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(96 Wash. 284, 165 Pac. 90.)
Wasco county, Oregon, upon which there was a mortgage of $1,000 to the Oregon state land board. In selling appellants 25 acres of this land, the contract provided for a right of way 16 feet wide across the remaining 40, since otherwise appellants would have no outlet to the public highway. In June, 1915, respondents conveyed the 40-acre tract to one Payne, subject to the mortgage to the Oregon state land board, and subject to his agreement with the appellants for a right of way across this tract. Payne gave respondents a purchase-money mortgage for $4,200 on the land thus conveyed to him. Some time in November, 1915, prior to the maturity of the contract between appellants and respondents, the latter, by letter, began efforts to secure the release of the 25-acre tract from the state land board mortgage. On November 30, 1915, the board responded as follows: "Replying to yours of the 27th inst., in order to secure release of 25 acres from your mortgage, it will be necessary for you to take the matter up with W. H. Wilson, of The Dalles, attorney for the board in Wasco county, and when his recommendation is received as to the amount necessary to be paid, the matter will be submitted to the board for consideration."
On the same date as the letter from the board to respondents, Wilson, as the attorney employed by appellants to examine the title, wrote respondents as follows: "Yesterday Henry B. Garrison was here to close up his contract with you. He deposited the balance due from him, namely, $535, in the bank of French & Company, with directions to the bank to pay the money over to you upon the receipt of a deed for the land and a quitclaim for the right of way for a road, and an abstract for the 25 acres showing clear title. This morning French & Company advised me that they had received the deed. I have examined the deed, and I find that it is on a Washington blank, and that it is not good in this
state. I have, therefore, prepared a new deed on an Oregon form, which I am sending herewith. Will you and Mrs. Newton please kindly execute this deed and forward it to French & Company. I have also prepared a quitclaim deed for the right of way for a road mentioned in your contract.
The 25-acre tract is covered by the state mortgage for $1,000, and before Mrs. Garrison can accept the deed from you the 25 acres must be released from the state mortgage. I do not know what the state land board will require as a payment in order to release this tract, but a payment of some kind will have to be made. I imagine that it will not be less than $250, probably more than that amount."
On December 3, respondents replied as follows: "I have received your deeds and complied with your request. Now, regarding the state mortgage. The parties now owning the land object to me paying off the mortgage, as they bought the land subject to the state loan. So you can see my position, while I am willing to do anything I can to satisfy Mrs. Garrison. I understand the state of Oregon does not want their money, as long as the security is ample, and in this case there is no question as to the amount of security. Now, Mr. Wilson, I hope you will see your way clear to either release the 25 acres or accept the abstract without any payment on mortgage, as the abstract is good except a technical point."
This letter was answered by Wilson on December 6, to the effect that the board would not release the 25 acres without a payment of some kind, and suggesting that respondents pay off the whole mortgage of $1,000 to the state, and protect themselves by taking an additional mortgage for that sum from Payne. Respondents replied on December 11, as follows: "In reply to yours of recent date will say, in answering your suggestion of paying off part of the mortgage, it seems as it would complicate matters consider
ably, and I hope there will be some way found that we can get around this matter. As to paying the full amount of the mortgage, I am not in a position to do that at present, as you know money matters are a little close with all of us; and as you know records show I sold that 40 acres subject to this mortgage to Mr. Payne, it would be very unjust to Mr. Payne for me to foreclose this mortgage, which I could not do. Now, Mr. Wilson, would you accept a contract from me guaranteeing and protecting Mr. Garrison in regard to the loan until I can pay off this mortgage, which I will do just as soon as I get payments from Mr. Payne. You know, I am holding a $4,000 second mortgage on that place. This contract can be made Al. Or if I will have the 40 acres reappraised by some of the best citizens and farmers of your community, and their reappraisement shows ample security for the $1,000, will you release the 25 acres, as we understand the matter is now up to you? Of course, this will be extra expense to me, but I am willing to bear this extra expense in order to adjust matters, providing Mr. Garrison will not accept the contract above mentioned. Hoping one of Hoping one of the above suggestions will meet with your approval, I am."
On December 16, Wilson wrote respondents that the land board would not release the 25 acres without some kind of a payment, and on the following day again wrote them as follows: "Mr. Garrison objects to the title of the 25 acres which you sold to him because it is covered by the mortgage held by the state land board for $1,000, and also the property was sold for delinquent taxes for 1912, amounting to $14.60. Of course, these objections can be overcome by your procuring a release of the 25 acres from the state land board mortgage, and by redeeming from the tax sale. Mr. Garrison objects to the right of way because the 40 acres across which the right of way runs is covered by the mortgage of the state land
board for $1,000; also the second mortgage to you for $4,000; and it has not been opened up to travel as required by the agreement. As I understand Mr. Garrison, he refuses to accept either the deed for the 25 acres, or the deed for the right of way for the road, for the reasons stated above."
