Washington Manufacturing Co. v. Wickersham

Under the doctrine that he who would have equity must do equity, one seeking the specific performance of a contract for the sale of land, but admitting that he owes part of the purchase-price, must pay or tender before institution of the suit at least the amount admitted to be due; and the petition as amended, failing to show that the amount admitted to be due was paid or tendered before institution of the suit, was subject to demurrer on that ground.

(a) The petition as amended was not subject to demurrer on the ground that no facts were alleged which would authorize a decree for an abatement in the purchase-price of the property.

(b) The description was too indefinite to authorize a decree for specific performance, and the petition was subject to demurrer on the ground that no facts were alleged which would authorize the grant of such relief.

(c) In the absence of a key to the description of the land in the instrument, the allegations of the petition as amended, to the effect that during negotiations leading up to the written contract a representative of the defendant pointed out the exact boundaries to the property intended to be conveyed, were subject to demurrer on the ground that such prior negotiations became merged in the written contract.

(d) The allegations to the effect that, after execution of the written contract, such representative requested the plaintiff to delay settlement until the defendant could procure title to some portions of the property as to which it developed the defendant had no title, and suggested that the plaintiff accept other land in lieu thereof, were subject to demurrer on the ground that the conversations and transactions were negotiations in an effort to compromise a dispute between the parties.

No. 15608. OCTOBER 9, 1947. REHEARING DENIED NOVEMBER 16, 1946. Washington Manufacturing Company excepts to rulings on demurrer. Brewster Wickersham filed, in Wilkes Superior Court against the company, a petition for specific performance based on a written contract wherein the defendant, a Georgia corporation, agreed to convey "all land, buildings, and machinery located on property on west side of Georgia Railroad tracks in City of Washington, Georgia."

The petition consisted of two counts. The first count as amended alleged substantially the following: The defendant operated in Washington, Wilkes County, Georgia, a planing mill, woodworking plant, dry-kiln, and dealt in coal, sand, brick, lumber, and builders supplies. The business was conducted on land known as the Washington Manufacturing Company located on the west or northwest side of the tracks of the Georgia Railroad, which formed the entire boundary on the side of the property next to the railroad tracks. The plaintiff, having announced his intention of entering a similar line of business, was approached soon thereafter by R. R. Johnson, representing the defendant, in regard to purchasing the entire property with the exception of the defendant's stock of merchandise and its office equipment. The plaintiff was not familiar with the property lines but, during a period of approximately ten days before the contract dated October 19, 1945, was signed, he had several discussions with Johnson in regard to purchasing the property, and was informed by him that the real property embraced all the lands on the west side of the railroad tracks, commencing at the old shop of Read Gresham, and lying between the railroad tracks and a public alley. The plaintiff was further informed that the real property was under fence, with the exception of a parcel of land roughly rectangular in shape lying outside the fence. On the day of the contract was signed, the parties had reached an agreement as to the consideration, based on the description of the property given to the plaintiff, and W. L. Johnson, president of the defendant corporation, was informed by R. R. Johnson in the presence of the plaintiff of the terms of the contract and description of the property. The contract was thereupon typed by W. L. Johnson personally. The location and description of the real property having been thus given to the plaintiff, he inspected the same and found that the defendant was using as a location for its machinery, buildings, and lumber yard 1.80 acres, consisting of all the property described as being inclosed and the rectangular strip of land lying outside the fence, which latter strip was not then being used, but was clearly described to the plaintiff and identified by him. After the real property had been thus described by the representative of the defendant corporation and identified by all the parties, the above-mentioned written contract was entered into between the parties, whereby the plaintiff purchased all the land, buildings, and machinery, for $35,000. At the time the contract was executed the plaintiff paid to the defendant $10,000 as the first installment on the purchase-price, and agreed to pay the remainder as set out in the contract, the defendant obligating itself to execute good titles to the property upon payment of the second installment of $15,000, which was to be made January 1, 1946. A note for the remainder was to be given by the petitioner bearing interest at 5 percent. By accident or mutual mistake of the parties, the agreed purchase-price was stated in the contract as being $25,000 instead of $35,000, and the contract failed to recite the payment of $10,000, made when it was signed. The plaintiff was to have been given possession on January 1, 1946, but the defendant was still operating its plant on that date, and did not commence to vacate the premises until January 4, at which time the plaintiff started to move equipment and supplies on the property. On or about January 5, he learned that a part of the property occupied by the defendant was owned by named railroad companies. He immediately contacted R. R. Johnson, who produced from the files of the defendant corporation a lease agreement dated in 1929, together with a plat, showing that .13 acres of the real estate included within the inclosure was not owned by the defendant, but was leased property, and that .21 acres of the real estate lying outside the fence was not owned by the defendant or held under lease. On January 6, R. R. Johnson requested the plaintiff to delay further settlement of the matter until the defendant could procure title to the real estate owned by the railroads, and suggested that the plaintiff accept a parcel of land lying on the east side of the railroad tracks in lieu of the property to which the defendant could not make title. One or two days prior to March 1, 1946, counsel for the plaintiff was notified by counsel for the defendant that the latter had been unable to obtain title to the real estate owned by the railroads. The plaintiff has been ready, able, and willing to close the contract by making the payment of $15,000 cash, and by giving a note for the remaining $10,000, at all times since January 1, 1946. It is impossible for him to determine the value of the land of which the defendant is unable to convey title, unless the value of the same is ascertained by a jury; but, as evidence of his willingness to carry out all the terms of the contract, he has paid into the registry of the court, as a continuing tender, $10,000, which is in addition to the cash payment of $10,000 already made to the defendant, and he is ready, able, and willing to pay any other sum which he may be required to pay, and to execute and tender a note to cover any deferred payment found to be due. The defendant has failed and refused to execute good titles to the property purchased, although it has been repeatedly requested to do so.

