Opinion
14547
October 13, 1937.
Before HOLMAN, J., County Court, Richland, March, 1937. Affirmed.
Suit by the Board of Missions for Freedmen of the Presbyterian Church of the United States of America against J.B. Dreher and another. From an order overruling the demurrer to the complaint, the named defendant appeals.
The order of Judge Holman follows:
This matter came on before me for a hearing on the demurrer of the defendant, J.B. Dreher, to the complaint. After hearing the argument of counsel for both plaintiff and defendant, and after reading the briefs submitted by both sides, it appears that the defendant demurred to the complaint on the grounds that the complaint does not state facts sufficient to constitute a cause of action, in that: (1) It appears from the face of the complaint that plaintiff seeks to recover a debt by an action in equity; (2) that it appears upon the face of the complaint that plaintiff has retained no lien on the property cognizable by an equity Court; (3) that plaintiff has an adequate remedy at law; and that a Court of equity is without jurisdiction as it appears from the face of the complaint that the action is for the recovery of a debt only. Or, in other words, the defendant claims that the vendor of real estate has no right in a Court of equity to seek performance of a contract for the sale of real estate where his redress amounts, substantially, to the payment of the purchase price under the contract.
Plaintiff sets out in its complaint: (1) An oral contract between plaintiff and defendant whereby defendant agreed to purchase certain land as described in the complaint; (2) that defendant promised to pay a certain sum therefor, and has paid a portion of the price; (3) that defendant entered into possession of the land with consent of plaintiff; (4) that defendant has failed to pay the balance of the purchase price; (5) that plaintiff stands ready and willing to convey the land to defendant upon payment of the balance due on the purchase price; (6) asks for performance of the contract, and, upon failure of defendant to perform, that possession of the land be delivered to plaintiff.
As I view the complaint, bearing in mind the authorities hereinafter cited, it sets forth a cause of action for specific performance of the contract described therein. As stated in Prudential Ins. Co. v. Berry, 153 S.C. 496, 151 S.E., 63, the vendor has the right to ask for specific performance of the contract, even though the substantial part of his relief is the recovery of money. The remedy is a mutual one, open to both vendor and vendee; the latter can seek performance by the delivery of a deed from the vendor to him; the only possible satisfaction for the former is that the contract shall be performed by the vendee, as regards his only duty, to wit, the payment of the purchase price. That is the only thing the vendor can demand. If he cannot demand the purchase money under the contract, then the remedy of specific performance is not a mutual remedy. The complaint, therefore, setting out a cause of action, it is not subject to demurrer.
Board of Directors v. Lowrance, 111 S.C. 295, 297, 97 S.E., 830; "A complaint is not subject to demurrer if it contains allegations entitling plaintiff to relief either on the law or the equity side of the Court." Huffman v. Owings, 108 S.C. 420, 95 S.E., 78: The effect of the defendant's contention, if tenable, would be that if the contract has not been performed, and it has not in this instance according to the pleadings, as the purchase price has not been paid. Singleton v. Cuttino, 107 S.C. 465, 92 S.E., 1046: "Before conveyance, and while there is a contract of sale merely, the vendor has the legal estate in the land, and the vendee has the equitable interest; the former being a trustee of the beneficial interest in the land for the latter, the latter being the trustee of the purchase money for the former." Blackwell v. Ryan, 21 S.C. 112; Gregorie v. Bulow, Rich, Eq. Cas. (9 S.C. Eq.), 235. Sweatman v. Edmunds, 28 S.C. 58, 5 S.E., 165: "One who purchases land, is let into possession, and pays the purchase money, * * * for all practical purposes must be regarded as the owner." Watts v. Witt, 39 S.C. 356, 17 S.E., 822, 827: "The rule, as we understand it, is that, where one goes into possession of real estate under a parol contract to buy the same, he cannot claim to hold adversely to his vendor until the purchase money is fully paid."
That is, defendant contends that if the contract has not been performed, the vendor cannot seek performance of the contract by the vendee, as it involves substantially the payment of the purchase price, and therefore the only redress of vendor is the recovery of judgment in an action at law for the balance due under the contract. This is not my understanding of the law of our State. The defendant further contends that if the vendor has indulged the vendee in the contract for a sufficiently long time so that the vendor cannot enforce payment of the purchase price under the contract by an action at law, that the vendor can neither enforce the contract in equity.
I do not think this position is logical or tenable; it is my understanding of the law of this State that the Courts of equity are for the purpose of protecting parties in just such a position as this. That if the vendor has indulged the vendee in the contract for a time so long that the vendor cannot enforce a collection for a breach of the contract at law, he can compel the performance of the contract in equity. But the vendor's indulgence of the vendee in the contract, the vendor is not estopped to seek performance of the contract; Courts of equity will entertain the specific performance of the contract by the vendor where the indulgences of the vendor have inured to the benefits of the vendee.
