Court Opinion

ID: 8192750
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:15:52.149496+00
Date Added: 2024-06-11T16:40:36.727807
License: Public Domain

Kerwin, J.
(dissenting). A preliminary land contract was made in this case for the exchange of land in Minnesota for cut-over land in Wisconsin. The Minnesota land was incumbered by mortgages in the sum of $11,465. The amount to be paid the Skidmore Land Company was arrived at by deducting the $11,465 incumbrance. A deed was afterwards given and accepted by the Skidmore Land Company in consummation of the deal.
It is plain from the deed and the surrounding circumstances shown in evidence, that the land contract did not contain all the terms of the agreement. The deed, being the final contract of the parties covering the subject matter of the deal., is controlling. This proposition is elementary.
The parties to the deed cannot escape from its provisions even if the preliminary contract was in conflict with it, which it was not. The contract did not cover the whole agreement. The deed is controlling not only as to its terms but as to its legal effect.
When a deed is delivered and accepted as performance of a contract tO' convey, the contract is merged in the deed. Though the terms of the deed may vary from those contained in the contract, still the deed must be looked to alone to determine the rights of all the parties. “No rule of law is better settled than that where a deed has been executed and accepted as performance of an executory contract to convey real estate, the contract is functus officio, and the *529rights of the parties rest thereafter solely on the deed.” 2 Devlin, Real Estate (3d ed.) § 850a, citing as to quoted matter Slocum v. Bracy, 55 Minn. 249, 56 N. W. 826.
Under the deed in question it was competent to show that the Skidmore Land Company assumed and agreed to pay the incumbrance. Strohauer v. Voltz, 42 Mich. 444, 4 N. W. 461 (opinion by Cooley, J.), is directly in point. In that case there was a warranty deed and a covenant against incumbrance, “subject to a certain mortgage given by the parties of the first part for one thousand dollars,”' and it was held that oral evidence was competent to show that the grantee had assumed and agreed to pay the mortgage. This court as well as others has held the same rule. Herrin v. Abbe, 55 Fla. 769, 46 South. 183, 18 L. R. A. n. s. 907; Mueller v. Cook, 126 Wis. 504, 509, 105 N. W. 1054; Perkins v. McAuliffe, 105 Wis. 582, 587, 81 N. W. 645; Beckman v. Beckman, 86 Wis. 655, 660, 57 N. W. 1117; Kickland v. Menasha W. W. Co. 68 Wis. 34, 31 N. W. 471; Frame v. Attermeier, 147 Wis. 485, 133 N. W. 603. Herrin v. Abbe, supra, is directly in point. The deed recited a consideration of “$1 and other valuable considerations,” and further, “The above property is conveyed subject to all liens and mortgages now standing of record against the same.” It was held that oral evidence was admissible to show that the grantee assumed and agreed to pay the incumbrance, and that such evidence did not vary the provision making the conveyance subject to the incumbrances.
The same rule applies to land contracts, and necessarily so, because a contract is no more sacred than a deed. 17 Cyc. 653. In Witzel v. Zuel, 90 Minn. 340 (96 N. W. 1124), at p. 342 it is said :
“The court did not err in denying this motion for the very sufficient reason that a portion of the evidence was not objectionable, and it seems also clear that under any circumstances the amount of consideration for the lands designated in the written instruments referred to was not conclusive, but might be shown by parol.”
*530In Ryan v. Hamilton, 205 Ill. 191 (68 N. E. 781), at p. 204 it is said: “It is well settled in this state that the true consideration for a contract or agreement may always be shown, whether one is shown in the contract or not; . . .”
Even if it be conceded that the land contract and the deed executed later are but parts of the same transaction and must be read together the result is the same: (a) because oral evidence was admissible to show other consideration in either contract or deed, and (b) the contract was incomplete, as shown by the deed and surrounding circumstances. In Jost v. Wolf, 130 Wis. 37 (110 N. W. 232), at p, 41 this court said:
“Further, appellant urges that the land contract and the deed executed ten days later are but parts of one transaction, and, read together, constitute complete written expression of its terms not subject to variation by parol. This is, however, merely begging the question of fact whether they were parts of one transaction, or whether another transaction took place after the written land contract and the deed was made in execution of such later contract.”
There can be m> doubt but that the Land Company is bound by all the terms of the deed. It accepted and ratified it. It contained terms different and in addition to those specified in the land contract and expressed a consideration of “sixty-eight hundred dollars and other valuable considerations,” and also contained a recital that the land was sold “subject to the following mortgages,” aggregating $11,465. The “other valuable considerations” can be shown by oral evidence. Frame v. Attermeier, 147 Wis. 485, 133 N. W. 603. The amount of consideration mentioned in the deed to Thompson was arrived at by deducting the amount of the incumbrances, $11,465, from the estimated value of the land. Thompson was substituted as grantee in place of the Skidmore Land Company by agreement between Coons and Hawkins, who represented the Skidmore Land Company in the deal.
*531The main contention of counsel for respondent here was that Hawkins had no authority to change the agreement as embraced in the land contract. No change by Hawkins in the land contract was necessary. The consideration in either land contract or deed was open to- oral evidence <5f what the real consideration was. Moreover, the land contract and deed are not in conflict. The contract recites that the Minnesota land was to- be sold “subject to mortgages amounting to $11,465, due December 1st, 1916, at 6 And the deed recites a consideration of $6,800 subject to mortgages aggregating $11,465.