The prayers were: (a) that the contract be reformed so as to speak the truth and to show the consideration of such contract as $35,000, and the cash payment, made at the time the contract was signed, as $10,000; (b) that the defendant be required to specifically perform its contract as made. Copies of the written contract and the plat were attached to the petition.

The second count as amended alleged all that was set forth in the first count, and in addition thereto substantially the following: When the contract was signed, the plaintiff began to make plans to expand his business, and to arrange for accepting contracts for various forms of building and constructing, and began to accumulate and arrange for the purchase of lumber, machinery, trucks, and other supplies, and to hire personnel to operate the plant. The parcel of land described as held by the defendant under lease, and the rectangular strip of land lying outside the inclosure, have a combined railroad frontage of 455.2 feet, which is all the usable frontage for unloading coal, lumber, and heavy materials, with the exception of approximately 55 feet lying between the "leased property" and cement shed on the 1.46-acre tract. The latter tract, to which the defendant holds title, is largely occupied by cement and planer shed, dry-kiln, and other improvements and machinery, and these could not be relocated without heavy expense. The plaintiff has commenced business on the 1.46 acres owned by the defendant; and since he could not move from the premises and rearrange his business without heavy loss, he has been forced to elect to retain the 1.46 acres. He is entitled to an abatement of the purchase-price, because the 1.46 acres are not the entire lot of land sold to him, and the defendant is unable to execute good title to the .21 and .13 acres, which two tracts are reasonably worth the sum of $15,000, or other large sum to be determined by the jury. Count two contained the same prayers that were set forth in count 1, and also the following: (a) that, if it should appear that the defendant is not able to make or cause to be made good titles to all the property sold, the court assess damages against the defendant for the property to which it can not execute good titles, and that such sums be allowed to the plaintiff as an abatement of the purchase-price; (b) that, in the event stated above, the court require the defendant to execute good titles to the real property, machinery, and improvements which it does own, upon the payment into court of $10,000 or such sums as the court may direct, after awarding damages to the petitioner; (c) that the $10,000 paid into court be declared to be a full settlement of all amounts due on the contract; (d) that the plaintiff offers and tenders into court such sum or sums as he may be due to the defendant, and as the court may direct, together with a note for any sum which the court may decree to be due as a deferred payment.

The defendant filed to the original petition a demurrer on general and special grounds. An amendment to the petition was allowed subject to demurrer. The defendant filed a second demurrer, renewing its original grounds and adding other grounds. The court overruled all of the grounds of demurrer, and the defendant excepted. In a suit by a purchaser for specific performance of a contract for the sale of land, it should be made to appear that before institution of the action the plaintiff had paid or tendered the purchase-money according to the contract, or that tender had been waived by the defendant. Robert v. Mayer, 191 Ga. 588 (1) (13 S.E.2d 382).

"He who would have equity must do equity, and give effect to all equitable rights of the other party respecting the subject-matter of the suit." Code, § 37-104. "One seeking relief from excessive tax levies, but admitting, either expressly or by necessary implication, that he owes part of the tax covered by such executions, must pay or offer to pay the amount of the taxes admitted to be due, in order to obtain the relief sought."Clisby v. Macon, 191 Ga. 749 (2) (13 S.E.2d 772), and cases cited.

By analogy, the plaintiff, before the present suit for specific performance was instituted, should at least have paid or tendered the amount of the purchase-price admitted to be due, and the language contained in count two of the original petition, "that as evidence of his good faith and readiness and ability to carry out his part of said contract, and to stop the running of interest on any balance that might be due, your petitioner pays into the treasury of the court as a continuing tender the sum of $10,000 in cash, which he believes is the full amount of the balance due on said contract," did not amount to an allegation that the $10,000 admitted to be due had been paid or tendered before institution of the suit for specific performance. Count one of the original petition did not make any reference to a tender, and the failure to allege a tender of any amount before filing the suit was not aided by the language contained in amendments to both counts, to the effect that the plaintiff as evidence of his ability, readiness, and willingness to carry out all the terms of the contract, has paid into the treasury of the court as a continuing tender the sum of $10,000, which is in addition to the cash payment of $10,000 already made to the defendant, and is able, ready, and willing to pay and tender into court for the defendant any other sum or sums he may be required to deposit, and to execute and tender a note in form and amount required by the court to cover any deferred payment or payments found to be due. The petition as amended fails to show that the $10,000 admitted to be due was paid or tendered before the suit was filed, and therefore was subject to demurrer on that ground.

