HELM v. RONE

Oklahoma Supreme Court1914-06-16No. No. 3443

43 Okla. 137141 P. 678

Summary · law.co

Holding. The judgment for the defendant was affirmed. A party who advances money in partial performance of an executory contract for the sale of real estate and thereafter breaches the contract by refusing to complete performance cannot recover the money paid, provided the other party remained ready and willing to perform.

A purchaser entered into a written contract to buy real estate from the defendant, paying $1,000 upfront with an agreement to pay $2,775 one year later, at which point a deed held in escrow would be delivered. The contract designated time as essential. The purchaser took possession and collected rents but failed to make the final payment when due. The defendant then retook possession and sold the property to another party, after which the purchaser sued to recover the initial $1,000 payment.

The court held that the purchaser could not recover the money because she breached the contract by failing to complete performance. Under established legal principle, a party who makes partial payment toward an executory sales contract and then refuses to proceed to completion—while the other party remains ready and willing to perform—forfeits the right to recover amounts already paid. Because the defendant was prepared to fulfill his obligations and deliver the deed upon receipt of the final payment, the purchaser's breach prevented any recovery.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether a breaching party can recover partial payments made under an executory land sale contract
Effect of designating time as the essence of a real estate sales contract
Right to recover money paid when purchaser fails to complete performance

Procedural posture

The trial court ruled in favor of the defendant, and the purchaser appealed the judgment denying recovery of her initial payment.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

TURNER, J.

The record discloses that on July 5, 1907, defendant in error was the owner of certain real estate in Oklahoma City, and on that date entered into a written contract with plaintiff in error to sell the same to her. She paid $1,000 on the purchase price, and agreed to pay $2,775 on July 5, 1908; the deed to be put in escrow and delivered to her on payment of that sum. The contract provided that time was the essence of the contract. Pursuant thereto the purchaser took possession of the property and collected the rents, but failed to pay the $2,775 as agreed. Thereafter defendant took possession of the property and sold it to another, whereupon plaintiff gued to recover the $1,000. paid as stated. Defendant, up to the time of the breach, was ready, able, and willing to perform his part of the contract. The trial court was right when it held that plaintiff could not recover. The rule is, without, exception, that where a party advances money in part performance of an executory contract of sale, and afterwards breaches his contract, he cannot recover the money paid. In Hansbrough v. Peck, 72 U. S. (5 Wall.) 497, 18 L. Ed. 520, the material facts are substantially the same as here. There the court said:

“And no rule in respect to the contract is better settled than this: That the párty who has advanced money, or done an act in part performance of the agreement, and then stops short and refuses to proceed to its ultimate conclusion, the other party being ready and willing to proceed and fulfill all his stipulations according to the contract, will not be permitted to recover back what has thus been advanced or done. Green v. Green, 9 Cow. [N. Y.] 46; Ketchum v. Everton, 13 Johns. [N. Y.] 364 [7 Am. Dec. 384]; Leonard v. Morgan, 6 Gray [Mass.] 412; Haynes v. Hart, 42 Barb. [N. Y.] 58. The same doctrine has been repeatedly applied by the courts of Illinois, the state in which this case arose. Chrisman v. Miller, 21 Ill. 236, and cases referred to in the argument.”

In Green v. Green, supra, in the syllabus it is said:

“To warrant a recovery as for money had and received, paid under a special contract (e. g., a contract to convey land), a strict performance must be shown by the plaintiff, the same as if he had suedon the special contract itself, unless the contract has been expressly rescinded, or impliedly so, as by nothing having been done under it for a long time or the party sought to be charged having acted inconsistent with it. Thus where a party covenanted to pay money for land by installments, on completing which he was to have a deed, and he took possession, and continued it for some time, making partial payments, but finally failed to pay, and the vendor took possession, in an action for money had and received to recover back the money paid, held, that it would not lie.”

No further citation of authority is necessary, but see Glock v. Howard & Wilson, etc., 123 Cal. 1, 55 Pac. 713, 43 L. R. A. 199, 69 Am. St. Rep. 17; Laffey v. Kaufman, 134 Cal. 391, 66 Pac. 471, 86 Am. St. Rep. 283; Satterlee v. Cronkhite, 114 Mich. 634, 72 N. W. 616; Goldman v. Willis, 64 App. Div. 508, 72 N. Y. Supp. 292; Steinbach v. Pettingill, 67 N.. J. Law, 36, 50 Atl. 443; Downey v. Riggs, 102 Iowa, 88, 70 N. W. 1091.

Affirmed.

All the Justices concur.