Court Opinion

ID: 5065568
Source: CourtListenerOpinion
Date Created: 2021-10-01 09:51:32.141401+00
Date Added: 2024-06-11T08:19:36.658108
License: Public Domain

CLARK, Presiding Judge.
This appeal is from a decree which ordered appellant executor specifically to perform an agreement made by appellant’s decedent with respondents to discount the balance payable under a real estate mortgage note. The issue is whether the unperformed contract of the decedent is specifically enforceable against the estate and the personal representative under the provisions of § 473.303, RSMo.Supp.1984.1 We conclude it was not and therefore reverse.
There is no dispute as to the facts. The note in question was given in 1981 in a real estate transaction and was payable to the deceased, Mae Kathryn Wooley, and Madeline Bauer McCabe, her daughter. It was in the principal amount of $65,000.00 and was secured by a deed of trust on the property sold, real estate located in Texas. Repayment was by 59 monthly installments of $744.52, including interest at 13V2%, and *442a lump sum or “balloon” payment due on the 60th month.
In 1982, respondents acquired the property from the original purchasers and assumed the obligation of the note. Some months later, respondents and Mrs. Wooley discussed an accelerated retirement of the debt for cash. The discussion culminated in a letter sent by Mrs. Wooley to Mr. Ellis on May 19, 1983. In the letter Mrs. Woo-ley offered to sell the note for $65,000.00. At that time, the unpaid principal balance was $64,752.14. Respondents agreed and arranged an escrow with a title insurance company in Texas to handle the payment and assignment of the note.
Madeline McCabe was not a party to the discussions between her mother and respondents and, so far as this record shows, she was unaware Mrs. Wooley had proposed to discount the note by some $10,-000.00 in return for an immediate cash payment. For their part, however, Mrs. Wooley and respondents recognized that the transaction depended on obtaining a release from Mrs. McCabe. The Texas title company engaged by respondents included the requirement of a release from Mrs. McCabe in the instructions they sent to Mrs. Wooley.
For some months before the transaction with respondents was first proposed, Mrs. Wooley had been attempting to persuade her daughter to assign the interest Mrs. McCabe held in the note to Mrs. Wooley, but without success. During the time relevant to this suit, Mrs. McCabe lived in Virginia and Mrs. Wooley lived in Missouri. At some time early in 1988 or before, Mrs. Wooley consulted an attorney about obtaining a release of her daughter’s interest in the note. In February, 1983, the attorney wrote Mrs. McCabe requesting that she sign and return an “Assignment and Endorsement” the attorney had prepared setting over to Mrs. Wooley all title to and interest in the note. Mrs. McCabe either ignored the request or told her mother she was unwilling to release the note. The next communication shown in this record is a letter Mrs. Wooley sent Mrs. McCabe June 16, 1983 in which she protested her daughter’s failure to sign the assignment enclosed with the attorney’s letter of the previous February and threatened suit.
Mrs. Wooley died five days later on June 21 without having received the release or assignment from Mrs. McCabe and without having endorsed the note or executed any documents to comply with the instructions by the Texas title company. As of the date of Mrs. Wooley’s death respondents had not deposited any money with the title company to perform their part of the agreement and, as later developments disclosed, respondents did not themselves have the funds with which to make the $55,000.00 payment.
Documentary evidence in the case suggests that Mrs. McCabe was not aware on June 21, 1983, or for some days thereafter, that her mother had died. On June 23, 1983, Madeline sent a letter to Mrs. Wooley enclosing the signed assignment form which had been supplied by the attorney the previous February. The letter expressed Mrs. McCabe’s concern over “many phone calls and threatening letters”, her opinion that nothing could have been done in court and she wished her mother good luck. That letter with the assignment apparently reached appellant executor in due course at some time within the week following Mrs. Wooley’s death.
In the point dispositive of the case, appellant contends the decree for specific performance was in error because the exec-utory agreement to discount the note could not have been enforced against Mrs. Woo-ley on or prior to the date of her death. Although respondents could conceivably have asserted some claim against Mrs. Wooley for loss of the agreed bargain, appellant says the available relief was not by specific performance because without the concurrence of the co-payee, Mrs. McCabe, Mrs. Wooley was incapable of satisfying the condition of the agreement to assign and release the note. Respondents counter by pointing out that the obstacle was removed when the assignment by Mrs. *443McCabe was delivered, albeit some days after Mrs. Wooley had died.