It seems to me clear that, even construing the land contract and deed together as one agreement, evidence of the real consideration was admissible. The evidence offered to the effect that the Skidmore Lmd Company assumed the incumbrance was not in conflict with any provision of the land contract or deed. It was in harmony with both, especially when viewed in the light of surrounding circumstances and the law that the consideration may be shown to be different- from that written in the contract or deed.
The land contract was executed November 15, 1915. On December 14, 1915, the Skidmore Lmd Company informed Coons that it accepted the proposition made November 15, 1915, and three days later Coons wrote the Land Company that he had his interest paid to- December 1, 1915, and asked that the Land Company assume the mortgages from that date. The Land Company made no denial of this proposition of Coons that it assume and pay the mortgages, but afterwards sent its manager, Hawkins, to Minnesota to close the deal with Coons. The deal was closed and a consideration of $6,800 agreed upon, and it was further agreed that the conveyance be made to Thompson instead of to the Lmd Company, and that the indebtedness of $11,465 be assumed and paid by the Skidmore Land Compmy as part of the consideration. The evidence also tends to show that in the negotiations between Coons and Hawkins the consideration put *532in the deed, $6,800, was arrived at by a discussion of the value per acre of the respective lands.
It was strenuously urged by counsel for respondent that the Skidmore Lmd Company was not bound by the agreement of Hawkins to- assume and pay the incumbrances, he being a special agent. However, Hawkins had authority on behalf of the Land Company to close the deal and accept the deed made. He had authority to vary the terms of the land contract, in some particulars at least, and had apparent authority' to do all that he did in making the contract. The Skidmore Land Company had notice, when it authorized Hawkins to go to Minnesota to close the deal, that Coons understood the incumbrances were to be paid by the Land Company, accepted and ratified the deed as made, and cannot question it in this action.
But even though Hawkins had no authority on the part of the Skidmore Land Company to' make an agreement assuming the incumbrances, still the court below committed prejudicial error in excluding evidence offered to' prove that Mr. Skidmore, officer of the Skidmore Land Company, who had authority, agreed to' assume and pay the mortgages on behalf of the company. This evidence related to the consideration, was competent and vital in tending to establish that the Land Company did assume and agree to pay the mortgages. This evidence alone would have been sufficient tO' carry the case to the jury.
The case here does not fall within the authorities holding that where the stipulation in the deed or contract is contractual it cannot be contradicted or varied by oral evidence. It is wholly immaterial whether the stipulation be in a deed or a land contract; if contractual it cannot be varied. This rule is elementary. But the consideration in either deed or contract may be varied, explained, or even contradicted. This is the situation in the case at bar. Strohauer v. Voltz, 42 Mich. 444, 4 N. W. 461; Herrin v. Abbe, 55 Fla. 769, 46 South. 183, 18 L. R. A. n. s. 907.
The evidence offered and excluded was consistent with *533both the deed and the land contract, and would not have varied or contradicted any contractual item of either. The evidence offered and excluded was ample to show that it was agreed that the Skidmore Land Company, as part of the consideration of the purchase price, assumed and agreed to pay the mortgages on the Minnesota land, and that an injustice was done Coons in excluding the evidence.
I am convinced that the judgment in this case should be reversed, and the cause remanded for a new trial: First. The deed of the Minnesota land was the final contract made in consummation of the deal, and oral evidence that the Skidmore Land Company agreed to pay the incumbrance was admissible. Second. Even if the deed and land contract be read together, the same result follows, bechuse the consideration in the contract as well as the deed could be shown by oral evidence; and if it be admitted that the evidence of Hawkins was inadmissible because he had no authority to make such an agreement, the evidence offered that Skidmore made such an agreement was admissible and should have been admitted. Third. Upon all the evidence and surrounding circumstances the agreement that the in-cumbrance was assumed did not contradict any covenant in the land contract or deed. The evidence offered and excluded went only to the consideration of the deed and contract. Fourth. It is plain from the evidence of Hawkins, as well as from the correspondence between the Skidmore Land Company and Coons, that the deed of the Minnesota land was made with the understanding on the part of Coons that the incumbrance was to be assumed and paid by the Land Company, the deed was made by Coons upon that condition, and the amount of the incumbrance deducted from the agreed value of the land. Under such circumstances the Land Company cannot profit by the deed and repudiate the oral agreement. Hannon v. Kelly, 156 Wis. 509, 146 N. W. 512; Corbett v. Joannes, 125 Wis. 370, 104 N. W. 69; Kipp v. Laun, 146 Wis. 591, 131 N. W. 418.
Even if it be conceded that evidence was not admissible *534under the pleadings as framed, the case should be remanded with permission to so amend the pleadings as to permit the issue of reformation of the deed to be litigated so that justice may be done in the case. Jilek v. Zahl, 162 Wis. 157, 155 N. W. 909; secs. 2669a, 2836b, Stats. In my opinion, however, as before observed, no' reformation is necessary, and proof of assumption of the mortgages should have been admitted under the issues framed.
The judgment should be reversed, and the cause remanded for a new trial.
I am authorized to say that Justice Siebecker concurs in the foregoing dissent.