Court Opinion

ID: 9755697
Source: CourtListenerOpinion
Date Created: 2023-08-28 20:47:30.927364+00
Date Added: 2024-06-11T09:54:47.960854
License: Public Domain

HAROLD L. LOWENSTEIN, Judge,
dissenting.
I respectfully dissent. There is no quibble with the conclusion that the Rushes, as Sellers, breached the sales contract when they failed to obtain a Deed of Release from their bank and provide fee simple title at closing. The Sellers, however, contend that the trial court’s granting of specific performance as relief was too harsh. This point has merit.
Specific performance is appropriate where the remedy at law for a breach of contract is inadequate. Becker v. Tower Nat’l Life Inv. Co., 406 S.W.2d 553, 559 (Mo.1966) (holding that where no evidence was offered to show that plaintiff remedy at law for damages was inadequate, court would not consider equitable relief in the form of specific performance, but would award damages instead). Sellers argue that in this case specific performance is an inappropriate remedy in that “there was no evidence or testimony that the specific piece of property sued on was unique or that there was some special reason [Buyers had to] have this particular piece of property.” Missouri courts have held that every tract of land is recognized as having a unique value. Kay v. Vatterott, 657 S.W.2d 80, 82 (Mo.App.1983). Each parcel *215of land is unique; a contract for sale of land is subject to the extraordinary remedy of specific performance. Peet v. Randolph, 33 S.W.3d 614, 617 (Mo.App.2000).
Specific performance is not a remedy of right, however. Lemp Hunting & Fishing Club v. Hackmann, 172 Mo.App. 549, 156 S.W. 791, 798 (1913) (“specific performance is not a matter of right ... but one somewhat of grace”). Specific performance is purely an equitable remedy governed by equitable principles. Hoover v. Wright, 202 S.W.2d 83, 86 (Mo.1947). “The remedy is invoked primarily that complete justice may be done between the parties.” Id. In a suit for specific performance, if the remedy would cause inequity, damages may be adjudged. Hamilton v. Hamilton, 59 Mo. 232, 233 (1875).
A court at its discretion, within established principles of equity, may award or withhold the remedy. Holtmeier v. Dayani, 862 S.W.2d 391, 405 (Mo.App.1993). The facts of the case determine whether an award of specific performance is equitable between the parties. Id. “The criterion by which a contract is judged as to ordering its specific performance is not whether a court would be justified in its rescission, or in refusing other forms of relief, but whether it would be inequitable to enforce the contract.” Likens v. Sourk, 263 S.W.2d 462, 465 (Mo.App.1953).
A court may choose to withhold specific performance when “its enforcement will cause unreasonable or disproportionate ... loss to the defendant.” Landau v. St. Louis Pub. Serv. Co., 364 Mo. 1134, 273 S.W.2d 255, 259 (1954). Even in the absence of mistake or fraud, the court may withhold specific performance if it determines that to grant the remedy would “inflict such a burden or hardship upon the defendant as to be inequitable or unconscionable.” Lemp, 156 S.W. at 798.
In this case, the subject of the contract is the Rushes greatest asset, their land, which they put on the market to alleviate their financial difficulties. Respondent Buyers point to Sellers’ balance sheet for January through December 2003 that lists Sellers’ net worth at $145,558. Buyers argue that Sellers have sufficient assets to pay down the debt to enable the Bank to release the land. However, with regard to Sellers’ statement of net worth, Sellers’ assets include a $68,000 carry over loss from farm operations and that asset is not cash available to the Sellers. Moreover, the 2003 balance sheet submitted does not reflect the later discovered $25,000 deferred payment liability. Therefore, actual assets that were available to Sellers to pay down the debt is $52,558. If, arguendo, Sellers liquidated $46,000 in assets to make up the difference between Buyers’ offer and the $1,200 per acre required by the Bank, Sellers would have lost their land and only have less than $7,000 in remaining assets.
Moreover, even if Sellers liquidate 87% of their assets to pay down the debt and close the sale, the Bank is unlikely to release the liens on the remaining land. Sellers would still have over $60,000 in liabilities with less then $7,000 in assets with which to secure the debt. Under such a scenario, both the Bank and the holder of the McQuinn lien may still require the land to secure the liens even after Sellers have virtually bankrupted themselves to meet the requirements of the sale contract.
Specific performance is invoked so that complete justice is done between the parties. A greater strength of case is required to grant, rather than to defeat, a claim for this equitable remedy. Kopp v. Franks, 792 S.W.2d 413, 419 (Mo.App.1990). There is no doubt here that the Sellers made a contract. They did not *216breach for any untoward reason or to gain any economic advantage. To the contrary, they acted in good faith and only breached when it became obvious their tangible assets were less and their liabilities were more than they should have known. They attempted to find a way to honor the contract without suffering an unreasonable economic hardship. Id. at 420. Illustrative is the testimony of Mr. Rush in cross-examination:
Q. Did you call anyone trying to sell any of your equipment?
A. What little — most of it we need; so it was either, I guess sell or quit, or—
This is not a case of a change of heart by the Sellers. Under the facts present in this case, specific performance would be the complete financial undoing of the appellants. I would affirm the judgment that there was a breach; and would reverse as to the remedy of specific performance, and remand the case to the trial court to determine damages for the Sellers’ breach.