Plitt v. McMillan

Hornby, J., delivered the opinion of the Court. This is the second time that this case, involving an install ⁴⁵² ment sale of a lot in a land development project on Kent Island in Queen Anne’s County, has been appealed to this Court. When Elizabeth S. McMillan purchased the lot from Chester Beach, Inc., she made a nominal down payment and agreed to pay the balance due in monthly payments to be applied first to taxes and then to interest and principal. At the same time that the purchaser executed the contract of sale granting the seller or its assigns an option in the event of a default to either cancel the contract or sue for the balance due on the note, she signed an installment note, attached to the contract of sale, containing the standard clause for the confession of judgment.

Among other things, the contract of sale further provided that: “This agreement shall be and constitute the purchaser’s application for membership in Chester Beach Club, Inc. In the event that application to said [club] is disapproved, then this agreement shall be inoperative and void, and all deposits made by the purchaser shall be refunded.” Shortly after the contract and note had been assigned to Clarence M. Plitt for a valuable consideration, the purchaser was notified to make the monthly payments directly to the assignee, and upon her failure to do so a judgment by confession was entered on the note. Subsequently, however, the judgment was stricken out, the defendant was allowed to plead and the trial of the case on its merits (by Byrnes, J.) resulted in a judgment for costs in favor of the defendant-appellee against the plaintiff-appellant. On the first appeal, reported as Plitt v. McMillan, 235 Md. 349 , 201 A. 2d 787 (1964), where the facts clearly indicated that the appellant (as assignee of the contract of sale and installment note) was an assignee with notice that all defenses the appellee (as purchaser) had against the seller were likewise valid against the assignee, we remanded the case without affirmance or reversal to the end that the lower court could consider whether or not the assignee was required to tender a deed to the purchaser as a prerequisite to the obtention of a judgment by confession for the balance due and whether or not the seller or its assignee had fully complied with the terms of the contract. In ⁴⁵³ the interim between the remand and the retrial of the case, title to the lot in question was transferred from Chester Beach, Inc., the corporate stock of which was held by the appellant as security for a debt, to Chesapeake View Company, the corporate stock of which was owned by the appellant.

On the remand, the lower court (Cullen, J.) retried the case anew as it had the right to do. On the question of tender it was shown that an offer to execute a deed would have been futile because the purchaser had refused to pay for the lot. Over objection, it was shown that the appellee had received a letter of cancellation from Chester Beach, Inc., but in rebuttal the appellant produced evidence to the effect that it was for him to