Court Opinion

ID: 9658263
Source: CourtListenerOpinion
Date Created: 2023-08-23 20:53:29.325489+00
Date Added: 2024-06-11T18:13:53.208436
License: Public Domain

SAND, Justice
(dissenting in part).
I agree that the case presents some difficult equitable principles, but I nevertheless do not agree with the allowance of interest as set out in the majority opinion. In this respect I concur generally in the equitable principles stated in the opinion of Justice Pederson.
After reviewing the annotation in 25 A.L. R.2d 951. (1952 and Later Case Service), Annot. 75 A.L.R. 316 (1931), I am satisfied that the rule attributed to the annotations stated above is too broad and does not reflect the case law cited. Case law set out in the above annotation does not stand for the proposition that the vendee in possession is required to pay interest on the purchase price even if the vendor refuses or declines to convey the property. Neither is this concept supported by North Dakota case law. Nasset v. Houska, 48 N.D. 668, 186 N.W. 255 (1921) and Pillsbury v. J.B. Streeter, Jr., Co., 15 N.D. 174, 182, 107 N.W. 40 (1906).
Mere possession is not controlling in determining whether or not the vendor is entitled to interest on the unpaid purchase price. Immediate possession, time of payment, including performance by vendor, triggering payment are all matters that may have influenced the purchase price. In this case the agreement made no reference to interest. Courts have held that the award of interest in some circumstances is in the nature of a penalty for wrongful detention of property. Texas Company v. Crown Petroleum Corporation, 137 Conn. 217, 75 A.2d 499 (1950); Bryant v. Jones, 255 Ky. 606, 75 S.W.2d 34 (1934); and Douglass v. Ransom, 205 Wis. 439, 237 N.W. 260 (1931). See Lund v. Larsen, 222 Minn. 438, 24 N.W.2d 827 (1946).
92 C.J.S. Vendor and Purchaser § 260, p. 128, states:
“Generally, unless there is a statute providing otherwise, when the contract makes no provisions as to interest, none commences to run or is payable before *712the purchase money has become due and the purchaser has made made default.”
Similarly, 77 Am.Jur.2d Vendor and Purchaser, § 310, p. 468 states:
“Unless it is otherwise stipulated in the contract, the unpaid purchase money does not draw interest before the stipulated time for its payment although the purchaser is given possession.”
This has full application to the instant matter. Significantly, footnote 12 of this article makes reference to Annot., 75 A.L.R. 345 and 25 A.L.R.2d 965, referred to earlier herein.
In addition, this case is readily distinguishable from the cases relied upon to allow the vendor to collect interest on the unpaid purchase price. This is not a case where the vendor’s passive failure to perform an act which would have triggered payment of the purchase price, but rather is a situation where the vendor actively sought to dispossess the vendee and to have the agreement nullified. As a result the vendee was put through a costly lawsuit and an appeal, all because the vendor declined to abide by the agreement. In my opinion, the vendor should not be allowed to have it both ways.
He who seeks equity must do equity and must come into court with clean hands. Gajewski v. Bratcher, 221 N.W.2d 614 (N.D.1974). Equity follows the law not only in its letter, but its spirit. Id. In my opinion, the vendor in this instance does not meet those basic requirements.
To give meaningful equity under the circumstances of this ease to the parties the vendor should be entitled to interest, if any, but only from and after entry of judgment on remand in Schwarting v. Schwarting, 310 N.W.2d 738 (N.D.1981). Any interest allowed prior to that date would, in effect, reward the person for refusing to comply with an agreement. The vendor in this case cannot have it both ways. As Justice Pederson points out, under the majority opinion the vendor will be encouraged to use and resort to the courts in an attempt to get out of what the vendor considers a “bad bargain.” In this case the vendee was ready, willing and able to pay the purchase price but the vendor never made the required delivery or an equivalent recording. In addition, the vendor testified that if payment had been tendered it would not be accepted. The actions of the vendor, in effect, prevented the payment.
In my opinion, the judgment on remand in Schwarting, supra, can be considered the equivalent of recording the deed for purposes of providing a marketable title and the vendor would be entitled to interest from that date. Accordingly, the judgment should be reversed and the case remanded with directions that interest be awarded but only from and after the entry of judgment on remand in the first case.