181 P. 964 | Wyo. | 1918
This is an action for specific performance wherein, as the case is presented here, the plaintiffs are seeking a decree requiring execution and delivery to them of a good and sufficient deed conveying a tract of land containing approximately forty acres and described as Lot Two (2) of Section Nineteen (19) in Township Forty-six (46) North of Range Ninety-eight (98), West of the 6th Principal Meridian, in this state. Upon a trial in the District Court, judgment was rendered upon a general finding in favor of the defendants, and the case is here on error.
As the plaintiffs in error were plaintiffs below and the defendants in error defendants -below, they will be referred to respectively as plaintiffs and defendants, when not mentioned by name, but a reference to the defendants collectively will include only the Rocky Mountain Cattle Company and L. G. Phelps, against whom only a decree for specific performance is sought. The plaintiffs are George Merrill, H. J. Guthrie Nicholson, and George Pennoyer.
The contract upon which the action is based is in writing and set out in full in the amended petition upon which the action was tried, and the material parts thereof are as follows :
“This Agreement Made and entered into, in triplicate this 9th day of May A. D. 1912 by and between Rocky Mountain Cattle Company, a corporation, duly organized and existing under the laws of the State of Wyoming, by L. G. Phelps, its President, duly authorized, party of the first part, and George Merrill, G. J. Guthrie Nicholson and George' A. Pennoyer, of Embar, Big Horn County, Wyoming, parties of the second part, and L. G. Phelps, wit-ne'sseth :
“That Whereas, Under the terms of a certain contract made and entered into by certain of the stockholders of the*224 Rocky Mountain Cattle Company on the 13th day of August 1910 wherein it was agreed by the said stockholders that the assets of the Company should be distributed upon terms therein designated, which said contract was duly ratified at a regular meeting of the stockholders of the said Company at the office of the Company on August 13th, 1910, and,
“Whereas, Under the terms of the said contract there was no time limit placed upon the acquisition of titles to certain lands then initiated, which said lands were subsequently conveyed by warranty deed to George Merrill, G. J. Guthrie Nicholson and George A. Pennoyer under the terms of the contract aforesaid, and
“Whereas, The parties hereto have agreed that title to the following lands included in the lands described in the warranty deed aforesaid, viz: (describing several tracts of land, containing a total of 1040 acres, and including the 40 acre tract aforesaid) which were initiated at the date of the contract aforesaid, so entered into, should not have been included in the Warranty Deed aforesaid, title not having inured to the Rocky Mountain Cattle Company.
“Now, Therefore, for and in consideration of the payment of the sum of Twenty Thousand Eight Hundred ($20,-800.00) Dollars to them in hand paid, the receipt whereof is hereby acknowledged, the parties of the second part herein do hereby agree to execute and deliver to the party of the first part herein a quit-claim deed to all of the property hereinbefore enumerated, and the party of the first part herein agrees that it will use all due diligence to obtain title to the lands hereinbefore described within Two (2) years from this date and will convey the same to the parties of the second part herein for the sum of Fourteen ($14.00) per acre, it Being Understood and agreed that the party of the first part herein is not required, under the terms of this contract, to obtain such title whenever it would be required to pay anjr sum in excess of Fourteen ($14.00) dollars per acre for such land. And the parties of the second part herein agree that they will pay the said sum of Fourteen ($14.00) Dollars per acre upon tender of good and sufficient title, as*225 the same may be secured from time to time during the period of Two (2) years aforesaid, to any of the lands herein set forth and will execute a good and sufficient 'bond in favor of the party of the first part herein conditioned that upon tender of good and sufficient deed to any of such lands save and excepting where surface rights only are required by the party of the first part under the terms hereof, then and in that event such surface rights shall be considered a full compliance with the terms hereof and such payment of Fourteen ($14.00) dollars per acre shall be made, it being understood and agreed, however, that such purchase and payment of and for the lands hereinbefore designated is conditioned upon the sale and disposal of all of the stock of the parties of the second part herein in the Rocky Mountain Cattle Company under the terms of this agreement prior to such purchase and payment; should such title be perfected and offered before the sale of the stock of the parties of the second part herein, then the payment shall be made at the rate of Twenty ($20.00) per acre for such land.
