Ward v. James

• Decision Date: 10 April 1917
• Citation: 84 Or. 375,164 P. 370
• Parties: WARD v. JAMES ET AL.
• Court: Oregon Supreme Court

164 P. 370

84 Or. 375

WARD v. JAMES ET AL.

Supreme Court of Oregon

April 10, 1917

On Petition for Rehearing, May 29, 1917.

On Petition for Rehearing.

Department 2.

Appeal from Circuit Court, Lane County; J. W. Hamilton, Judge.

Suit by George D. Ward against W. F. James, Francis E. James, and others. From a decree in favor of Francis E. James, plaintiff appeals. Dismissed without prejudice, on rehearing.

This is a suit to foreclose a contract for the sale of land, sought to be rescinded by the defendants. From a decree in favor of defendant Francis E. James rescinding the contract and for $3,245.65, partial payments made and damages, plaintiff appeals.

On April 14, 1913, plaintiff, George D. Ward, and defendant W F. James entered into a contract for the sale by the former and the purchase by the latter of a farm in Lane county consisting of 640 acres, for $18,000, to be paid in the following manner: $7,000 upon delivery of the contract and $11,000 on or before 10 years from that date, with interest at 7 per cent. per annum payable annually. Defendant W. F James was to pay the taxes on the land. A farm in South Dakota was conveyed to plaintiff for $6,000, and the sum of $1,000 in cash was paid by the Jameses, who entered into possession of the premises. The contract, inter alia provided as follows:

"That the said party of the first part (Ward) hereby agrees and binds himself and his heirs that in case the aforesaid sum of eighteen thousand ($18,000.00) dollars, with the interest, shall be fully paid, at the times and in the manner above specified, he will on demand thereafter cause to be executed and delivered to the said party of the second part (James), or his legal representatives, a good and sufficient deed in fee simple of the premises above described, free of all legal incumbrances except the taxes herein agreed to be paid by the party of the second part. And it is agreed that, if the party of the second part shall fail to make any of the said payments at the time and in the manner above specified, this agreement shall henceforth be utterly void, and all payments thereon forfeited, or said party of the first part may foreclose this contract for the amount due thereon, together with costs and attorney fees, second party to have possession of said premises from May 1, 1913, free of charge so long as he complies with the terms of this agreement."

Some live stock and personal property valued at $2,000 were transferred with the place which are not mentioned in the written agreement. On February 27, 1914, the defendants James entered into negotiations with the defendants Rickman for the transfer of the former's interest in the property and for the assignment of the contract of sale which assignment was executed and recorded. The Rickmans entered into possession of the premises and remained there until after this suit was begun. On August 26, 1914, plaintiff commenced this suit for a strict foreclosure of the contract of sale, alleging that there was due and unpaid $952.26, interest, and $128.35 taxes on the land, which plaintiff was compelled to pay. The Jameses answered and asserted that the contract was made by W. F. James as agent for Mrs. Francis E. James and asked to have the same reformed in this respect, which was allowed. All the defendants defended upon the ground that there were defects and irregularities in Ward's title to the land and the Jameses asked to have the contract rescinded for that reason.

J. M. Williams and O. H. Foster, both of Eugene (Williams & Bean, Jesse G. Wells and Foster & Hamilton, all of Eugene, on the brief), for appellant. C. A. Hardy, of Eugene (Thompson & Hardy, of Eugene, on the brief), for respondents.

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

It is contended by the plaintiff's counsel that the time for Ward to furnish a good title and convey the land to the Jameses or their assigns has not arrived, and that the vendor is not in default in the premises, and therefore the contract of sale cannot be rescinded. The stipulation of the agreement of sale provides for a deed of conveyance to be made by Ward after the payment of the purchase price is completed. It appears that the consideration for the deed has not been paid nor tendered to Ward. In order to put Ward, the vendor, in default, such payment, or a valid tender thereof, must be made to him according to the agreement of sale.

The assignment, or an arrangement for an assignment, of the contract by the Jameses to the Rickmans, did not change the status of the vendor. The Rickmans would stand in no better position than the Jameses did prior to such deal. Neither of the defendants is entitled to make the defense that there are defects in Ward's title and the Jameses are not entitled to rescind the contract of sale.

It is sufficient if the vendor have good title when the vendee by payment or tender of the purchase money places himself in a position to demand title, where the vendee is in possession and there is no fraud. Waterman on Specific Performance, § 420. In actions by the vendor for the purchase money before the time when he is required by the contract to pass the title, the purchaser cannot defend on the ground that the title is defective, since the vendor may acquire title before the specified time. It is sufficient if he has a good title at the time when the conveyance is to be made, and the objection that he had none when the contract was made will be unavailing. A purchaser in possession is estopped from denying the title of the vendor. The vendor and vendee stand in the relation of landlord and tenant. Frink v. Thomas, 20 Or. 265, 273, 25 P. 717, 12 L. R. A. 239; Maupin on Marketable Title to Real Estate, § 308, p. 741; 39 Cyc. p. 1574, p. 1614; Gervaise v. Brookins, 156 Cal. 103, 103 P. 329. There can be no rescission and recovery of purchase price by the purchaser where the vendor is able and willing to perform within the time limited by the contract of sale. 39 Cyc. 2006. If the vendor fail to furnish good title at the time fixed for performance, the purchaser may maintain an action to recover the price paid. 39 Cyc. 2009, note; Eggers v. Busch, 54 Ill.App. 279. Prior to the expiration of the time fixed for tendering the conveyance James, the purchaser, cannot recover the partial payments made where no deed was required to be given by Ward until the balance of the price is paid as agreed; the purchaser not having paid nor tendered the amount. Sievers v. Brown, 36 Or. 221, 56 P. 170, and cases there cited; McAlpine v. Reicheneker, 56 Kan. 100, 42 P. 339; Woodward v. Van Hoy, 45 Mo. 300. Where the payment of the purchase money or a deferred portion thereof and the making or tender of the deed are to occur simultaneously, they are regarded as mutual and concurrent acts which disable either party from putting an end to the contract, without performance or a valid offer to perform on his part. Frink v. Thomas, supra, 20 Or. 273, 25 P. 717, 12 L. R. A. 239.

After the negotiations between the Jameses and the Rickmans an abstract of title was prepared and examined by an attorney, resulting in a letter from James to Ward requesting him to straighten out the title and put the same in a marketable condition. After the commencement of this suit it appears that plaintiff took steps to do this. James claims that $500 for the possessory right to a tract of land should be credited as a payment to Ward.

The rights and equities of the parties in the premises depend largely on what has taken place since the beginning of this litigation. From the present state of the record it would be impossible for this court to adjust the equities of the case with safety. From the findings of the trial court it does not seem that Ward does not own the land in question, but that the record does not show a perfect title in him. Plaintiff seeks a harsh and unfavored remedy of a strict foreclosure: Wiltsie on Mortgage Foreclosures, vol. 2 (3d Ed.) § 965; 27 Cyc. 1648 (b). This should not be granted without the court being informed as to the present conditions and as to the prospect of a compliance with the terms of the contract on the part of the Jameses. Quite a large payment in land and cash has been made. It appears that the personal property transferred with the place has been partly dissipated which has a bearing on the case.

It is asserted by counsel for defendants in their brief that before a vendor can foreclose a sale contract he must be able to tender and tender a title in accordance with his contract. This rule applies where the payment of the purchase money and the making of the conveyance are by the contract to be concurrent acts. It cannot be invoked where by the terms of the contract payments of installments of interest are to be made which...