Nothing further was done by respondent William Newton until after his return to Seattle from a business trip to Spokane, when, on January 10, 1916, he wrote Wilson as follows: "I have just returned to the city and would now be very glad to have this matter straightened up. Now, Mr. Wilson, what is the least payment you will accept on the state mortgage, or what will the state take in cash for the release of the 25 acres and right of way, leaving the mortgage as it is, as a foreclosure is possible this fall, and I would rather deposit a certain amount of cash to the state credit than affect the mortgage, on Mr. Payne's account. I hope you will be as lenient as possible."
Wilson answered that the least payment he could recommend for the board to accept for a release would be $250. On January 14, respondent Newton wrote Garrison as follows: "Now, in regard to that abstract: I want to ask you if you will not accept the abstract as it is for the present, as it is absolutely good with only a technical point of law to cloud it, and that will be removed and everything clear just as soon as I am in a position to lift the $1,000 mortgage. $1,000 mortgage. You understand, Mr. Payne assumed the full $1,000 state mortgage when he bought the 40 acres, and which is on record at The Dalles, showing that the 40 acres is held for the $1,000 state loan. I hold a $4,000 as second There is absolutely no danger to mortgage, so am also responsible. you. Or, to convince you of my honest efforts, I will be willing for you to hold back $50 or $100 until I can lift the mortgage. Now, Mr. Garrison, there is nothing gained for you or me by holding out on these
(96 Wash. 284, 165 Pac. 90.)
trivial points; we could both work to better advantage if we friends and understand one another. I will do anything within reason. that you may suggest, to show that I want to do what is right, but, Mr. Garrison, I am not in a position just now to lift that mortgage, and I do want to get this matter straightened out satisfactorily to both of us. Please let me hear from you at your earliest convenience regarding this matter."
In response to this letter, appellant Garrison sent the following reply and notice of rescission: "You evidently now wish me to pay the money and accept your deed with the $1,000 mortgage unpaid, or the land released from the mortgage, without the right of way being either selected or improved, with the $4,000 second mortgage against the right of way. In other words, to take the property practically as it is, and look to Mr. Payne to pay off the mortgage and improve the right of way. In the mean
time, on December 6, 1916, I had an opportunity to lease this property, and again on January 4, 1916; . . . to these people I have been unable to give any reply on account of the uncertainty about closing the deal.
In fact, you say you are 'not in a position just now to lift that mortgage.' In view of this admission on your part, and your failure to say anything about the right of way, its selection or improvement, or the delinquent taxes still unpaid, I think it is useless for us to go any further. It seems that I have waited in vain since November 29, 1915, and kept my check good at bank since 29th of November, for you to get busy on. I have waited in vain.
We have accordingly, in view of all these facts, concluded to and do hereby give you notice that we have rescinded the contract."
On receipt of this notice of rescission, respondents at once made application through Wilson, the local attorney for the board, for a release of the 25 acres, but the appli
cation was held up until early in February because of the failure of respondents to inclose a remittance of the amount tendered for a release. The board agreed to the release for the sum of $500, which sum was forwarded by respondents upon notification, and a release duly executed on February 16, 1916. The delinquent tax sale against the property was redeemed by respondents on February 28, 1916.
Respecting the right of way for a road over the Payne 40, there was in evidence a contract between Payne and appellants, executed on November 29, 1915, making provision therefor to the satisfaction of the latter. The appellants, however, claimed that Payne's mortgage of $4,200 to respondents created an encumbrance upon this right of way. To obviate this, respondents executed a release of their mortgage as to the right of way agreed upon by Payne and appellants, and this release was recorded in Wasco county on February 16, 1916. The abstract of title was brought down to date and certified on March 3, 1916, showing clear title to the property in respondents.
