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Of course, each case must be governed by its own peculiar facts, and, looking to them as they appear in

this case, we have concluded that the court properly determined the case, and its judgment is affirmed.

ANNOTATION.

Measure of recovery by vendee under executory contract for purchase of real property where vendor is unable or refuses to convey. [Damages, § 111.]

I. In general; change in value of the real estate, 12.

II. Loss of bargain as an element of damage:

a. In general, 14.

b. Difference between contract price and actual value, 14.

c. Value of the real estate less amount unpaid on purchase price, 17. III. Effect of good faith of the vendor:

a. In general, 19.

b. Rationale of rule as to good faith, 24.

IV. Effect of election by vendee to recover purchase price paid, 29.
V. Effect of a subsequent contract by the vendee, 35.

VI. Application of foregoing rules:

a. In general, 36.

b. Where breach is due to a defect in the title, 36.

c. Where breach is due to total lack of title by vendor, 41.

d. Where breach is due to refusal of vendor's spouse to join in the

conveyance, 42.

e. Effect of knowledge of vendor of defect in title, 45.

f. Effect of knowledge by vendee of defect in title, 50.

g. Where breach is due to refusal of vendor to convey, 51.

h. Where breach is due to act of vendor in disabling himself from performing, 55.

i. Other reasons for nonperformance, 58.

VII. Expenses of vendee in investigating the title as an element of damage, 59. VIII. Interest as an element of damage, 60.

IX. Improvements made by vendee, 64.

X. Miscellaneous, 68.

XI. Determination of value:

a. In general, 70.

b. Absence of evidence of value; burden, 71.

1. In general; change in value of the real estate.

The annotation does not include cases which involve the question of the measure of damages for failure to convey real estate, or devise real estate, in consideration of an agreement to support, or similar contracts. Nor does it include cases where the measure of damages is stipulated for in the contract.

In view of the anomalous rule of damage applied in many jurisdictions, in actions by a vendee to recover damage for breach of contract to convey real estate, it is of interest to note that "damage," as distinguished from

injury, is the pecuniary consequence which the law imposes for the breach of a duty or the violation of a right. According to its Latin significance (damum, from demo, to take away), damage is a species of loss, signifying the thing taken away-the lost thing which a party is entitled to have restored to him, so that he may be made whole again. 8 R. C. L. 420. The fundamental and cardinal principle of the law of damage is compensation to the injured party for the loss sustained. 8 R. C. L. 431. However, in the assessment of the vendee's damage for breach by the vendor of an executory contract to convey real

estate, in many jurisdictions which, under some conditions, deny the vendee the benefit of his bargain there is a most. decided departure from these general principles.

This departure is apparently the outgrowth of a solicitude by the courts for innocent vendors, who, owing to the unsettled state of titles in early times, and the many technical objections which might be made to them, would be taking a most decided risk in entering into an executory contract for the sale of real estate, if the vendee were allowed to have a jury speculate as to the actual value of the land over and above the contract price, in assessing his damage, where the contract failed because of some defect in the title. This doctrine was not so anomalous or illogical, when applied to the actual conditions surrounding the execution of these contracts when the rule was first enunciated, for the executory status of the contract was intended to be of brief duration, generally only for such a period of time as might be required to search the title and to secure the necessary evidence of the vendor's title. In these circumstances there was considerable justification for the holding of the courts that there was an implied condition in these contracts that, if the vendor failed to produce evidence of a good or marketable title, he would repay to the vendee the deposit the latter had made at the time of the execution of the contract, and thus terminate the transaction. In America, the character and purpose of executory contracts has so changed-at least, in many jurisdictions-as to make this rule for assessing the vendee's damages inapplicable, for it imposes upon the innocent vendee a serious loss, to the benefit of the vendor, who is at fault. This is peculiarly true where the contract extends over a period of years, as they frequently do, during which time the vendee makes substantial payments upon the principal, as well as substantial improvements to the property, with the result of an increase in the value of the property greatly exceeding the cost of the improvements.

One element of damage growing out of a breach by the vendor of an executory contract to convey real estate, which the vendee is entitled to have taken into account, is the amount he has paid on the purchase price. While, as pointed out, there is a conflict of opinion as to other elements of damage, the vendee's right to have taken into account, in assessing his damage, the amount he has paid upon the purchase price, is clear.