“It is understood and agreed by and between the parties hereto that the right of possession of the parties of the second part, without let or hindrance of the party of the first part, to the lands hereinbefore set forth shall continue during the period of Two (2) years herein designated and that the Quit-claim deed shall contain a clause to that effect and the parties of the second part paying the taxes thereon.
"It is understood and agreed by and between the parties hereto that a deed or deeds to the lands hereinbefore designated, as titles shall be acquired from time to time under the terms hereof, shall be tendered to S. C. Parks, of Cody, Wyoming, who shall be authorized by the parties of the second part herein to receive such deed or deeds and make payment therefor within Thirty (30) days of such tender.
“It is further understood and agreed by and between the parties hereto that the party of the first part herein does not guarantee the procurement of title to any of the land herein-before designated within the time designated, but agrees to use all reasonable diligence to procure the same under the*226 terms and conditions of this contract and the parties of the second part agree that they will not molest or hinder the party of the first part in its endeavor to procure such titles.
“It is further understood and agreed by and between the parties hereto that at the expiration of Two (2) years from the date hereof the party of the first part shall submit to E. E. Enterline and E. T. Clark of Sheridan, Wyoming, at Sheridan, Wyoming, such muniments of title as it or its agents or trustees then possesses or possess to lands herein-before described but which have not been, in the meantime, conveyed, to the parties of the second part, under the terms of this agreement, and the said E. E. Enterline and E. T. Clark shall thereupon determine what muniments of title are sufficient, in their judgment, to warrant the party of the first part conveying or assigning its right thereto in the lands to which such muniments of title pertain to the said parties of the second part, as well as the parties of the second part receiving the same, and designate the character of instrument or instruments in writing by which the ownership thereto shall pass from the party of the first part to the parties oi the second part, the parties of the second part, agreeing to pay the sum of Fourteen ($14.00) Dollars per acre for all such lands or muniments of title so conveyed or assigned.”
The petition aforesaid, after setting out said contract, describes the lands covered thereby to which said petition relates by classifying them as Parcels 1, 2, 3 and 4, respectively, and designating the land in controversy here as Parcel 3. The allegations as to Parcel 4 were eliminated upon demurrer. The petition alleges and the answer admits that title to the separate tracts described as Parcels 1 and 2 respectively was acquired by the defendant Phelps and conveyed to the plaintiffs within the two year period prescribed by the contract, — title to Parcel 1 having been acquired in May, 19x3, and conveyed to plaintiffs in August of that year, and title to Parcel 2 having been acquired in June, 1912, and thereafter conveyed to plaintiffs. The averment as to Parcel 2 does not state the date of its conveyance to the
The petition aforesaid alleges certain other facts which are admitted by the answer of said defendants, including the following:
That the defendant Phelps for a long time prior to May 9, 1912, was and ever since has been the president of the Rocky Mountain 'Cattle Company, and executed and delivered said contract as such officer; that he owned a large majority of the stock of said company, and managed its business and dictated.its policy; that in his proceedings to secure title to said lands he was acting for the company; that said company was at all times dominated and controlled by him; and that he signed and executed said contract, thereby binding himself to all the covenants and conditions thereof. That during all the times referred to said Company was the owner of 320 acres of “Jed R. Washburn Forest Rieu Scrip”, authorized by certain stated Acts of Congress and regulations of the Secretary of the Interior, which gave the owner of such scrip the right to select, enter and receive patent in the name of said Jed R. Washburn, but for the use and benefit of the owner of the scrip, a number of acres of vacant public lands open to settlement equivalent to the amount of scrip so held by the owner. That when said contract was executed most of the lands therein described had been selected by this state under its various land grants, and applications had been made by the defendant Phelps on behalf of said company to purchase the same from the state; that the remainder of said lands had theretofore been entered with said “Forest Rieu Scrip” for or on behalf of the defendants; and that the defendants, at the date of the contract, had already secured substantial rights to each and every parcel of land described therein. That on April 5, 1911, the defendant Phelps, acting for.and on behalf of said company, selected and caused to be entered in the United States land office at Rander, Wyoming, in the name of said Jed R. Washburn, the lands described as Parcel 3, using for said
It is also alleged as to said Parcel 3, but denied by the answer, that after the issuance of the patent thereto, and on the 13th day of August, 1914, and in violation of the terms of said contract, the defendant Phelps caused said land to be conveyed to himself and that he still holds the legal title thereto. It is assumed in the brief of plaintiffs that it was intended by the denial of said averment to deny only that the conveyance alleged was in violation of the contract, and presumably that is what was intended, for it appears that the land was conveyed to the defendant Phelps on the date alleged, under a power of attorney executed by said Jed L. Washburn to whom the patent was issued.
