Case Name: YELLOWSTONE COUNTY, Respondent, v. WIGHT et ux., Appellants
Court: Montana Supreme Court
Jurisdiction: Montana
Decision Date: 1943-12-24
Citations: 115 Mont. 411
Docket Number: No. 8421
Parties: YELLOWSTONE COUNTY, Respondent, v WIGHT et ux., Appellants.
Judges: Mr. Justice Adair concurs.
Reporter: Montana Reports
Volume: 115
Pages: 411–438

Head Matter:
YELLOWSTONE COUNTY, Respondent, v WIGHT et ux., Appellants.
(No. 8421.)
(Submitted September 30, 1943.
Decided December 24, 1943.)
[145 Pac. (2d) 516.]
Mr. Fred G. Huntington, for Appellants.
Mr. B. V. Bottomly, Attorney General, Mr. Clarence Hanley, Assistant Attorney General, Mr. B. F. Hills, County Attorney, Mr. Frederic Moulton, and Mr. Chas. B. Sande, Deputy County Attorneys, for Despondent.
Mr. William A. Brown, amicus curiae,
Messrs. Melvin N. Hoiness and E. E. Collins, acting in behalf of Mr. Hills, the county attorney, in the matter of petitioning for a rehearing, he having been inducted into the military service of the United States.

Opinion:
ME. JUSTICE ANDEBSON
delivered the opinion of the court.
This is an appeal from a judgment in an action brought to quiet title to real estate.
The complaint is in short form, alleging title and right to possession in the plaintiff and unfounded adverse claim of title by the defendants. The prayer is for adjudication and quieting of title in the plaintiff as against the defendants and for general relief.
Defendants by tbeir answer deny the ownership of plaintiff and allege that they themselves are the owners of the real estate claimed; that they are in possession thereof under a sale contract made to defendant John Wight by the plaintiff on November 5, 1934, which they allege is in full force and effect. The prayer of the answer is that the rights and title of the defendants as claimed by them be adjudicated and decreed to be in full force and effect, and that they be adjudged to have the equitable title to the land. There is the further prayer: ' ' That the court ascertain what sum, if any, may be due plaintiff under said contract and if it be found there be due to plaintiff any amount under said contract defendants be given a reasonable time, in accordance with established rules in equity, within which to make payment thereof and to secure to themselves, or their assigns, deed thereto from plaintiff. Defendants pray that they have such further relief as may seem to the court to be just and equitable."
Trial was had and the court made findings of fact and conclusions of law upon which judgment was entered. The judgment declared plaintiff to be the owner of the land and entitled to the possession thereof, and quieted its title thereto as against the defendants. The appeal is from the judgment and on the judgment roll.
The pertinent facts found as the basis for the judgment are as follows: The plaintiff, Yellowstone county, owned 1,720 acres of land which, on November 5, 1934, it contracted to sell to the defendant John Wight for the sum of $1,902.60. The sum of $380.42 was paid down and the balance was, by the contract, made payable in four successive equal annual installments commencing November 5, 1935. The purchaser was to pay all taxes. Time was made of the essence of the contract, and in event of any default in payment the vendor should be released from the obligation to convey and should retain all moneys paid and improvements made by the vendee as rental for the premises and as liquidated damages for breach of the contract. The vendee had defaulted in the payments to be made and had failed to pay the taxes. The following are the only payments that were made:
$380.52 Principal At the time of purchase
360.00 ' ' May 11, 1936
20.00 ' ' July 3, 1936
100.00 October 28, 1936
5.00 Interest July 3, 1936
100.00 September 14, 1939
No taxes were paid and there was a total of $356.97 delinquent for the years 1935 to 1940, inclusive. The vendee had remained in possession and had made valuable improvements on the premises, but as to the amount of the value of such improvements the •court was unable to determine. The only interest of defendant Susan M. Wight was such as she might claim as the wife of the vendee.