Even though it may be that the delivery postmortem of the McCabe assignment gave appellant the capacity to perform, it is the enforceability of the contract in equity against the decedent by which respondents’ suit under § 473.303, RSMo.Supp.1984 must be measured. We therefore turn next to an analysis of the contract status and rights as they existed between the parties on June 21, 1983.
For purposes here, we reject appellant’s argument that the discussions recited earlier between Mrs. Wooley and Mr. Ellis did not progress beyond an offer and counter offer stage. The consequence of those discussions was a bilateral contract, a promise for a promise. Respondents agreed that if the note were assigned and released, they would pay $55,000.00. Mrs. Wooley promised that if the money were paid, she would assign and release the note. These promises were, however, subject to the condition that Mrs. Wooley procure from Madeline McCabe the assignment of her interest in the note. Had Mrs. McCabe persisted in her refusal to assign her interest in the note, the agreement would not have been specifically enforceable by respondents against Mrs. Wooley because Mrs. Wooley was incapable of transferring full ownership of the debt.
Mrs. Wooley was fully aware of her inability to perform the agreement with respondents until she could persuade her daughter to release the note. This awareness is demonstrated by Mrs. Wooley’s repeated demands and later threats to her daughter and the fact that Mrs. Wooley made no attempt to perform herself so long as she did not have ownership of the full interest in the note. Although respondents may not have been informed concerning the exchanges between Mrs. Wooley and Mrs. McCabe and did not know of the hostility on the subject, they did condition payment of the agreed sum on releases and assignments executed by both note payees. Until that assignment vested Mrs. Wooley with full ownership of the note, she could not specifically perform the undertaking to sell respondents the note nor would a judgment for specific performance have been of any practical effect.
Respondents contend, and the trial court apparently assumed, that the ultimate delivery of the McCabe assignment to appellant validated Mrs. Wooley’s earlier agreement which then ripened into a specifically enforceable obligation. The difficulty with that argument is respondents based their cause of action on the limited foundation of § 473.303, RSMo.Supp.1984. That statute serves only to give authority for recovery of judgment on a contract specifically enforceable against the decedent lacking only the execution by the decedent. As the facts here demonstrate, the contract for the discounted payment of the note was not specifically enforceable up to and including the date of Mrs. Wooley’s death. Respondents therefore made no case under the statute upon which they based their cause of action.
We do not consider whether the death of Mrs. Wooley served to revoke the exec-utory contract or whether respondents had a potential claim against the estate for breach of contract. Such a cause was not cognizable under § 473.303, RSMo.Supp. 1984 which is by express terms limited to cases in equity. The cause may not now be converted into one against the estate on a breach of contract theory because respondents filed no claim against the estate within six months after the first published notice of letters of administration. Section 473.360, RSMo.Supp.1984. Any claims not so filed are barred from recovery on estate assets being administered. White v. Roberts, 637 S.W.2d 332, 334 (Mo.App.1982). To allow the present judgment to stand would be, in effect, to allow a claim against the estate for some $9,000.00 (the difference between the present value of the note and the discount) contrary to the provisions of the non-claim statute. Moreover, the consequence would also place appellant in contravention of § 443.160, RSMo.1978 which authorizes satisfaction of a deed of *444trust by an executor or administrator only after payment of the note secured.
The foregoing discussion has assumed that the agreement between Mrs. Wooley and respondents for the sale of a mortgage note would have been specifically enforceable in equity under the provisions of the statute on which respondents’ suit relied if Mrs. Wooley had acquired full ownership of the note before her death. Counsel however have cited no authority for that proposition and independent research has disclosed no ease in which § 473.360, RSMo.Supp.1984 has been applied except to contracts involving the sale of real estate. It is not necessary here to speculate what unperformed contracts of a decedent other than for the sale of real estate would also be specifically enforceable under the cited statute. Here, Mrs. Wooley’s agreement to sell respondents the subject note at a discount is not enforceable in equity not only because of the decedent’s lack of capacity to perform, but because respondents’ loss is calculable and compensable in money damages.