The petition further alleges that said defendants at the expiration of two years from the date of the contract refused and still refuse to submit any muniments of title to .said Enterline and Clark, claiming that plaintiffs have no right to any of said lands. This was also denied by the answer. There are other averments of the petition denied by the answer which need not be recited here but may be referred to in the course of the discussion if found necessary.
The answer alleges as a separate defense that the defendants did not, during the two-year period aforesaid, — two years from May 9, 1912, possess any muniments of title to the lands designated in the contract, save and except to those parcels which were conveyed during that period to the plaintiffs under the terms of the contract, and that the plaintiffs were notified of that fact on May 13, 1914, and that the contract was terminated and closed. That no demand was made upon the deféndants for the conveyance of the land designated as Parcel 3 until August 28, 1914, at which time the plaintiffs believed the land to be of great value because of the discovery of valuable mineral thereon, which dis
The following facts are shown by the evidence: On May 9, 1912, the date of the contract aforesaid, the plaintiffs executed to the defendant company a quit claim deed conveying the land' described in the contract, which deed was thereafter duly recorded, and it contained, as required by the contract, a provision reserving a right of possession in the plaintiffs “for two years hereafter,” that is to say, two years after the date of said deed, or until and including May 9, 1914. That deed, or the copy thereof in the record, also recites as the consideration therefor the payment to the grantors, the plaintiffs herein, of the sum of $20,400.00, by the said grantee, the defendant company; but the contract states such consideration as $20,800.00, and that sum is mentioned in the testimony as the consideration. Mr. Nicholson, one of the plaintiffs, explained the consideration and the reason for the contract provision for the deed, when testifying as a witness, as follows:
“In the original agreement of the dissolution of the Rocky Mountain Cattle Company we arrived at so much land should go to Mr. Merrill and myself and so much should go to himself. On the books of the company there were two charges, $200,000 against L. G. Phelps and $100,000 against Merrill, Pennoyer and myself. For that $100,000 so much land was to be turned over to us by warranty deed. It was made out and when it was gone into and we hunted up the titles there was a certain part of that for which there was no title so that in 1912 we agreed to quit claim back the land*230 to Phelps and he was to surrender to us that $20,800 for which he had already charged us.”
Mr. Phelps testified concerning the matter: “Growing out of a deed in 1911, the sufficiency of which was questioned, at a meeting, of at several meetings, in May, 1912, the present agreement was entered into by which under the contract I bought back or the Rocky Mountain Cattle Company bought back all the lands in which the titles was questioned, and $20,800 was paid in cash for this property and I entered into possession of it, or the Rocky Mountain Cattle Company, whichever you wish to style it, and in order to compromise any question and to settle all matters amicably it was agreed that for two years Merrill, Nicholson and Pennoyer were to occupy the lands and I was to use my best endeavor to secure title to the land.” An objection being made to the statement of the witness, “it was agreed”, he added: “I have stated the reason, part óf my titles were questioned and I bought back the land,” paying $20,800 for it.
,The defendants had no notice or knowledge of the issuance of the patent to Parcel 3 on May 7, 1914, until the receipt by Mr. Phelps between the 19th and 23rd of May, 1914, of a postal card from the Land Office at Lander, Wyoming, dated May 15, 1914, stating that a patent had been issued to Jed L. Washburn, and that upon surrender of the proper evidence of ownership it would be delivered to the holder of the title; and the patent was obtained by Mr. Phelps on August 13, 1914. On that date also the land was conveyed to him by deed executed in’ the name of Jed L. Washburn by Ed. T. Clark, his attorney in fact.
