Treadwell v. Henderson

• Court: New Mexico Supreme Court
• Writing for the Court: McGHEE; SADLER; LUJAN; McGHEE; SADLER
• Citation: Treadwell v. Henderson, 58 N.M. 230, 269 P.2d 1108, 1954 NMSC 23 (N.M. 1954)
• Decision Date: 09 February 1954
• Docket Number: No. 5666,5666
• Parties: TREADWELL ex ux. v. HENDERSON.

Page 1108

269 P.2d 1108

58 N.M. 230

TREADWELL ex ux. v. HENDERSON.

No. 5666.

Supreme Court of New Mexico.

Feb. 9, 1954.

Rehearing Denied April 28, 1954.

Gilbert, White & Gilbert, Santa Fe, for appellant.

Rodey, Dickason, Sloan, Mims & Akin, James C. Ritchie, Albuquerque, for appellees.

McGHEE, Chief Justice.

We are asked to reverse the decree of the lower court in an action for declaratory judgment directing the defendant, appellant here, to convey to the plaintiffs, appellees here, real estate formerly belonging to the community estate of the appellant and her former husband, the appellant not having joined in the execution of a contract for the sale of such real estate.

The facts as found by the trial court are, in substance, as follows:

In April, 1948, while Jack L. Harper and the appellant were married, he contracted to convey to the appellees for $5,500 the real estate which is the subject of this action, it having been stipulated such real estate was community property. The appellant did not join in the execution of the contract, and in it Harper represented himself to be a single man.

The appellees entered into immediate possession of the premises which they occupied as their home. They had neither actual nor constructive notice of the fact Harper was a married man and in good faith they entered into the contract believing him to be single.

Very shortly after the execution of this contract Harper filed suit for divorce and the appellant filed a cross-complaint in that action in which she referred to the 'sale of properties' and 'deals in real estate' by her husband. Pertinent requested findings of fact and conclusions of law made by her in that action were the following:

'Requested Finding of Fact No. 6

'That subsequent to the ceremonial marriage in Safford, Arizona, in 1941, the plaintiff acquired certain real property in the County of Bernalillo, State of New Mexico, to-wit: (Description) taking said property in his own name and representing himself therein as a single man; that on the 15th day of April, 1948, as a single man the plaintiff entered into a real estate contract with LaMar D. Treadwell and Ruth Treadwell, his wife, selling to said Treadwells the 'Westerly 41.03 feet of Lots numbered One Hundred and seventy-nine (179) and One Hundred and eighty (180)' as above described for the sum of $5,500, $1,000 of which was paid in cash, plus $50 paid on the execution of the contract, and the balance of $4,450 payable at $50 a month on the 15th day of each month at 5% interest. The balance still due under said contract is $4,025.12; that said property was acquired with community funds.'

'Requested Conclusion of Law No. 5

'That the plaintiff has received under the Treadwell contract approximately $1,650, which said sum was community property and that the plaintiff holds one-half of the same as Trustee for the defendant, which said sum is $825, and plaintiff should account for and pay over said sum to the defendant.'

'Requested Conclusion of Law No. 9

'That the defendant is entitled to alimony and the interest of her husband in the real property located in Bernalillo County, New Mexico, * * * that title to said property should be vested in the defendant; that both parties will be required to execute papers necessary to clear and transfer title to said property and that the Court retains jurisdiction of this cause for the purpose of altering or amending the award of alimony.'

The final decree in the divorce action provided, among other things, the following:

'c. That Marian Volney Harper is entitled to alimony, and the interest of Jack L. Harper in the real property located in Bernalillo County, New Mexico, including his interest in the Treadwell contract * * * is awarded to Marian Volney Harper in lieu of alimony, and title to said property is hereby vested in said Marian Volney Harper; that both parties be required to execute the papers necessary to clear and transfer title to all the property involved in this case.'

The appellant took an appeal from the decree of the lower court in the divorce action, contending she should have been awarded half of the money already paid to Harper under the Treadwell contract of sale. This court rejected her contention and affirmed the decree of the lower court. Harper v. Harper, 1950, 54 N.M. 194, 217 P.2d 857.

