Realty Securities Corp. v. Johnson

• Decision Date: 18 January 1927
• Parties: REALTY SECURITIES CORPORATION v. JOHNSON.
• Court: Florida Supreme Court

111 So. 532

93 Fla. 46

REALTY SECURITIES CORPORATION v. JOHNSON.

Florida Supreme Court

January 18, 1927

En Banc.

Suit by the Realty Securities Corporation against J. W. L. Johnson to remove a cloud from title, for an injunction, and other relief. From an order of dismissal, complainant appeals.

Reversed and remanded.

Syllabus by the Court

SYLLABUS

Vendor exercising option to terminate land sale contract, making time of essence for default in payments, must generally give reasonable notice of intention, fixing reasonable time for compliance. Where time is of the essence of a contract for the sale and conveyance of land, and such contract provides that it may be forfeited and terminated at the option of the vendor when payments are not made at the times agreed on, if default be made to vendor desiring to exercise such option must, as a general rule, in order to forfeit and terminate the contract, give reasonable notice to the vendee of his intention in that regard, and that he will insist on payment as provided in the contract by a future date, fixing a reasonable time within which the vendee may have an opportunity to comply.

If purchaser removes without leaving information as to address vendor may exercise option to terminate land sale contract for default in payments and remove cloud on title (Rev. Gen St. 1920, § 3213, as amended by Laws 1925, c. 10223; Laws Ex Sess. 1925, c. 11383). If after several defaults on the part of the vendee the vendor attempts to give notice of the character stated in the preceding headnote, but is prevented from so doing by the removal of the vendee without leaving information as to his future address, and without making any provision for carrying out the contract, the vendee will be deemed to have abandoned the contract, and the vendor may then declare and treat the contract as forfeited and terminated in accordance with its terms, and may take proper steps in equity to obtain the removal of the cloud upon his title by the cancellation of the public record of such contract.

Parties may make time of essence of contract; express intention of parties in contract that time shall be of essence will be recognized in equity as well as at law. Parties have the right to make time of the essence of a contract if they so desire, and if it clearly and unequivocally appears from the contract, by means of some express stipulation, that time shall be essential, this expressed intention of the parties will be recognized in equity as well as at law.

Appeal from Circuit Court, Dade County; H. F. Atkinson, Judge.

COUNSEL

Paul C. Taylor, of Miami, for appellant.

Evans & Mershon, of Miami, for appellee.

The purpose of the bill as amended in this cause was to obtain a decree declaring a certain contract for deed and the assignment thereof a cloud upon the title of the complainant appellant here, and removing said cloud, and ordering the clerk of the court to enter on the margin of the record of said contract for deed an appropriate notation showing that the same had been canceled and ordered removed from the records by virtue of such order. There was also a prayer that the court perpetually enjoin the defendant from making any claim to the property under said agreement for deed; also a prayer for general relief. This bill as amended was demurred to by the defendant on the ground that the same was without equity. The chancellor sustained the demurrer and dismissed the bill at the cost of complainant, from which order this appeal was taken.

The facts alleged in the bill are as follows:

The complainant was the owner in fee simple of two described lots of land in Kirkland heights, which it sold to a Mrs. Fowler. On May 25, 1920, complainant executed and delivered to Mrs. Fowler a contract or agreement for deed wherein complaint agreed to convey to Mrs. Fowler the said two lots for $475, $20 being paid in cash, and the remainder to be paid at the rate of $10 per month until the contract was fully paid. On October 4, 1921, Mrs. Fowler assigned said contract, which had been duly recorded in the public records, to defendant, Johnson. The contract contained the following provision:

'And in case of the failure of the said party of the second part to make either of the payments or any part thereof or to perform any of the covenants on her part hereby made and entered into, this contract shall at the option of the party of the first part be forfeited and terminated, and the party of the second part shall forfeit all payments made by her on this contract, and such payments shall be retained by the said party of the first part in full satisfaction and liquidation of all damages by it sustained. And the said party of the first part shall have the right to re-enter and take possession of the premises aforesaid without being liable to any action therefor.