By an agreement dated August 12, 1914, but acknowledged on August 13, 1914, Mr. Phelps leased the land to the Ohio Oil Company, a defendant in this case, for the purpose of mining and operating for oil and gas and laying pipe lines, constructing tanks, buildings and other structures thereon to take care of said products. Under that lease a producing oil well was drilled on the land by said oil company in October, 1914. The land is shown to be valuable for
The two-year period prescribed by the contract having expired on May 9, 1914, Mr. Phelps, on that date, wrote to the Mr. Clark named in the contract to act with Mr. Enter-line in passing upon any muniments of title submitted by defendants at the expiration of said period requesting him to inform Mr. Enterline that he, Mr. Phelps, had no other muniment of title, and, therefore, desired to terminate the contract; and on May 13, Mr. Clark wrote to Mr. Enter-line to the effect that he had received a letter “from Mr. Phelps stating that with the exception of some lands already conveyed and for which he had been paid there was no change in the conditions affecting the remainder of the lands and that “we would be glad to take up this matter with you so that it may be closed.” He received no answer to that letter, but on the day it was written he met Mr. Enterline, told him that he had written the letter and explained its contents, whereupon he was asked by Mr. Enterline if there were any different muniments of title, if he had any other muniments of title than they had on May 9, 1912. Mr. Clark replied: “No, we have no other proof of title than we had at that time.” And Mr. Enterline then said that he should consider the contract closed and would write his clients (the plaintiffs) to that effect. On August 26, 1914, Mr. Enterline notified Mr. Clark that he wished a consultation about the Nicholson-Phelps contract, and Mr. Clark then informed him that “we considered the contract closed”.
As testified by two of the plaintiffs, money was left or deposited by the plaintiffs with Mr. S. C. Parks of Cody, during all the time after the date of the contract, to pay for
The exact time when the plaintiffs first learned that a patent to the land had been issued or when demand for a conveyance of the land was made upon Mr. Phelps, is not definitely shown by the record, owing to the absence therefrom of a letter and telegram introduced in evidence, as exhibit, through no fault, however, of the official reporter who certifies that the missing exhibits were, after the trial, handed to one of the attorneys for the plaintiffs at his request and had not been returned, but, as he, the reporter, was informed, they had been mislaid or lost. But the time when the plaintiffs learned about the patent seems to have been after the first of June, 1914; and the demand for a conveyance, which was by telegram from Mr. Enterline,— the missing telegram, was probably in August, at or about the time when Mr. Enterline notified Mr. Clark of his desire for a consultation about the matter, or on August 28, 1914, as alleged in the answer.
The contract aforesaid, in addition to the provisions thereof above quoted, provided for the sale or division among its stockholders of certain other real and personal property of the defendant company, which, as recited in the contract, included all the property of said company, and for the division thereafter of its cash assets, and that after such division of cash assets the parties of the second part named in the contract, — the plaintiffs herein, shall deliver to L. G. Phelps all the capital stock of the company held by them, viz: 1100 shares, at a price of ten cents per share. A time limit was fixed for the sale or division of the property. Thus the sale of a specified ranch by the company to Phelps at a stated price was provided for within 7 days from the date of the contract, with a provision for repayment of part of the price to Phelps by the plaintiffs if the scrip title to a forty acre tract should fail within 2 j^ears from the contract date. The division of certain live stock within 6 days was provided for, and also within the same period the purchase of other live stock of the company by Phelps at a valuation
It appears from the evidence that all the shares of stock of the plaintiffs in said company were delivered to Mr. Phelps sometime in August, 1913, thereby eliminating the condition fixing the price to be paid for the land at $20 per acre. The provision of the contract for the payment of that sum instead of $14 per acre is explained in the testimony of the plaintiff Nicholson as follows: “If the land was deeded to us prior to the delivery of the stock to Mr. Phelps, Merrill, Pennoyer and myself would have participated in our $20 paid. After the delivery of the stock, $14 went to Mr. Phelps, and we had no participation in it then.”