On July 30, 1940, the county commissioners by resolution declared the contract in default and declared their intention to cancel it unless the terms were complied with on or before August 31st. Notice thereof was given to Wight. He failed to comply and on September 17th the commissioners adopted a resolution declaring the contract cancelled and the rights of the defendant Wight thereunder forfeited and terminated. Notice thereof was given to Wight on September 19th.
It was further found as a fact that at the trial of the action the defendant John Wight offered to pay, and tendered, the full amount of delinquent payments, interest and taxes under the contract, which would constitute payment in full. The offer was refused. The facts found by the court are not questioned.
There is no transcript of the testimony and proceedings in the lower court; the record on appeal consisting of the pleadings, the court's findings, and the judgment. The question then is whether the court reached the right conclusion on the facts found, and whether on the pleadings and the court's findings the plaintiff is entitled to the judgment as rendered.
Defendants' prayer in effect asks for relief against forfeiture. Section 8658, Revised Codes, provides: "Whenever, by the terms of an obligation, a party thereto incurs a forfeiture, or a loss in the nature of a forfeiture, by reason of his failure to comply with its provisions, he may be relieved therefrom, upon making full compensation to the other party, except in case of a grossly negligent, wilful, or fraudulent breach of duty." A forfeiture of the rights of a vendee under a contract of sale of real estate may be relieved against by returning payments made or by allowing vendee, on reasonable condition, to perform and save his contract. In the second alternative, it is necessary that the defaulting vendee make a tender of complete performance, which was here done.
Section 8658 has been construed by this court in a number of cases, and the rule thereunder is that "a person may be relieved under it in any case where he sets forth facts which appeal to the conscience of a court of equity." (Huston v. Vollenweider, 101 Mont. 156, 53 Pac. (2d) 112, 115; see, also, numerous other Montana cases therein cited.)
The case of the defendant vendee, in respect to relief against the forfeiture, appeals to us as meritorious. The purchase was made at a time when money for private investment was not readily available, in fact was difficult to obtain. Existing land purchase contracts were abandoned and few new contracts were made. Tax delinquencies were the rule. These things did hot. come about because of the sheer gross negligence of debtors, vendees and property owners. They resulted from money conditions over which the average small investor and businessman had no control. While the vendee was in default, it occurred under circumstances such that we cannot see that he was negligent to the degree which would bar him from consideration. He had, during the four years following the making of the contract, paid nearly half of the principal and some interest. The tender made would constitute full performance so as to entitle the vendee to' deed of conveyance. To the vendor it would give all that the contract called for, with no loss because of delay, and would constitute full compensation. With the county as the vendor, its only interest was to complete the sale and get the land into private ownership and on the tax rolls. The only possible loss to the county by reason of the delay would be the loss of the use of the money. This would be fully compensated for by the payment of interest which was tendered. There are no circumstances which would render it unjust or inequitable to grant the relief. (66 C. J. 789, 790.)
With the payment period specified in the contract long- expired, the contract relation between the parties is not the same. While the obligation to pay remains, the provision for forfeiture in event of default no longer serves. (66 C. J. 785, see. 385.) The vendor may sue to collect the remainder of the purchase price. The right to rescind may be revived, but only after notice of intention to resort to such remedy with reasonable time first to the vendee to perform. What is reasonable notice will of course depend upon the circumstances in each case. Where there had been successive defaults with implied waiver of the right of forfeiture throughout the entire payment extension period under the contract, and long after, the time that was here given .by the notice to establish ground of forfeiture seems to us wholly inadequate.
It must be that the trial court took the view the contract had not been cancelled and was still in existence on the day of trial. The court's finding of the fact that a tender of payment was made must have followed a finding that there still was a contract. Without a contract, a tender of payment would not have been material to any issue before the court because there would have been no contract to which the tender would apply. That is the case presented to this court on the record before us.
