Aiken v. Andrews, 233 N.C. 303 (1951)

March 7, 1951 · Supreme Court of North Carolina

233 N.C. 303

W. R. AIKEN et al. v. R. C. ANDREWS et al.

(Filed 7 March, 1951.)

1. Vendor and Purchaser § 19b—

Where the vendor makes a deposit on the purchase price under agreement that the balance should be paid upon tender of deed upon completion of the house by a stipulated time, evidence that the vendor complied with his contract and tendered deed on the day specified and demanded payment of the balance of the purchase price, and that such tender was refused, is sufficient to take the case to the jury on vendor’s counterclaim for damages resulting from breach of the contract by the purchaser set up in the purchaser’s action to recover the advance deposit.

2. Same—

Where deed is to be delivered upon payment of the balance of the purchase price, actual and timely tender of deed by the vendor and demand by him for the balance of the purchase price is necessary to cut off the purchaser’s right to treat the contract as still subsisting and entitle the vendor, in event of the purchaser’s refusal, to recover the damages suffered by reason of the purchaser’s breach.

Appeal by defendants from Patton, Special Judge, August Term, 1950, of BuNcombe.

Civil action to recover payment' on contract to buy and sell a tract of land or house and lot.

On 8 April, 1949, the defendant, Roy C. Andrews, agreed to sell, and the plaintiff, W. R. Aiken, agreed to buy, a house and lot located on School Road in West Asheville, at and for the price of $17,500, of which $1,000 was paid at the time, and it was stipulated in the agreement that the transaction should be completed on or before 8 May, 1949. The balance of $16,500 was to be paid in cash “at the close of the deal”; and “upon failure (of execution) by the seller within thirty days, the deposit shall be returned to the purchaser.” It was further provided that the house should be complete “with screens and storm sash for all windows, screen doors, window shades,” etc., so as to close the deal within the stipulated time.

On Monday, 9 May, 1949 (the 8th day being Sunday), the defendants tendered the purchaser warranty deed to the property, duly executed, and demanded payment of balance of purchase price. This was declined, without reason assigned therefor, the plaintiff simply saying, “I won’t accept it.” The next day, defendant’s lawyer called Dr. Aiken on the telephone and asked him if he were going through with the deal. His reply was, “see Mr. Loftin, talk to him.” He says, “I immediately called Mr. Loftin, and he told me that Dr. Aiken was not going through with it.”

The defendant then put the property in the hands of a real estate agent for sale. For convenience, he conveyed it to Irwin Monk on 13 June, 1949, and on 24 June, 1949, Irwin Monk and wife conveyed the property to Vernon R. Cheek and wife. The defendant received from the Cheeks $17,000, less real estate commissions of $850.00.

The plaintiff sues to recover the advanced payment of $1,000.00. The defendant filed counterclaim of $1,350.00, alleged loss on the transaction— $500.00 on purchase price and $850.00 paid as commissions to broker.

On the hearing, “it was stipulated in open court that the plaintiffs were entitled to recover $1,000.00 of the defendants unless the defendants showed a breach and prevailed on this counterclaim.” Whereupon the court ruled that the burden of proof was on the defendants to make good their counterclaim.

At the close of defendants’ evidence judgment of nonsuit was entered on the counterclaim. The court thereupon entered judgment in favor of the plaintiffs for $1,000.00.

The defendants appeal, assigning errors.

E. L. Loft-in for plaintiffs, appellees.

Don G. 7oung and Irwin Monk for defendants, appellants.

Stacy, O. J.

The question for decision is whether the evidence, taken in its most favorable light for the defendants, suffices to overcome the demurrer and to carry tbe case to tbe jury on tbe counterclaim. Tbe trial court answered in tbe negative, ffe are inclined to a different view.

Defendant’s testimony is to tbe effect tbat be complied witb tbe terms of tbe written contract in every respect, tbat is, be completed tbe bouse as agreed, duly executed and tendered deed witbin tbe time stipulated, and plaintiff declined to accept it or to go through witb tbe deal. Tbis is evidence from which tbe jury may infer tbat tbe plaintiff breached tbe contract of sale, thus entitling tbe defendant to treat it at an end and to sue for damages. Pope v. McPhail, 173 N.C. 238, 91 S.E. 947. Tbis, tbe defendant has done, and to minimize bis loss be immediately put tbe property back on tbe market for sale. Such is bis evidence.

It seems tbe defendant was well advised in timely tendering deed and demanding balance of purchase price, albeit tbe contract is one of sale and not an option. Winders v. Kenan, 161 N.C. 628, 77 S.E. 687. Speaking of its purpose and effect in Bateman v. Hopkins, 157 N.C. 470, 73 S.E. 133, Walker, J., witb bis usual thoroughness, analyzed tbe authorities and drew from them tbe following epitome: “Where tbe stipulations are mutual and dependent — that is, where tbe deed is to be delivered upon tbe payment of tbe price — an actual tender and demand by one party is necessary to put tbe other in default, and to cut off his right to treat tbe contract as still subsisting.” Hence, tbe effect of tbe tender and demand was “to cut off tbe plaintiff’s right to treat tbe contract as still subsisting,” or further to insist upon its performance. Bateman v. Hopkins, supra, 49 Am. Jur.—Specific Performance 40. This, of course, required tbe return of tbe money advanced on tbe purchase price. However, if tbe defendant suffered loss by reason of tbe plaintiff’s breach of tbe contract, be has bis action for such loss — here asserted by way of counterclaim, tbe plaintiff having sued to recover tbe advanced deposit. 4 Pomeroy’s Eq. Jur. (5 Ed.), Sec. 1407a, loc. cit. 1052.

Tbe plaintiff may have a different story to tell. There is no debate over tbe right of plaintiff to recover tbe advanced payment, if tbe contract were breached or abandoned by tbe defendant or mutually rescinded. Adams v. Beasley, 174 N.C. 118, 93 S.E. 454. And here, by agreement in open court, “unless tbe defendants showed a breach and prevailed on tbis counterclaim.”

We refrain from further animadversion, preferring to await tbe plaintiff’s version of the matter.

Tbe counterclaim would seem to be for the jury.

Reversed.