The question which we think first necessary to be considered is the character and extent of the obligation of the defendants, under the contract, to convey any of the land therein described to the plaintiffs, and in that connection what obligation was imposed upon defendants to tender a deed to the land in controversy, or submit muniments of title thereto. The contract contains two provisions which, while interdependent and to be construed together in the light of the whole contract, are in a sense separate and distinct. The one which we shall refer to as the first because it first appears in the contract requires due diligence on the part of the defendant company to obtain title to the lands described in a preceding paragraph within two years from the date of the contract and the conveyance thereof to the plaintiffs for the sum of $14.00 per acre, and that the plaintiffs shall pay that sum per acre upon tender of good and sufficient title during said period of two years, as the same
The consideration for the agreement to use diligence in securing title and then to convey was the reciprocal agreement of the plaintiffs contained in the same paragraph to pay the prescribed sum per acre upon tender during the two-year period of good and sufficient title. The consideration for such agreement was not the payment of the sum of $2Q,8oo recited in the beginning of the paragraph, for that was the consideration passing to the plaintiffs for their quit-claim deed. And that sum was actually paid to the plaintiffs for their conveyance back to the company, as representing, according to the evidence, the amount which had been charged against them on the books of the company for the land. We find nothing in the evidence or admitted facts to substantiate the statement in the brief of plaintiffs that the contract was made to relieve the company from its covenant of warranty, and that for such release defendants agreed to acquire title to the 1040 acres and convey same to plaintiffs. On the contrary, we think the reasonable inference from the evidence and the contract itself is that the plaintiffs did not care to rely on the warranty and hold the lands with the imperfect titles, but preferred a return of the money charged against them therefor, and thereafter to take the lands only if and when good title should be acquired and conveyed within the time specified in the contract. And that would not have been an unreasonable preference in any case, 'in the absence of some intended
The second provision requires the company, at the expiration of said period of two years, to submit to E. E. Enterline and E. T. Clark at Sheridan, Wyoming, such muniments of title as it or its agents or trustees then “possesses or possess” to lands which had not in the meantime been conveyed to the plaintiffs, who shall determine what muniments of title are sufficient, in their judgment, to warrant a conveyance or assignment by the company of its right to the plaintiffs, or their receiving the same, and designate the character of instrument to be executed to pass the ownership in the lands to which such muniments pertain, and that for all stick lands or muniments of title so conveyed or assigned plaintiffs shall pay said sum of $14 per acre. This provision seems to eliminate the necessity of tender of a deed or deeds to Mr. Parks for any land embraced in or covered by muniments of title submitted thereunder at the expiration of said two-year-period. There is a slight indication by the words used in this provision that there may have been in the minds of the parties at the time a thought of a transfer under it of something less than a complete and perfect title; but, if so, it must certainly have comprehended more than was possessed at the date of the contract.
Now this contract is in some important respects unlike the ordinary contract for the sale of land, where there is, an unqualified agreement to sell and buy, assuming that the vendor has or will be able to convey a good and sufficient title. The parties to this contract all understood that the vendor did not have a perfect title and might not acquire such a title to any of the lands within the specified time, if
This contract was the result of an arrangement between the stockholders of the defendant company to dispose of its
Although the patent to the parcel now in controversy was issued at Washington, D. C., on May 7, 1914, two days before the expiration of the two years/that fact was not known to either of the parties until at least ten days after the expiration of said period, when the defendant Phelps received notice by mail from the Land Office where the entry had been made. In the meantime, Mr. Enterline, representing the plaintiffs, was notified on behalf of defendants that they had no further muniments of title than at the date of the contract for land not already conveyed, and upon receiving that information he declared that he should consider the contract closed and would write his clients, the plaintiffs, to that effect. In that notice to Mr. Enterline there was clearly no intentional misrepresentation of the fact, nor, as we think, any actual misrepresentation, within the meaning of the contract.
To complete the title held at the date of the contract not only a patent from the United States was necessary, but also a deed from the grantee named in the patent, though provision for the latter, as we understand, had been made
Thus the only muniments of title to the parcel in question that could in fact or actually have been tendered or submitted on that date were those which the defendants held at the date of the contract; and there was no apparent reason for submitting those muniments of title on the date of the expiration of the two-year period, unless accompanied by other muniments acquired after the contract was made. But the contention of the plaintiffs as to this particular parcel is that as title was actually obtained by defendants within the two-j^ear period, they became obligated to convey the same to the plaintiffs for the stipulated price. That is not, however, technically or in fact, true. A legal or fee simple title was not then acquired by defendants because no deed to either of them conveying the title of the grantee named in the patent had been executed, and the defendants, through no fault on their part, were without knowledge or information of the fact that might have made the execution of such a deed proper. Title did actually pass to Jed L,. Washburn, the grantee named in the patent, on the date that it was issued and recorded in the proper office at Washington, viz: May 7, 1914, assuming that it was recorded on the date that it was issued, for delivery of a land patent by the United States is not essential to the taking effect of the granting
While in a broad sense, taking into consideration the fact of the issuance of the patent not known to either of the parties at the time, the tender of a deed during the last three days of the two-year period properly conveying Washburn’s title to the plaintiffs might have been a tender of good and sufficient title, the defendants were not then in a position to make such tender with muniments of title confirming its sufficiency, as contemplated by the contract and as required in the case of tender of title to other parcels, to require acceptance and payment by the plaintiffs. And we think it plain that the defendants were not at fault in failing to make a tender as to the parcel in question. Indeed, this action does not seem to be predicated upon a wrongful failure to tender title under the first provision of the contract for transferring title, but only upon the alleged refusal of the defendants to submit muniments of title at the expiration of the two-year period. For there is no averment in the petition to the effect that the defendants wrongfully failed or refused to tender title within the time prescribed therefor.
