McCown v. Spencer
| Decision Date | 27 May 1970 |
| Citation | 8 Cal.App.3d 216,87 Cal.Rptr. 213 |
| Court | California Court of Appeals Court of Appeals |
| Parties | Alvin J. McCOWN, Plaintiff and Appellant, v. James R. SPENCER, Jr., et al., Defendants and Respondents. Civ. 34311. |
Culliton & Hunter, and Daniel J. Culliton, Los Angeles, for plaintiff and appellant.
Boyle, Atwill & Stearns, and James B. Boyle, Pasadena, for defendants and respondents.
This is an action brought by the intended buyer of real property against the sellers for damages caused by the sellers' alleged breach of their escrow agreement. The case went to trial on the basis of the first and fifth causes of action pleaded in a second amended complaint. The first cause of action was for breach of contract. The fifth cause of action purported to sound in fraud but merely alleged statements made by the sellers, after a closing date specified in the escrow agreement, upon which statements plaintiff relied for an extension of the time for performance. Accordingly, the trial court treated it as pleading an excuse, by way of estoppel, for nonperformance by plaintiff.
A verdict was returned for plaintiff and, on defendants' motions, the court thereafter granted judgment for the defendants notwithstanding the verdict for plaintiff 1 and, alternately, ordered a new trial. (Code Civ.Proc. § 629.) Plaintiff appeals from the judgment and from the order granting the new trial. (Code Civ.Proc. § 904.1, formerly § 963.)
The evidence disclosed that on May 14, 1963 escrow instructions were prepared and signed by the parties at a branch of Union bank, as escrow holder. They provided for a total sale price of $160,000, of which $75,000 was to be in cash, an encumbrance of $75,000 was to be assumed by the buyer and $10,000 was to be evidenced by a promissory note bearing 6 percent interest. Outside of escrow, plaintiff had handed to defendants a check for $5,000, apparently as earnest money, to be deposited by defendants in the escrow and credited against the cash required of plaintiff.
Pertinent parts of the escrow instructions read:
......
* * *
'......
* * *
'......
* * *
'* * * * * *
'(g) Time is of the essence of these and all additional or changed instructions.'
A brief review of the evidence is required. In considering appellant's appeal from the judgment notwithstanding the verdict, the evidence must be considered in the light favoring appellant, all inferences therefrom being drawn in appellant's favor. Hergenrether v. East, 61 Cal.2d 440, 442, 39 Cal.Rptr. 4, 393 P.2d 164 (1964); Bufano v. City and County of San Francisco, 233 Cal.App.2d 61, 68, 43 Cal.Rptr. 223 (1965). This is contrary to the usual rule on appeal whereby all inferences are drawn in favor of sustaining the judgment and therefore in favor of a respondent.
The evidence discloses that appellant and the respondents had been acquainted for several years. Respondent, Dr. James Spencer, Jr., informed appellant that he had received an offer of $150,000 for his property. Appellant offered to buy it for $160,000 and the escrow ensued. By an oral side-agreement, with which we are not here concerned, respondents retained an option to maintain a one-sixteenth interest in the property, representing the proportion that the $10,000 (to be evidenced by the promissory note) bore to the total purchase price. Because of this interest, respondents joined in appellant's successful efforts to have the property rezoned so that it might be improved by the construction of a convalescent hospital. After the rezoning, they tried to obtain $200,000 as a price for the property whereupon, being unsuccessful, appellant suggested recontacting respondents' original offeror, Mr. Milligan who, on learning of the rezoning, offered to purchase the property for $180,000. Appellant then named Milligan as his nominee.
A modification of the escrow instructions, dated June 24, 1963, was signed by both sides and by Milligan, calling for a payment by Milligan of $25,000 to appellant, $5,000 of which is deposited herewith,' following which title to the property was to be vested in Milligan (or his nominee) contingent upon approval of a tract subdivision map by responsible authorities. The modification provided: 'Upon receipt in escrow of written waiver from E. J. Milligan of the aforementioned contingency, you are instructed to accept all further instructions in this escrow from said nominee, and all funds deposited by me herein are to be used for the credit of and upon instructions of said vestee.'
Thereafter several discussions were had with Milligan, or his representative, who desired to extend the term of the escrow; but on June 26th and again on July 11th, 1963, respondents sent letters to the escrow holder, to appellant and to Milligan advising of respondents' intention to abide strictly by the time provisions of the escrow and stating no time extension had been, or would be, granted.
