorney for the Dicuses in that transaction. It recited, inter alia, that the subject property 'has a road frontage on Gambrills Road of eight hundred (800) feet, more or less' and that the selling price was $80,000 of which $500 had been paid prior to the signing of the contract and the balance to be paid as follows: an additional $29,500 to be paid at the time of settlement and the $50,000 balance to be financed by a purchase money mortgage, under terms and conditions set forth in the contract. The contract then provides:

'It is expressly understood and agreed that this contract shall be subject to the following terms and conditions, and upon failure of any of said terms and conditions, this contract shall become null and void, and all deposit monies shall be promptly returned:

LCK

JMD

DED

DCK

1. Sellers will take back a purchase money mortgage for Fifty Thousand Dollars ($50,000.00), payable in twenty-five (25) years, said mortgage bearing interest at the rate of six per cent (6%) per annum, computed on the unpaid principal balance with the right of prepayment without penalty after the end of the tenth year; monthly installments to include principal and interest, with Buyers paying annual real estate taxes and other public charges assessed against the property. Buyers are also to insure the premises for not less than Fifty Thousand Dollars ($50,000.00) for benefit of sellers.

2. All houses situate on said premises are being sold 'as is'.

3. Sale includes: Kitchen stoves in all houses, one (1) refrigerator, one (1) Ward's freezer, space heaters and heating equipment in all houses.

4. Prior to settlement, Sellers will show Buyers location of boundary stakes, septic system and water pipes.

5. Settlement shall take place not later than March 31, 1971.

6. The hereinafter stated offer to sell said premises shall be revoked if not accepted by Buyers not later than December 18, 1970.'

Later in the contract is the provision 'time being of the essence of this Agreement.'

The sellers also agreed to pay Charles H. Steffey, Inc., in cooperation with Earl Patterson Realty, a brokerage commission of 6% of the total sale price.

The Kimms are Koreans. They have been in the United States for a number of years. In this transaction, they were represented by Mrs. Virginia Lewis, a real estate agent employed by Charles H. Steffey, Inc. Mrs. Lewis had previously sold the Kimms three other properties in a period of four years prior to December 10, 1970. Mrs. Lewis prepared the first draft of the proposed contract of sale between the Kimms and the Dicuses and presented that draft to Earl Patterson, the listing broker, who was cooperating with Steffey. Mr. Patterson indicated that he was not satisfied with the wording of the proposed contract and wished to have an attorney prepare the contract. Mr. Patterson later stated that Mr. Wagonheim (who has offices in the same building as Mr. Patterson) prepared the draft of the contract which, with certain amendments, was signed by the parties. The signatures of the Kimms were witnessed by Mrs. Lewis; Mr. Wagonheim witnessed the signatures of the Dicuses.

After the contract of December 10, 1970, was signed, Mrs. Lewis arranged for an appointment with the Dicuses to meet at the subject property on January 10, 1971, in order that Mr. Dicus could show the Kimms the boundary stakes, as well as the location of the septic system and the water pipes. When the parties met at the subject property on January 10, the ground was largely covered with snow as a result of a snowfall a few days before. Mr. Dicus was too ill to walk the boundaries, particularly in the snow. Mrs. Dicus apparently did not know the location of the boundaries, having never bothered to learn their location. Mrs. Lewis testified that Mr. Kimm appeared to be upset or angry about the condition of the pipes in the Dicuses' house. What was said between the Kimms, however, was said in Korean. Mrs. Kimm testified that her husband was upset only because he had taken a day off from work and was displeased about the inability of the Dicuses to show him the boundaries of the subject property. ¹

Mrs. Lewis testified that, thereafter, on behalf of the Kimms, she made repeated telephone calls to the office of Earl Patterson in an effort to make new arrangements for the Dicuses to show the Kimms the boundary lines, but without success. The boundary lines were never shown to the Kimms until shortly before the Dicuses executed a deed for the subject property to them on May 4, 1971.

Mrs. Kimm wanted the Dicuses to consent to certain amendments of the December 10 contract and she and Mrs Lewis met in Mr. Wagonheim's office on January 30, 1971. Mrs. Lewis thought the meeting took place on February 6, 1971, but the precise date of the meeting is immaterial. Mrs. Kimm at this meeting indicated that she wanted the December 10 contract amended in three particulars, i. e., (1) a reduction in the rate of interest on the purchase money mortgage; (2) a reduction in the required amount of fire insurance; and, (3) a one-month deferment from payment of the $29,500 due at settlement. The Dicuses rejected all of these proposed amendments. At the January 30 (February 6), 1971, meeting in Mr. Wagonheim's office, Mr. Wagonheim suggested that Mrs. Kimm might wish to invest her money in the Delaware farm the Dicuses were buying, but Mrs. Kimm stated: 'oh no, I want the (subject) property.'

Mrs. Kimm acquiesced in the rejection by the Dicuses of the proposed amendments and began to prepare for settlement by ordering a title search for the subject property in the middle of February, 1971, from the Central Maryland Title Company, Inc., with which William A. Hackney, an attorney, is affiliated.

On March 1, 1971, Mrs. Lewis and Mr. Patterson met in the office of Mr. Hackney, who, as already indicated, is affiliated with the Central Maryland Title Company, Inc., which was employed by the Kimms to search the title of the subject property. Mr. Hackney's office is in the Steffey Building across the hall from the office of Mrs. Lewis. It was at this meeting that March 30, 1971, was selected as the date for settlement. Although no written notice of the settlement date was sent to the Kimms either by Patterson, Hackney, or Wagonheim, Mrs. Lewis testified that she told Mrs. Kimm of the proposed settlement date and that Mrs. Kimm agreed to the date, provided the boundary lines were shown to the Kimms prior to that date.

An arrangement had been made for the Kimms to meet the Dicuses at the subject property on March 24, 1971, so that the boundaries, septic system, and water pipes could be shown to the Kimms. On March 24, however, Mr. Patterson telephoned the office of Mrs. Lewis and left a message that Mr. Dicus was in the hospital with pneumonia. This message was passed on to the Kimms.

Mr. Wagonheim testified that on March 27, 1971, Mr. Hackney telephoned him, stating that the Kimms wanted the boundaries shown to them prior to settlement. The boundaries, however were not shown to the Kimms and, on March 29, 1971, Mr. Hackney left a message at Mr. Wagonheim's office to the effect that the Kimms were not coming to the settlement. Mrs. Lewis and the Kimms apparently believed that the settlement would not take place on March 30 in view of the information given them that Mr. Dicus was in the hospital with a serious illness. Unknown to them, however, Mr. Wagonheim had obtained the signatures of Mr. and Mrs. Dicus on a deed for the subject property and also on a letter authorizing Mr. Wagonheim to make the affidavit in regard to consideration on the proposed purchase money mortgage. The signatures on these documents were obtained by Mr. Patterson at Mr. Wagonheim's request. Mr. Wagonheim advised Mrs. Dicus not to attend the settlement because, he said, it could 'be very ugly at a settlement.'

On March 30, 1971, Mr. Wagonheim...