We think there can be no doubt that the provision of the contract requiring the defendant company to submit to Mr. Enterline and Mr. Clark, at the expiration of two years from the date of the contract, such muniments of title as it or its agents or trustees “then possesses or possess” has reference to muniments possessed at the expiration of said period,
The defendant company did not, however, at the time stated, possess the patent, except perhaps constructively, and of that'it had no knowledge, nor was it in the-possession of an agent or trustee of the company. Constructive possession merely without knowledge of the fact or facts creating it, due diligence having been used to obtain title, is not, we think, what was intended or contemplated. And it may be doubtful if mere knowledge that it had been issued, communicated to the arbiters, without ability then to submit it, would have required them to consider it, or the plaintiffs to accept and pay for the land.
So that without fraud, collusion or fault on the part of the company or any agent or trustee it could not submit the patent for the consideration and determination provided for, at the time specified. It did all that it was then able to do. Promptly at the expiration of the period aforesaid notice was given to Mr. Clark and by the latter to Mr. Enterline that the defendants had no further muniments of title to land covered by the contract provisions aforesaid not already
No provision was made in the contract for any further examination of titles; but the plaintiffs bound themselves as to land for which muniments were to be submitted at the expiration of the period aforesaid only to pay for lands or muniments of title conveyed or assigned under the determination provided for upon muniments so submitted. If the defendants had been negligent or at fault in failing to learn of the patent, or had fraudulently concealed a fáct known to them, a different question might, perhaps, be presented. But within the meaning of the contract, as we think it must be construed, they complied with the provisions of the contract as to this land for submitting muniments of title at the expiration of the period of two years. Had they thereafter proposed to submit the patent after learning of its issuance and receiving it, or other muniments acquired or received after the expiration of the two-year period, plaintiffs might or might not have accepted the same, but without obligation to do so. And there would be lacking a determination of the arbiters named in the Contract as to the sufficiency of such muniments and the character of instrument for assignment or conveyance, provided for as a condition to the obligation of plaintiffs to pay the specified price. (Church v. Shanklin, 95 Cal. 626, 30 Pac. 789, 17 L. R. A. 207; Farm Farm Mort. Co. v. Wilder, 41 Okla. 45, 136 Pac. 1078; Bank v. Clay (Okla.), 177 Pac. 115; Simmons v. Zimmerman, 144 Cal. 264, 79 Pac. 452, 1 Ann. Cas. 850; Goodwine v. Kelley, 33 Ind. App. 57, 70 N. E. 832; Hudson v. Buck, 7 Eng. L. Rep. Chan. Div. 1877-8, 683; Averett v. Lipscomb, 76 Va. 404; Warvelle on Vendors (2nd ed.), secs. 300-302.)
Church v. Shanklin, supra, was an action to foreclose a mortgage to secure notes made payable by defendants to plaintiff “whenever he perfects the title to” certain described
In Bank v. Clay, supra, it appeared that a contract for the sale of an oil and gas lease stipulated that the vendor should furnish to the plaintiffs a complete abstract of title to the land to be submitted to a certain named attorney for the vendees, and that the lease should take effect and the mutual obligations of the parties accrue only in case such' attorney should approve the title. The abstract was furnished and upon examination by the attorney named he disapproved the title. Suit was thereupon brought by the vendees to recover a sum of money which had been deposited by them as “earnest money” to secure their faithful performance of the contract. The plaintiffs were allowed to recover, and the following rule was stated: “A vendee cannot be compelled to accept a title which is in fact perfect, but which his attorney in good faith refuses to approve where his contract requires the title to be perfected to the satisfaction of such attorney.”
