Tri-State Properties, Inc. v. Middleman

Prescott, C. J., delivered the opinion of the Court. Being dissatisfied when the Circuit Court for Prince George’s County (Powers, J.) granted appellee’s motion for a summary judgment and dismissed its amended bill for specific perfor ⁴³ manee of a contract for the purchase of real property, appellant has appealed. The appellant contends that the trial court erred in two ways: (1) the court failed to construe the provisions of the contract correctly; and (2) there was a genuine dispute as to material facts; hence there should have been a trial upon the merits of the case. Maryland Rule 610 d.

On October 24, 1961, appellant and appellees entered into a contract for the sale of some 15 acres of land by the appellees to the appellant for $187,500. The contract is of normal length for one of this nature, but, for the purposes of this appeal, it is necessary to set forth but brief portions thereof. They follow: “This contract is subject to the Seller obtaining, at Seller’s cost and expense, zoning on subject property, either to R-18 zoning jrom Prince George's County or its nearest approximate equivalent from annexation into the town of Laurel, Maryland, but in no event a zoning to permit less than 300 apartment units. If Seller has not obtained said rezoning within nine (9) months from date of acceptance of this contract by Seller, then Purchaser shall have the right to attempt to secure said rezoning at Seller’s expense.

If such zoning is not so obtained within one (1) year from date of acceptance of this contract by Seller, the Purchaser may thereafter cancel this contract by written notice or settle on property as is within thirty days after the expiration of one (1) year after acceptance of this contract by Seller.” “SETTLEMENT. Time is of the essence of this contract and within 60 days after zoning has been obtained and appeal period has expired but no sooner than March 15, 1962, * * * seller and purchaser are required and agree to make full settlement * * "TITLE. The property is sold free of encumbrance except as aforesaid; title is to be good of record and ⁴⁴ in fact and merchantable; the property covered by this contract shall be subject to no covenants or restrictions, recorded or unrecorded as could in any manner whatsoever affect or interfere with the development and/or use of the same under applicable zoning and building regulations except customary rights of way for utilities and utilities installations; otherwise the deposit is to be returned and sale declared off at the option of the purchaser, * * (Emphasis supplied.) The sellers made prompt application for the zoning called for in the contract, but were unable to obtain the same within either the nine months’ period, or the year. The purchaser did not obtain the zoning within the year, and no notice was given by the purchaser, oral or written, of either the termination of the contract or its determination to accept the property “as is,” within 30 days thereafter.

Before the year had expired, an action was filed by the Maryland-National Capital Park and Planning Commission against the City of Laurel and one of the owners (a defendant in the case at bar) relative to the property that is the subject matter of the present proceeding. The suit, in no manner, involved the title to said property, but involved a dispute between the two corporate agencies as to which had jurisdiction over the property with respect to its zoning. After the expiration of the 13 months’ period, on January 16, 1963, Mr. Isen, the President of the purchaser, wrote one of the owners a letter which contained the following pertinent excerpts: “We are prepared to make settlement under this contract subject to compliance with all of the conditions thereof, including, without limitation, the zoning of the property as called for under the contract.” “We understand that you are following up the matter of the pending equity suit * * * [the one mentioned above]. Please let use know when this suit is finally disposed of and the zoning is permitted to stand for apartment use.” (Italics ours.) ⁴⁵ It will be noted that this letter was written some 50 days after the termination of the 13 months’ period, but no mention is made, even at this time, that the purchaser had any intention of completing the contract on an “as is” basis, but, on the contrary, clearly indicated that it was interested in consummating the purchase if, and when, zoning were obtained.

Nothing in the evidence shows that there was any further correspondence between the parties until September 16, 1963, when Isen again wrote one of the owners a letter, stating, among other things, the following: “It is my understanding from our last conversation regarding the contract between us of October 23, 1961, involving the fifteen acres of land * * * that you propose to reapply for apartment house zoning in the near future. “In order that I can better determine when I will be required to arrange the necessary financing for the purchase of the property * * *; it would be greatly appreciated if you could let me know when you propose to file for the zoning and approximately how long it would take for final disposition of the request.” The owner answered by a letter to Isen on September 23, 1963 saying: “I hereby advise you that your contract is null and void since the property is no longer zoned and the time limit has expired. You have our permission to request the return of