Court Opinion

ID: 9639295
Source: CourtListenerOpinion
Date Created: 2023-08-22 16:11:24.443521+00
Date Added: 2024-06-11T15:35:01.305263
License: Public Domain

On Petition for Rehearing.
PHILLIPS, Circuit Judge.
In the instant case, the defense of laches was based solely on the lapse of time and the action was brought within the period of the analogous statute of limitations. In the time that intervened between the tender and the commencement of the action, no change in the situation occurred that was detrimental to Strong. Strong did not deny that he was obligated under the contract. He merely refused to deed an undivided one-half interest in the land to Shell, as he was obligated to do. Instead of performing in accordance with the terms of the contract, he offered to divide the land and convey to Shell a full title to one-half thereof.
We think the cases cited in the petition for rehearing are distinguishable from the instant case. In Fowler v. Marshall, 29 Kan. 665, 29 Kan., 2d Ed., Ann. p. 475, the facts were these: On July 2, 1878, Moore conveyed a lot in Topeka, Kansas, to Marshall and took back a mortgage for part of the purchase price; Marshall defaulted in his payments; on May 13, 1880, Moore commenced an action to foreclose the mortgage; Fowler, on his own motion, was made a party to the suit; he filed an answer in which he claimed to be the equitable owner of the property under a contract with Moore dated December 10, 1877. *914The contract recited a down payment of $5 and provided that Fowler should pay $5 monthly, with interest, until the full sum of $125 had been paid. Fowler sought specific performance of the contract. Fowler testified that he had paid $35 to Moore’s agent; Moore testified that he had received only $20. After the contract of December 10, 1877, Fowler took possession and put $100 worth of improvements on the premises. Thereafter, in May, 1878, he delivered possession to Marshall. Fowler testified that Marshall entered as his tenant. Marshall testified that he entered under a contract of purchase upon which he had made payments aggregating $22, in support of which he offered receipts for such payments. In June, 1878, an agent of Moore notified Fowler that he had forfeited his contract and also advised Marshall of that fact. Fowler thereupon told Marshall that he could not receive any further payments from him as he could not perfect his arrangements with Moore. After the notification of forfeiture, Fowler made nó further payments nor tender of payments to Moore and made no demand for payments from Marshall. Not until he filed his answer did he assert any further rights under his contract. It will be noted that in this case there was an express repudiation of the contract and an acquiescence therein by Fowler. The trial court denied Fowler specific performance and he appealed. It is significant that the court said:
“We do not wish to be understood as holding that the mere lapse of time, * * * would of itself be sufficient to defeat plaintiff in error’s recovery, but only refer to it as one of the matters which contribute to justify an upholding of the decision.”
In Agens v. Koch, 74 N.J.Eq. 528, 70 A. 348, 349, the facts were these: Agens and others entered into a contract by which they agreed, in consideration of $20,000, to convey to Koch, by warranty deed, “a perfect record title” to a tract of vacant land, on or before October 15, 1906. On October 15, by written agreement endorsed on the contract, the time for performance was extended to October 19, 1906. Koch intended to erect a building on the tract of land and early possession was important, if not necessary, to effect the object of the purchase. The vendors knew that Koch intended to build and that he desired immediate unclouded possession. The title to the property was clouded by two judgment liens and by a dedication of a street across a considerable portion of the frontage of the property. Koch rejected the title on account of such defects on October 19, 1906. 'On February 1, 1907, Koch brought an action to recover the money he had deposited under the contract. On February 19, 1907, the vendors brought an action for specific performance. Koch answered setting up as defenses the defects in the title and the fact that time was of the essence of the contract. At the time the action for specific performance was commenced, the defects had not been cured. They had been cured at the time of the hearing. The court held that the vendors were not barred by laches, but that time was of the essence of the contract and on that ground denied specific performance.
Livermore v. Beal, 18 Cal.App.2d 535, 64 P.2d 987, was an action to quiet title. A defense of laches was asserted. The land involved was mineral land. There was a long delay in the commencement of the action and in the interim the defendants had entered under oil and gas prospecting permits issued by the Secretary of the Interior and had developed the land for oil and gas, which greatly enhanced its value. In that case, in addition to the delay, plaintiffs stood by while the defendants, under the permits, developed the land and greatly enhanced its value. The court held the plaintiffs were barred by laches.
In Superior California Fruit Land Co. v. Grossman, 32 Cal.App. 357, 162 P. 1046, the action was to quiet title. The defendants filed a cross-complaint, in which they sought to set up a cause of action for specific performance of an option contract executed to them by an option holder. The cross-complaint was filed three years and nine months after the second option was given, and after the original option holder had sold and conveyed to a third party through whom the plaintiffs claimed. The defendants did not show any valid tender of the money representing the purchase price, and after the recording of the instruments, under which plaintiffs claimed, and after plaintiffs had gone into possession, remained silent and inactive. The court held that defendants were barred by laches.
In Alexander v. Phillips Petroleum Company, 10 Cir., 130 F.2d 593, 605, the plaintiffs sought to redeem certain stock from a pledge and to recover possession thereof. *915In applying the doctrine of laches, the court said:
“Laches consists of two elements, inexcusable delay in instituting suit and prejudice resulting to the defendant from such delay. Its existence depends upon the equities of the case, and not merely upon the lapse of time.”
Ketcham v. Owen, 55 N.J.Eq. 344, 36 A. 1095, was an action for specific performance of a contract for the sale of land. The contract was signed only by the vendor. The vendor asserted misrepresentation and inadequacy of consideration and advised that she would not perform the contract. The vendor made no tender of performance. The notice of repudiation was given in April, 1890. The purchaser did not bring the action until August, 1893. The court held that because of the inadequacy of consideration and the lapse of time, the purchaser was barred by laches.
Marsh v. Lott, 156 Cal. 643, 105 P. 968, 969, was an action for specific performance of an option contract. The purchaser made a tender, which was refused. He did not bring his action until a lapse of more than three years after the tender, and in the interim the property had increased in value approximately 50 per cent. The court said:
“It is undoubtedly true that when an express statute of limitation applies to a suit in equity, mere delay to commence the suit for a period less than that of the statute of limitations is never a reason for dismissing the proceeding. Lux v. Haggin, 69 Cal. [255] 267, 4 P. 919, 10 P. 674. There must be other circumstances which, taken in conjunction with the mere lapse of time, render it inequitable to enter into the investigation or give the relief sought.”
In Schaffer v. Latta, 113 N.J.Eq. 589, 168 A. 41, which was an action for specific performance, after the purchaser had been iff default for three years the vendor brought an action for damages. The bill for specific performance was not filed until one year after the damage suit had been instituted. After defaulting under the contract, the purchaser continued to occupy the premises and pay rent. The court held that, under the circumstances, the purchaser had abandoned his contract and was barred by laches.
Since, in the instant case, no change in conditions occurred between the tender and the commencement of the action which created equities in favor of Strong, and the defense of laches rested solely on the lapse of time, we adhere to our former decision.
The petition for rehearing is denied.
MURRAH, Circuit Judge, dissents.