Kaiser v. Klein

WHITING, J. The defendant, a married man, entered into' a contract with plaintiff, whereby he contracted to sell and convey, and the plaintiff contracted to purchase, 360 acres of land in Roberts county, S. D., for the lump sum of $14,400. This contract was not signed by the wife of defendant, though the said land, which comprised three separate and distinct tracts, contained one tract of 160 acres which was the homestead of defendant and wife, upon which they were residing at the time the said contract was executed. This action is brought by plaintiff to enforce the specific performance of such contract so far as the land other than the homestead is concerned. Plaintiff asked that there be abated from the agreed purchase price an amount equal to the value of said homestead tract. There are absolutely no terms or conditions contained in said contract under which one can determine the valuation, if any, which the parties to said contract placed upon any separate tract of land; said contract being, in its nature, clearly indivisible in that regard. It was conceded by the plaintiff, as shown by his sworn testimony, that, at the time he entered into said contract, he knew part of said land was defendant’s homestead and that a contract in relation thereto was invalid without the signature of defendant’s wife. The evidence shows that,. prior to bringing the action, plaintiff tendered to defendant the total agreed purchase price and demanded a conveyance of the whole 360 acres of land. There is no claim that he tendered the full contract price and asked a conveyance of the land other than [473] the 'homestead, or that he ever tendered the full contract price less the value. of the homestead and asked for a conveyance of the land other than the homestead. Upon the trial by the circuit court sitting- without a jury such court allowed proof of the value of the homestead. The trial court entered a decree adjudging that, upon payment of the said $14,400 less the value of the homeriead as found, the defendant should be required to convey to plaintiff the said land other than the homestead. From such decree and order denying a new trial defendant has appealed. It is conceded that under section 3217 of the Political Code of this state the said contract, so far as it purports to relate to the homestead, was of no validity; said section reading as follows: “A conveyance or incumbrance by the owner of such homestead shall be of no validity unless the husband and wife,' if the owner is married, and both husband and wife are residents of this state, concur in and sign the same joint instrument, except as provided in the next two sections.” It is the contention of appellants that, under said section, there is no contract which can be enforced in part by the court. Appellant also contends that, even if the contract was otherwise valid and binding upon the parties and such as, if unenforceable in toto, might yet support a decree for specific performance as to part of the land with or without damages for breach as to the remainder, such relief could not be claimed herein for the reason that plaintiff knew of -the homestead character of part of the land at the time said contract was entered into and knew that such con-contract was invalid at least to the extent of the homestead land'. Respondent contends that the facts of this case bring this contract under the well-established -rule under which a vendee may have specific performance of the contract so far as it.covers lands the title to which the vendor is able to convey, and may have an abatement from the contract price for that part of the land which he does not obtain. Respondent quotes the following from 36 Cyc. 74°: “Although the purchaser cannot have a partial interest, forced upon him; yet, if he entered into the contract in ignorance of the vendor’s incapacity to give him the whole, he is generally entitled to have the contract specifically performed as far as the [474] vendor is able, and to have an abatement out of the purchase-money for any deficiency in title, quantity, or quality of the estate. This is not making a new contract for the parties, since the vendor is not compelled to convey anything- which he did not agree to convey, and. the vendor pays for what he gets according to the rate established -by the agreement.” It should .not be overlooked that such rule contemplates a contract which is legal- and in every respect -binding as between the parties, but which is unenforceable-in part and unenforceable for some reason unknown to the vendee zvhen he entered into the contract. Bearing in mind the fact that part of this land was a homestead, we find that the only valid contract (if any valid contract ■ was entered into¡) was one to convey the -land other than the • homestead for the contract price of $14,400. This is especially true for the reason that respondent knew the contract was invalid as to the homestead. But, in view of the provisions of our statute, should such a contract be held to have any validity? We think not. Certainly the parties, though they knew of the invalidity of the contract so far as it related to the homestead, did' not intended to enter into any other contract than one covering all of said 360 acres of land, and the court should not make any other contract for them. It will thus be seen that this case differs in a most essential particular from those cases where parties have made a valid contract which valid contract the court seeks to enforce so far as possible. It must at all times be borne in mind that a contract tot convey land, part or all of which is not owned by the vendor, is valid unless declared invalid by express statute and the vendee can recover in damages for a breach thereof 01-can enforce specific performance even as to land not owned by vendor at time of contract if vendor has afterwards acquired title to same. Barnett v. Mendenhall, 42 Iowa, 296. It is such a contract, wholly valid, and not a contract -such as the one before us, to which -the rule quoted from 36 Cyc. applies. But even if the contract were valid, yet, under the very authority quoted, respondent has no standing in a court of equity owing to the fact that he knew the true situation when -he entered into such contract. In 2 Pomeroy’s Equitable Remedies, §' [475] 833, it is said: “But to be entitled to specific-performance with compensation, the buyer must, generally, have been unaware of the deficiency at the time of the bargain.” In the case of Knox v. Spratt, 23 Fla. 65, 6 South. 924, the court says: “It seems to-be now settled that the enforcement of a specific execution of a contract is not a matter of right in either party, but a matter of sound reasonable discretion in the court. Story’s Eq. Jur. § 742; Blackwilder v. Loveless, 21 Ala. 371. An-d the court uniformly refuses to decree a specific performance except in cases where such decree would be strictly equitable. Id. The doctrine that in case the vendor is unable to comply with the contract by reason of not having a legal title to all the land sold, yet that the vendee is entitled to a specific performance of the contract for such as lies in the power of the vendor to convey with compensation for the residue, is undoubted. This principle, however, is qualified in its operation and cannot be invoked by a -purchaser who at the time of the making the contract had notice of the fact that the vendor had a limited interest in the land. See White & Tudor’s Leading Cases, p. 1071, vol. 2, pt. 2, and cases ‘there cited. In this case notice was given at the -time of the sale that there was a deficit in the claim of title which the company would remove. . With this knowledge the purchaser does not come within the rule laid down ‘that in equity the purchaser, though he cannot have a partial interest forced upon him, yet if he entered into the contract in ignorance of the vendor’s incapacity to give him the whole, he has a right to insist that the vendor shall convey to him so much, as is in his power to do.’ The complaintant’s bill admits that he had the notice, and he is therefore not such a purchaser as equity will aid in demanding a performance of part of the contract with compensation for the residue. Adams’ Equity, p. 90.” In the case of Lucas v. Scott, 41 Ohio St. 636, a case in many respects analogous to the case at bar, the court said: “The rule is well -settled ‘that a vendor whose estate is less than or different from that which he agreed to sell, or who cannot give the exact subject-matter embraced in his contract, will not be allowed to-set up his inability as a -defense against the demand of a purchaser who is willing to take what he can get with-compensation for that [476] which the vendor cannot convey.’ Pomeroy’s Sp. Per. § 438, and authorities there referred to. This rule, however, is limited to those cases in which the purchaser had no knowledge, at the time the contract was made, that the interest of the vendor was partial, that his title was defective, or that the subject-matter was deficient.” The same exception to the general rule is noted in the notes following case of Eppstein v. Kuhn, 10 L. R. A. (N. S.) on page 1 iy. The judgment of the trial court and order denying a new trial are reversed, with directions to the trial court to dismiss the complaint herein.