Christian v. Johnson Construction Co.

Parke, J., delivered the opinion of the Court. The Johnson Construction Company sold, and Charles M. Christian and Grace Christian, his wife, bought, the leasehold interest in four lots, with the buildings thereon, for the sum of $3,000. The contract was in writing and under seal, and was executed on April 1st, 1926. Ten dollars were paid when the contract was signed, and the residue was agreed to be paid in equal monthly installments of thirty-six dollars, payable on the first day of every succeeding month from the date of the agreement.

The vendees were to pay interest on the purchase price, taxes, insurance, and all expenses, when legally demandable, until the whole of the purchase money was paid. It was further covenanted that, if the vendees should default in payment of any monthly installment, taxes, or legal expenses, and such default continued for a period of over thirty days, the default should be considered a breach of the contract, and the whole amount due on this contract should become due and payable; and, if not paid, the contract, at the option of the vendor, should be null and void, and all payments made should be retained by the vendor as rental for the premises. The contract concludes with the stipulation.that: “Upon the payment of the full purchase price together with the interest, the said party of the first part agrees to give to the said parties of the second part a good and merchantable deed at the expense of the parties of the second part.” ⁹¹ The vendees entered in possession and paid on account the sum of $587, which was in full of the first payment and the monthly installments and interest to August 1st, 1927; hut nothing more was paid, and on November 19th, 1928, the vendor brought an action on the contract to recover the amount of the unpaid purchase money with the interest due, taxes, and insurance. The plaintiff’s cause of action on the contract was set forth in the seventh count of the declaration, to which the defendants demurred.

The demurrer was overruled, and the defendants in their pleas pleaded by way of set-off that the contract was entered into by the defendants upon the express condition that the honse on the lots sold should be in good order and condition and tenantable and fit for occupancy by them as their home, and that, after the contract was so entered into, the defendants took possession of the honse thereon, and furnished the same with household •furniture and effects, and attempted to live in and occupy said honse as their home, hut that said house was untenantable and unfit for occupancy by them as their home, because the roof and walls were not watertight, and so the rain came through in large quantities, and, after the repeated neglect and refusal of the plaintiff to make the house tenantable and fit to occupy as their home, the defendants rescinded the contract in the summer of 1928, and demanded from the plaintiff the return of the said sum of $587, which the plaintiff refuses to make. After the parties were at issue, trial was had and judgment entered on the jury’s verdict, which was for the plaintiff in the amount of $3,000.67, or the amount apparently due according to the terms of the contract on the day suit was brought, less the credit of $587. During the trial, there was no controversy over the fact that there had been a contemporaneous parol agreement with respect to the repair of the honse by the plaintiff, and no question made of the admissibility of the evidence with reference to the conflicting versions of the terms of this parol agreement, and whether or not the plaintiff had made the repair as he had agreed by parol. Furthermore, the testimony on the part of the plaintiff and of the defendants in ⁹² support of their respective contentious with reference to the terms of the parol agreement and its performance or breach raised issues on these questions for the jury to find; and, under the plaintiff’s third prayer and the defendants’ second, the theory of each side on this branch of the inquiry was fully submitted.

If, however, the defendants’ contentions be sound, that, under the allegations of the declaration, the terms of the written contract, and the circumstances of the record, the plaintiff, in order to recover, must aver and prove that, before the suit was brought, it had tendered to the defendants a grant or deed of assignment of the leasehold estate, then the nisi prius court was in error in overruling the demurrer to the seventh count of the declaration, which did not contain an averment of such tender, and also in granting the plaintiff’s third prayer, which did not require the jury to find the tender; and, moreover, the defendants’ first prayer taking the case from the jury should have been granted, if it had not been defective in form by confining its demurrer to the evidence offered by the plaintiff instead of addressing it to all the evidence in the case. 2 Poe, Pl. & Pr., sec. 295 B; State. v. Balto. & O. R. Co., 69 Md. 343 , 14 A. 685, 688 ; Pennsylvania R. Co. v. Cecil, 111 Md. 288 , 73 A. 820 ; Fidelity & Deposit Co. v. Panitz, 142 Md. 300 , 120 A. 713 . 1. The defendants assert that it was necessary for the plaintiff to aver and prove either a delivery of the grant, or its tender and refusal, before the plaintiff had a right of recovery for the purchase money due. The assertion assumes that the covenants here of the vendor to grant the leasehold estate and of the vendees to pay the purchase price are mutual and dependent covenants, and that the obligation to make the tender was not waived. Neither of these assumptions is correct.

(a) The attempted incorporation of the terms of the contract in the seventh count of the declaration by reference and filing with the declaration is not good pleading, and, on demurrer, the contract will not be considered as a part of the count. The count in question does, however, set up a contract to sell by the plaintiff, and to buy by the defendant, a ⁹³ certain leasehold property at a specified sum, with interest and the payment of taxes, insurance, and expenses; the delivery of possession to the defendants, and the ability and readiness of the plaintiff to transfer the title and to do all other necessary things; the failure of the defendants to pay for a period of over ihirty days after default; and the fact that the defendants, after making numerous promises to pay the purchase money, finally notified the plaintiff that they were unable to perform their part of the contract by paying the amount due; and that, although repeatedly demanded, the defendants had refused to pay the money so demanded. Should it be assumed that the covenants to grant and to pay were mutual and dependent stipulations, and that a tender of the grant and an offer and readiness to perform may, in the first instance, have been a condition precedent to a right of action in the vendor for the failure of the vendees to have paid the purchase money, yet, since this tender was made useless by the refusal of - the vendees to pay and by their notice to the vendor that they were unable to perform their part, of the contract, a tender of the grant is dispensed with as a condition precedent to the right of the vendor’s suit for the purchase money. A tender is not necessary where it appears that, if made, it would have been futile.