Section 8658, Revised Codes, was enacted for the benefit of obligors whose failure to punctually perform would result in loss to them in the matters in respect to which they have contracted. The intention of the legislature in enacting the statute was that it should be operative and that it should be given full force and effect when the circumstances in any case gave it application. The intention of the law under this statute is that a forfeiture should not be needlessly enforced. The courts have established that as the policy of the law in the absence of statute. The rule as it has found expression in court decisions generally is that both in law and in equity forfeitures are abhorred. Under the circumstances in the instant case, existing at the time of the tender, we can see no reason why a forfeiture should be declared. (Rynhart v. Welch, 156 Or. 48, 65 Pac. (2d) 1420; Schnitz v. Grand River, etc., Co., 271 Mich. 253, 259 N. W. 900; Grider v. Turnbow, 162 Or. 622, 94 Pac. (2d) 285, 292; Young v. Fitts, 138 Tex. 136, 157 S. W. (2d) 873; West Lumber Co. v. Henderson, (Tex. Civ. App.), 238 S. W. 710, 714, Seaboard Bank, etc. v. Amuny, (Tex. Civ. App.), 6 S. W. (2d) 186.)
Our view is that the tender of payment offered by the vendee on the day of trial should have been accepted and the county required to execute conveyance for the reason (1) that there never had been a valid cancellation of the contract at the time the tender was made, and (2) that the forfeiture sought to be enforced by the county as a necessary adjudication to maintain its position under the issues that arose in the case should have been denied.
The instant case is distinguished from other decisions by this court wherein the vendee, in default of payment, was denied relief against forfeiture. In the case of Suburban Homes Co. v. North, 50 Mont. 108, 145 Pac. (2d) 6, Ann. Cas. 1917C, 81, one of the leading cases, the court points out the failure of the vendee to make tender of performance at any time, even on the day of trial, as of controlling importance in the judgment of the court. Speaking of that phase of the case, the court in its opinion, says: "In view of the failure of defendant to respond to the demand of the plaintiff, as well as his failure to tender payment at the trial and demand a conveyance, the conclusion seems inevitable that he is either unwilling, or, more probably, unable, to meet his obligations under the contract. Such being the case, he is in no position to claim that the plaintiff ought to be denied relief." This statement by the court is pregnant with the statement that had tender of performance been made even the day of trial, as was done in the instant case, the vendee would have furnished ground for seeking relief which' the court would have been justified in granting.
Plaintiff makes the contention that deferred payments in county contracts for the sale of real estate may not extend over a period of more than five years because of the provisions of sections 2235 and 4465.9, Revised Codes, and that the county commissioners therefore were without authority to deal with the vendee under the contract as still in force after the five-year period. Also, it is contended that because of provisions of section 2208.1, Revised Codes, the tax delinquencies automatically can-celled the contract.
Sections 2235 and 4465.9, Revised Codes, provide that in contracts made by the county, for the sale of any real estate it may own, deferred payments may not extend over a period of more than five years. This limits the deferred payment period which the county commissioners may provide for in such contracts. It does not mean that at the end of such period of time the contract and property rights of the vendee thereunder shall necessarily all be lost if the purchase price has not all been paid during such five-year period. After the five-year period, if there still remain a part of the purchase price unpaid and the vendee offers payment thereof, such payment may be accepted — and this, without any violation of the provisions of sections 2235 and 4465.9.
Section 2208.1, Revised Codes, relating to disposal of tax title property held by the county, provides that if any tax delinquency occurs in respect to any such land sold by the county on installment contract, the failure to pay the tax shall automatically cancel the contract. This provision, read into such a contract as part of the agreement, could not take from a court of equity the power to relieve against a forfeiture resulting. As a tax collecting measure allowing no redemption period, it is void as class legislation, singling out a class of property owners to be dealt with more harshly than all others.
The cause is remanded, with directions that if appellant shall, within thirty days from the filing of remittitur, deposit with the clerk of the court for the use of respondent the full amount of purchase price owing under the sale contract with interest thereon to the time of deposit, and also all taxes assessed against the said land and remaining unpaid, judgment shall then be entered in favor of the appellant directing the respondent to receive the money so deposited and to execute and deliver to the appellant a deed of conveyance of the said land; if such deposit is not made within the said thirty-day period, the judgment appealed from shall stand as affirmed.
Mr. Justice Adair concurs.