Stringer v. Swanstrum

• Decision Date: 01 May 1946
• Docket Number: 7262
• Parties: JOHN STRINGER, Respondent, v. ALBERT C. SWANSTRUM and KATHERINE SWANSTRUM, his wife, Appellants
• Court: Idaho Supreme Court

168 P.2d 826

66 Idaho 752

JOHN STRINGER, Respondent, v. ALBERT C. SWANSTRUM and KATHERINE SWANSTRUM, his wife, Appellants

No. 7262

Supreme Court of Idaho

May 1, 1946

Rehearing denied May 25, 1946.

1. Specific performance

Evidence justified finding that conduct of vendors in accepting interest on part of the purchase price and other conduct constituted acquiescence in purchaser's delay of a few days in the matter of performance, and was a waiver of such performance and right to declare a forfeiture.

2. Contracts

Equity abhors forfeitures.

3. Evidence

In action for specific performance of contract for sale of realty, oral testimony establishing part performance by purchaser, acceptance by vendor, and a waiver of the strictness of time in making full payment of purchase price was not incompetent as tending to alter terms of a written contract.

4. Husband and wife

A waiver of the strictness of time in making full payment under contract for the purchase of realty which constituted community property was not required to be in writing and acknowledged by vendor's wife to be binding on her, since the receipts from the sale of community property are community property still and subject to the management and control of the husband. (I.C.A., sec. 31-913.)

Rehearing Denied May 25, 1946.

Appeal from the District Court of the Ninth Judicial District, for Clark County. Hon. C. J. Taylor, Judge.

Affirmed.

Arthur W. Holden and Jones, Pomeroy & Jones for appellants.

Time being of the essence of an option contract, whether or not so expressed, acceptance must be made and conditions performed within the time, if any, limited by the option in order to constitute a contract of sale, but the full time is allowed. (66 C.J. 502, Sec. 27; Tilton v. Sterling Coal Co (Utah), 77 P. 758; Pomeroy's Equity Juris Prudence, Vol. 6, p. 1328, Sec. 807; Pomeroy's Equity Juris Prudence, Vol. 6, p. 1334, Sec. 811; 39 Cyc. 1241; 66 C.J. 502, Sec. 27; Spokane P. & S. Ry. Co. v. Ballinger, et ux (Wash.), 97 P. 739.)

An oral agreement extending the time of payment on an option for the purchase of real property is invalid and unenforcible. (Sec. 16-503, I.C.A.; Lawyer v. Post, et al (Ida.), 109 F. 512; Hicks v. Post (Cal.), 96 P. 878.)

An oral agreement affecting real property, that by its terms is not to be performed within a year from the making thereof, is invalid. (Subdivision 1, Sec. 16-505, I.C.A.)

The husband cannot sell, convey or encumber the community real estate unless the wife joins with him in executing and acknowledging Deed or instrument of conveyance by which real estate is sold, conveyed or encumbered. (Sec. 31-913, I.C.A.)

The husband cannot modify lease of community real estate for more than one year without consent of his wife, or unless wife joins with him in executing and acknowledging an instrument for such purpose. (Intermountain Realty Co. v. Allen, 60 Ida. 228.)

Ralph L. Albaugh and E. H. Hillman for respondent.

Where an option agreement for the sale of land provides for the payment of a sum certain upon the exercise of the option, and the vendee pays, and the vendor accepts a part only of the purchase price, the agreement is ipso facto changed into a contract for the sale of the property, and thereafter the right to specific peformance, or to declare a forfeiture, will be in accordance with the rules that apply to executory contracts of sale. (Howard v. Hobson Co. (Cal.), 176 P. 715, 721; Menzel v. Primm (Cal.), 91 P. 754, 756; In re Fulmer's Estate (Cal.), 265 P. 920, 921; McCowen v. Pew (Cal.), 123 P. 191, 199.)

A course of conduct on the part of the vendor in failing to declare a forfeiture, thereby leading the vendee to believe that the vendor waives strict compliance with the terms of the contract, works a waiver of the vendor's right to declare a forfeiture until he gives the vendee a reasonable opportunity to make the delinquent payment. (Seeley v. Security Natl. Bank, 40 Ida. 574, 583; Sullivan v. Burcaw, 35 Ida. 755, 763; Boone v. Templeman (Cal.), 110 P. 947; Lahr v. Broyles (Ind.), 155 N.E. 709, 710.)

