Logan v. Illinois Rivers Development Co.

279 P. 274 | Or. | 1929

Suit to foreclose real estate contract. Plaintiff had decree on the pleadings and defendant appeals. Affirmed.

Plaintiffs instituted this suit to foreclose a contract of purchase and sale of some real property. The real property consisted of placer mining ground in Josephine County, which the plaintiffs agreed to sell to the defendant and the defendant agreed to purchase from the plaintiffs for the sum of $30,000. The contract was entered into February 28, 1928, and the purchase price was to be paid in installments as follows: Five thousand dollars on or before April 1, 1928; $12,500 on or before February 15, 1929; $12,500 on or before February 15, 1930. By the terms of the contract all installments, principal and interest were to become due and payable on default of any payment of the purchase price. The complaint is in the usual form and was filed on the thirteenth day of April, 1928. On the third day of April, 1928, notice was given by the plaintiffs to the defendant in manner and form as particularly described in the contract. The complaint was filed ten days after said notice was given, that is, on the thirteenth day of April, 1928. A copy of the contract and a copy of said notice were attached to the complaint and made a part thereof as exhibits "A" and "B" respectively. Defendant answered admitting the contract as pleaded, its default in the payments, the performance by plaintiffs of the terms of the contract on their part and the possession of the premises by defendant; denied on information and belief the giving of the notice; denied the conclusion set out in the complaint that plaintiffs were entitled to immediate possession; denied the right of plaintiffs to have said contract foreclosed and that ten days after the decree was a reasonable period to be allowed defendant for redemption of the premises. Defendant further pleads by way of an affirmative defense a former contract entered into on May 7, 1927, between plaintiffs and one C.M. Dickinson and thereafter assigned by said Dickinson to one J. Thornburn Ross, and thereafter by said Ross assigned to defendant; that certain work was performed by defendant and its predecessors on said real property in accordance with the terms of the contract made by plaintiffs with said Dickinson; that later the contract entered into on the twenty-eighth day of February, 1928, was entered into by the plaintiffs and defendant for their mutual advantage and benefit. Then follows the following two paragraphs:

"That at the time of the execution of the said contract attached to plaintiffs' complaint, it was understood by the plaintiffs that the first installment of $5,000.00 to be paid under said contract would be raised by a sale of stock to the public; that immediately on the execution of said contract this defendant with all reasonable expedition made application to the corporation commissioner of the State of Oregon for a permit to sell stock to the public for the purpose of raising sufficient funds to pay said first installment and for other purposes; but that due to the exacting requirements of the corporation commissioner of the State of Oregon the defendant was not able to obtain any such permit until on or about the 26th day of March, 1928, and was not able for this reason to make the payment which became due under said contract on April 1st, 1928.

"That a few days prior to the first day of April, 1928, and on subsequent occasions, Arthur J. Drews, the President of the defendant corporation, had conversations with the plaintiff, James T. Logan, acting for himself and as agent for the plaintiff, Rose L. Logan, and at these conversations said plaintiff stated although he would not enter into a formal agreement extending the time of payment, nevertheless he did state that if said sum of $5,000.00 was tendered him subsequent to said first day of April, 1928, he would accept the same and this defendant relied upon said statement and in reliance thereon failed to make said payment and now alleges that the plaintiffs should be estopped from demanding or requiring a strict foreclosure of said contract; but that the defendant should be given a reasonable length of time and not less than ninety days subsequent to the entry of a decree in this case in which to raise said sum of $5,000.00; and in the event that this court grants to this defendant such a reasonable length of time, this defendant will tender into court a quit claim deed to said real property to the plaintiffs herein and shall also tender into court its copy of said contract for cancellation; and in all other respects the defendant herein is willing to do equity as may be decreed by this court."

Plaintiffs put at issue the affirmative answer by general denials. Plaintiffs do not pray for judgment for any sum against defendant but solely for the foreclosure of defendant's interest in said mining property and appurtenances. Plaintiffs moved for decree on the pleadings. This motion was granted. Decree was entered giving defendant ten days from the date thereof in which to redeem the property by paying the amount due according to the contract with $250 attorney's fee and costs of the suit. The contract provides for a reasonable attorney's fee to redeem in case a decree of foreclosure should be rendered and entered. No allegation touching a reasonable attorney's fee is in the complaint. The contract between plaintiffs and defendant dated February, 1928, contains this clause:

"Upon the incurrence of any default hereunder a notice, in writing, by the Vendors, or either of them, to the Vendees, declaring such default and delivered to The First National Bank of Southern Oregon aforesaid shall constitute a sufficient declaration of default to terminate this contract and forfeit all rights of the Vendee hereunder, and shall be deemed to constitute a re-entry and taking possession of the premises by the Vendors without any other or different re-entry and the possessory rights of the Vendee in said premises shall forthwith terminate, Vendee hereby waiving any statutory notice to quit or vacate, and the Vendors, or either of them, may, at any time thereafter, make an actual entry upon the premises without being liable for trespass, and take possession of the same."

Defendant appeals from the decree entered on the pleadings.

AFFIRMED. Defendant's first point is that questions of fact cannot be tried on a motion for judgment on the pleadings: Smith v.Aplanalp, 126 Or. 213 (267 P. 1070); Oregon WesternColonization Co. v. Willoughby, 122 Or. 170 (257 P. 812). If there is an issue of fact joined in the pleadings, the decree on the pleadings was improper. Appellant claims that the provision in the decree for attorney's fee is improper because there is no issue joined on that question. For that reason there is no issue of fact involved. Conceding, without deciding, that the court erred in providing for attorney's fee in case redemption should be attempted or made, yet that question is not here in this proceeding. There is no pretense that defendant has attempted to redeem. Defendant was in no way injured by the provision. It had ten days from the date of the decree in which to redeem. That period expired many months ago. Defendant gave no stay undertaking on appeal. The amount of attorney's fee is of no consequence now.

