Sherwood v. Daly

• Decision Date: 23 April 1938
• Docket Number: 6528
• Citation: 78 P.2d 357,58 Idaho 744
• Parties: CHARLES L. SHERWOOD, Appellant, v. THOMAS F. DALY and ANNA B. DALY, Husband and Wife, Respondents
• Court: Idaho Supreme Court

78 P.2d 357

58 Idaho 744

CHARLES L. SHERWOOD, Appellant, v. THOMAS F. DALY and ANNA B. DALY, Husband and Wife, Respondents

No. 6528

Supreme Court of Idaho

April 23, 1938

VENDOR AND VENDEE-EXECUTORY LAND CONTRACT, BREACH OF-ACTION TO FORECLOSE MORTGAGE.

1. A vendor under a land contract need only have, the title contracted for at the time performance is due.

2. Where sheriff executes and delivers certificate of sale to purchaser at mortgage foreclosure sale, title to realty passes, and the only right or property interest remaining in mortgagor is the right to divest purchaser of his title within a year from sale by compliance with redemption statute. (I. C. A., secs. 8-301, 8-402 to 8-407.)

3. The commencement of a mortgage foreclosure suit against vendors was not a breach of an executory land contract under which vendee was in possession of realty, where performance by vendors was not due when suit was commenced because vendee had not paid purchase price in full, and it did not appear that vendors permitted suit to be prosecuted to point of divesting them of title to realty, or that default had been entered against them when vendee commenced his action for breach of contract. (I. C. A., secs. 8-301, 8-402 to 8-407.)

APPEAL from the District Court of the Eleventh Judicial District for Twin Falls County. Hon. James W. Porter, Judge.

Action to recover damages for breach of contract. Judgment for defendants. Affirmed.

Affirmed. Costs awarded to respondents.

J. H Barnes for Appellant.

A cause of action on a contractual obligation accrues immediately the contract is breached or repudiated, or a party thereto renders future performance by him impossible or apparently impossible. (1 C. J. S. 1387, sec. 124b; 1 C. J. 1146, sec 386; 6 R. C. L. 1031, sec. 389; Payne v. Melton, 67 S.C. 233, 45 S.E. 154; Obenauer v. Solomon, 151 Mich. 570, 115 N.W. 696; Restatement of the Law of Contracts, p. 475, sec. 318, Comment a.)

Where one of the parties to an executory contract abandons, repudiates or renounces his obligation, or disables himself from substantially performing in the future the other party's right of action is not dependent either upon tender of performance by him, or upon his demand of performance by the other party. (66 C. J. 1555, sec. 1662; 66 C. J. 1556, sec. 1666; Lunde v. Minch, 105 Conn. 657, 136 A. 552; Matteson v. United States & Canada Land Co., 103 Minn. 407, 115 N.W. 195; Lowe v. Harwood, 139 Mass. 133, 29 N.E. 538 (opinion by Justice Holmes); Way v. Root, 174 Mich. 418, 140 N.W. 577; Restatement of the Law of Contracts, p. 413, sec. 280; Id., p. 482, sec. 320.)

In every executory contract, each of the parties has a right not only to performance of the contract when due, but also to the maintenance of the contractual relation up to that time. (9 Cyc. 635, f. 3; 6 R. C. L. 1024, sec. 385; Roehm v. Horst, 178 U.S. 1, 20 S.Ct. 780, 44 L.Ed. 953; Hochster v. De La Tour, 2 E. & B. 678 (discussed in note, 2 Parsons on Contracts, p. 780); Central Trust Co. v. Chicago Auditorium Assn., 240 U.S. 581, 36 S.Ct. 412, 60 L.Ed. 811.)

Harry Benoit, for Respondents.

In an action for breach of contract to recover purchase money paid and money expended for taxes and improvements plaintiff must allege tender of balance of purchase price and demand for deed. (Barney v. Curtis, 37 Idaho 742, 218 P. 190; Papesh v. Wagnon, 29 Idaho 93, 157 P. 775; Bell v. Stadler, 31 Idaho 568, 174 P. 129; Rischar v. Shields, 26 Idaho 616, 145 P. 294.)