One court remarked that it requires no citation of authority to sustain the position that, when one receives money upon a contract and voluntarily makes it impossible to perform, he must, at least, return the money he has received. Adams v. Beasley (1917) 174 N. C. 118, 93 S. E. 454. And, of course, where the damage is fixed at the difference between the contract price and the actual value of the property, there is to be included any amount that the vendee has paid upon the purchase price. Cunningham v. Lamb (1917) 101 Neb. 288, 163 N. W. 149. If at the time of the breach the land is worth less than it was at the time of the contract, the vendee is entitled to recover nominal damages. Carver v. Taylor (1892) 35 Neb. 429, 53 N. W. 386. But see Bangs v. Paullin (1890) 37 Ill. App. 465, wherein the rule is stated that the vendee is entitled to recover, as his damage for failure of the vendor to convey according to his executory contract, what he has lost by the breach, which, in case part of the price has been paid, may be more or less than the amount paid, depending upon whether the vendee had a good bargain. And it is pointed out in Wilkirson v. Yarbrough (1924) Tex., 257 S. W. 535, that, in an action for damages for breach of contract to convey real estate, the vendee is not entitled to recover the amount paid on the purchase price, where he merely shows that the vendor's title is doubtful. In this case, however, there was nothing in the vendee's pleadings with regard to the payment of any portion of the purchase price, and no prayer for the recovery thereof.

In Doherty v. Dolan (1876) 65 Me. 87, 20 Am. Rep. 677, the general rule:

of damages is thus declared: "If the plaintiff had paid nothing down, and the land was worth at the date of the breach more than he was to give for it, the difference would be his profit, and he could recover that amount. If there was no difference between the contract price and the value of the land when it should have been conveyed, and nothing was paid, then his damages would be nominal only; or if, in such case, the land was worth less than the contract price, he would then have nominal damages for the technical breach. So, if the plaintiff had paid the contract price in full, he could recover the value of the land at the time it should have been conveyed to him, whether the value was then more or less than the contract price. And so it logically follows, there being a part payment, and the land worth less than the contract price at the time a conveyance should have been made, that the damages recoverable would be what the land was then worth, less the amount of the price for it that remained unpaid. By paying the full price, the vendee is entitled to the land or its value, whatever the value may be. The recovery of damages, according to these rules, puts him in as good condition as if the contract had been performed. He gets exact indemnity."

After stating the rule that, if the failure to convey was through the fault of the vendor, the vendee may recover the increased value of the land at the time the conveyance should have been executed, the court, in Yokom v. McBride (1881) 56 Iowa, 139, 8 N. W. 795, said that this rule contemplates that the increased value of the land is greater than the consideration paid. If the vendor has the ability to convey the land, and refuses to do so, the plaintiff may recover its value. If the value of the land is less than the consideration paid, the plaintiff cannot be limited to the recovery of the value of the land. The value of the land is the measure of damages when it exceeds the value of the consideration, and the conveyance is not made through the fault of vendor. If the latter is in fault, the vendee is entitled to recover substantial dam

ages-the value of the land, if it is greater than the consideration paid; but, if it is less, the measure of damages is the consideration paid.

II. Loss of bargain as an element of damage.

a. In general.

As a general rule, the damages recoverable for breach of contract by the vendor to convey real estate are only such as may fairly and reasonably be considered as either arising naturally-that is, according to the usual course of things-from such breach, or such as may reasonably be supposed to have been in the contemplation of both parties at the time they made the contract, as a probable result of the breach. Cape Girardeau & C. R. Co. v. Wingerter (1907) 124 Mo. App. 426, 101 S. W. 1113. Where the vendor wrongfully breaches his contract, the measure of the vendee's damage is such loss as he has suffered as the natural and proximate result of the breach, which may be reasonably supposed to have been within the contemplation of the parties at the time the contract was made, as a probable result of the breach. Bender v. Barton (1913) 182 Ala. 181, 62 So. 732. b. Difference between contract price and actual value.

