Court Opinion

ID: 9680527
Source: CourtListenerOpinion
Date Created: 2023-08-24 07:32:56.54805+00
Date Added: 2024-06-11T18:17:29.029962
License: Public Domain

BLACKMAR, Judge,
dissenting.
I agree with the statement in the principal opinion that the assignee of the interest of a seller in a real estate contract does not, by entering into the assignment or by receiving subsequent payment of installments, necessarily become obligated to the buyer for the performance of the seller’s obligations under the initial contract. This conclusion is supported by the Missouri authorities, Senn v. Manchester Bank of St. Louis, 583 S.W.2d 119 (Mo. banc 1979), and, as the citations in the principal opinion demonstrate, appears to represent the weight of authority among other jurisdictions. The Restatement of Contracts intimates a trend toward a finding of assumption of liability by an assignee of contracts, but seems to treat real estate contracts in a different manner and to support the Missouri rule as to the latter. See Restatement (Second) of Contracts, Sec. 328, Illustration 4.
The assignee of the seller’s interest, however, may expressly assume the seller’s obligations to the buyer as a part of the assignment transaction. Senn, supra. To the extent that the principal opinion holds that any such undertaking requires separate consideration moving from the buyer, I disagree. If the assignee covenants to assume the seller’s obligations to the buyer, the buyer is a third-party beneficiary of the assignment contract. A third party beneficiary may enforce the benefits conferred upon him or her without a showing of additional consideration. Slate v. Boone County Abstract Co., 432 S.W.2d 305 (Mo.1968). Restatement (Second) of Contracts, Sec. *138304. The consideration which supports the assignment contract, therefore, is sufficient to support the assignee’s obligation to the beneficiary.
State ex rel. Hoyt v. Shain, 338 Mo. 1208, 93 S.W.2d 992 (1936), does not indicate a different conclusion. There the buyer’s interest in a contract to purchase real estate was assigned, and the assignee did not assume the buyer’s obligations to the seller as a part of the assignment transaction. After the closing, the assignee indicated to the seller that he was willing to enter into an express assumption, if requested. This Court held, quite appropriately, that there was no consideration for the assignee’s subsequent assumption. The assignment transaction was a closed one, and the as-signee was without power to add to it. The later promise to another party required independent consideration, which was not shown.
The defendant sellers were duly notified of the setting of the present case for trial, and did not appear, choosing instead to rest their interests with their attorney. The trial judge’s decision to proceed is not here challenged. In this court-tried case, we are obliged to defer to the trial judge’s findings of fact, if supported by evidence. Murphy v. Carron, 536 S.W.2d 30 (Mo.1976). The evidence shows that in the defendants’ first communication to the plaintiff buyers, giving notice of the assignment, the defendants undertook to provide information as to how the buyers would obtain their warranty deed after completing payment of the purchase price. The trial judge might well have believed that the defendants’ giving of this information indicated that they had assumed the seller-assignor’s obligations under the contract. The contract of assignment, as the principal opinion points out, is not in evidence, but the defendants are certainly in the best position to furnish information about the terms of assignment. The conclusion is fortified by the showing that this assignment was part of a series of assignments of contracts for the sale of lots. Senn, supra. The trial judge was justified in deciding the case on the basis of the record before him, and his conclusion as to liability is supported by the evidence.
It might be objected that there is no evidence in the record that the defendants ever obtained title to the property in issue, and that, without title, they were in no position to execute and deliver an effective deed. The record shows that they did execute and tender a quitclaim deed (which was manifestly not sufficient under the contract), but the quitclaim deed might simply operate as a waiver of defendants’ claims to the lot, after the final payment was received, and not as any indication of title or power to convey. The transcript of the trial shows, however, that defendants’ counsel suggested that his clients could provide a warranty deed, and it would not be inappropriate for the trial court to take this suggestion into consideration, in the absence of further information which the defendants were equipped to give and did not.
In spite of my conclusion that there was a basis for finding liability, I am not willing to affirm the judgment as it stands. The trial court entered judgment for the full amount of the payments of principal and interest which the plaintiff had made to the seller and to the defendants as assignees. The plaintiffs, following the signing of the contract, were entitled to possession. This is shown clearly by the contract provisions requiring redelivery of possession of the land and any improvements to the seller in the event of the buyer’s default. The court at the very least should have determined whether possession of the land for the period between the execution of the contract and the date of trial had any value, and, any value so found should have been subtracted from the judgment. There is, furthermore, no showing of the actual damages from nondelivery of the deed. The plaintiffs may simply have made a bad bargain. The court on retrial might conclude that the plaintiffs are entitled to no relief other than the tender of a proper warranty deed from the titleholder.
Because, in my view, the case should be remanded for further proceedings, I believe that the trial court should be directed to *139allow the defendants’ third-party petition, in which they ask that the seller, Arrowhead Resorts, Inc., be brought into the case so that the defendants’ rights over against Arrowhead may be adjudicated. There is great advantage in having all parties necessary to a complete resolution of the controversy before the court. There was no abuse of discretion on the part of the trial court in failing to sustain the application for leave to file a third-party petition, inasmuch as it was not presented until the day of trial, but, if the case is remanded, there would be ample time to order additional parties in, allow the parties to amend their pleadings, and hear evidence on all aspects of the case.
I therefore dissent from the outright reversal. I would reverse and remand the case for further proceedings consistent with the views just expressed.