To constitute anticipatory breach of contract there must be a positive and unequivocal repudiation of the entire contract. The acts and conduct relied upon as a breach must also be positive and unequivocal. (Ross v. Tabor, 53 Cal.App. 605, 200 P. 971; 6 Cal. Jur., sec. 274, p. 458; 66 C. J., sec. 1666, p. 1556; 6 R. C. L., sec. 385, p. 1025; Williston on Contracts, vol. 5, revised edition, sec. 1324, p. 3724.)

HOLDEN, C. J. Morgan, Ailshie, Budge and Givens, JJ., concur.

OPINION

HOLDEN, C. J.

On and prior to November 19, 1932, respondents were the owners of certain lands located in Twin Falls county, Idaho. And on and prior to that date, there was of record in that county a mortgage on a portion of said lands, which said mortgage fell due January 1, 1927. The mortgage was not mentioned in the contract hereinafter referred to, but was known to appellant prior to the making of such contract.

November 19, 1932, respondents and appellant entered into a written lease covering the entire tract at a yearly rental of $ 1,080, with an option to appellant to purchase the property for the sum of $ 18,000. December 16, 1933, appellant exercised his option. Under the terms of the option, appellant was given the privilege of paying the purchase price either in cash or produce--apples or potatoes. Appellant had the privilege, if he elected to pay the purchase price in cash, to pay it in full or to pay any substantial part thereof. If paid in cash, but not in full, the balance was to draw interest at the rate of 6 per cent per annum. And if appellant elected to pay in produce, he was given the right to limit his payments on the purchase price to the yearly delivery to respondents of two cars of apples or four cars of potatoes, but appellant could, if he chose, deliver larger quantities. Appellant elected to purchase the property and to pay the purchase price in produce.

A dispute having arisen as to the meaning of certain terms of the option, respondent Thomas F. Daly and appellant, April 26, 1935, mutually interpreted the option as follows: "That the total purchase price of said property is $ 18,000.00; that any unpaid part of said purchase price draws interest at the rate of six per cent per annum from December 16th, 1933, the date when second party (appellant) exercised his option to buy; that the cash value of the two cars of apples or four cars of potatoes, to be computed as in said contract provided, shipped in any one year shall be applied first on the payment of said interest, and any overplus shall be applied on the principal; that if the cash value of said cars of apples or potatoes in any one year is not sufficient to pay all of the interest due, then the unpaid portion of the interest shall be carried over into the succeeding year or years; that second party (appellant) fully complies with the terms of said option agreement by the shipment of said cars of apples or potatoes, regardless of whether the cash value thereof is sufficient to bring the interest payments up to date, and keeping up the payment of taxes and water maintenance charges levied on said real property."

During a period of approximately four years following the exercise of said option, appellant paid respondents on the purchase price sums totaling $ 3,676, and also paid for water maintenance and taxes sums totaling $ 951.40. Appellant alleges that in addition to the payment of said sums on the purchase price and for water maintenance and taxes, amounting to the sum of $ 4,627.40, he expended the following sums for the following purposes: "Budding and cutting back unprofitable varieties of apple trees, $ 2,560.00; extra spraying required for cleaning up orchard, $ 1,000.00 extra pruning and cleaning up, $ 500.00; pulling two cares of unproductive apple trees, $ 200.00; purchase and installation of electric motors, $ 188.59; extermination of ants, $ 170.00; fencing, $ 114.60; filling and leveling ditches used in irrigating the orchard and substituting the corrugated sod system therefor, $ 500.00," totaling $ 5,233.19.

June 11, 1937, the owner of said mortgage commenced suit to foreclose his mortgage upon certain legal subdivisions covered by the option contract, making appellant a party defendant and serving him with process. September 17, 1937, appellant commenced this action against respondents to recover damages in the sum of $ 9,860.59 for the alleged anticipatory breach of said option agreement.

October 4, 1937, respondents interposed a general demurrer to appellant's complaint. October 30, 1937, the court sustained the general demurrer without leave to amend, and entered judgment of dismissal of the action. This appeal is from the judgment of dismissal.

The decisive question is, Did the commencement of the suit to foreclose said mortgage constitute a breach, anticipatory or otherwise, of the executory contract in question?

The pertinent allegations of the complaint are: That appellant has done all of the things and made all of the payments required to be done and paid by him under the terms of the contract of purchase and sale; that he is now and at all times has been willing, able and ready to do and perform all of the things required of him under the terms of the contract; that by the terms of the contract, responden...