'It is mutually agreed, however, by and between the parties hereto, that the time of payment shall be an essential part of this contract, and that the covenants and agreements herein contained shall extend to and be obligatory upon the successors, heirs, executors, administrators, and assigns of the respective parties.'

Up to December 10, 1921, complainant had received payments aggregating $190, and on that date the defendant secured a deed from the complainant for one of said lots, leaving a balance due on the contract of $285. The lots were of equal value, so that defendant received from complainant property of more value than the sum which had been paid to the complainant. This transaction left a balance of $285 due on the contract covering the remaining lot. No further payment was made by the defendant until January 28, 1922, when $5 was paid, and on January 30, 1922, $10 was paid. No further payments were made by the defendant. On June 29, 1922, complainant sent a letter to the defendant at his last known address, 923 Northwest First avenue, in the city of Miami, calling his attention to the fact that no payment had been made on said property since January 30, 1922. This letter was returned by the postal authorities with a notation to the effect that it was unclaimed. This being the only address known to complainant, and not hearing from the defendant nor receiving any further payments from him, complainant, on August 25, 1922, addressed a letter to the defendant, sending the same by registered mail, notifying him that unless within 30 days from the date of said letter the payments in default were made, that complainant would exercise the option contained in said contract and cancel the same. This letter was also returned by the postal authorities with a similar notation to the effect that the same was unclaimed.

The amended bill alleges that to the best of complainant's information and belief the defendant, after January 30, 1922, removed himself from the city of Miami, Fla.; that he did not leave with complainant any address whatsoever; and that complainant could not know and could not have known by reasonable diligence the address of the defendant so as to serve him personally with notice to make the payments called for by the agreement, and that complainant had no means of serving the defendant personally with notice except as above set forth; that on account of defendant's failing to make the payments as called for by the contract and said notice, complainant exercised its option and declared the contract forfeited and terminated. Complainant in said bill tenders to the defendant the sum of $15 paid by him on account of the remaining lot covered by the contract, and alleges its readiness to pay said sum to the defendant, the contract having been canceled by the complainant. It is further alleged that the defendant, by recording the agreement for deed, caused a cloud to be cast upon the title of complainant to said land, which complainant desired to have removed and his title quieted. The bill further alleges that the defendant had never taken possession of the said property and that the same was unimproved and unoccupied land. The bill closed with the prayer for removal of cloud hereinabove mentioned. The amended bill was filed on February 22, 1924, and alleged that the defendant was then a resident of Miami, Dade county, Fla. A demurrer was filed by the defendant, which demurrer was sustained, as above stated.

OPINION

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

This is a bill, not for the rescission, or forfeiture, or cancellation of an existing contract, but for the removal of a cloud resulting from the recordation of a contract which the complainant alleges had previously been terminated by it in accordance with the terms of such contract. While the allegations of the amended bill are not as full and specific as they might be, this is a fair interpretation of the meaning and effect of its averments.

Equitable jurisdiction to remove clouds from title is granted on the principle quiatimet; that is, that the deed or other instrument or proceeding constituting the cloud may be used to injuriously or vexatiously embarrass or affect plaintiff's title. Pomeroy's Eq. Juris. (4th Ed.) vol. 4, §§ 1398, 1399, volume 5, §§ 2146, 2147. Under section 3213, Rev. Gen. Stats. 1920, as amended by chapter 10223, Laws of 1925, as well as under chapter 11383, of the Extra Session Laws of 1925, it is not longer essential to the jurisdiction that the complainant be in actual possession of the land from the title to which it is desired to remove the cloud.

Instruments and proceedings of every conceivable nature have been removed as clouds on title, among them land contracts. Pomeroy's Eq. Juris. §§ 1399 and 2149, and numerous cases cited; Sea v. Morehouse, 79 Ill. 216; Larmon v. Jordan 56 Ill. 204; Taylor v Rawlins, 86 Fla. 279, 97 So....