Before August 13, 1963, respondents deposited in escrow an executed deed granting title in the property, and also deposited a form of promissory note acceptable to them. Neither on nor before August 13th did appellant perform under the escrow and on August 23, 1963 respondents sold the property for $170,000 to a savings and loan association with whom Milligan had arranged to 'warehouse' it, I.e.: to purchase it, giving him an option to repurchase it at a later date. Appellant's lawsuit followed soon thereafter. A number of points are raised, requiring separate discussion.
As noted, sellers and buyer agreed that, before August 14, 1963, each would deliver a deed, or cash and a note, respectively, to the escrow holder, further agreeing that 'time is of the essence.' Paragraph 5 of the instructions went on to provide that if a condition of the escrow was not met before August 14th, then any party who had fully complied could, in writing, After that date demand the return of whatever he had deposited with the escrow holder; and, 'If no such demand is made you are to close the escrow as soon as the conditions (except as to time) have been complied with.'
Appellant contends, and respondents dispute, that paragraph 5 does away with 'prior to August 14, 1963' as the closing date of the escrow. This means that, though respondents performed, appellant nevertheless could satisfy his escrow obligations after August 13th and require the escrow to close unless respondents, after August 13th but before appellant performed, made a written demand for return of the papers they deposited. We agree this is the correct interpretation. (See: Weisberg v. Ashcraft, 223 Cal.App.2d 793, 36 Cal.Rptr. 188 (1963).) Since time was of the essence, strict compliance with the date of performance was required, if demanded after the date specified, and performance within a 'reasonable' time after demand would be impermissible. Accordingly, if the buyer had not performed by the end of August 13th, then on August 14th the sellers could have given a written demand for return of the deed they had deposited. But the sellers gave no such demand until August 23rd, when a demand letter was addressed to appellant and the bank. Since appellant had not fully performed by that date, the sale of the property by respondents to a third party on August 23rd would not constitute a breach of the contract, absent other considerations.
This leads us to the next question, namely, whether the sellers were estopped to terminate the escrow by their letter dated August 23rd. If they were, their sale of the property that date constituted a breach of the agreement.
The trial court instructed the jury on the nature of an estoppel in the terms of Code Civ.Proc. § 1962, subd. 3 (now contained in Evid. Code, § 623) and submitted to the jury a number of special verdicts. (Code Civ.Proc. § 625.) One of these inquired: 'Do you find that defendants by their conduct or action are estopped to claim that plaintiff or his nominee did not perform the contract in time?' to which the jury responded 'Yes.' The special verdict went on to inquire, 'If yes, what action or conduct of defendants constituted such estoppel?' The jury found that: 'The defendant gave no indication that anything...
To continue reading
Request your trial
-
Hauter v. Zogarts
...reasonable inferences may be drawn, the motion for judgment notwithstanding the verdict should be denied. (McCown v. Spencer (1970) 8 Cal.App.3d 216, 226, 87 Cal.Rptr. 213; Hozz v. Felder (1959) 167 Cal.App.2d 197, 200, 334 P.2d 159.) 'A motion for judgment notwithstanding the verdict of a ......
-
Otay Land Co. v. U.E. Ltd., L.P., D068347
...the Estate.Under California law, to " ‘assign’ ordinarily means to transfer title or ownership of property." ( McCown v. Spencer (1970) 8 Cal.App.3d 216, 225, 87 Cal.Rptr. 213.) Dictionary definitions are consistent with this usage. (See, e.g., Black's Law Dict., supra , at p. 142, col. 2 [......
-
Almont Ambulatory Surgery Ctr., LLC v. UnitedHealth Grp., Inc.
...was to pass title to the chose in action, then an assignment will be held to have taken place.” Id. (quoting McCown v. Spencer, 8 Cal.App.3d 216, 225, 87 Cal.Rptr. 213 (1970) ).The purported assignment here does include the following language: “I assign, whether signing as patient or patien......
-
Swiderski v. Milberg Weiss
...evidentiary presentation. (Cf. Musgrove v. Ambrose Properties (1978) 87 Cal. App.3d 44, 56,150 Cal.Rptr. 722; McCown v. Spencer (1970) 8 Cal.App.3d 216, 229, 87 Cal.Rptr. 213.) When the ground for a new trial motion is section 657, subdivision 7, the superior court has "no discretion to gra......