Langley v. Norris

• Citation: 173 S.W.2d 454
• Decision Date: 21 July 1943
• Docket Number: No. 8091.,8091.
• Parties: LANGLEY v. NORRIS.
• Court: Texas Supreme Court

Page 454

173 S.W.2d 454

LANGLEY v. NORRIS.

No. 8091.

Supreme Court of Texas.

July 21, 1943.

Error to Court of Civil Appeals of Eleventh Supreme Judicial District.

Suit by W. A. Langley against John Norris for title and possession of a section of land. Defendant brought a cross-action against plaintiff and L. S. Mitchell and others for specific performance of a contract to sell such land to defendant. To review a judgment of the Court of Civil Appeals, 167 S.W.2d 603, affirming a judgment for defendant, W. A. Langley brings error.

Judgments of the District Court and of the Court of Civil Appeals affirmed.

Sullivan & Sullivan, of Big Spring, and O. D. Montgomery, Callaway & Reed, and L. O. Langley, all of Dallas, for plaintiff in error.

Justice, Moore & Justice, of Athens, Thomas & Thomas, of Big Spring, and Culbertson, Morgan, Christopher & Bailey, of Fort Worth, for defendant in error.

SMEDLEY, Commissioner.

Petitioner Langley, claiming title through a deed from L. S. Mitchell and wife and Frank A. Baggett and wife executed April 6, 1940, sued respondent Norris for the title and possession of a section of land numbered 32 in Howard County. Norris made Mitchell and wife and Baggett and wife parties and by cross action sought against them and Langley specific performance of a written contract dated September 16, 1939, and executed about October 1, 1939, whereby Mitchell and wife and Baggett and wife agreed to sell and convey the section of land to Norris. After return of a verdict favorable to Norris, the trial court rendered judgment for him against the other parties, awarding the land to him subject to liens securing specified sums found to be owing to Mitchell and wife and Baggett and wife and to Langley. On appeal by Langley alone, the Court of Civil Appeals affirmed the trial court's judgment. 167 S.W.2d 603.

By the terms of the written contract between Mitchell and wife and Baggett and wife as vendors and Norris as vendee, the vendors agreed to sell and convey Section 32 to the vendee and the vendee agreed to purchase the section of land from the vendors for $15 per acre, to be paid in cash. The vendee agreed immediately to make application to a loan company associated with the Federal Housing Administration for a loan on the land in an amount of 80% or more of the agreed purchase price, the money so procured to be used to pay vendors for the land, and the vendee to pay the balance of the agreed purchase money in cash. The vendors agreed to furnish an abstract of title showing a good and merchantable title to the land, subject only to an existing lien securing approximately $4,600, and provisions were made for examination of the abstract by the loan company, the correction of defects in the title, and the execution and delivery of the necessary instruments for closing the sale upon the approval of the title. The contract provided that in the event the loan in the amount of 80% or more of the agreed purchase price could not be secured by the vendee, then the contract should be null and void and of no force and effect. The next and concluding sentence of the contract is: "It is agreed that this instrument will not be recorded and that it will be null and void and of no force and effect on and after November 2, 1939."

It was discovered by a survey made in connection with the examination of the title that the section of land, believed by the parties to contain 640 acres or 620 acres, in fact contained 548 acres. The vendors had 620 acres within their enclosure, but the north 72 acres were within Section 29 lying immediately north of Section 32, the record title to which 72 acres was in Chris Anderson, the owner of Section 29. The trial court's judgment contains the finding, supported by undisputed evidence, that the contract of sale was intended by the parties to cover the whole of the 620 acres within the vendors' enclosure.

Other material facts taken from findings made by the jury, which are supported by evidence, and from undisputed evidence, are as follows: On October 14, 1939, Norris and his wife made application through the Great American Life Underwriters on the elaborate form of the Federal Housing Administration for a loan of $9,000. The application shows that an existing mortgage debt of $4,800 would be paid from the proceeds of the loan and that improvements of an estimated cost of $2,864 would be begun when the loan was approved. On October 19, 1939, Norris telegraphed the insurance company, inquiring what disposition had been made of his application, and on November 17, 1939, he was advised that commitment had been made by the Federal Housing Administration on November 13, 1939, to insure a loan of $8,400. The commitment was subject to approval of title and to construction of the improvements according to the plans and specifications submitted with the application.

Before making the application, Norris had caused plans and specifications to be prepared for the construction of a house on the land in accordance with Federal Housing Administration requirements and to cost $2,800, and in the month of November, 1939, Norris made arrangements to borrow from a Mrs. Smith the money to pay the balance of the consideration for the land.

Norris was in possession of the land in controversy as a tenant of Mitchell and Baggett when his contract to purchase it was executed and thereafter he remained in possession, claiming the right to it under the contract.

Not having heard from the insurance company about his application for the loan, Norris, a short time before November 2, 1939, wrote Mitchell a letter asking him to extend the time until November 15 so that he would be able to hear from his application for the loan, and on November 3, 1939, Mitchell, who was acting for all of the vendors, wrote a letter to Norris advising him that he could have the extension of the agreement to November 15. In another letter written November 15, 1939, Mitchell asked Norris to advise him how his loan negotiations were progressing and stated that he was willing to allow him a reasonable time "for exercising out your plan".

It clearly appears from this correspondence and other facts and circumstances in evidence that the last sentence in the contract providing that it should be null and void after November 2, 1939, was intended and understood by the parties to have reference to the obtaining of assurance or commitment for a loan on or before that date and not to the final completion of the entire transaction. The jury found in answer to a special issue that the parties to the contract did not intend, when the contract was made, that everything necessary to be done should be completed and the sale closed by November 2, 1939. It further found that Mitchell and Baggett treated the contract as being in force and effect after November 2, 1939, and led Norris to believe that they did not intend to enforce the time limit as expressed in the original contract, if there was a time limit therein; that Norris relied upon Mitchell's letter of November 15, 1939, giving him a reasonable time in which to complete the contract and made valuable improvements on the land; that Norris offered within a reasonable time after November 2, 1939, to pay Mitchell and Baggett for all of that part of the land to which they could give good title; that Norris had made arrangements to pay for the land and was financially able to do so; and that Mitchell and Baggett, before they conveyed the land to Langley, refused to convey to Norris the 548 acres at $15 per acre unless he would also accept and pay for the 72 acres, the title to which was in dispute.

After the making of the agreements for extension evidenced by Mitchell's letters of November 3 and November 15, 1939, Mitchell from time to time urged Norris to complete his arrangements for closing the sale, but the defect in the title to the north 72 acres appeared when a survey was made in November or December, 1939, and both Mitchell and Norris did what they could to clear up the title, Mitchell going to the Land Commissioner's office several times and employing another surveyor to verify the work done by the surveyor employed by Norris. The defect was never corrected, however, until Mitchell on September 24, 1940, obtained the execution by Chris Anderson of a boundary agreement fixing the line between Sections 29 and 32 so that the 72 acres were included within the bounds of Section 32.

In the meanwhile, however, as early as February 4, 1940, Norris offered to accept and pay for the 548 acres, but Mitchell insisted upon his buying all of the land, and on March 4, 1940, Mitchell wrote Norris demanding that Norris pay for the land by posting the full purchase price in the First National Bank of Big Spring by March 9. This demand was that Norris take the title "just as it was" and pay for all of the land, including the 72 acres.

The commitment for the FHA loan to Norris was cancelled by the Federal Housing Administration or by the insurance company on March 16, 1940, the specific reason assigned for the cancellation being that good title could not be given to the entire tract, which fell short about 70 acres. Norris thereafter made arrangements with a Mr....