Boyd v. McCullough

137 Pa. 7 | Pa. | 1890

Opinion,

Mr. Justice Clark:

On the 10th of June, 1873, Nicholas McCullough, by articles of agreement, sold to Dr. John Boyd in fee a certain tract of land in Wharton township, Fayette county, containing 256 acres, the consideration being $1,350, payable, $100 in thirty days; $600 January 1, 1874; $200 April 1,1874; $200 July 1, 1874; and $250 on September 1,1874. The deed was to be made on full payment of the purchase money. Several payments were made upon the purchase money, at various dates between the date of the agreement and April 13,1874, amounting in the aggregate to $811. But no payments were at any time thereafter made.

It appears that, at the time of the contract, there were judgment liens upon the land in the name of McGregor, who was McCullough’s predecessor in title, to the amount of $1,700 or $1,800. These liens covered, not only the lands in question, but also other lands which McGregor had previously conveyed to McCullough. Dr. Boyd took possession in March, 1874, and made payments as stated. There is no evidence that Boyd had any actual notice of the existence of these judgments at the time of his purchase; but the record of the judgments themselves, found in the line of his vendor’s title, were constructive notice to him, which, under the proofs in this case, was equally as effective as actual notice: Kuhn’s App., 2 Pa. 264; Stephen’s App., 87 Pa. 202. There is no evidence of fraud or unfairness, or of concealment or of misrepresentation; for anything that appears, the parties acted in good faith, with knowledge of all the facts.

For some reason, Dr. Boyd ceased to pay the purchase money: he paid none after the 13th of April, 1874; it may be, as suggested by the plaintiff, that his failure was attributable to his discovery of the existence of these liens; but, whether he ceased to pay because of the encumbrances, or for want of ability to pay, or for some other reason, does not appear. In the year 1876, the other lands of McCullough already referred to were sold upon foreclosure of the mortgage thereon; the tract of 256 acres was seized and sold at sheriff’s sale, in satisfaction of the judgments mentioned, and the plaintiff was evicted by the purchaser. This suit is brought to recover back the $811 paid upon the contract, as upon a rescission thereof.

If the purchase money due and owing by Boyd had been sufficient, or more than sufficient, to satisfy the encumbrances, that would have been a proper application of the money; and, if he had failed so to apply it,-and suffered a sheriff’s sale of his property, he would certainly have no equity to complain of the loss of what he had paid. If he had become the purchaser at the sale, under such circumstances, he would have remained liable to McCullough for the residue of the purchase money on the footing of his contract; even if a stranger had become the purchaser, Boyd’s liability would have depended upon the inquiry whether or not, at the time of the sale, he had in his hands, of the purchase- money due and unpaid, a sum sufficient to extinguish the encumbrances : Garrard v. Lantz, 12 Pa. 192. But the amount of the encumbrances against the land in the name of McCullough, was considerably in excess of the purchase money unpaid, and, as it was McCullough’s duty to remove them, he could not enforce the contract, or the payment of the purchase money, excepting by ejectment, until he had removed them. He did not tender a deed in compliance with his contract, and, therefore, Boyd was not liable upon the contract after his eviction.

It does not follow, however, that Boyd has a right of action to recover back what he had paid; this depends upon other considerations, to which we will now refer. It will be observed that, at the time of the sheriff’s sale, Boyd was himself in default. The purchase money was all due, and a large amount thereof was unpaid. His payments had been made with the record open before him, and no implication of a promise to repay the money could arise, except upon full compliance with his contract. He had not demanded his deed, nor is it shown that he was ready and willing to pay, at any time, the amount in arrears. It was in his power, notwithstanding the encumbrances, to tender performance, and thus restore himself from the effect of his default in payment of the purchase mon ey. McCullough, upon payment of the purchase money, was certainly bound to remove the encumbrances, and if the tender or offer of the money had been coupled with a demand to that effect, he might have doneso. But non constat that Boyd would perform his contract; he may, from insolvency or other cause, have been wholly unable to pay it, in which case, notwithstanding the encumbrances, his equity was liable to be defeated, and his money lost. In order, therefore, to rid himself from the consequences of his own default, it was his duty to tender or offer a performance, and to demand his deed; having done this he would now stand upon a full compliance with his contract, and^would have a clear right to recover for the consequences of McCullough’s default. The time for payment of the purchase money and for the delivery of the deed having passed, without any payment of the money or any offer of payment, and without any tender of a deed or demand for the money, the time for performance became indefinite, but mutual and dependent whenever it should occur. Whichever of the parties first desired to enforce the performance was bound to regard his part of the contract as a condition precedent, and to perform, or'to offer performance, in order to enable him to enforce the contract : Irvin v. Bleakley, 67 Pa. 24.

In the case cited this court said: “ The vendee must tender the unpaid purchase money, as a general thing, whether he Avishes to rescind or to enforce the agreement; this results from the principle that a party, himself in default, has no right to insist on rescission while in default: 2 Parsons on Cont., 5th ed, 679.” Referring to the encumbrances which, in that case, were less than the purchase money due and unpaid, the court further say : “ This was no ground for a rescission ; they had the means in their own hands to pay the judgments, if the defendant did not satisfy them. He Avas not bound, however, to remove them, unless he was put upon doing so by the demand of the plaintiffs for performance, and at the same time showing "a readiness and a willingness on their part to comply with their covenants. This they did not do. Why should the defendant have removed these liens in consideration of the plaintiffs, without knowing whether they were going to complete the contract on their part? While they did nothing towards that end, their existence did not hurt them: Hampton v. Speckenagle, 9 S. & R. 212.” This case was followed by Hatton v. Johnson, 83 Pa. 219, where the same principle is distinctly recognized. In Stephen’s Appeal, supra, a contract for the exchange of lands had been duly executed by the delivery of conveyances: the land conveyed by Emerick was encumbered by mortgage, to the amount of $4,100, or thereabouts : $1,334 of the amount Mrs. Stephen had agreed to pay; Emerick was to pay the residue ; but neither of them paid any part of the mortgage. On a bill in equity by Mrs. Stephen, in which she was joined by her husband, for a rescission and re-conveyance, it was held that she had no equity to ask for a rescission whilst she Avas herself in default. “ The appellants,” said this court, “ had no right to ask for a rescission on the ground of encumbrance, unless they first discharged, or showed a willingness to discharge that portion of the encumbrance obligatory on them; ” citing Irvin v. Bleakley, supra.

In all these cases, as well as in the case in hand, it will be observed the element of fraud is wanting; where fraud exists, the rule does not apply : Bonner v. Herrick, 99 Pa. 220. But the general rule is, that, in the case of a contract containing concurrent conditions, or mutual and dependent covenants, either an offer of performance or of readiness to perform, by ono party, must be shown before he can charge the other with a breach, and without a breach, of course, there can be no ground for rescission. As this view of the case is fatal to the plaintiff’s recovery, it is unnecessary to consider the effect of the plea, of the statute of limitations, or any other question raised in the assignments of error.

The judgment is reversed.