The averments of the seventh count show that the plaintiff had an existing -capacity to perform, but that his tender would have been a useless gesture, so the demurrer was rightfully overruled. Citizens’ National Bank v. Davisson, 229 U. S. 212, 224 , 33 S. Ct. 625 , 57 L. Ed. 1153, 1159 ; 27 R. C. L., sec. 254, p. 525, "Vendor and Purchaser.” See Bullen & Leake, Precedents of Pleading (1868), pp. 246, 247; Ragan v. Gaither, 11 G. & J. 472 ; Cole v. Hymes, 46 Md. 181 ; Rasst v. Morris, 135 Md. 243 , 108 A. 787 . Compare Scarlett v. Stein, 40 Md. 512, 528 ; East Vedado Corp. v. Adkins & Co., 157 Md. 416 , 146 A. 385 . (b) The written contract of sale was offered in evidence, .and its terms disclose that the contract price of $3,000, with interest, was payable in equal monthly installments until the whole of the purchase price was paid, and that meanwhile ⁹⁴ the vendees were to assume the discharge of the taxes, insurance, and expenses; and, “upon the payment of the full purchase price together with the interest,” the vendor agreed to give the vendees “a good and merchantable deed (sic) at the expense of the parties of the second part.” So the contract to pay the purchase price was by a succession of equal monthly payments, and the covenant to convey is independent of such payments falling due, save probably the last, and a recovery may certainly be had for all the payments, with the likely exception of the last, without a tender of the deed by the vendor.

With respect to the last installment, the weight of decision seems to be that the agreement to convey is dependent or concurrent, unless the terms of the contract prevent that-construction. 27 R. C. L., secs. 172, 173. The action here is not for a particular installment nor yet for the final one, but upon the theory of a breach by the vendees of the contract, that occurred after they had paid but $587, which discharged the monthly installments to August 1st, 1927. From that date, the vendees declined to pay any further installments, and remained in default for more than thirty days. When this occurred, the stipulations of the contract expressly declared “such default shall be considered a breach of this contract on the part of the parties of the second part (i. e., the vendees) ; and the whole amount due on this contract shall immediately become due and payable, and if not paid, this agreement at the option of the party of the first.part (i. e., the vendor) shall be null and void.”' So it was not necessary for the vendor to tender a grant to put the vendees in default.

By the very terms of the agreement, the vendees were in default, and the immediate consequences were to accelerate the maturity of the whole residue of the purchase money, and to make this amount, without the tender of the deed as a condition precedent, immediately become due and payable. Hence afiirmative action was forthwith cast upon the vendees, and, if they failed so to pay, there arose by the terms of the agreement the privilege or option of the vendor to declare the contract null and void or to-enforce by action the payment of all of the unpaid purchase ⁹⁵ price, which under the contract was immediately due and payable. In the situation brought about by the breach of the contract in failing or declining to discharge the mutual and independent obligation to pay, the reasonable purpose of the provision now under discussion, as well as the plainly manifested intention of the parties, was to give the vendor the privilege of rescinding the entire contract or enforcing at once the payment of the sum due without another precedent act. Should the vendees continue in default in the payment of a monthly installment for more than thirty days, it would obviously be an idle ceremony to require a tender to produce a second default, when there was subsisting one which had arisen, continued, and was the condition which made the entire purchase price “immediately become due and payable.” Loud v. Pomona, Land, etc., Co., 153 U. S. 564, 576 , 14 S. Ct. 928 , 38 L. Ed. 822 ; 27 R. C. L., secs. 168-173, pp. 454-461.

The cases cited on briefs have been carefully examined, and the conclusion here expressed is not, in our opinion, at variance with the principles there applied. As there was evidence, on the one hand, tending to show a fnll performance of the parol promise according to the plaintiff’s theory of its terms, a delivery to defendants of possession of the premises sold, and an existing capacity, readiness, and offer of the plaintiff to comply with the written contract, and a refusal and inability of the defendants to pay as agreed, and, on the other hand, evidence tending to prove another version of the parol agreement, which was different in terms and was intended to be a. condition of the sale, a nonperformance of this agreement by tbe plaintiff, and a rescission of the contract by the defendants because of such breach, and a demand for the refunding of the payments on account of the purchase price, the ease could not have been withdrawn from the consideration of the jury; and, inasmuch as the respective theories of the testimony were submitted to tbe jury for their determination by the plaintiff’s third and fifth prayers and the defendants’ second and fourth prayers, there was no ⁹⁶ reversible error in the court’s rulings on these prayers and its rejection'of defendants’ first or demurrer prayer. The only other prayer for review is defendant’s third prayer, which asked that the jury be instructed that the statements or admissions made by the husband to the plaintiff, out of the presence and without the knowledge or consent of the wife, are not binding on the wife. The husband and the wife were the joint vendees and principals, and this prayer was properly refused because it ignored the testimony tending to show that the wife had constituted the husband her agent in the transactions had with the plaintiff in reference to the contract at bar. 2.

There are eighteen exceptions to the rulings on the evidence. The defendants do not press the eighth, thirteenth, and fourteenth exceptions, and there is no error disclosed in these bills. There is nothing presented for review by the-second bill of exceptions. The question was answered without objection, and no motion was made to strike out the testimony given.

Atlas Realty Co.