Bennie v. Becker-Franz Co.

BOSS, J. The question in this case, reduced to its simplest form, is, Do the pleadings and the findings of fact sustain the judgment ? It seems clear from the terms of the agreement that appellant had the right of exercising his choice of either paying the appellee on or before July 31, 1909, $6,250, or conveying to appellee forty-nine one-hundredths of the property. It was contemplated that the exercise of this right of choice should be made on or before said date. A failure of appellant, to pay the $6,250 or to execute a conveyance of forty-nine one-hundredths to appellee, as 'provided in the agreement, ordinarily would entitle the appellee to declare a forfeiture of the contract. The agreement does not, by express terms, make time the essence of the contract, but an express stipulation to that effect is not always essential, as it may be implied from the [585] character of the subject matter, as where it is likely to undergo sudden, frequent or great fluctuations of value. This is especially true of mineral property. Waterman v. Banks, 144 U. S. 394, 403, 36 L. Ed. 479, 12 Sup. Ct. Rep. 646; Merk v. Bowery Min. Co., 31 Mont. 298, 78 Pac. 519; Williams v. Long, 139 Cal. 186, 72 Pac. 911; Snider v. Yarbrough, 43 Mont. 203, 115 Pac. 411; 27 Cyc. 674. It is also well settled that even though time is of the essence of the contract, whether by express language or by reason of the nature and character of the property, it may be waived. A waiver may arise by agreement or by estoppel growing out of the conduct of the parties. Boone v. Templeman, 158 Cal. 290, 139 Am. St. Rep. 126, and note, 110 Pac. 947. The pleadings and findings of fact disclose that appellee took no step to declare a forfeiture on July 31, 1909, or at all, except by the institution of this suit in February, 1912. Appellant pleads a waiver of strict compliance of the terms of the contract by appellee pending the litigation with the Sierra de Oro Gold Mining and Milling Company over title to part of the property;. and while, in terms, the court fails to find on this issue, there is a finding that a suit was instituted by appellee against the Sierra de Oro Company which resulted in a judgment against appellee on October 3, 1910, whereby a portion of certain of the mining claims “agreed to be sold to Bennie was lost to plaintiff.” There is the further finding that appellant “contributed 51 per cent of the expenses of litigation in said cause of the Becker-Franz Company, a corporation, against the Sierra de Oro Gold Mining and Milling Company.” Thus it is seen that long after July 31, 1909, the appellee and appellant were co-operating in an effort to clear up the title to the property, paying forty-nine per cent and fifty-one per cent respectively, of the expenses of a lawsuit prosecuted in the name of the appellee. "While there is no finding as to who was in possession of the property in 1910, there is a finding that appellant was in possession in 1908 and 1909 and that he did considerable development during those years. Another finding is that the appellee had performed the annual assessment since 1910 “and is now in the possession of said property.” We think it may be reasonably inferred, taking these two findings, together, that appellant was in possession during 1910 and did the representation work [586] for that year. This is certain as will be shown further on in this opinion. If there was an agreement, either express or implied, that the payment of the last $6,250, or in lieu thereof a deed of conveyance of forty-nine one-hundredths of the property to appellee, should be postponed beyond July 31, 1909, the date fixed in the agreement for the doing of one or the other, the appellee is not in a position to declare a forfeiture, at least until it has fixed another date for performance and given appellant a reasonable time in which to act. “Where time was originally essential, but for sufficient cause a forfeiture for default therein has been waived, time ceases to be essential and becomes only material thereafter until (when) the vendor again makes it essential by a proper notice and demand.” Boone v. Templeman, supra; 39 Cyc. 1345, 1349, 1350. In Opejon v. Engebo (Wash.), 131 Pac. 1146, it is said: “The rule is well settled in this state that, after a party has waived the essence clause of a contract, the purchaser will not be in default until after a demand has been made upon him for a compliance with his contract and a reasonable time has elapsed in which to comply with the demand.” The entering of judgment in this case quieting appellee’s title must be justified, if at all, by the following finding of fact: “ That th.e defendant herein failed and neglected to exercise his right to complete his purchase of said mining property on or before the 31st day of July, 1909, by the payment of the sum of $6,250 as agreed, and failed and neglected to transfer and convey unto the said plaintiff herein, its successors or assigns, at any time prior to the 31st day of July, 1909, a forty-nine one-hundredths interest in and to the said property in lieu of the payment of the said sum of $6,250 in accordance with the terms of his contract, and failed and neglected to exercise his option to purchase said forty-nine one-hundredths interest in and to said property at any time after August 1, 1909, and December 1, 1910, for the sum of $10,000 in accordance with the terms of his said contract.” It does not seem to us, in view of the findings above analyzed, that the mere fact of failing and neglecting to make the payment mentioned or, in lieu thereof, the deed on or before July 31, 1909, was equivalent to a finding of a forfeiture of the contract. If that were so, it follows that the [587] essence clause may never be waived. The crux of this case hangs upon the question as to whether or not there was a waiver of the essence clause, for the findings are that appellant did everything required of him under the agreement, except that he failed to pay $6,250 prior to July 31, 1909, or to convey to the appellee prior to said date forty-nine one-hundredths interest in the property in lieu thereof. After that date the parties joined in an effort to clear the title that lasted till October 3, 1910. Appellant remained in possession during 1908, 1909 and 1910, and performed the annual assessment work for those years. That part of the court’s finding that the appellant had “failed and neglected to exercise his option to purchase said forty-nine one-hundredths interest in and to said property at any time after August 1, 1909, and December 1, 1910, for the sum of $10,000 in accordance with the terms of said contract, ’ ’ is aside from any issue involved, except the ease was tried upon the theory that the appellee had waived a strict compliance of the essence clause. For no such option existed under the agreement until after appellant had deeded forty-nine one-hundredths of the property to appellee. Indeed, in that connection, appellee in its brief states that appellant “had until December 1, 1910, to make his final payment of $10,000 and take the property over.” We think a fair and reasonable inference from the findings is that the appellee waived a strict compliance- of the essence clause, and that it ought not to be permitted to declare a forfeiture without first giving the appellant an opportunity to pay the balance of the agreed purchase price or at his election, in lieu thereof, convey to appellee forty-nine one-hundredths of the property. There being no finding that such opportunity was given the appellant, we think, under the decisions in Boone v. Templeman, supra, and Opejon v. Engebo, supra, the findings fail to sustain the judgment. We do not intend that it should be understood that the appellee, after submitting an abstract of title satisfactory to appellant, was under any legal obligation to institute and prosecute the suit against the Sierra de Oro Company, but we do hold that in so doing, after the date fixed in the essence clause, with the co-operation and financial aid of appellant, it recognized that appellant had rights in the property. It was [588] held in Lyons v. Wait et al., 51 N. J. Eq. 60, 26 Atl. 334, that, “where the vendor and vendee are endeavoring to remove some supposed encumbrance or cloud upon the title, neither has a right to consider his obligations to the other determined without reasonable notice.” Opejon v. Engelo, supra. For the reason that the findings clearly show that the essence clause of the agreement between appellant and appellee was waived, and there being no finding that appellee subsequently, by notice or otherwise, revived said essence clause and demanded performance within a reasonable time, the judgment of the lower court is reversed, and the case is remanded for a new trial. FRANKLIN, C. J., concurs.