Zuelke v. Gergo

• Decision Date: 09 January 1951
• Citation: 45 N.W.2d 690,258 Wis. 267
• Parties: ZUELKE, v. GERGO et al.
• Court: Wisconsin Supreme Court

Page 690

45 N.W.2d 690

258 Wis. 267

ZUELKE, v. GERGO et al.

Supreme Court of Wisconsin.

Jan. 9, 1951.

Edward T. Berkanovic, Milwaukee, for appellant Maretich.

Paul D. Kain, Milwaukee, for appellant Gergo.

Paul, Ebert, Paul & Kuswa, Milwaukee, for respondent.

FAIRCHILD, Justice.

There is a distinction pointed out by the cases between a breach of promise to do a thing and a breach of promise as to the time when it shall be done. Courts 'have treated stipulations as to time as subsidiary and of less importance than the thing promised. * * * If on interpretation of the contract, the court finds that the defendant is not protected by any express limitation or condition or by any provision that the plaintiff's performance at the exact time that he promised is vital, the justice of excusing the defendant because of a breach by the plaintiff of his promise to perform at a stated time, depends chiefly' as to whether the nature of the contract is such as to make time of vital importance. See 2 Williston on Sales, Revised Edition, sections 452a and 453, pages 694 and l97.

The importance of time of performance depends upon the terms in the contract and the circumstances appearing from the acts of the parties. In some cases the forfeiture feature may be employed. However, a contract is to be entered into in good faith by both parties, and usually for the purpose of accomplishing a result agreeable to those concerned. The essence of a contract is that the minds of the parties thereto must meet on the same thing. Intent or understanding of the parties is necessarily an essential element. See 15 Words & Phrases, Title, Essence, p. 244. One may not precipitately rescind a contract because of a mere delay and certainly not when he does it to avoid discharging an obligation in an executory contract which he has assumed and failed to meet; and which is the very object concerning which the contract was entered into. There are cases, and this is one, where the right to rescind and impose a penalty does not exist unless the rescinding party would be entitled to specific performance.

The final words passing between the plaintiff and defendants in the two letters appearing in the foregoing statement of facts are with relation to the transaction. On the plaintiff's part, he stands ready, willing, and able to perform when the defendant is ready to deliver a merchantable title to the property. The parties at different times had some discussion about modifying the terms, but there is no testimony tending to indicate a purpose on the part of the plaintiff or on the part of the defendants to abandon the contract until the final word was written in the letter of defendants after certain weaknesses in the title had been pointed out.

In reversing the decision of the civil court, the circuit court, on the plaintiff's appeal, necessarily reached the conclusion from the testimony in the record that there was no evidence to sustain defendants' position in assuming the right of rescission or entitling them to the judgment granted by the civil court; and that findings to that effect are against the great weight and clear preponderance of the evidence. The circuit court ordered a reversal of the judgment of the civil court and directed the entry of a judgment in plaintiff's favor, that is, for the recovery of the amount of money that had been advanced as a down payment.

The learned circuit judge pointed directly to the problem involved, and in his decision dealt with an existing situation, indicating the important lines of inquiry. An important factor becomes apparent when consideration is given to the letter of the plaintiff to the seller dated December 6, 1946 and delivered on that day, and also to the letter of the defendants dated December 6, 1946 but not received by plaintiff till December 11th, although there was an attempt by the postal authorities to deliver the latter on December 7, 1946.

It is established that the defendants were not at any time covered by the acts here involved able to deliver the property under a marketable title. It is also established that they had the opportunity, had they been able to and in good faith so desired, to complete the transaction, the contract providing explicitly for a ninety-day period for such purpose. This appears from a consideration of the terms of the contract and the actions of the defendants with relation to the attempt to exact a forfeiture. It is also clear that the defendants were in no way prevented by plaintiff from carrying out their part of the contract. The contract does not contain a provision making time of the essence, but it does, as set forth in the foregoing statement of facts, provide that the seller shall provide a complete abstract of title extended to within twenty days of the closing of the transaction, 'said abstract to show the Seller's title to be marketable and in the condition called for by this agreement, and to be delivered to the Buyer for examination at least fifteen (15) days prior to the date set for the closing.' The suggested time for the closing was 'on or before December first.' The proceedings under this clause of the contract were not seriously adhered to, and the terms thereof were treated with indifference by both parties. The contract contains a provision that the deal was to be concluded within twenty days from the time to which the abstract was extended. The abstract was only brought down to October 28, 1946, but it was not delivered to the plaintiff until two weeks later. The question naturally arises as to whether the nature of the contract is such as to make time of vital importance, and here the acts of the parties, particularly those of the defendants, become of consequence. The absorption of equitable principles by the law has modified the severity of the rule giving undue importance to mere dates. In Restatement of the Law of Contracts, Vol. I, the more lenient rule is referred to in section 276(a) to the effect that unless the nature of the contract is such as to make performance on an exact day vital or the contract in terms so provides, the failure by a party to perform on the particular day does not discharge the other party. There is also a rule which is entitled to serious consideration that when the terms of a contract are, or, by any act of parties under the contract, become indefinite, uncertain and susceptible of two constructions, and by giving them one construction one of the parties would be subject to a forfeiture, and by giving them the other no such forfeiture would be incurred and no injustice would be done to the other party, the contract should be construed as not creating a forfeiture. Jacobs v. Spalding, 71 Wis. 177, 190, 36 N.W. 608. With reference to this same point, we find that in Droppers v. Hand, infra, where it was contended that time was of the essence of the contract, the court said with reference to the facts there, which are sufficiently similar to those here: 'We deem this contention to be without merit. The fact that a contract sets a date for the closing of a transaction does not of itself make time of the essence of the contract.' On the plaintiff's part, it is established that he was at all times material here ready, able and willing to carry out his contract if and when there was available to him a marketable title to the property he was to buy.

Time not being of the essence under the facts...