During the pendency of the divorce action, appellant's mother called upon the appellees in their home and at such time the question of payments under the real estate contract was discussed. Later the same day the appellant encountered appellees in a restaurant in Albuquerque and promised them substantially as follows: 'If I get the property, I will give you a deed,' and, 'You don't need to worry, I'll make it right with you.' It was upon this day the appellees first learned Harper was a married man.

After her initial promise, made in the fall of 1948, and until the latter part of August, 1951, the appellant called at the appellees' home on different occasions and discussed the contract with them, reaffirming her earlier promise. It was not until the last mentioned date that appellees were informed appellant did not intend to execute a deed in their favor upon full performance of the contract, when the appellant called upon Mrs. Treadwell and in the course of their conversation the contract was discussed. At this time the appellant told Mrs. Treadwell she would give the appellees their deed if she got the full price of the property--that is, if the appellees would contract Harper and obtain the money already paid him to give to appellant, or if the appellees would pay her such sum themselves, she would give them clear title.

In reliance upon the promises made by appellant, appellees continued to make monthly payments to an escrow agent under the contract of sale and spent some $635 in improving the premises and the appellee LaMar D. Treadwell labored 283 hours on these improvements. When the appellees were informed appellant would not carry out her assurances to them, they ceased to make monthly payments to the escrow agent, but have stood ready to perform at all times.

The lower court found that at all times material the appellant knew or should have known of the real estate contract and its terms; that she knew or should have known that the appellees were making their monthly payments; that she knew or should have known the appellees were improving the real estate, but that she never advised the escrow agent to refuse to accept the payments being made, or advised appellees to discontinue the payments; that she never advised them they had no right to live on or improve the real estate, or asserted she was entitled to its possession until the counterclaim was filed in the present action.

The lower court then concluded as a matter of law that appellant was bound by the contract of sale, apparently resting this conclusion on the doctrine of equitable estoppel and upon the further ruling the appellees were in privity with Harper with respect to the duties, rights and benefits conferred on the parties to the divorce proceeding. It was decreed the appellant should execute and place in escrow a conveyance adequate to transfer merchantable title to the property in question to the appellees upon their performance of their duties under the contract.

On this appeal the appellant argues first, that Sec. 65-403, N.M.S.A. 1941 Comp., renders void any transfer or conveyance attempted to be made of the real property of the community by either husband or wife alone; that by the force of this statute, a contract for the sale of community realty in which the wife does not join is likewise void, at least to the extent that the wife cannot be divested of her interest in the community real estate by estoppel or other equitable doctrine.

Secondly, it is contended the decree in the divorce action did not purport to make the contract of sale binding on appellant, and that even if it were to be so construed, such decree would be of no effect, as the appellees were not before the court in the divorce action, and there is no relation of privity between them and Harper.

Lastly appellant asserts even if the doctrine of equitable estoppel may be invoked against her, the evidence is insufficient to establish all of the elements of the doctrine as laid down by this court in Chambers v. Bessent, 1913, 17 N.M. 487, 134 P. 237.

We will first consider appellant's argument the elements of equitable estoppel have not been established.

We have carefully examined the record, and beyond any doubt there is sufficient evidence to support the findings made that appellant on different occasions promised appellees she would give them a deed to the property, and otherwise reassured them; that until shortly before this action was commenced she never took a position inconsistent with such promises and assurances, even in a divorce action making division of the community property, and, finally, that she stood by for some two years after having full knowledge of the contract, permitting appellees to remain in possession, when she knew, or should have known, they were steadily improving the premises.

Appellant objects there was no proof of any misrepresentation on her part--that she promised to give appellees a deed to the property, but that she did not say for how much she would give such deed. It is sufficient answer to this that at all times material hereto the appellant was chargeable with notice of the contract, and could easily have learned at the time the initial promise was made by her (if she did not already know) what amount remained unpaid on the contract; if she intended to claim otherwise than under the contract, it was her duty after representing her intention to convey title to appellees to specify her terms. Her silence upon this point after stating she would give appellees a deed and assuring them, 'You don't need to worry. I will make it right with you,'...