If a condition in the contract for the sale of real property is one for the payment of money at stated times and preceding payments had been made without much regard to the precise time of their maturity, equity will not allow a forfeiture for a payment not made on the precise day it was due, but tendered a few days afterwards, when under the circumstances it would be grossly unequitable to allow forfeiture. (Thompson on Real Property, (Permanent Edition), Vol. 4, Sec. 2119, p. 666; Shade v. Oldroyd (Kan.), 18 P. 198.)

Since an agreement extending the time of payment in connection with contracts for the sale of community real property does not involve the sale, encumbrance, or transfer of the property and need not be in writing, the husband, as the managing agent of the community, has the statutory authority to extend the time of payment by an oral agreement, express or implied. (I.C.A., sec. 31-913; Binder v. Blair, 48 Ida. 580, 583.)

Ailshie, C.J. Miller, J., concurs. Budge, J., concurs in conclusion. Givens, J., specially concurring. Holden, J., deeming himself disqualified, did not sit or participate in the decision in this case.

OPINION

Ailshie, C.J.

This is an action for specific performance of a contract and option to purchase certain real property situated in Clark county.

The facts are quite fully set forth in the findings of the court quoted hereinafter.

The cause was tried to the court without a jury. Orders denying motion to strike portions of the amended complaint and overruling demurrers to the same were entered. The court concluded that the contract of lease and option to purchase "was and is a valid contract" and respondent "has not forfeited his rights thereunder"; that, by accepting interest payment and payments of mortgage installments and taxes by respondent, appellants "waived strict performance with respect to the time of payment of the indebtedness", and "by advising the plaintiff (respondent) that all they wanted was the interest money, and that they would let him know when they wanted the balance of the purchase price."

The substantial and essential findings of fact and conclusions of law, on which judgment was subsequently entered, are as follows:

"II.

"That on the said 13th day of June, 1942, the plaintiff and the said defendants entered into a written contract of lease and option to purchase by the terms whereof the said defendants demised and leased the premises hereinbefore described for the term of two years thereafter in consideration of the sum of $ 5,000.00, which was paid by the plaintiff to the said defendants at the time of the execution and delivery of said contract.

III.

"That in further consideration of the said sum of $ 5,000.00 paid by the said plaintiff as aforesaid, it was further covenanted and agreed that the plaintiff should have, and he was therein and thereby given the exclusive option of purchasing said premises at any time prior to the 13th day of June, 1944; that said option agreement provided that upon the exercise of the said option by the plaintiff, he should assume and pay according to the terms and conditions thereof a certain mortgage upon said premises in favor of the Federal Land Bank of Spokane, and thereupon pay to the First National Bank of Dillon, Montana, as escrow agent for the use of the said defendants, a sum of money being the difference between the amount owing on said mortgage and $ 7,000.00, together with interest on said sum at the rate of five percent per annum from the 13th day of June, 1942.

IV.

"That coincidentally with the execution of said contract the said defendants made and executed their Warranty Deed conveying to the said plaintiff all of the premises hereinbefore described, and the said Warranty Deed, and a copy of said contract were thereupon delivered to the First National Bank of Dillon, Montana, as escrow agent, and the same, together with an Abstract of Title to said property and a Bill of Sale to certain personal property, are now in the possession of said escrow agent.

V.

"That the plaintiff, upon the execution and delivery of said contract, paid to the defendants the said sum of $ 5,000.00 and entered into the possession of said premises, and at all times since has been and is now in the possession thereof, and he has duly performed all of the conditions of said lease and option to purchase on his part to be performed.

VI.

"That the fair and reasonable rental value of said premises from the 13th day of June, 1942, to the 13th day of June, 1944, was the sum of $ 1500.00; that the fair, just, and reasonable value of said property at the time said contract was entered into was the sum of $ 12,000.00, and that there has been a slight increase in the value of said property since the execution of said contract.

VII.

"That the plaintiff, with the knowledge, consent, and acquiescence of the defendants, has paid all of the installments on the said mortgage on said premises in favor of the Federal Land Bank of Spokane that have become due since the execution of said contract, and as follows: $ 74.36 paid on or about the 16th day of June, 1943; $ 75.58 paid on or about the 22nd day of January, 1944; $ 76.83 paid on or about the 12th day of May, 1944, and $ 76.83 paid on or about the 21st day of June, 1944.

VIII.

"That on or about the 10th day of July, 1943, the plaintiff, at the request of the defendants, paid to the defendants the sum of $ 255.00, the same being interest on the sum of $ 5100.00 at the rate of five percent per annum from the 13th day of June 1942, to the 13th day of June, 1943, the said sum of $ 5100.00 being the difference between the mortgage...