Court Opinion

ID: 9623331
Source: CourtListenerOpinion
Date Created: 2023-08-22 06:31:24.931385+00
Date Added: 2024-06-11T18:05:28.527031
License: Public Domain

DONOFRIO, Judge,
dissenting.
I respectfully disagree with the conclusion of the majority that the trial court erred in granting summary judgment in this case.
Several additional facts are necessary to a full perspective of the case:
1. By the terms of the agreement between the parties, closing was to be no later than 90 days after the opening of escrow unless extended for an additional 90 days by purchaser paying an additional $10,-000.00 into escrow. The additional $10,-000.00 was to be nonrefundable.
2. Time was of the essence of the contract.
3. The escrow was opened on April 19, 1978, so that closing should have taken place on or before July 18 and purchaser did not extend the time for closing as provided by the agreement.
4. Purchaser did not offer to tender cash in lieu of second deed of trust financing on or before July 18, 1978.
5. Sellers first moved for summary judgment in September 1978 basing their motion on a letter from the Philadelphia Savings Fund Society to a Washington lawyer for one of the appellees. This letter stated that the savings institution would not consent to a secured secondary financing. Purchaser opposed the motion on the grounds that the letter was hearsay. There was an affidavit of the appellant attached to his response in opposition to the motion for summary judgment asserting his capability to make the various necessary payments on the note provided for in the contract, to be secured by a second deed of trust. Appellant’s response asserted his right to pay cash down to the first mortgage in the following terms:
The plaintiff in the instant case remains free to waive the benefit of the second deed of trust provision and to pay cash to mortgage instead. (Emphasis supplied).
Seller’s motion for summary judgment was denied on the sole basis that it had not shown by admissible evidence that the Philadelphia Savings Fund Society would not consent to a second lien on the property.
6. Appellant admitted when his deposition was taken on September 21, 1978 that he had not at that time made application to the Philadelphia Savings Bank for its approval to put a second lien on the property.
7. Appellant subsequently responded to an interrogatory by appellees by attaching a letter from Philadelphia Savings Fund Society to appellant’s California counsel stating that Philadelphia Savings Fund Society would not consent to a second deed of trust. Appellant referred to the letter without evidentiary qualification and stated that it “speaks for itself.”
*3878. Based upon the response to the interrogatory and the foregoing letter attached to the answers, seller again moved for summary judgment. It was in response to this motion that appellant finally verbally “waived” the second mortgage financing provision and stated a willingness and readiness as well as ability to pay cash in lieu of obtaining financing secured by second deed of trust. No cash has ever been tendered.
I wholly agree with the majority that under the terms of this particular agreement the appellant had an absolute right to tender cash all the way down to the first mortgage rather than executing a note secured by a second deed of trust. I also recognize that the appellees prematurely declared the agreement unenforceable, thus reasonably requiring appellant to institute the specific performance suit if he chose to and could perform. I further recognize the principle which excuses the necessity of tender in appropriate circumstances, see Shreeve v. Greer, 65 Ariz. 35, 173 P.2d 641 (1946), and the existence of authorities holding under appropriate circumstances that an actual tender may sometimes be sufficient if made during the course of litigation. See 71 Am. Jur.2d, Specific Performance, Section 66 (1975). I think, however, that the record negates the contemporaneous coexistence of readiness, willingness and ability and I further believe that a decree of specific performance under the facts of this case would be contrary to the manifest intention of the parties expressed in their agreement.
Setting aside for the moment the issue of the admissibility of the letter from the Philadelphia Savings Fund Society to appellant’s California counsel, that letter clearly established appellant’s lack of ability to finance the deferred balance by a note secured by second deed of trust. The record clearly establishes that the savings bank’s authorization for secondary financing was necessary and no reasonable inference can be drawn that an approval might have been forthcoming earlier at the time set for closing. Appellant’s response to appellees’ first motion for summary judgment clearly indicates that while appellant had considered the possibility of tendering cash all the way down to the first mortgage, he was withholding either a tender or a manifestation of such willingness at that time. In other words, if appellant “remained free” to make such a tender, the necessary implication is that he had not made such a tender and was not making such a tender at that time. Appellant sought, in effect, to preserve an option to come up with cash to the mortgage in the event that the savings bank could not, in time, be persuaded to approve a second deed of trust.
