Minshall v. Case, 19438

• Decision Date: 18 September 1961
• Docket Number: No. 19438,19438
• Citation: 148 Colo. 12,364 P.2d 868
• Parties: Guy A. MINSHALL and John W. Minshall, Plaintiffs in Error, v. Leon M. CASE and Eleanor V. Case, Defendants in Error.
• Court: Colorado Supreme Court

Page 868

364 P.2d 868

148 Colo. 12

Guy A. MINSHALL and John W. Minshall, Plaintiffs in Error, v. Leon M. CASE and Eleanor V. Case, Defendants in Error.

No. 19438.

Supreme Court of Colorado, In Department.

Sept. 18, 1961.

Frank A. Bruno, Stanley H. Johnson, Denver, for plaintiffs in error.

Roepnack, McCurdy, Orahood & Maloy, Arvada, for defendants in error.

MOORE, Justice.

This action involves a controversy arising out of a contract for the purchase and sale of real estate. Plaintiffs in error will be referred to as the sellers, defendants or as Minshalls. We will refer to defendants in error as the purchasers, plaintiffs or Cases.

On December 21, 1956, the said parties entered into a contract, in major part on the familiar printed form, under the terms of which Cases agreed to purchase described real estate (residence property) in Jefferson county, and Minshalls agreed to convey the property to the purchasers, '* * * in fee simple by good and sufficient warranty deed, free and clear from all liens and incumbrances except general taxes for 1956, payable in 1957, and all subsequent taxes, and deliver title insurance therefor so showing.'

The total purchase price was $13,500, of which $1,500 was paid upon execution of the contract. The provision of the contract governing the unpaid balance was as follows:

'* * * the balance in monthly installments of $100.00 or more at the option of Parties of the Second part, including interest at the rate of 6% per annum, and including 1/12 of estimated taxes for the current year on the first day of February, 1957 and on the first day of each subsequent month. Purchasers hereby referred to as parties of the second part further agree to apply for and secure at their expense the best financing available on said property on or before January 1, 1958 and pay first Parties out in cash. In event new financing will not pay First Parties in full, First Parties agree to carry balance as Collateral loan or second mortgage. * * *'

In addition to the usual provisions concerning insurance and payment of taxes, the contract contained the following agreement pertinent to the questions we are required to determine. The purchasers were:

'* * * until the termination hereof [to] be entitled to possession of said property, but in case of failure of the parties of the second part to make any one or more of said payments, or perform any of the covenants agreed to be made and performed by the parties of the second part, this agreement may be terminated at the election of the parties of the first part, upon giving to the parties of the second part 30 days' notice of intention so to do, which notice may be served as provided by law for service of notice to quit, and in case of such election the parties of the second part shall forfeit all payments made, and such payments shall be retained by the parties of the first part in full satisfaction and liquidation of all damages the parties of the first part may have sustained.

'It is mutually agreed, That time shall be of the essence of this agreement, * * *'.

The provisions of the contract were to extend to and be binding upon the 'heirs, * * * successors and assigns of the respective parties.'

Purchasers, who were plaintiffs in the trial court, alleged that they had complied with all the terms of the contract, and that on the 4th day of January, 1958, defendants served upon them a notice as follows:

'To: Leon M. Case and Eleanor V. Case

'You are hereby notified that Guy A. Minshall and John W. Minshall, as sellers under that certain agreement for sale and purchase of property dated December 21, 1956, wherein you are the purchasers, do hereby terminate all of your right, title and interest in and to the following described real estate situate in the County of Jefferson, State of Colorado, to-wit:

'Lot 24,

Block 2,

Cheryl Crest (Part One)

Commonly known as 6350 Quay Street, Arvada, Colorado,

by reason of your failure to keep and perform the covenants set forth as follows: 'Purchasers hereby referred to as parties of the second part further agree to apply for and secure at their expense the best financing available on said property on or before January 1, 1958, and pay first parties out in cash', and your failure further to invoke the following clause contained in said Agreement: 'In the event new financing will not pay first parties in full, first parties agree to carry balance as collateral loan or second mortgage'.

'Said termination shall be effective thirty days from the date of service of this notice upon you.

'You are accordingly notified to quit said premises and surrender possession thereof on or before thirty days from the date of the service of this notice upon you; you are to quit possession and surrender the property in question in good condition, ordinary wear and tear excepted.

'Dated at Denver, Colorado, this 3rd day of January, 1958.'

Purchasers further alleged that prior to 30 days from the service of said notice, on January 30, 1958, they arranged for a loan with Mortgage Investment Company, Denver, Colorado, and offered to pay Minshalls in full in accordance with the terms of their contract in exchange for a deed from the sellers. The notice was as follows:

'Gentlemen:

'Leon M. Case and Eleanor V. Case hereby notify you that on Thursday, the 30th day of January, 1958, at the hour of 12:30 afternoon, at Mortgage Investment Company, 1711 California Street, Denver, Colorado, Leon M. Case and Eleanor V. Case will make full payment to you of the moneys which you have coming from them under and by virtue of that contract dated December 21, 1956, wherein you are parties of the first part, and they are parties of the second part, in exchange for your Warranty Deed to them as provided in said contract.

'Dated this 28th day of January, 1958.'

The purchasers alleged that the sellers failed and refused to execute and deliver their deed conveying the aforedescribed property, and refused to receive full payment in accordance with the terms of their contract, and thereby breached their agreement and damaged the purchasers. It was further asserted that on the 30th day of January, 1958, the reasonable value of the property in question was $13,900; that the amount owing to Minshalls was $11,697.16; and that by reason of the breach of contract by them the purchasers were damaged in the sum of $2,202.84 for which amount they prayed judgment with interest from January 30, 1958, and for costs.

Minshalls by answer admitted making the contract, admitted service of the Notice of Termination as alleged by Cases and admitted that they had applied for a loan from Mortgage Investment Company. They denied all other allegations in the complaint. By way of affirmative defenses they alleged that Cases are not the real parties in interest; that they waived any rights they may have had in the subject matter of the action; and alleged an estoppel and forfeiture of purchasers' rights in the contract.

By way of counterclaim the Minshalls seek to quiet title to the premises involved. Trial was had to the court and the evidence shows that subsequent to signing the contract the purchasers moved into and took possession of the property, and that during all of 1957 monthly payments were made by them substantially as called for by the contract. It is undisputed that purchasers were unable to procure financing to pay defendants in cash for the balance due under the contract. There is no showing that other or partial financing was ever attempted by purchasers, nor that any request was ever made of Minshalls to accept a second mortgage in part payment of the amount remaining...