Court Opinion

ID: 7889245
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:46:47.878931+00
Date Added: 2024-06-11T16:31:51.339351
License: Public Domain

The opinion of the court was delivered by
Horton, C. J.:
The contention upon the part of Mary E. Chambers is that, under the provisions of the written contract signed by her, she had the option to abandon the purchase at any time upon forfeiting all money paid by her thereon; that thereby the contract became wholly void, and all the parties were thereupon released therefrom. It is argued in her interest that the written contract should be so construed as to allow her to pay out and take the land if she desired so to do, according to the terms thereof; or, by refusing to pay, that the contract permitted her to be released therefrom upon the surrender of the property and forfeiting the payments • made. It was decided in Bohart v. Investment Co., 49 Kas. *39194, upon a written contract containing a provision similar to those now under consideration, that
“The provision in the contracts making them null and void if Bohart made default in the payment of his installments, or any installment, was for the benefit of the investment company. The company could have insisted upon this provision, and had the contracts annulled. It also had the right or option to declare a forfeiture for the nonpayment of the installments, or any installment; but it also could waive that right. A waiver of the right to declare a forfeiture for nonpayment at a specified time is not a rescission of the contract. The investment company, as the vendor, is entitled to its money upon the contract, and the vendee to the lots therein described.” (Barrett v. Dean, 21 Iowa, 423, and Sigler v. Wick, 45 id. 690.)
The law as declared in that case is challenged by the attorneys of Mary E. and ,C. C. Chambers, and we are asked to reexamine the question. We have patiently and laboriously complied with this request, but after such examination we must reiterate what was then said. The law upon the question presented is well settled.
In Wilcoxson v. Stitt, 4 Pac. Rep. 629 (Cal. 1884), it was held that
“Where, in an agreement for the sale of land, the parties stipulate that, ‘in event of the failure to comply with the terms of the agreement, the vendor shall be released from all obligation to convey, and the vendee shall forfeit all right thereto, and the agreement shall be void,’ the meaning of such clause is, that such agreement is void only at the election of of the vendor, who cau avoid it or enforce it at his option.”
In that case the vendor agreed to sell a tract of land for $18,480. Of this sum, the purchaser paid one-half, and agreed to pay the remaining one-half on or before the 21st of March, 1878, together with interest. The action was brought to recover the sum last mentioned in the contract, with interest, etc.
Canfield v. Wescott, 5 Cow. 270, was an action of covenant on articles of agreement under seal, to recover certain install*392meins of the purchase money, in that cáse, the following clause in the articles came under consideration :
“The said Daniel [the defendant] hereby agrees that, should he fail in performing any part of above covenants, that this contract shall become void and of no effect, and that the said party of the second part [the testator] shall and may reenter and take possession of the said premises, without hinderauce or molestation.”
The court said:
“The provision that this agreement should be void was for the benefit of the vendor. On the vendee’s default, the vendor might, therefore, consider the agreement void, at his own election, or affirm it, and bring his action on the covenants; and they said this had been often so held in much stronger cases; as, where the provision in the articles was general and positive, in the words of both parties, that if the vendee failed to perform, the contract shall be void.”
Church v. Ayres, 5 Cow. 272, follows the last case cited, and the court in that ease says: “It is a settled principle, that a party in whose favor a provision is made by the contract may waive it, if he so pleases.” (See, also, Cartwright v. Gardner, 5 Cush. 281; Mason v. Caldwell, 5 Gilm. 196; Smith v. Mohn, 87 Cal. 489, same case, 25 Pac. Rep. 696; 1 Pom. Eq. Jur., §446, and cases cited; Dooley v. Watson, 1 Gray, 414; Hooker v. Pynchon, 8 id. 550; Daily v. Litchfield, 10 Mich. 29.)
The law is similar in reference to conditions contained in leases. (Clark v. Jones, 1 Denio, 518. See Dakin v. Cope, 2 Russ. 170; Dumpor’s Case, 1 Smith, Lead. Cas. 97, 98; Smith v. Miller, 13 Atl. Rep. [N. J.] 39; Ray v. Gas Co., 20 id. [Pa.] 1065.) In the opinion in this last case, the court says: “No case has been brought to our notice in which the lessee was allowed to take advantage of his wrong, or to set up his own default to work a forfeiture of his own contract.” (See, also, Phillips v. Vandergrift, 23 Atl. Rep. [Pa.] 347; Agerter v. Vandergrift, 21 id. [Pa.] 202; Appeal of Wills, 18 id. [Pa.] 721.)
*393Under the authorities, it was the undoubted intention of all the parties to the written contract, when they inserted the clauses permitting the contract to be declared null and void upon default of Mary E. Chambers, to provide a penalty to insure the prompt performance of the contract by her. If the refusal of Mrs. Chambers to perform the terms of the contract prevents an action from being maintained thereon against her, the agreement leaves everything in her own hands. It allows her to defeat or make the contract operative as may best subserve her interest, without any discretion on the part of the others. It makes it binding on the seller, but not on the buyer. But this is not law. The provisions in the contract permitting it to be regarded null and void could only be taken advantage of at the election of the plaintiffs below, who can avoid it or enforce it at their option.
The case of Bradford v. Limpus, 10 Iowa, 35, to which we are referred, shows that the provisions of forfeiture were not for the benefit of the grantor or seller only. In that case, Bradford sold certain land to Limpus for the consideration of $4,600; $1,700 cash, and the remainder was represented by three notes, payable as follows: Two of them for $1,000 each, payable in one and two years, and the other for $900, payable in three years, and, upon payment of these according to their tenor, Bradford was to execute and deliver a good deed to lands. To secure the faithful performance of this on Bradford’s part, he gave a bond for $1,200, conditioned as follows:
“That if Limpus failed or neglected to pay the notes, or either of them, and especially the first one, according to the tenor thereof, time being of the essence of the contract, then Bradford should have full power to enter upon said real estate and take full possession thereof; and, if the failure to pay was on the first note, then the contract should be void, and said Bradford shall take possession of the premises, and refund to Limpus or order the sum of $1,200, without interest, out of the $1,700 so paid in hand, $500 thereof having been forfeited by reason of said failure on the part of Limpus to comply with the terms of the contract.”
*394As Limpus was to have returned to him $1,200, if he failed or neglected to pay the note or notes described in the contract, it clearly appears that the forfeiture clause placed in that contract was for his benefit, not wholly for the benefit of Bradford. That case is different from this, because there is no provision in the contract under consideration requiring any money to be refunded to Mrs. Chambers. The forfeiture clauses placed in this contract were wholly for the benefit of the parties selling the real estate, and these clauses may be waived by them. A party to a contract is not permitted to avoid it by his own wrong.
The judgment of the district court will be affirmed.
All the Justices concurring.