As pointed out in Miller v. Minhinnette, 185 Ga. 490,494 (195 S.E. 425), it is only when there is a deficiency in the quantity of land sold that it becomes material under the Code, § 29-201, to inquire whether or not it was a sale by the tract. In the present case there is no complaint that there is any shortage in quantity. Instead the petition asserts that the defendant is unable to convey title to two tracts of land included within the plaintiff's purchase, on account of the title thereto being in another. In such a case the applicable principle is that contained in the Code, § 29-202, to wit: "If the purchaser loses part of the land from defect of title, he may claim either a rescission of the entire contract, or a reduction of the price according to the relative value of the land so lost." Under the foregoing ruling, the petition was not subject to demurrer on the ground that no facts were alleged which would authorize a decree for an abatement in the purchase-price of the property.

"Specific performance of a contract (if within the power of the party) will be decreed, generally, whenever the damages recoverable at law would not be an adequate compensation for the non-performance." § 37-801.

This is not a suit for specific performance of a parol contract for the sale of land, and therefore the provisions of the Code, § 37-802, as to specific performance in the event of partial payment of the purchase-price accompanied with possession, are not applicable.

The description of the realty, contained in the written contract, that the defendant agrees to convey "all land, buildings, and machinery located on property on west side of Georgia Railroad tracks in City of Washington, Georgia," standing alone, was too indefinite to authorize a decree for specific performance. Martin v. Oakhurst Development Corp., 197 Ga. 288 (1) (29 S.E.2d 179), and citations.

The only allegations in the petition as amended in reference to accident and mistake were as follows: By accident or mutual mistake of the parties the agreed a purchase-price of the property was erroneously stated as $25,000 instead of $35,000, and the contract failed to recite the payment of $10,000, made when it was signed. The only prayer on the question of reformation was: That the contract be reformed so as to speak the truth and to show the consideration of such contract as $35,000, and the cash payment, made at the time said contract was signed, as $10,000. Construing the allegations of the petition most strongly against the pleader, as must be done on demurrer, the allegations and prayers, insofar as the indefinite description of the property was concerned, were insufficient to form the basis for a reformation of the written contract. The petition did not purport to identify any land that was agreed upon after execution of the written contract. Consequently the case comes within the principle stated in Clayton v. Newberry, 138 Ga. 735 (76 S.E. 63), that "Specific performance of a contract for the sale of land will not be decreed unless the land which is the subject-matter of the alleged sale is clearly identified in the contract." See, in this connection, Wardlaw v. Wardlaw,182 Ga. 209, 211 (184 S.E. 873), where, as here, the language dealt with differed from cases in which the descriptive words furnished a key by which the description could be applied by extrinsic evidence. Since the present suit is based on the written contract, containing a description that was too indefinite to authorize a decree for specific performance, the petition as a whole was subject to demurrer on the ground that no facts were alleged which would authorize the grant of specific performance.

In the absence of a key to the description of the land in the written contract, and of any appropriate allegations or prayers seeking to reform the contract so as to make the description sufficient, parol evidence would not be admissible for the purpose of adding to the description contained in the written contract. Therefore the allegations of the petition as amended, to the effect that during negotiations leading up to the written contract a representative of the defendant corporation pointed out the property intended to be conveyed, were subject to demurrer on the ground that such prior negotiations became merged in the written contract.

The allegations of the petition as amended, to the effect that after execution of the written contract a representative of the defendant corporation requested the plaintiff to delay further settlement until the defendant could procure title to the real estate owned by the railroad companies, and suggested that the plaintiff accept a parcel of land lying on the east side of the railroad tracks in lieu of the property to which the defendant could not make title, were subject to demurrer on the ground that the conversations and transactions were negotiations in an effort to compromise a dispute between the parties, and would be inadmissible to affect the rights of the parties. In Georgia Ry. Electric Co. v. Wallace, 122 Ga. 547, 550 (50 S.E. 478), this court said: "It costs time, trouble, and money to defend even an unfounded claim. Parties have a right to purchase their peace. The fact that they have entered into negotiations to secure that end, and admissions or propositions made with the view to a compromise, are not admissible in evidence for or against either litigant, in the event there is a failure to adjust and a suit follows." The above ruling was followed inDuncan v. Bailey, 162 Ga. 457 (134 S.E. 87), where the admission in evidence of negotiations, to the effect that the defendant admitted there was a mistake about the land he had shown the plaintiff and that he was willing to adjust it on some terms but that a third person would not sell at any price, was held to be erroneous.

Judgment affirmed in part, and reversed in part. All theJustices concur.