In the English case above cited, Hudson v. Buck, the contract provided for approval of title by the solicitor of Buck, the vendee. And it was held that said solicitor having disapproved the title, the vendor could not enforce specific
“What, then, does the law imply in the sale of a leasehold property ? It implies that the vendor shall make a good title to the property. Is that the same thing as a stipulation that the contract shall be subject to the approval of the title by the purchaser’s solicitor? It appears to me that it is not. Observe the difference between the results in the two cases. Tn the one case the approval or disapproval of the person specified is, in my opinion, in the absence of bad faith or unreasonable conduct, conclusive as to the goodness of the title shewn. In the other case the goodness of the title may be a matter for the decision of the court. * * * It appears to me that it is not unreasonable to suppose that the purchaser should desire to preclude the possibility of such a protracted litigation, and that he should intend to stipulate that the opinion of a particular person, his own solicitor, should be conclusive as to the sufficiency of the title deduced, and that, in the absence of compliance with that condition, the contract should not be capable of being enforced.”
Thus upon the theory that the contract requires the defendants to convey the land in controversy to the plaintiffs, the requisite mutuality of obligation and remedy to justify a decree for specific performance would be lacking, under either provision of the contract relating thereto. In Frank v. Stratford-Hadncock, 13 Wyo. 37, 77 Pac. 134, 67 L. R. A. 571, 110 Am. St. Rep. 963, after stating that several so-called exceptions to the general rule that as a prerequisite to specific performance there must exist both mutuality of obligation and remedy had become established in modern equity practice, this court said:
“Where a contract is intended to bind both parties, or where it is of such form or nature that it contains mutual executory provisions, that is to say, where both parties have bound themselves or intended to bind themselves by reciprocal obligations, then no doubt the doctrine as to the requirement of mutuality applies; and in such a case, if for any*244 reason one of the parties is not ‘bound, he cannot compel performance by thd other.”
And in our opinion that principal would apply to the contract in this case if it is to be construed as obligating the defendants to convey this land upon the facts aforesaid. We do not, however, understand the obligation of defendants to convey land to which title shall be obtained within two years to be as broad as plaintiffs contend. The agreement in that respect does not stand alone but is qualified by the provisions for tendering title within said period and submitting at the expiration thereof muniments of title then possessed, for examination as to whether the title is good and sufficient in case of a tender, or the determination provided for upon the submission of muniments of title as to whether they are sufficient to warrant conveyance or acceptance. So that the defendants would not become obligated to convey any particular parcel of the land described unless title thereto was obtained and they were also in a position, acting diligently and in good faith, to tender good and sufficient title within said two-year period, or, at the expiration of said period could produce and submit muni-ments of title that might be declared sufficient to warrant conveyance under the provision of the contract for a determination as to that matter.
And without an obligation to convey there would be no ground for specific performance. Certainly the agreement to use all due diligence to obtain title within the period named, standing alone, would not furnish a basis for specific performance. (Parker v. Sargent, 201 Ill. App. 574 ) In the case cited it was held that an agreement of a defendant to use his “best endeavors to convey” property to the complainant is not an agreement to convey. But here it is alleged that due diligence was' used to obtain title.
For the above reasons the judgment denying specific performance must be affirmed. Blit there is a further ground upon which we would feel constrained also to affirm the judgment, and that is the laches of the plaintiffs in asserting their alleged right, in view of the changed conditions affect
A decree for the specific performance of a contract for the sale of real estate does not go as a matter of course, but is granted or withheld according as equity and justice seem to demand in view of all the circumstances of the case. (McCabe v. Matthews, 155 U. S. 550, 15 Sup. Ct. 190, 39 L. Ed. 253.) And courts of equity will not decree specific performance when to do so would be plainly inequitable and unjust. (Pomeroy v. Fullerton, 131 Mo. 581, 33 S. W. 173.) In Holgate v. Eaton, 116 U. S. 33, at page 40, 6 Sup. Ct. 224, 29 L. Ed. 538, it is said by Mr. Justice Miller that the following language of Mr. Justice Story in Taylor v. Longworth, 14 Pet. 172, 174, 10 L. Ed. 405, has become a legal maxim in this class of cases, viz: “In the first place, there is no doubt that time may be of the essence of a contract for the sale of property. It may be made so by the express stipulation of the parties, or it may arise by implication from the very nature of the property, or the avowed objects of the seller or purchaser. And even when time is not, thus, either expressly or impliedly, of the essence of the contract, if the party seeking a specific performance has been guilty of gross laches, or has been inexcusably negligent in performing the contract on his part; or if there has, in the intermediate period been a material change of circumstances, affecting the rights, interests or obligation of the parties; in all such cases courts of equity will refuse to decree specific performance, upon the plain ground that it would be inequitable and unjust.”
