185 Mo. App. 45 | Mo. Ct. App. | 1914
This is an action to recover liquidated damages for the breach by defendant of an executory contract for the exchange of real property in the city of Nevada, owned by plaintiff and which was his homestead, for a farm of 160 acres in Vernon county, owned by defendant and occupied by him and his family as a homestead. The contract was not signed by the wife of either party but at the time set for the exchange of deeds plaintiff tendered a warranty deed executed and acknowledged by him and his wife, and demanded a like deed from defendant conveying the farm. The wife of defendant would not join in the execution of such deed and being unable to perform the contract, he repudiated it as void from the beginning. The.contract contained the agreement “the parties hereunto do bind themselves, their heirs . . . each unto the other ' in the sum of one thousand dollars, which they hereby agree upon as liquidated damages, to be paid by the party failing to comply with his covenants contained in this agreement.”
The land of each party is valued in the testimony of plaintiff at $10,000, and no attempt was made to prove any actual pecuniary loss to him from the refusal of defendant to perform the contract. At the close of the evidence of plaintiff the court refused defendant’s request for a peremptory instruction and (defendant offering no testimony) ■ directed a verdict for plaintiff in the sum of $850. Such verdict was returned and defendant appealed: The farm of defendant, in area, did not exceed that allowed by law as a homestead, but it did in value to the extent of $8500. [Sec. 6704, Rev. Stat. 1909.] Obviously the court in its peremptory instruction treated the • stipulation- in the contract for the assessment of damages in the event
Defendant argues, first, that the contract was void in toto, and second, that since the two properties admittedly were equal in value, the agreement to liquidate the damages for a breach by either party at the sum of $1000, clearly was a provision for the imposition of a penalty.
The statute provides (Sec. 6704) “the husband shall be debarred from and incapable of selling, mortgaging or alienating the- homestead in any manner whatever, and- every such sale, mortgage or alienation is hereby declared null and void, provided, however, that nothing herein contained shall be so construed as to prevent the husband and wife from jointly conveying, mortgaging, alienating or in any other manner disposing of such1'homestead, or any part thereof.”
The history of our homestead law which, in great part, was transplanted from Vermont (Macke v. Byrd, 131 Mo. 682) was reviewed by the Supreme Court in Bushnell v. Loomis, 234 Mo. 371, and by tins court in Williams v. Williams, 161 Mo. App. 249, and need not be repeated here. The right of homestead is for the benefit of the family, and the head of the family in whom it inures has no other interest in it than that of the “head of a family and a member of an immediate family” (Bushnell v. Loomis, supra). The husband and father who owns the land, subject to the right of homestead,' which he holds by virtue of his headship of the family, is not allowed to sell or alienate that right without the consent of the wife in whom the law invests the power to veto any such sale or alienation by refusing to join in the execution of a deed to give it effect.
The right of the husband owner to sell and convey the homestead, if his wife join in the deed, is absolute and, of course, is incompatible with the idea that the wife and children have any vested estate in the land or that the wife possesses any other power than that of interposing her veto to the consummation of his contract. . The statute does not curtail his right as owner of the fee and of the homestead to sell and alienate both estates except to the extent, and to that extent only, that his contract to sell, mortgage or alienate, becomes null and void if the wife refuse to join in the execution of the deed or mortgage. If instead of so joining, she exercises her right of veto, specific performance of the husband’s contract to sell cannot be enforced. The effect of the interposition of the veto is not to make the owner’s contract for the sale of the land void ab initio but only to place an effectual check upon its specific performance.
In some of the cases to which we shall refer'the thought seems to be uppermost that one of the beneficent objects of the homestead law is to prevent, or, at least, discourage both husband and wife from selling or attempting to sell the homestead which they have acquired. Such is not one of the purposes of the law
We repeated the same doctrine in the later case of Young v. Ruhwedel, 119 Mo. App. 231. In a still later case, Mundy v. Shellaberger, 161 Fed. 503, the United States Court of Appeals for the Eighth Circuit, in an action for the specific performance of the husband’s contract for the sale of the homestead, properly held that the exercise by the wife of the veto power granted her by the statutes of. this State deprived the vendee of any right to a specific performance of the contract, but' proceeded, upon reasoning at variance with that upon which we based our decisions in the Curry and Young cases, to hold that such. contract could not be made' the basis of an action for damages for nonperformance. The opinions of that high court are entitled to, and have, our deepest respect, but in this instance we are unable to agree with the reasoning of their decision which, if followed to its logical conclusion, would add no real benefit to families of owners of homesteads, and frequently would result in injury to them caused by the unnecessary restrictions it would impose upon the practical exercise of the lawful right of alienation which still exists as an element of the ownership of property, subject only to the right of veto the wife may exercise to the sale of the homestead.
The weakness of this line of reasoning is that it rests upon the unsound premise that it is unlawful for a husband to contract to sell the homestead. The prem•ise being wrong, the conclusion was wrong. So far as the question of liability of the contracting parties to answer in damages for a breach of the contract, is concerned, the contract was neither void nor voidable, in whole or .in part. Each obligated himself to procure the execution of a deed by his wife. It is not unlawful for a person to contract to sell and convey something he does not own but expects to acquire, and if he unqualifiedly undertakes to do that which later he finds he cannot'perform, he must and should suffer the liability the law imposes upon the contract breaker.
The remaining issue that the amount stipulated in the contract as liquidated damages should be construed as a penalty must also be decided against defendant. The question is one of law for the court (May v. Crawford, 150 Mo. 504; Dyer v. Cowden, 168 Mo. App. 649)
“It is perfectly competent for parties, when entering into an agreement, to avoid all controversy as to the amount of damages which may result from a violation of the contract, and to agree upon a fixed, certain and definite sum which shall be paid'by the party in default. The damages in such a case are termed liquidated, stipulated, or stated damages. But in such cases great difficulty has been experienced in giving the contract a practical application and construction in determining whether the damages should be régarded as liquidated, or as a mere penalty only. The question is environed with doubt and contradiction and the decisions are conflicting and inharmonious. Mr. Sedgwick, the learned author of the Treatise on Damages, says: ‘The subject-matter of the contract and the intention of the parties are the controlling guides. If, from the nature of the agreement, it is clear that any attempt to get at the actual damage would be difficult, if not vain, then the courts will incline to give the relief which the parties have agreed
Each party valued his land at $10,000, and it is fair to assume that neither would have agreed to an exchange if he had not expected to reap some profit or advantage. Snch is the dominating motive in all trades. Both must have anticipated the difficulties and uncertainties that would be encountered in proving the actual pecuniary -loss one would suffer if the other breached the contract. The market values were not definitely fixed by law and would be ascertained by the triers of fact from variable and even contradictory evidentiary sources of information. Each party occupied the dual role of vendor and vendee. Vendors, are prone to overvalue and vendees to undervalue. Notwithstanding the valuation each party allowed the other to place on the property he put into the trade, the issue of the quantum of damages would have to be determined by the. test of the comparative market values and it was within the realm of reasonable probability that proof would show a greater difference in the market values of the respective properties than the sum agreed upon as liquidated damages. Such being the case we cannot say as a matter of law that the contractual estimate was unreasonable, or oppressive and, therefore, shall not interfere with the agreement the parties chose to make for themselves. The court should have rendered judgment for plaintiff for the whole of the stipulated sum but since .plaintiff did not appeal and no prejudicial error was committed against defendant, the judgment should be affirmed.
It is so ordered.