It will be observed that the title was not perfected until subsequent to the commencement of this action for rescission, but that the respondents, in their answer, tendered a sufficient warranty deed and abstract, showing clear title, and brought the same into court. It appears from the evidence that respondents were making an effort, beginning at a date prior to the maturity of the contract, to get their title in a shape to be satisfactory to the appellants. They did not understand in the beginning that more would be required of them than the securing of the release of the mortgage to the land board, and they were in good faith endeavoring to accomplish that. Learning that appellants insisted that respondents' mortgage from Payne was an encumbrance on appellants' right of way, and that the 1912 taxes were a lien against the land at the date
of contract, respondents promptly took measures to release their mortgage as against the right of way, and to redeem from the lien of the 1912 taxes. They had completely cleared the title within two and onehalf months of the date on which appellants were entitled to a good and sufficient deed. The contract The contract did not make time of its essence, and it is the rule of law in such cases that a vendor is entitled to a reason
Vendor and purchasertime of performance.
able time in which to perform his contract. Whether or not the two and one-half months taken by respondents to perfect their title was a reasonable time, it is unnecessary to decide, in view of the attitude of the parties. The appellants did not promptly rescind at the time when they were entitled to performance, but waived such right by their acquiescence in the efforts of respond
right to rescind.
ents to effect a release of the mortgage encumbering the land. It is true the appellants asked respondents to pay off the blanket mortgage covering another tract in addition to that contracted for by appellants, and that, on being informed that this could not be done, they gave notice of rescission. But respondents were endeavoring all the time to get the 25-acre tract of appellants released from the mortgage at the smallest outlay possible for themselves, and when they found that could not be done for less than a payment of $500 on the mortgage debt, they promptly paid that sum.
That appellants were willing to grant time appears from the crossexamination of Mr. Garrison:
Q. After you learned that there was a mortgage of $1,000, did you or did you not consent and approve of Mr. Newton's proceeding to get a release from that mortgage as to that 25 acres of land?
A. Yes, I did. I wanted him to. After allowing the respondents a month and a half in which to clear
title, and just as arrangements to accomplish that object were being brought to a head, notice of intended rescission was given. Following closely upon the filing of the complaint, respondents were able to tender a perfect title so far as the encumbrances were concerned. Their legal title had always been perfect.
We think there was a sufficient showing of consent to delay in performance to warrant the time taken in which to perfect the title. There was no showing of injury to the appellants than their
-waiver of performanceother reasonableness of delay. state
ment in one of their letters that they would have been able to lease the land if they had had perfect title. The land had never been occupied or cultivated by appellants, but had evidently been bought for speculative purposes and allowed to lie idle. There was no proof of depreciation in value between the date for performance and the time of trial. The principle of law applicable to the state of facts existing in this case is expressed in Opsjon v. Engebo, 73 Wash. 324, 131 Pac. 1146, as follows: "The rule is well settled in this state that, after a vendor has waived the essence clause of a contract, the purchaser will not be in default until after a demand has been
made upon him for demand for a compliance with performance. his contract, and a reasonable time has elapsed in which to comply with the demand. Whiting v. Doughton, 31 Wash. 327, 71 Pac. 1026; Douglas v. Hanbury, 56 Wash. 63, 134 Am. St. Rep. 1096, 104 Pac. 1110; Walker v. McMurchie, 61 Wash. 489, 112 Pac. 500. We have also held that the time in which to perform a written contract may be waived as well as extended by parol. Whiting v. Doughton, supra.
"The appellant, having encouraged the prosecution of the suit to quiet title to the lot, and having acquiesced in the delay in tendering the deed and abstract of title, was
(96 Wash. 284, 165 Pac. 90.)
not in a position to assert a breach of the contract upon the part of respondents, in failing to convey the lot at the time agreed upon. Colpe v. Lindblom, 57 Wash. 106, 106 Pac. 634; Hawes v. Swanzey, 123 Iowa, 51, 98 N. W. 586; Bales v. Williamson, 128 Iowa, 127, 103 N. W. 150."
Respondents had a cross complaint in the action, asking for judgment for $535, the amount of final payment and interest due on the contract. The appellants conceded that sum was due from them if the contract should be enforced.
We think the findings and conclusions of the court are supported
by the evidence. The judgment based thereon is affirmed.
Ellis, Ch. J., and Mount, Parker, and Holcomb, JJ., concur.
The question involved in the reported case (GARRISON V. NEWTON, ante, 804) as to time for performance of contract for sale of land, where the time originally fixed by the contract has been waived, is the subject of the annotation beginning at page 815, post. Instances of what constitutes a reasonable time are gathered at page 826.
1. The waiver by a purchaser of real estate of the agreement by the vendor to furnish abstracts of title on a specified date does not relieve him from the duty to perform within a reasonable time.
[See note on this question beginning on page 815.]
Rescission failure to furnish abstract of title.
6. A purchaser of real estate has a right to a rescission of the contract where the vendor has delayed for two years to furnish, as agreed, an abstract showing merchantable title in himself.
allowance for improvement.
7. One who enters into possession of real estate under a contract of purchase which subsequently fails because of the vendor's inability to perfect title may be allowed the value of improvements placed by him upon the land while he is in possession, as an offset against the rental value.