In Pickering v. Pickering, 38 N. H. 400, the court said, stating a well-settled principle: “Relief by specific performance is matter not of absolute right in the party, but of sound, reasonable discretion in the court, and the granting of such relief must always be entirely equitable. The court will never compel specific performance, where, looking at all the circumstances on both sides, it is apparent that injustice would or might probably be done thereby.”
• “The defence of laches which prompted the dismissal of the bill in this case, has so often been made the subject of discussion in this court that a citation of cases is quite unnecessary. Some degree of diligence in bringing suit is required under all systems of jurisprudence. In actions at law, the question of diligence is determined by the words of the statute. If an action be brought before the statutory time expires, it will be sustained; if a day after, it will be defeated. In suits in equity the question is determined by the circumstances of each particular case. The statute of limitations consorts with the rigid principles of the common law, but is ill adapted to the flexible remedies of a court of equity. The statute frequently works great practical injustice — the doctrine of laches, never. True, lapse of time is one of the chief ingredients, but there are others of almost equal importance. Change in the value of the property between the time the cause of action arose and the time when the bill was filed; complainant’s knowledge or ignorance of the facts constituting the cause of action, as well as his diligence in availing himself of the means of knowledge within his control, are all material to be considered upon the question whether the suit was brought without unreasonable delay.”
In an opinion by the same learned justice, in a case involving mining property, where there had been a great increase in value, it is said: “Under such circumstances, where property has been developed by the energy and at
In Patterson v. Hewitt, supra, it was further said: “indeed, in some cases the diligence required is measured by months rather than by years.” So in the case of In re. Casey, 195 Fed. 322, the court said: “Laches is measured sometimes by years and sometimes by days, depending on the nature of the case and the circumstances.”
In this case the land involved was of comparatively small value when the contract was made, but at or about the time of the expiration of the two-year period a possible or prospective increase in value became apparent through the discovery of oil upon other lands, and it appears that the plaintiffs were approached by representatives of the Ohio Oil Co., who proposed a lease to them for drilling upon the land, but the plaintiffs declined to lease it on the ground that they did not have title to it, showing this contract disclosing the extent of their interest. They learned of the issuance of the patent sometime thereafter, but just when does not appear, though, as we have stated above, probably -between the early part of June and sometime in August, 1914, and
. After such demand it appears that the plaintiffs entered into some arrangement with another party to whom they assumed to give possession of the land, presumably for the purpose of exploring for oil, for it is shown that some oil well casing was placed on the land. On September 21, the Ohio Oil Company also placed some casing on the. land; and the petition alleges, without stating the time, that said company, although warned not to enter into possession of the ground, did actually 'by force enter thereon and exclude the plaintiffs therefrom, and commenced drilling thereon. They succeeded in drilling a producing oil well in October of the same year. This suit was brought by the filing of the original petition on February 13, 1915, praying, in addition to specific performance as against the principal defendants a showing and accounting by the Ohio Oil Company of the oil and other substances taken from the land, a judgment against said company therefor, and the appointment of a receiver, if found necessary, pending the litigation.
Thus, with knowledge of the facts, the plaintiffs' waited before asserting their right here claimed until the value of the land for oil purposes had been demonstrated by the defendant Phelps through his lease to said operating company, allowing their decision to insist upon what they now claim as their right to depend upon the success or failure of the drilling operations carried on at the expense of others. We think that a very prompt assertion of their alleged right was necessary to justify the exercise of equity jurisdiction for the enforcement thereof. With respect to the time intervening before suit was brought, as affecting the question of laches, it is apparent that the situation would not be materially different if there had been a much longer delay. The changed conditions causing the increase in value had already occurred, and while the plaintiffs remained inactive so far as this record discloses.
