Oconto Co. v. Bacon

• Decision Date: 19 October 1923
• Citation: 181 Wis. 538,195 N.W. 412
• Parties: OCONTO CO. v. BACON ET AL.
• Court: Wisconsin Supreme Court

181 Wis. 538

195 N.W. 412

OCONTO CO.

v.BACON ET AL.

Supreme Court of Wisconsin.

Oct. 19, 1923.

Appeal from Circuit Court, Oconto County; W. B. Quinlan, Judge.

Action by the Oconto Company against D. J. Bacon and James Flynn. From a judgment for plaintiff, defendants appeal. Affirmed.

Action to quiet title. In September, 1920, the defendant Bacon entered into a land contract with the plaintiff for the purchase of 40 acres of land in section 31, township 33 north, range 16 east. By the terms of the contract, Bacon, party of the second part, bound himself to pay the sum of $500--

“in the manner following, to wit: Payable $120 on or before June 1, 1921, 1922, 1923, and $140 on or before June 1, 1924, together with interest thereon from the date hereof, at the rate of 6 per cent. per annum, payable on or before June 1st of each year during the term of this contract, until the purchase price is fully paid; provided, however, said D. J. Bacon builds a log house and barn on said lands not later than June 1, 1921, and clears from brush and stumps five acres of said land before June 1, 1921.”

In a subsequent clause of the contract Bacon agreed to erect a fence around the land prior to June 1, 1921.

The contract contained the usual clauses as to insurance, payment of taxes, and keeping of the premises in repair, and there was a clause providing that failure to pay any installment of principal or interest when due, or the violation of any term of the contract, should render the whole of the principal sum due and payable. The plaintiff agreed that, upon payment of the purchase price and the performance of the other covenants of the contract by the party of the second part, it would convey the premises, subject to certain reservations relating to mineral rights, free and clear of all incumbrances. The contract then provided:

“And it is distinctly agreed and understood by and between the parties hereto that, if the said party of the second part shall fail to make any of the payments of money or interest above specified, or shall violate any of the provisions of this contract, then, and in that case, this agreement shall, at the option of said party of the first part, be henceforth utterly void, and all payments thereon forfeited, subject only to be revived and renewed by act of the party of the first part, or the mutual agreement of both parties.”

It is undisputed that Bacon made none of the improvements upon the premises which he agreed to make, that no sum of money was paid as a down payment, and that no subsequent payments were made.

In the month of September, 1920, Bacon assigned his interest in the contract to the defendant Flynn. Flynn made no payments, nor did he make any of the improvements which Bacon had contracted to place upon the premises. On July 7, 1921, the plaintiff wrote a letter to Bacon, reciting the terms of the contract, in which the following language was used:

“You have not done any of this--in other words, you have failed to comply with any of the provisions of this contract; therefore, the full amount of the sale price of $500 is due now and must be paid immediately or the contract will be canceled. As a matter of fact we will cancel the contract anyway.

You will have to pay up and get a deed to hold this land. By the terms of the contract you have forfeited the same at this time of writing. This is notice to you that we will give you until July 14th to make full and final payment, including interest and all other charges assessed against the land.”

In the letter it was also suggested that Bacon should execute a quitclaim deed releasing his interest in the premises.

On July 16th the plaintiff wrote Bacon a letter in which the following language was used:

“Inasmuch as you have seen fit not to answer our letters, and have failed to carry out the agreements contained in your land contract dated June 1, 1920, this is to notify you that the said contract is canceled.”

A quitclaim deed was inclosed, to which reference was made in the letter, after which the following language was used:

“If we do not receive same by return mail, we will proceed to foreclose the contract, and will take judgment against you for the full amount of claim including costs and damages.”

There was testimony in the case, which was undisputed, to the effect that the making of the improvements was a material part of the consideration, inasmuch as it made more salable lands in the vicinity which were owned by the plaintiff.

On July 15th Flynn wrote a letter to the plaintiff informing the plaintiff that the contract in question had been assigned to him by Bacon, and said:

“Let me know just what is due and I will remit whatever payments is due on same.”