The general rule for assessing the damage for breach by the seller under an executory contract for the sale of personal property, by failing to deliver the property, is to allow the buyer the difference, if any, between the contract price and the market value of the property, either at the time of the breach, or at the time fixed for the delivery of the property. 24 R. C. L. 70. With the exception made in some jurisdictions, and hereinafter more particularly referred to, relieving the vendor of liability to the vendee for loss of the latter's bargain, where the inability of the vendor to perform is due to defects in his title, if there has been no fraud or bad faith on his part, the rule as to the measure of damage in sales of personal property likewise applies where the vendor in an executory contract for the sale

of real estate is unable or refuses to convey to the vendee a good or marketable title, as required by the contract. In such case the loss of the vendee's bargain is assessed upon the basis either of the difference between the contract price and the actual value of the land, or the actual value of the land, less the amount, if any, remaining unpaid on the contract price. In the following cases, in assessing the vendee's damage, one element taken into account was the difference between the contract price and the actual value of the land at the time of the breach, thus compensating the vendee for the loss of his bargain (it should be noted that this does not preclude taking into consideration, also, the amount, if any, paid on the purchase price. See supra, I.) :

United States. Hopkins v. Lee (1821) 6 Wheat. 109, 5 L. ed. 218; Harten v. Löffler (1909) 212 U. S. 397, 53 L. ed. 568, 29 Sup. Ct. Rep. 351; Watkins v. American Nat. Bank (1904) 67 C. C. A. 110, 134 Fed. 36, writ of error dismissed in (1905) 199 U. S. 599, 50 L. ed. 327, 26 Sup. Ct. Rep. 746; Hampton Stave Co. v. Gardner (1907) 83 C. C. A. 521, 154 Fed. 805; Freeman v. Falconer (1913) 120 C. C. A. 32, 201 Fed. 785; Clark v. Belt (1915) 138 C. C. A. 1, 223 Fed. 573; Phillips & Sager v. Kern (1921) 50 App. D. C. 317, 271 Fed. 547.

Alabama. Whiteside v. Jennings (1851) 19 Ala. 784; Hamaker v. Coons (1897) 117 Ala. 603, 23 So. 655; Phelan v. Tomlin (1910) 164 Ala. 383, 51 So. 382; Greenberg v. Ray (1926) 214 Ala. 481, 108 So. 385.

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Arkansas. Cohn Kempner v. (1886) 47 Ark. 519, 58 Am. Rep. 775, 1 S. W. 872; McGregor v. Echols (1922) 153 Ark. 128, 239 S. W. 736. But see Shelton v. Ratterree (1915) 121 Ark. 482, 181 S. W. 288.

California. Yates v. James (1891) 89 Cal. 474, 26.Pac. 1073; Smith v. Bangham (1909) 156 Cal. 359, 28 L.R.A. (N.S.) 522, 104 Pac. 689; Wilson v. White (1911) 161 Cal. 453, 119 Pac. 895; Kiger v. McCarthy Co. (1909) 10 Cal. App. 308, 101 Pac. 928. Delaware. Lynam v. Harvey (1919) 12 Del. Ch. 129, 108 Atl. 850.

Georgia.

Irwin v. Askew (1885)

74 Ga. 581; Mobley v. Lott (1907) 127 Ga. 572, 56 S. E. 637; Mitchell v. Owen (1924) 31 Ga. App. 649, 121 S. E. 699, affirmed in (1924) 159 Ga. 690, 127 S. E. 122, on general measure of damages, but reversed on specific instruction. See (1925) 33 Ga. App. 665, 128 S. E. 12, which follows holding of supreme court.

Illinois. Dady v. Condit (1904) 209 Ill. 488, 70 N. E. 1088; White v. Kiggins (1906) 130 Ill. App. 404; Posvic v. Harford (1918) 211 Ill. App. 273; McMillen v. Betz (1922) 224 Ill. App. 117.

Iowa. Foley v. McKeegan (1856) 4 Iowa, 1, 66 Am. Dec. 107; Sween v. Steele (1857) 5 Iowa, 352; Sawyer v. Hawthorne (1916) 178 Iowa, 407, 158 N. W. 665; Carter v. Schrader (1919) 187 Iowa, 1245, 175 N. W. 329; Abrams v. Sinn (1922) 193 Iowa, 528, 187 N. W. 491.

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Kansas. Tracy v. Gunn (1883) 29 Kan. 509; McAdam v. Leak (1922) 111 Kan. 704, 208 Pac. 569.

Kentucky. Whitworth v. Pool (1906) 29 Ky. L. Rep. 1104, 96 S. W. 880; Jenkins v. Hamilton (1913) 153 Ky. 163, 154 S. W. 937; Slusher v. Moore (1924) 202 Ky. 13, 258 S. W. 946. See Hampton v. Porter (1926) 215 Ky. 604, 286 S. W. 690.

Louisiana. Doriocourt v. Lacroix (1877) 29 La. Ann. 286.