The remedy of specific performance is available as a matter of right in an appropriate case. It is, however, an equitable remedy designed for the diligent but not the speculative. See, e.g., Walton v. McKinney, 11 Ariz. 385, 94 P. 1122 (1908), affirmed 12 Ariz. 207, 100 P. 471 (1909). While I do not agree with the trial judge that appellant was required to make a cash-to-mortgage tender prior to filing suit, I think appellant was at the very least required by a fair interpretation of the agreement to declare his willingness to perform the contract in this manner at the time scheduled for closing. The record affirmatively indicates, however, that appellant was merely attempting to preserve his options in this regard up until the time of responding to appellees’ second motion for summary judgment. There was no willingness manifested to tender cash prior to that time.
It seems to me that if a decree of specific performance is held appropriate under circumstances such as these, speculative litigation is encouraged, and that in a rapidly inflating real estate market a purchaser in a position analogous to appellant’s may find it possible to trade upon an increase in market value to finance a purchase prior to the end of litigation when he could not meet specified conditions at the commencement of litigation, all in the face of a contract such as this one which made time of the essence and which contained very specific provisions as to when closing must take place. I am unwilling to conclude that either appellees’ letter of June 25 or the *388fact that appellant filed suit prior to the scheduled closing date or the principle excusing the necessity of tender in appropriate circumstances result in an increase in appellant’s contractual rights at the expense of appellees’ rights. I do not believe that the pendency of litigation initiated by the purchaser should allow the purchaser to “gain time” in a specific performance suit.
The rule excusing actual tender is grounded on the premise that an actual tender would be refused, making the tender a futile act. See Shreeve v. Greer, supra. Its application in this case seems questionable in the first instance because the performance contemplated by the parties in their contract was a secured note, not a full cash payoff down to the first mortgage. While the payment of cash may not have been a substituted performance strictly speaking, it was significantly different than that provided in the agreement. In any event, if an offer to tender is to be held the equivalent of an actual tender for the purpose of maintaining a specific performance suit, there must logically be nothing contingent about the offer to tender. Here, again, the record shows an absence of ability to finance by secured note and merely an attempt to reserve the right to pay cash down to the first mortgage.
As to the question of admissibility of the letter from the savings bank to appellant’s California counsel, had appellant merely paraphrased the contents of the letter in answer to appellees’ interrogatory as he would have had to do in order to be fairly responsive to the interrogatory, there would have been no hearsay objection. Instead, appellant incorporated the letter by reference into his answers without evidentiary or other qualification, stating merely that it “speaks for itself.” Under those circumstances, I consider appellant estopped to object to appellees’ present use of the letter on a motion for summary judgment. Cf. Adams v. Bear, 87 Ariz. 288, 350 P.2d 751 (1960). Alternatively, I believe that the letter was admissible notwithstanding appellant’s hearsay objection by reason of Rule 803(24) of the Rules of Evidence, 17A A.R.S. set forth in the margin.4 The letter meets the criteria set forth in the rule.
For the foregoing reasons, I would affirm the judgment of the trial court.

. Rule 803. Hearsay Exceptions; Availability of Declarant Immaterial
The following are not excluded by the hearsay rule, even though the declarant is available as a witness:
(24) Other exceptions. A statement not specifically covered by any of the foregoing exceptions but having equivalent circumstantial guarantees of trustworthiness, if the court determines that (A) the statement is offered as evidence of a material fact; (B) the statement is more probative on the point for which it is offered than any other evidence which the proponent can procure through reasonable efforts; and (C) the general purposes of these rules and the interests of justice will best be served by admission of the statement into evidence. However, a statement may not be admitted under this exception unless the proponent of it makes known to the adverse party sufficiently in advance of the trial or hearing to provide the adverse party with a fair opportunity to prepare to meet it, his intention to offer the statement and the particulars of it, including the name and address of the declarant.