Defendant has submitted me no South Carolina authorities to sustain his position, and I have also been unable to find any. Following the authorities set out below, I find the position of the defendant untenable, and therefore overrule the demurrer.
Gregorie v. Bulow, Rich. Eq. Cas., 235: "The jurisdiction of the Court of Equity over the specific performance of contracts for the sale of lands, is as ancient as the Court itself. That the party could have a remedy at law in damages, is no answer to the claim of jurisdiction. * * * It would not then be pretended, that because the party might have proceeded at law, Equity would not give him relief. In cases of specific performance, properly so understood, the Court of Law has no jurisdiction. For it [Court of Law] has not the power to give relief to both parties, by decreeing titles to one, and the purchase money to the other."
Singleton v. Cuttino, supra: "The plaintiff has the right to bring an action at law to recover damages for breach of the contract; he also had the right to invoke the aid of the Court [of Equity] in the exercise of its chancery powers. He, however, could not resort to both remedies. He elected to pursue the equitable remedy, and thereafter the jurisdiction of equity was exclusive. In a case of specific performance of contract the power of the Court to exercise its equitable jurisdiction is not dependent upon the adequacy of the remedy at law."
Welling v. Crosland et al., 129 S.C. 127, 123 S.E., 776, 782: "The more modern authorities prefer a simpler, more intelligible, and more workable rule, particularly in reference to executory contracts for the sale of land, which eliminates the second inquiry referred to, and declares that the party complaining of a breach of such a contract has as high a legal right to invoke the aid of a Court of equity to declare specific performance as a Court of law to award damages."
To deny the right to the decree and remit the plaintiff to an action at law for damages is to accord the choice of proceedings to him who is in default, an option which fairly belongs to the other. Palmer v. Richardson, 3 Strob. Eq., 16; Peay v. Seigler, 48 S.C. 496, 26 S.E., 885, 59 Am. St. Rep., 731; McMillan v. McMillan, 77 S.C. 511, 58 S.E., 431; Sweatman v. Edmunds, 28 S.C. 58, 5 S.E., 165; Watts v. Witt, 39 S.C. 356, 17 S.E., 822; Hammond v. Foreman, 48 S.C. 175, 26 S.E., 212; Farm Land Co. v. Roseman, 93 S.C. 350, 76 S.E., 979; Prudential Ins. Co. v. Berry, supra.
It appears to me that in cases of the failure to perform contracts, the parties have, in general cases, an election of remedies, either to sue for damages for the breach of the contract, or to sue for the specific performance of the contract; the aggrieved party having the election. Welling v. Crosland, supra. Here the aggrieved party, plaintiff, has elected to sue for specific performance of the contract, and it is not the province of the defendant to force it into an action for damages for the failure of defendant to perform the contract as alleged where it elects to do otherwise.
In view of defendant counsel's statement that if my ruling on the demurrer went against him the matter would be appealed, I reserve a ruling on defendant's motion to strike out the reply of plaintiff to the answer and counterclaim until after the disposition of the appeal; and it is so ordered.
Messrs. Jennings Jennings, for appellant, J.B. Dreher.
Mr. Thomas B. Whaley, for respondent, cites: Specific performance: 76 S.C. 167; 56 S.E., 780. Statute of limitations does not run against an action for specific performance: 40 S.C. 41; 18 S.E., 237; 151 S.C. 114; 148 S.E., 704.
October 13, 1937.
In 1929, as we gather from the amended complaint, the plaintiff and the defendant Dreher entered into an oral contract, whereby the former agreed to sell to the latter, and the latter agreed to purchase from the former, a tract of land containing about 26 acres for the sum of $1,052.00, payable as follows: $240.00 in cash, and one-tenth of the balance, with interest at 6 per cent. per annum, each year until the entire amount should be paid. With the consent of the plaintiff, upon the payment of the $240.00, the defendant Dreher went upon the lands and has been in possession ever since. He made no further payment, however, on the purchase price as agreed upon, although demand was duly made upon him by the seller to do so.
This action was commenced in February, 1937, and was brought by the plaintiff to compel specific performance by Dreher of the said oral agreement. A demurrer to the complaint was overruled, and this appeal followed.
We are satisfied that the conclusion reached by the County Judge is correct, and we approve the result of his decree. In addition to the authorities cited, see Peak v. Young, 40 S.C. 41, 18 S.E., 237; Fanning v. Bogacki, 111 S.C. 376, 98 S.E., 137; Parrott v. Dickson, 151 S.C. 114, 148 S.E., 704.
The order appealed from, which will be reported, is affirmed.
MR. JUSTICE CARTER did not participate on account of illness.