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Massachusetts.

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Brigham v. Evans (1873) 113 Mass. 538; Roche v. Smith (1900) 176 Mass. 595, 51 L.R.A. 510, 79 Am. St. Rep. 345, 58 N. E. 152; Hallett v. Taylor (1900) 177 Mass. 6, 58 N. E. 154; Boyden v. Hill (1908) 198 Mass. 477, 85 N. E. 413. Michigan. Allen V. Atkinson (1870) 21 Mich. 351; Hammond v. Hannin (1870) 21 Mich. 374, 4 Am. Rep. 490; Bugajski v. Siwka (1918) 200 Mich. 415, 166 N. W. 863; Zimmerman v. Miller (1919) 206 Mich. 599, 173 N. W. 364.

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Minnesota. Erickson v. Bennet (1888) 39 Minn. 326, 40 N. W. 157; Fleckten v. Spicer (1896) 63 Minn. 454, 65 N. W. 926; Vallentyne v. Immigration Land Co. (1905) 95 Minn. 195, 103 N. W. 1028, 5 Ann. Cas. 212. Missouri. Kirkpatrick v. Downing (1874) 58 Mo. 40, 17 Am. Rep. 678.

Montana. Willard v. Smith (1906) 34 Mont. 494, 87 Pac. 613; Ross v. Saylor (1909) 39 Mont. 559, 104 Pac. 864.

Nebraska.-Carver v. Taylor (1892) 35 Neb. 429, 53 N. W. 386; Beck v. Staats (1908) 80 Neb. 482, 16 L.R.A. (N.S.) 768, 114 N. W. 633; Anderson v. Ohnoutka (1909) 84 Neb. 517, 121 N. W. 577; Beetem v. Follmer (1910) 87 Neb. 514, 127 N. W. 858; Cunningham v. Lamb (1917) 101 Neb. 288, 163 N. W. 149; Householder v. Nispel (1923) 111 Neb. 156, 195 N. W. 932. New Hampshire. Chartier v. Marshall (1876) 56 N. H. 478.

New Jersey. King v. Ruckman (1873) 24 N. J. Eq. 298; Drake v. Baker (1870) 34 N. J. L. 358; Brown v. Honniss (1904) 70 N. J. L. 260, 58 Atl. 86, see same case, later appeal upon other points, in (1907) 74 N. J. L. 501, 68 Atl. 150; Cohen v. Cyzam Realty Co. (1925) N. J. L. 130 Atl. 440.

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New York. Baldwin v. Munn (1829) 2 Wend. 399, 20 Am. Dec. 627; Pumpelly v. Phelps (1869) 40 N. Y. 60, 100 Am. Dec. 463; Sloan v. Baird (1900) 162 N. Y. 327, 56 N. E. 752; Palmer-Marcy Lumber Co. v. Osband (1919) 108 Misc. 313, 177 N. Y. Supp. 539; Ackley v. Parsons (1920) 190 App. Div. 762, 181 N. Y. Supp. 116; Schwimmer v. Roth (1920) 111 Misc. 654, 182 N. Y. Supp. 12; Grosso v. Sporer (1924) 123 Misc. 796, 206 N. Y. Supp. 227; Goodman v. Wolf (1904) 95 App. Div. 522, 88 N. Y. Supp. 934; Farley v. Secor (1915) 167 App. Div. 80, 152 N. Y. Supp. 787; Timby v. Kinsey (1879) 18 Hun, 255; Boyd v. De Lancey (1895) 91 Hun, 542, 36 N. Y. Supp. 245; Pringle v. Spaulding (1868) 53 Barb. 17.

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West Virginia. Mullen v. Cook (1911) 69 W. Va. 456, 71 S. E. 566; Mooring v. Warnock (1924) 95 W. Va. 539, 121 S. E. 732.

Wisconsin. Hall v. Delaplaine (1856) 5 Wis. 206, 68 Am. Dec. 57; Poposkey v. Munkwitz (1887) 68 Wis. 327, 60 Am. Rep. 858, 32 N. W. 35; Muenchow v. Roberts (1890) 77 Wis. 520, 46 N. W. 802; Maxon v. Gates (1908) 136 Wis. 270, 116 N. W. 758; Brink v. Mitchell (1908) 135 Wis. 416, 116 N. W. 16; McLennan v. Church (1916) 163 Wis. 411, 158 N. W. 73;

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