McVeety v. Harvey Mercantile Co.

• Decision Date: 02 January 1913
• Parties: McVEETY v. HARVEY MERCANTILE CO., Limited, et al.
• Court: North Dakota Supreme Court

24 N.D. 245

139 N.W. 586

McVEETY

v.HARVEY MERCANTILE CO., Limited, et al.

Supreme Court of North Dakota.

Jan. 2, 1913.

Syllabus by the Court.

Plaintiff in writing contracted to sell and convey by his warranty deed 1,200 acres of land to defendant corporation as a purchaser. He sues to recover damages for refusal and neglect of defendants to perform their part of the contract. The answer denies that plaintiff was ever able to perform under his contract. On trial the proof disclosed that plaintiff never owned any of the land, nor had he any interest therein, but that he had contracted to personally sell the same, relying upon written permission from the owner that he might sell during a period which had expired, but had been verbally extended, to expire at the end of the time fixed in the written contract between plaintiff and defendants for its performance. The owner executed for delivery his deed of 960 acres, and assigned contracts for deeds for 160 acres, but inadvertently omitted to deed the remaining 80 acres of the 1,200-acre tract agreed by contract to be conveyed. The deed was sufficient to convey title to the land designated therein from the owner, Ross, grantor, to defendant company as grantee. This deed, with assignments of contracts to the 160 acres, was deposited at the place designated for deposit in the written contract between McVeety and defendants, and within the time limited for performance of said contract; this as a tender of performance by McVeety, who then notified defendants that he was able and ready to convey and fully perform his part of his contract upon payment by them of the purchase price, consisting of, in part, a bill of sale of a stock of goods, deeds of some town lots owned by Sayre, and a cash balance. Defendants refused to accept the deeds, convey, or pay the purchase price, on the ground that the deed deposited did not convey fee title to the omitted 80 acres and the 160 acres covered by contracts assigned, such refusal having been made on the last day of the 15-day period for the performance of the contract. Plaintiff asserts that defendants were in default in a condition precedent to the right to require a deed, in that an inventory of the stock of store goods, the inventory price of which was to constitute part of the purchase price of the lands, had not been theretofore made as provided in the contract, and that a sufficient proof of ability of McVeety to convey had been made, while defendants had been proven to have been in default, and that defendants cannot be heard to claim the right to a deed from McVeety instead of from Ross, owner, in the performance of the contract, because defendants did not specifically object on that ground to the sufficient title offered them by the deed from the owner direct to the defendant company. Plaintiff seeks to recover the difference between what the landowner. Ross, would have been paid for the land, $38,000, and the $66,000, contract selling price to defendants, and on the trial recovered a verdict for $13,000. Held:

(1) That to have performed his contract according to its terms defendant must have been able to convey by his own warranty deed the land he has contracted to so convey, under the provisions of section 5401, Rev. Codes 1905, providing that: “An agreement to sell real property binds the seller to execute a conveyance in form sufficient to pass title to the property.”

That under section 5253, Rev. Codes 1905, providing that “an offer of performance must be free from any conditions which the creditor is not bound on his part to perform,” plaintiff has never offered a performance of his contract to convey, even granting the deed had been sufficient to convey title to the full tract of land covered by the contract; and, as the tender of the deed of the third party owner could not constitute a compliance with the contract calling for a deed of McVeety to defendants, proof of the offer of the third party to so convey all said tract is not sufficient to constitute proof of McVeety's ability to perform his contract with defendants.

The right to the covenants of warranty by deed from the seller is a valuable property right in the purchaser that must be given as required by the contract, unless expressly waived by the purchaser.

Defendants, by merely refusing to perform upon the tender of performance here offered by Ross, did not, by failing to demand the deed of McVeety instead of the one tendered, waive the right contracted for, that McVeety should deed as grantor to them as grantee, and that the title should come to the defendant company through McVeety.

Proof that a buyer of real estate would have received title from a third person to land covered by the contract is not proof of ability in the seller to perform his contract to convey by his warranty deed to his purchaser.