In determining whether a prospective award of damages in an action at law would be adequate so as to bar specific performance, the inquiry is whether the award of damages would put the injured party in a situation as beneficial to him as if the agreement were specifically enforced. State ex rel. Dowd v. Turpin, 576 S.W.2d 754, 755 (Mo.App.1979). Respondents here have made no claim to any prospective loss whatever except the interest differential between invested funds at a current rate and the rate of interest payable under the subject note. As respondents’ brief describes the basis for monetary damages, they say it is the “opportunity cost” of funds placed in other investments compared to the interest charged on the note. This computation, they say, is very difficult if not impossible.
No such exotic calculation is necessary. The note had a market value as of June 21, 1983 determinable with reference to the rate of interest specified, the term of repayment and the quality of the security. Because of the early maturity date, November, 1986, and the collateral of a first deed of trust, the primary valuation factor would be the interest rate. If the rate provided in the note was above the then market, the note would be valued at a premium, if below, at a discount. Whatever the worth of the note were determined to be, respondents’ damages were the difference between the market value of the note and $55,000.00, the price at which Mrs. Wooley agreed to sell. What respondents could possibly have earned on other investments, whether it was necessary for them to borrow money to meet their part of the contract or what the estate would do or could have done with its funds are immaterial.
Respondents also claim that the case is within those situations where a contract is made for the sale of real estate. This follows, they say, because a release of the deed of trust entails a recording of an instrument, a release deed or a marginal entry, affecting title to the property in question.2 In the first place, the contract proposed by Mrs. Wooley did not refer at all to a deed, only a sale of the note. We are not favored with citations of Texas law, but assume a deed of trust recorded there may be released by the holder of the note, be he payee or assignee. It was unnecessary for Mrs. Wooley to prepare or sign any instrument for recording to consummate the agreement.
*445Secondly, respondents have never claimed to have sustained any damages, apart from the interest differential, because the lien of the deed of trust continued to encumber their property or because they were unable to prepay the note. Nothing in the agreement with Mrs. Woo-ley indicated and no evidence in the case suggests that respondents’ objective was to prepay the note for the purpose of freeing their property from the deed of trust. A release of the mortgage was a mere incidental consequence to follow upon respondents’ purchase of the note which, in turn, was advantageous to respondents only because of the substantial discount. The transaction was therefore not one to which the remedy of specific performance was applicable under the theory that a sale of an interest in real estate involves a unique asset.
The trial court erred in ordering specific performance under § 473.303, RSMo.Supp. 1984 because the contract between respondents and Mrs. Wooley was not specifically enforceable as of the date of death. Even were Mrs. Wooley to have been capable of performance, however, specific performance was not an available remedy because respondents’ damages, if any, were recoverable in money.
The judgment is reversed.
SOMERVILLE, J., concurs.
KENNEDY, J., dissents in separate opinion.

. "473.303. Specific execution of contract of decedent — petition.—1. If a decedent entered into a contract, specifically enforceable in equity, and did not execute the same in his lifetime, nor give power by will to execute the same, the other party, wishing specific execution of the contract, or the personal representative of the decedent, may present a verified petition to the court, setting forth the facts and stating that no part of the contract has been satisfied except as set forth, and praying that an order be made that the personal representative execute such contract specifically, by executing a deed for the same”.

. As this opinion observes, § 473.303, RSMo. Supp.1984 appears to refer substantially if not exclusively to conveyances of real estate by deed. If, as the dissenting opinion suggests, it is the lien encumbrances of the mortgage which serves to invoke the remedy of specific performance, a decree by a Missouri court would be inoperative upon title to Texas real estate and would be jurisdictionally defective. Section 508.030, RSMo.1978; Sisk v. Molinaro, 376 S.W.2d 175, 177 (Mo.1964). The parties have not considered or briefed this issue and the dissent does not discuss how a Missouri decree could operate in the transfer of a mortgagee's title in Texas to Texas realty.