Court Opinion

ID: 9789424
Source: CourtListenerOpinion
Date Created: 2023-08-31 01:36:14.371509+00
Date Added: 2024-06-11T07:37:22.434303
License: Public Domain

Dore, J.
(dissenting) — Until now, the law of this state has always been that the vendor of land by a real estate contract, upon default of the purchaser, may either sue for the contract price by tendering the deed, or sue for damages and keep the land. Tombari v. Griepp, 55 Wn.2d 771, 776, 350 P.2d 452 (1960); Hogan v. Kyle, 7 Wash. 595, 35 P. 399 (1894). Furthermore, a vendor cannot both retain the property and sue for the purchase price, as this would give the vendor a double recovery. Stevens v. Irwin, 132 Wash. 289, 291, 231 P. 783 (1925). I believe the majority implicitly modifies this rule, allowing for a double recovery, and I therefore dissent.
Robert and Barbara Smith sold the property in question to the Kings and Mullinaxes. They in turn sold the property to John Frankenfield and his partner (hereinafter Frankenfield). Both of these sales were executed pursuant to real estate contracts, which provided that if the purchasers failed to make payments, their interest in the property could be forfeited.
Frankenfield failed to make payments on the second real estate contract. The Kings and Mullinaxes, who used the money from this second contract to pay off the first contract, therefore had a choice. They could have continued to make the payments to the original owners under the first *453contract and sued Frankenfield. This suit could have been for damages or for forfeiture of Frankenfield's interest in the property. Alternatively, they instead decided to default on their first real estate contract with the original owners, thereby forfeiting their interest in the property. As a result of this forfeiture proceeding, Frankenfield's interest was also forfeited.
I believe that the decision of the Kings and Mullinaxes can only be described as an election to forfeit the interest of Frankenfield and therefore precludes any additional recovery against him. Frankenfield lost his interest in the property, and lost all the money he had spent acquiring that interest. Accordingly, he is unfairly penalized twice if, in addition to forfeiting this investment, he is liable to the Kings and Mullinaxes for the damages from the breach of the second contract. The forfeiture of the land represented the damages for that breach.
Furthermore, the Kings and Mullinaxes would receive a double recovery in this situation. Not only would they receive damages for breach of the second real estate contract, but also, they would have permitted a forfeiture of Frankenfield's interest in the property. While it is true that the Kings and Mullinaxes did not receive the property by that forfeiture because their interest was also lost, this was not Frankenfield's fault. The Kings and Mullinaxes lost this interest on account of their own breached real estate contract. By failing to make payments on the first contract, the Kings and Mullinaxes were also at fault. In essence, two breaches occurred, one by Frankenfield and one by the Kings and Mullinaxes. I see no reason at all why Franken-field should suffer twice, and the Kings and Mullinaxes not at all.
I believe the majority found itself in this baffling position by the way it framed the issue in this case. The majority states that:
Here contract purchasers of real estate resold the property to second purchasers by another real estate contract; the second purchasers then later breached their *454contract with the first purchasers causing the first purchasers' interest in the property to be forfeited back to the original owner.
(Italics mine.) Majority, at 446. This is incorrect. Franken-field's breach did not cause the Kings and Mullinaxes' interest to be forfeited back to the Smiths. The Kings and Mullinaxes voluntarily chose not to continue paying on the first real estate contract. They had just 2 months earlier received $9,000 as a down payment on the second real estate contract — an amount more than sufficient to make all the payments on the first contract until the balloon payment became due well over a year later. That the Kings and Mullinaxes chose not to make the payments, out of the $9,000 payment made by Frankenfield to the Kings and Mullinaxes, cannot be attributed to Frankenfield. Otherwise instead of having a simplified real estate forfeiture procedure requiring the seller to elect his remedy, a great deal of manipulation for the balance of the debt will occur with great injustices resulting to subsequent contract ven-dees.
I believe, therefore, the result the majority countenances is a marked departure from well settled law in this state. The breach of a real estate contract allows the vendor either to sue for damages or to forfeit the purchaser's interest in the property. The vendor, however, cannot get both remedies. Here, the Kings and Mullinaxes, by allowing forfeiture proceedings to occur, elected that remedy, and should be barred from recovering additional damages. I dissent, as I would reverse the trial court's judgment for additional damages against Frankenfield and his partner.
Utter and Goodloe, JJ., concur with Dore, J.
Reconsideration denied October 10, 1986.