In reply to this letter the plaintiff, after calling attention to the conditions of the contract requiring the making of the improvements, in its letter of July 18th wrote as follows:

“This contract is null and void. Bacon or you have failed to comply with the terms, therefore it is due for full and final settlement immediately, together with interest. The contract is canceled by the failure of you or Bacon to comply with terms of same. We do not know you in this matter, for Bacon has not given us any notice of assignment. We gave him until July 14th to comply with the terms of the agreement. He failed to do so; therefore our position is that we propose to foreclose this contract without further delay.”

Plaintiff's managing officer testified that subsequent to that date, in the fall of 1921, the amount due on the contract was tendered, but that the tender was refused because the plaintiff held the contract should be forfeited. This action was begun, the facts set out, and plaintiff made the following prayer for relief:

“Wherefore the plaintiff demands judgment canceling the contract, and declaring it null and void; that the contract and any payment thereon be declared forfeited; that the defendants deliver possession of said premises to the plaintiff; that the plaintiff's title be established against any and all claims or interest of the defendants;” and for other relief.

The court found the facts substantially as stated, and found that neither Bacon nor Flynn had performed the conditions of the contract, and judgment was entered adjudging the contract to be null and void, and quieting the plaintiff's title as against the defendants Bacon and Flynn, and for costs. From the judgment so entered, the defendants appeal.

Classon & O'Kelliher, of Oconto, for appellants.

Megan & Megan, of Oconto, for respondent.

ROSENBERRY, J. (after stating the facts as above).

An opinion was filed in this case on March 6, 1923. After the time in which a motion for a rehearing might be made had expired, it was called to the attention of the court that the decision as written was misunderstood, and had introduced some confusion into the law relating to the rights of vendor and purchaser under a land contract. The decision was withdrawn, the authorities reviewed, and the entire subject reconsidered, resulting, however, in no change in the mandate, nor, as we understand it, in the law as declared in the former opinion.

Upon the trial it was contended by the defendants that that clause of the contract relating to the making of the improvements was waived by the plaintiff company by reason of the fact that one Dunham, an agent of the Home Land Company, which last-named company was the plaintiff's sales agent, had advised the defendant Flynn that the making of the improvements would not be insisted upon by the plaintiff. The record is barren of any evidence showing that Dunham or the Home Land Company, whose agent he was, had any authority to waive any of the provisions of the contract.

[1] The principal contention of the defendants is that upon the undisputed facts it appears that the plaintiff had elected to foreclose the contract, and had thereby waived its right to declare the contract at an end. This claim is based upon statements contained in the letters of July 7th and July 16th, the material parts of which are set out in the statement of facts.

Under Shenners v. Pritchard, 104 Wis. 287, 80 N. W. 458, and Foster v. Lowe, 131 Wis. 54, 110 N. W. 829, it cannot be doubted that upon the breach of the conditions of a land contract the vendor has three remedies: (a) He may elect to sue for the unpaid purchase money; (b) he may elect to sue for specific performance of the contract; and (c) he may elect to declare the contract at an end. See, also, Kunz v. Whitney, 167 Wis. 446, 167 N. W. 747.

There can be no doubt that the election of one of these remedies waives the others. The question in this case is, What constitutes a sufficient election?

In Fox v. Wilkinson, 133 Wis. 337, 113 N. W. 669, 14 L. R. A. (N. S.) 1107, it is said:

“Since such choice is merely mental, any unambiguous act consistent with one and inconsistent with the other of the elective positions will be deemed conclusive evidence of such election.”

While this language was not used with reference to a land contract, it is applicable upon the general question of what constitutes an election of inconsistent remedies. See Smeesters v. Schroeder, 123 Wis. 116, 101 N. W. 363.

The letters of July 7th and July 16th can scarcely be said to be unambiguous. In the letter of July 7th the plaintiff says that it will cancel the contract, although by the same letter it extends the time of payment until July 14th. In the letter of July 16th it says, “This is to notify you that the said contract is canceled,” although it is also said in that letter that, if the quitclaim deed is not returned properly executed, “we will proceed to foreclose the contract and will take judgment against you for the full amount of claim including costs.”

At all times after July 16th the plaintiff contended that the contract was at an end, and did nothing inconsistent with that position. It refused to accept the tender of the remainder of the purchase price made by...