Worley v. Nethercott

Belcher, C. In January, 1889, the plaintiff was residing upon and claiming to own certain real property in the town of Red Bluff, Tehama County. On the 26th of that month, plaintiff verbally agreed, to sell the real property and some personal property to the defendant, for the sum of $1,880, and to' let him take immediate possession thereof. Plaintiff was to give a warranty deed of the real property, conveying a good and perfect title thereto, and defendant was to pay $1,000 cash, and give his note for $880, bearing interest at the rate of ten per cent per annum, but it was not stated how long the note might run. Defendant paid ten dollars to bind the bargain, and asked paintiff if ho had a good title to the property, and the latter replied that he thought he had; that he had a warranty deed of it. Defendant asked for an abstract of the title, and plaintiff agreed to furnish one. On the 29th of the month, defendant took possession, and about that time the abstract was made out and put in the hands of Mr. Ellison, an attorney at law. On the 4th of February the parties met, and went to Mr. Ellison’s office, and defendant testified: “ When I entered Mr. Ellison’s office, knowing that he had the abstract, I said to him: * As an attorney, can you say that the title is perfect?’ He said: ¿Ho, I can’t/ He said: ‘I have looked over it, and I can’t say that it is perfect/ ” A few days later, the parties again met, and plaintiff testified: 611 went to him and told him I was going away, and I wanted to settle it up one way or another; he wanted to know what I wanted to do, and I asked him if he was satisfied with the title, and he said he was n’t; then I told him we would say quits; he said he had been out considerable in moving down there, and would be in moving away; I asked him how much, and he said about twenty dollars; I told him I would pay it and he would give up possession; he said he did n’t care to do it.” Defendant then proposed to retain possession of the property and to make some improvements upon it, and plaintiff agreed that he might make improvements costing from $100 to $150- [516] Before the end of February, plaintiff went to the mountains, and he did not return till some time in August. During his absence, defendant made improvements on the property, costing, as he testified, $388.21 besides his own work, 'which he estimated to be worth $125. The matter remaining unsettled, plaintiff, in October, executed a warranty deed of the property, and on the 2d of November tendered it to the defendant, and demanded of him payment of the balance of the purchase-money, namely, $1,870. The defendant refused to accept the deed or to pay the money, but he, on the same day, tendered and asked plaintiff to execute a warranty deed for an undivided one half of the property, and in connection therewith, offered to pay him $1,075 for the real and personal property. The plaintiff refused to execute this deed or to accept the payment as offered. The plaintiff then served on defendant a notice reading as follows: — “Mr. Robert Netheroott. “Bear Sir,—Having refused to pay me the contract price for the land hereinafter described, I hereby notify you that the contract of sale for said lots is hereby rescinded. I hereby offer to pay you for any improvements you have made upon said property, the amount they have cost you, upon being satisfied of the true amount, and also the ten dollars you paid thereon, with legal interest, deducting therefrom the rent of said premises during the time you have occupied them; and I hereby demand that you leave said premises, and surrender up to me the possession thereof. [Then follows a description of the property.] [Signed] “W. H. Worley.” Possession was not surrendered, and the plaintiff brought this action of ejectment to recover the same. The defendant answered, denying all the averments of the complaint, and for a second defense, settingup the contract of sale and plaintiff’s failure and inability to convey a good and perfect title, and his own readiness [517] and ability to perform his part of the contract on receiving a conveyance of such title. The court below gave judgment for the defendant, from which, and from an order denying him a new trial, the plaintiff appeals. It appears from the evidence that the plaintiff did not have a perfect title to the whole of the property which he agreed to sell; and it is claimed for respondent that under such circumstances he was not obliged to accept plaintiff’s deed or to pay the purchase-money, but that he could retain both the land and money until a pez’fect title should be offered him. ,We do not think this position can be maintained. In Gates v. McLean, 70 Cal. 42, the action was brought to recover the possession of certain land which the plaintiff had contracted to sell to the defendant, and the court, on page 50, said: Even where the contract provides for the vendee taking possession, the remedy of the purchaser, where the title of the vendor fails, or he is unable to make conveyance as stipulated in the contract, is to rescind the contract, or offer to, and to restore the possession, in which case he may recover the purchase-money advanced and the interest, together with the value of his improvements, deducting therefrom such sum as the use of the premises may reasonably have been worth. If, on the other hand, the purchaser chooses not to rescind, but to retain possession under the contract, he can do so only on the condition that he pays the purchase-money and interest according to the contract. In the latter case, it is considered that he is willing to receive such title as the vendor is able to give, and is content with the personal responsibility of the vendor upon his covenants.” In Rhorer v. Bila, 83 Cal. 54, the court said: “ A purchaser cannot remain in possession of lands under a contract and at the same time refuse to pay the purchase price. If the title fails, or the vendor refuses to convey, an action on the covenants of his deed or contract will e, give him all the relief to which he is entitled.” [518] It is urged for respondent that what is said in the above quotation from Gates v. McLean, 70 Cal. 42, was not necessary to the decision of that case, and was merely obiter dictum; and that it was not a correct statement of the law, and ought not to be followed. We cannot assent to the conclusion reached by counsel. In our opinion, the law was correctly declared, whether what was said was necessary to the decision of that case or not. To hold otherwise would, in many cases, work very great injustice. It follows, in our opinion, that the findings and judgment were erroneous, and that they ought not to be permitted to stand. We advise, therefore, that the judgment and order be reversed, and the cause remanded for a new trial. Fitzgerald, C., and Vanclief, C., concurred. The Court. For the reasons given in the foregoing opinion, the judgment and order are reversed, and cause remanded for a new trial. Hearing in Bank denied.