Without proof of ability in a seller of real estate to convey to his purchaser in accordance with his contract with such purchaser, there can be no proof of detriment or injury occasioned the seller by a refusal of his purchaser to perform the contract. Proof of the seller's ability to perform lies at the base of any right of his to recover, and is a condition precedent to any right in him to recover. Without proof of such ability no cause of action is established.

With no cause of action established as in plaintiff, because no ability in him to perform the contract has been shown, proof that the defendants were in default in the performance of any act precedent to the delivery of the deeds and payment of the consideration therefor is immaterial, as it can neither cure nor affect plaintiff's inability to perform the contract at any time during the life thereof.

The evidence precludes any right of plaintiff to recover, and the motion of defendants for judgment of dismissal of this action notwithstanding the verdict should have been granted.

Appeal from District Court, Wells County; Coffey, Judge.

Action by James H. McVeety against the Harvey Mercantile Company, Limited, and another. Judgment for plaintiff, and defendants appeal. Reversed and remanded, with directions to dismiss.

John O. Hanchett, of Harvey, for appellants. Pollock & Pollock and Turner & Murphy, all of Fargo, for respondent.

GOSS, J.

This action was brought to recover damages for alleged defaults of the defendant in fulfillment of a certain contract to purchase lands. A verdict of $13,000 was obtained against defendants, who appeal. The contract reads: “This agreement made and entered into in triplicate this 27th day of May, 1910, by and between J. H. McVeety, party of the first part, and the Harvey Mercantile Company, a corporation, and A. J. Sayre, acting by and through L. P Strong, attorney in fact, party of the second part, witnesseth: That the said parties have agreed and do hereby agree to make a sale and exchange of property as follows, viz.: The said party of the first part agrees to sell and convey to the Harvey Mercantile Company, one of the said parties of the second part, by good and sufficient warranty deed free from all incumbrances, twelve hundred acres of land in the County of Clay, in the State of Minnesota, at the price of $55 per acre, amounting to $66,000, to be paid for by the parties of the second part in the manner hereinafter specified; which said land is more particularly described as follows: [With description] known as the D. C. Ross land. The parties of the second part agree to take and purchase the above-described land from the party of the first part at the price above mentioned, and to pay therefor as follows, viz.: The said A. J. Sayre, one of the said parties of the second part agrees to sell and convey to said first party, by good and sufficient warranty deed, free from all incumbrance, the store building and lots in the City of Harvey, North Dakota, now occupied by the said Harvey Mercantile Company, at the agreed price of $18,000, which said first party agrees to take at said price as a payment upon the sale of said land; which said lots and store building are more particularly described as follows: [With description given] and the store building thereon. As a further payment to the said first party for said land the said Harvey Mercantile Company, one of the parties of the second part, agrees to sell and transfer to said first party, free from all incumbrance, its stock of goods and merchandise now situated in the said store building on the lots above described. [With the particular description of the stock transferred and providing for an inventory by parties named to determine the value of said goods.] And the said Harvey Mercantile Company, party of the second part, agrees to sell and transfer to the said party of the first part, free from all incumbrances, and the said party of the first part agrees to take as a payment on the sale of said land all of the fixtures in said store, except the fixtures in the hardware department, the same to be inventoried and taken at the inventory price. That the balance of the purchase price of said land shall be paid to said party of the first part in cash by the said Harvey Mercantile Company, party of the second part, after the said inventory of stock and fixtures has been made and completed, and at the time the deeds are delivered and transfer made. It is agreed that said inventory is to be made, abstracts of title procured, deeds and bills of sale prepared and executed in accordance with the terms of this contract, and the deal closed within fifteen days from this date; said deal to be closed and deeds, abstract and bill of sale delivered at the Bank of Harvey in the City of Harvey, Wells County, North Dakota. In case the said lands shall have loans or incumbrances thereon which the parties of the second part desire to assume, they may do so and the amounts owing thereon deducted from the purchase price of such land.”

The complaint exhibiting the foregoing contract as a part thereof pleads...