Rochlin v. P. S. West Construction Co., 234 N.C. 443 (1951)

Nov. 7, 1951 · Supreme Court of North Carolina

234 N.C. 443

A. ROCHLIN v. P. S. WEST CONSTRUCTION COMPANY, INC.

(Filed 7 November, 1951.)

1. Trial § 25—

Upon intimation of opinion by the court adverse to plaintiff on the law upon which the action is founded, or the exclusion of evidence offered by plaintiff which is necessary to make out his case, plaintiff may submit to nonsuit and appeal.

2. Frauds, Statute of, § 9: Vendor and Purchaser §§ 22, 24—

While in the face of denial of liability parol evidence is not competent to establish an oral contract to convey realty for the purpose of obtaining specific performance, G.S. 22-2, it is competent for the purpose of determining whether the purchaser is entitled to recover the amount paid under such parol agreement which has been breached by the seller, and conversely whether the seller is entitled to retain the payment made for breach by the purchaser.

Appeal by plaintiff from Phillips, J., January Term, 1951, of Iredell.

This action was brought to recover a deposit of $1,000 made with the defendant pursuant to the terms of an alleged parol agreement for the purchase of land which the plaintiff alleges the defendant refused to perform in accordance with the terms thereof.

The plaintiff alleges in his complaint that the plaintiff and defendant entered into an agreement on or about 20 January, 1946, “whereby the defendant agreed to erect and convey to the plaintiff a house and lot on East Front Street in the City of Statesville, North Carolina, with sidewalk and all improvements; the price to be between $10,000 and $11,000. The exact amount to be itemized and furnished to the plaintiff upon completion of the house; that pursuant to the above agreement, the plaintiff made a deposit of $1,000 to the defendant on the said house and lot; that sometime thereafter . . . the defendant tendered a deed and demanded of the plaintiff a balance of $12,000, making a total purchase price of $13,000, whereas, the agreement was between $10,000 and $11,000.”

The defendant admits there was a verbal agreement entered into by and between the parties for the purchase and sale of the property referred to in the complaint. However, it denies that the amount of the purchase price was not to exceed $11,000 as alleged in the complaint. The defendant alleges in its answer that the house was to he constructed according to specifications furnished by the plaintiff on the basis of the actual cost of the labor and materials entering into the construction thereof, plus ten per cent and the agreed cost of the lot.

The defendant pleaded as an offset to the plaintiff’s alleged cause of action damages in the sum of $1,000 caused to it by reason of the plaintiff’s wrongful breach of contract.

At the trial below the plaintiff offered testimony tending to establish the terms of the parol agreement and upon objection by the defendant, the objection was sustained and a motion to strike allowed. The trial judge held that the purported contract was for the purchase and sale of real estate, and since the same was not in writing, the contract was inadmissible and the proffered evidence was inadmissible. To this ruling the plaintiff excepted and submitted to a nonsuit and appealed to the Supreme Court, assigning error.

Land, Sowers <& Avery for plaintiff, appellant.

Scott ■& Collier and M. L. Nash for defendant, appellee.

DeNNY, J.

In our opinion there was error in the ruling of the trial judge. And where a judge intimates an opinion on the law which lies at the foundation of the action, adverse to the plaintiff, or excludes evidence offered by the plaintiff which is material and necessary to make out bis case, be may submit to a nonsuit and appeal. Nowell v. Basnight, 185 N.C. 142, 116 S.E. 87; Chandler v. Mills, 172 N.C. 366, 90 S.E. 299; Hayes v. R. R., 140 N.C. 131, 52 S.E. 416; Hickory v. R. R., 138 N.C. 311, 50 S.E. 683; Tiddy v. Harris, 101 N.C. 589, 8 S.E. 227; Mobley v. Watts, 98 N.C. 284, 3 S.E. 677.

Tbis is not an action for specific performance, but one for tbe recovery of money paid to tbe defendant, as part of tbe purchase price of real property, pursuant to tbe terms of a parol agreement wbicb tbe plaintiff alleges tbe defendant breached.

In tbe case of Carter v. Carter, 182 N.C. 186, 108 S.E. 765, tbe Court said: “We have solemnly adjudged in tbis Court, more than once, that where there is a parol contract to convey land, tbe full amount of tbe purchase money is paid, tbe vendee enters into possession and tbe vendor afterwards repudiates tbe contract by refusing to make a deed for tbe land, tb purchaser may recover tbe price of tbe land so paid by him (Improvement Co., v. Guthrie, 116 N. C. 381), and further that where tbe vendor elects so to repudiate bis parol contract by refusing to convey and sets up tbe Statute of Frauds, tbe purchaser may recover tbe amount paid by him for tbe land under bis prayer for general relief, although tbe action be for specific performance.”

In Improvement Co. v. Guthrie, cited above, it is'said: “If A and B contract for tbe sale of tbe land by parol and tbe vendor elects to repudiate tbe contract, the vendee may recover back tbe amount be bad paid under tbe contract ... A parol contract for land is not void, except at tbe instance of tbe party who is allowed and does plead tbe statute, and neither party who repudiates tbe contract can take any advantage or benefit under it.” Wilkie v. Womble, 90 N.C. 254; Barnes v. Brown, 71 N.C. 507; Albea v. Griffin, 22 N.C. 9.

In tbe last cited case tbe Court held that tbe payment of tbe purchase price, tbe taking of possession of the premises, and making improvements thereon would not entitle tbe vendee to specific performance of tbe parol agreement; and further held that “no action will lie in law or equity for damages because of nonperformance.” Even so, tbe Court said: “We are nevertheless of tbe opinion that tbe plaintiff has an equity wbicb •entitles him to relief, and that parol evidence is admissible for tbe purpose of showing that equity.”

Therefore, we bold that while tbe plaintiff is not entitled to establish bis parol agreement with tbe defendant for tbe purpose of obtaining specific performance thereunder, G.S. 22-2, since the agreement as alleged is denied, McCall v. Institute, 189 N.C. 775, 128 S.E. 349; Arps v. Davenport, 183 N.C. 72, 110 S.E. 580; Henry v. Hilliard, 155 N.C. 372, 71 S.E. 439; Miller v. Monazite Company, 152 N.C. 608, 68 S.E. 1; be may do so for tbe purpose of determining whether be is entitled to recover the amount lie bas paid tbe defendant under such, agreement. And it is clearly evident this can only be done by oral testimony. Luton v. Badham, 127 N.C. 96, 37 S.E. 143; Pass v. Brooks, 125 N.C. 129, 34 S.E. 228; Tucker v. Markland, 101 N.C. 422, 8 S.E. 169; Pitt v. Moore, 99 N.C. 85, 5 S.E. 389; Wilkie v. Womble, supra; Kivett v. McKeithan, 90 N.C. 106. Cf. Grantham v. Grantham, 205 N.C. 363, 171 S.E. 331; Grant v. Brown, 212 N.C. 39, 192 S.E. 870. If, on the other hand, it is determined that the plaintiff has breached the parol agreement as alleged by the defendant, he will not be entitled to recover the amount paid thereunder. Improvement Co. v. Guthrie, supra. There is error in the ruling of the court below.

Error.