Case v. the Texas Co.

In September, 1931, Lewis A. Case and Babetta Case, his wife, brought this action in the Circuit Court for Palm Beach County, against the Texas Company for recovery of the sum of $1,208.70 which that company had retained from the purchase price of certain property under an agreement entered into on December 5, 1927, by which it was agreed that such sum should be retained by the vendee, Texas Company, to abide the result of appropriate proceedings brought in the Circuit Court of Palm Beach County to determine the disposition of said retained amount, if the parties were unable to settle that question *Page 669 amongst themselves. The material facts in the case and a summary of the pleadings and issues will be found in the opinion prepared by Mr. Justice ELLIS filed herewith. Such opinion is concurred in by a majority of this Court with the exceptions hereinafter set forth. A majority of the Court are of the opinion that the rendition of judgment in this cause for the defendant below was error and that the plaintiffs should have been allowed to recover because of the breach by the defendant, Texas Company, of the agreement of December 5, 1927, under which the money retained by it from the purchase price was agreed to be retained to be applied in payment of the assessment against the property for the paving and sewer improvement either when the parties agreed upon a settlement, or after the matter had been determined by a friendly suit in the circuit court, but that the measure of recovery to be allowed should be limited to a recovery of the retained sum of $1,208.70, less the amounts that the Texas Company has been compelled to actually suffer the loss of, in order to secure the cancellation of the paving assessment liens concerning which the retained sum was withheld, and not the amount originally assessed against the purchased land for paving assessments. No deduction should be made for the alleged sewer assessments which appear to be ineffective as encumbrances. The majority of the Court construe the contract of December 5, 1927, as having been made for the principal purpose of idemnifying the Texas Company against liability for municipal assessment liens then contemplated against the land it was buying, but the legal existence of which was doubtful. The contract must be read in the light of facts known to have been contemplated by the parties at the time the Texas Company purchased from the Cases the *Page 670 land upon which paving liens were later imposed as of a date prior to the purchase. A majority of the Court are further of the view that the assessment liens subsequently imposed by the City of West Palm Beach, when imposed, then related back and constituted an encumbrance on the property as of October 8, 1927 (the date of vendor's contract to deliver satisfactory unencumbered title), within contemplation of the retention contract of December 5, 1927, but that the stipulated encumbrances having subsequently become dischargeable for a less amount than the whole sum of $1,208.70 retained as indemnity against liability for these liens, that the Texas Company when it breached its contract by discharging said liens out of said retained sum without plaintiff's consent or prior legal determination of the liability, only damaged plaintiffs to the extent that it refused to pay over the difference between what it legally had to pay out and the total retained amount. The judgment appealed from is therefore reversed with directions to reinstate the proceedings in the court below and to proceed according to law in a manner, and to a final determination, not inconsistent with this opinion. Reversed and remanded with directions. DAVIS, C. J., and WHITFIELD, TERRELL, BROWN and BUFORD, J. J., concur.