Defendant also argues that since the complaint alleged that ten days was a reasonable time in which to redeem and that allegation was denied, there was an issue of fact joined thereby. But we do not think that the matter of reasonable time in which to redeem is an issuable question of fact. The court must fix that time under the contract. The judge must determine that himself without relying upon the testimony of witnesses. The allegation in the complaint touching that matter is argumentative and a conclusion.

Defendant argues because it alleged in its further and separate answer the understanding between plaintiffs and defendant as to the manner of raising the $5,000 and

"That a few days prior to the first day of April, 1928, and on subsequent occasions, Arthur J. Drews, the President of the defendant corporation, had conversations with the plaintiff, James T. Logan, * * and at these conversations said plaintiff stated although he would not enter into a formal agreement extending the time of payment, nevertheless he did state that if said sum of $5,000 was tendered him subsequent to said first day of April, 1928, he would accept the same and this defendant relied upon said statement * *."

plaintiffs waived their right to foreclose upon ten days' notice. Defendant relies on Ewing v. Ryan et al., 113 Or. 225 (231 P. 981); Gray v. Pelton, 67 Or. 239 (135 P. 755);Kingsley v. Kressly, 60 Or. 167 (111 P. 385, 118 P. 678, Ann. Cas. 1913E, 746); Merrill v. Hexter, 52 Or. 138 (94 P. 972, 96 P. 865); Neppach v. Oregon Cal. R.R. Co., 46 Or. 374 (80 P. 482, 7 Ann. Cas. 1035); Graham v. Merchant, 43 Or. 294 (72 P. 1088); Williston on Contracts, §§ 595, 600, 690. The rule relied on by defendant to the effect that a vendee who is lulled into security by the indulgence of the vendor cannot after default be deprived of the right to notice from the vendor before a forfeiture will be enforced is firmly fixed in the jurisprudence of this state. But does the allegation in the affirmative answer bring the defendant within the protection of that rule? Upon a motion for judgment upon the pleadings the allegations of the answer must be taken as true. Does a mere conversation with a vendor in which he says that he will accept an installment after it becomes due prevent him from insisting upon the performance of the contract between him and the vendee when no offer of performance is made by the vendee? It is not contended by defendant that such statement could change the contract between the vendors and the vendee but simply that plaintiffs thereby waived a right to strict performance of the contract. Defendant admits that it has paid nothing on the contract. There is no controversy about any of the material facts. Defendant does not claim to have performed the work required of it in the contract. The work referred to in the further and separate answer was done under the former contract between vendors and the vendee's predecessors. Defendant does not allege or claim that it had done any work under the contract in force nor that it was either able or willing to make the payment due April 1, 1928.

Construing the allegation most strongly against the pleader we are warranted in drawing the conclusion that no work was done by defendant upon the ditch and that it was unable to make the payment due on April 1, 1928:Graham v. Merchant, supra. The affirmative answer does not state facts sufficient to bring defendant within the rule upon which it relies. There is no allegation that defendant in any way or manner changed its attitude or situation by reason of the statement made by plaintiffs that they would receive payment after it became due. It is not unlikely that plaintiffs would have been glad to accept payment even after decree, if it had been tendered. Defendant has failed to plead that it did anything by reason of the statement relied upon that it would not have done but for that statement.

Plaintiffs acted promptly. The first day of April, 1928, fell upon Sunday. Defendant therefore had all day on the second in which to make payment of the installment. Plaintiffs gave notice of their intention to foreclose on the earliest date they had a right to. The notice was given as prescribed in the contract: 2 Williston on Contracts, 1134, § 689; 1 Williston on Contracts, 1148, § 595; Ewing v. Ryan, above. The contract further prescribes:

"And in consideration of the premises and of the possessory rights herein granted, it is especially provided and agreed that all covenants and agreements herein contained are conditions of continuance of the Vendee's rights hereunder and that no forbearance on the part of the Vendors to exact strict or timely performance of any payment, * * on the part of the Vendee to be performed, or delay in declaring a default or forfeiture shall be deemed to waive time as the essence of this agreement, or require a new time to be fixed for performance upon such default or defaults, or to waive any rights arising in the Vendors upon such or any default, * *."

The provisions of the contract were such as to entail a forfeiture by the force of the terms thereof: Neppach v.Oregon Cal. R.R. Co., supra; Gray v. Pelton, 67 Or. 239,244, 245 (135 P. 755), and other cases hereinbefore cited; 2 Williston on Contracts, 1621, § 846.

There was no issue of fact to be determined under the pleadings. Plaintiffs did not waive their right to a strict enforcement of the terms of the contract. Defendant was in possession of the premises for a number of months without having paid a cent on its contract to purchase. The property was mining property and any products taken therefrom diminished the value of the property. An ordinary farm will reproduce the products of the soil. A mining claim does not grow gold or other minerals. Plaintiffs did not delay in declaring a forfeiture and seeking foreclosure. An expression of willingness to receive payment after default is not equivalent to accepting payment after default. If defendant had made or tendered payment before foreclosure was begun a different problem would be presented for solution. But defendant did not pay or offer to pay, although plaintiffs expressed a willingness to accept. Plaintiffs gave notice before proceeding and gave that notice promptly after defendant defaulted.

The decree is affirmed. AFFIRMED.

McBRIDE, RAND and ROSSMAN, JJ., concur.