Moran v. Pryor

Opinion by STEPHENSON, C. A contract in writing was entered into, between J. T. Pryor and wife, as first parties, and J. L. Motan, as the second party, on July 20, 1922, whereby the first parties bound themselves to sell and convey an undivided one-half in *261 terest in the Bromide Hotel, together with certain 'lots, in tile city of Sulphur. Okla. A supplemental contract was entered into between the parties on the 10th day ot‘ August, 1923, to the effect: (1) That tbe first parties should sell and convey the one-half undivided interest in the property for the consideration of $3,000, to be paid in cash, when the first parties furnished an abstract showing a merchantable title to> the property; that notes should be executed for the balance of the consideration in the -sum of $6,500, and a mortgage executed on the premises to secure the pay-inept of the notes. (2) It was provided that the first parties should have until October 10th to furnish the abstract of title, and that the $3 000 should remain in escrow, with the contract, in the Farmers National Bank, of Sulphur. The plaintiff went into possession of the property under the contract of conveyance. The plaintiff paid the $3,000, and executed and delivered the $6,500 in notes, with a mortgage to secure the payment thereof, and delivered the same to Pryor. Pryor executed and delivered warranty deed to' Moran bearing date as of July 20. 1922. Later* Moran paid one of the $1,000 notes. Moran commenced his action in August, 1923, to cancel the contract and sale. Pryor filed a cross-action for foreclosure of his mortgage in about the sum of $5,500. The trial of the cause resulted in judgment denying cancellation of the sale and for judgment in favor of Pryor ordering the foreclosure of the mortgage. Moran has appealed the cause here, and assigns several rulings made in the trial of the cause as error for reversal herein. The main errors assigned a-re: (1) That the judgment is contrary to the law. (2) That the judgment is against the weight of the evidence. The substance of plaintiff’s petition for cancellation of the sale is: (1) Allegations setting forth the matters heretofore detailed. (2) That the defendant pointed out to him the lines of the property before lie purchased the same and! that the lines of the property as pointed out to him included a bathing pool, which was considered one of the main inducements for the purchase of the property. (3) That the defendant represented to him that he had a good merchantable title to the property. The answer of J. T. Pryor to these allegations is in the nature of a general denial. The answer further set forth that if the bathing pool was located upon the property of the city and that of the United States, the defendant was not so advised and did not know of such fact at the time elf the sale. The record indicates that both plaintiff and| defendant were not experienced in handling matters of business, and each of the parties did not exercise that care and concern for the matters involved in this transaction that reasonably prudent men show in the concern- of their own business interests. It appears from the evidence that both parties/ relied on one attorney for the preparation of the written contract and the papers in connection with -the sale. The defendant stated to the plaintiff, after the contract for sale was entered into, that Parks, the owner of the other undivided one-half interest, had) -the abstract of the -property in his x>ossession; that if the plaintiff would agree for a delay in the furnishing of the abstract, the defendant would be able to procure the abstract from Parks and save tbe cost of preparing a new record of the title. It appears that the plaintiff later agreed to give the defendant until January, 1923, to procure and furnish an abstract showing a merchantable title to -the property. It -appears that during all these times both parties were consulting the same attorney and relying upon the same attorney for advice in connection with matters pertaining to the sale. It -appears from the evidence that the attorney in question, before the procurement of the abstract, examined the records at the county seat- and advised this plaintiff that the title: was perfect, with the exception that two judgments against the defendant, which would be liens upon the-property, remained unsatisfied; that the two judgments would become dormant sometime in the latter part of the year 1922, if executions were not issued thereon. It appears -that the purpose of deferring the furnishing of the abstract until January 1, 1923, was to permit the judgments to- become dormant. In this situation, the plaihtiff paid the $3.000 to the defendant, and executed and delivered notes and mortgage on the property to< secure the balance of the purchase price in the sum of $6,500. The defendant left Sulphur after receiving the $3,-000, and did not return until April, 1923. The plaintiff commenced making certain improvements on the property in the early summer of 1923, in clrder to take care of the tourist business for that season. A part of the improvements was -the construction of a dining room to the hotel. About the *262 time the dining' room was completed the mayor of the city of Sulphur advised plaintiff that the building extended on to the street of the city of Sulphur, and that the building must be removed from the city property. The city of Sulphur paved a street in the vicinity of the Bromide Hotel later, and according to the location of the pavement it was made to appear to the plaintiff that the bathing pool was located, ■ in part, in the street of the city of Sulphur as platted, to the extent of about 15 or 20 feet. It appears from the evidence that if the bathing pool had been upon the property, and the property situated so as to include the bathing pool, the dining room would have been upon the property purchased by the plaintiff from the defendant. The plaintiff had paid one of the $1000 notes in the meantime. When it became apparent that a part of the bathing p'ol was on the property of the city and government, and that the lines of the property were different from those which plaintiff claimed the defendant pointed out to him, the plaintiff became concerned about his title. The plaintiff Anally procured an abstract of the title, which was submitted to Judge Young, a member of the Sulphur bar, for examination. Among the several defects disclosed by the record title were: (1) A deed showing to have been acknowledged before a notary public in Montgomery county, Okla. (2) A deed acknowledged before an officer in the state of Texas, who designated his official title as justice of the peace. (3) An action pending for the enforcement of a lien against Pryor upon the land in question in the sum of $1,500, which showed that a verdict had been returned in the cause for the defendant, but no judgment of the court thereon. (4) A grantor in .another deed failed to show whether he was single or married. The defendant became bound by his written agreement with the plaintiff to convey a merchantable title to the plaintiff for the $3,000 cash and notes and mortgage for the sum of $6,500. It is quite clear that the defendant has failed to deliver to the plaintiff the kind of title he hound himself to convey for the consideration set forth in the contract. No waiver or estoppel in relation to the kind of title to he conveyed was pleaded. The answer of the defendant, in relation to the defects of the title charged by the plaintiff, was in the nature of a general denial. The single question presented by th« pleading is the truth or falsity of the allegations of the idaintiff. According' to the testimony of both parties, each had a survey made of the property and each made xvroof of such survey. There is a conflict between tbe evidence of the surveyors as to the location of the property lines, but according to tbe testimony if both, the bathing pool is, in part, upon the city properly. The defects in the title to which we have referred are no't disputed by the defendant. The defendant in oral argument seemed to rely mainly upon, waiver, or estoppel, against the plaintiff to assert the defects in title. The defendant did not plead waiver, or estoppel, as a defense, and we do not know upon what state of facts the defendant relies in this respect. Suffice it to say that this defense must be pleaded, in order to avail tbe defendant. Holt v. Holt, 23 Okla. 639, 102 Pac. 187; Nance v. Okla. Fire Ins. Co., 31 Okla. 208, 120 Pac. 948; Federal Mutual Life Ins. Co. v. Dean, 57 Okla. 84, 156 Pac. 304. Tbe finding of (he issue in favor of the defendant, that the latter conveyed a merchantable title to the plaintiff, is against tbe weight of the evidence. This court wiil weigh the evidence in a case of purely equitable cognizance upon ai>peal, but will not reverse' the judgment- unless it be clearly against the' weight of the evidence. It follows that the judgment ordering the foreclosure of the mortgage in favor of the defendant upon his cross-action is 'also against the weight of the evidence. The evidence is not clear as -to the value of the improvements made iby the plaintiff upon the property, and at what stag’e in the course of making the improvements the plaintiff discovered that the building was upon, the property of the city. If -the plaintiff did not discover that the dining room was upon the property of the city until it was comxfleted to thel point of placing roofing upon the building, or was virtually completed, the plaintiff would he entitled to recover his expenditure for such improvements, and for such other improvements as he made prior to discovering that the original improvements were p’Laced, in part, upon the property of the city -and government. The plaintiff is entitled to a judgment canceling the sale and conveyance, and for a 'money judgment against the defendant for $4,000- paid upon the consideration, with interest at the rate of 6 per cent, per annum, from the date of payment. The defendant Pryor is entitled to recover one-half of the reasonable rental *263 value of the property during the time he has been out of possession. The plaintiff should be allowed recovery for any taxes he has paid upon his undivided one-half interest in the property. I-Iis right oí recovery for any improvements relates only ro one-half the value thereof. An equitable lieu should be de-i Glared in lavor of the plaintiff, and upon the undivided one-half interest in the pr’-perty, -to secure the payment of the sums of money found -to be due the plaintiff. Judgment should be entered in favor of the plaintiff and against the defendant canceling the notea -and mortgage in question. The judgment is reversed, and remanded fc-r further proceedings in accordance with the views herein expressed. By the Court: It is so ordered. Nate. — See under (1) 4 <!• J. p. 900 § 2S69; 2 R. C. L. p. 203; I It. C. L. Supp. p. 442; 4 R. O. L. supp. 91: 5 it. (.'. L. Supp. p. 81. (2) 9 O. J. p. 1188 § 54; 39 Oye. 1413.