DocketNumber: No. 4183
Citation Numbers: 32 Wash. 418
Judges: Fullerton
Filed Date: 8/4/1903
Status: Precedential
Modified Date: 8/12/2021
The opinion of the court was delivered by
On February 12, 1894, Columbus McDonnell and Margaret McDonnell, who were then husband and wife, were the owners of 391.48 acres of land situate in Clarke county, in this state, all of which was suitable for the culture of prunes. The land was incumbered by a mortgage made by the owners to Balfour, Guthrie & Company, nominally for a larger amount, but upon which there was then owing the sum of $14,945, and some accrued interest. Very little of the land was under cultivation ; some 140 acres being in timber and a large portion of the remainder being only partially cleared. It had at that time growing upon it some sixteen acres of prunes, known in the record as the “10-acre 3-year-old orchard,” the “4-acre 3-year-old orchard”, and the “2-acre old orchard”. While the land was in this condition the Stearns Fruit Land Company, a corporation, conceived the idea of purchasing the land, planting it to prunes, dividing it into small lots, and selling the lots at a greatly enhanced price on the installment plan, with small periodical payments, covering a long period of time. To that end it entered into a written agreement with the owners of the
“How this agreement witnesseth: That said parties of the first part [McDonnells], in consideration of the covenants and agreements of the party of the second part herein contained, hereby covenant and agree to and with said party of the second part, as follows:
“That upon the payment by said party of the second part, of the taxes now due against said land upon or before the first day of April, 1894, and of all taxes hereafter accruing during the existence of this agreement and of all interest hereafter accruing or earned or falling due by virtue of said mortgage and of the payment in the times and manner hereinafter specified, of the amount of the principal of said mortgage, and in addition thereto of the sum of $20,000.00 payment of same to be made at the rate of an amount equal to $20.00 per acre on the whole of said land upon or before January 1, 1895, but payments made of taxes due now, and back interest to date are to be first deducted from the amount so to fall due, and the further sum of an amount equal to $10.00 per acre on the whole of said land on or before the first day of January for five years thereafter, said payments falling due upon the first day of January in the years 1896, 1897, 1898, 1899 and 1900; and a final payment of the remainder of said sum upon or before the first day of April, 1900, no interest on deferred payments, that the parties of the first part will thereupon make, execute and deliver to said party of the second part, their successors or assigns, a good and sufficient warranty deed or deeds to the whole of said tract of land as a whole or in such parcels or tracts as the said parties of the second part shall desire.
“It is hereby expressly understood and agreed that said party of the second part agrees to make payments of said
“It is expressly agreed that said parties of the first part will at any time, and from time to time, hereafter make and execute to such person or persons as said party of the second part shall make sale to, of any parcel or parcels of said land lying south of the Mill 'Plain Road, a good and sufficient deed of general warranty, conveying title upon receiving payment either to themselves, or applied in payment of said mortgage against the premises, at the following rates therefor, viz.: not less than $200.00 per acre for the 10-acre 3-year old prune orchard; not less than $200.00 per acre for the 4-acre 3-year-old prune orchard; and not less than $300.00 per acre for the 2-acre old orchard, with house and barn and $125 per acre for the balance of the cleared and cultivated land; upon such sale of any of said parcels of land, possession shall be immediately given to the purchaser, save as to any cleared land then in annual crop, between March 1st and October 1st, in any year as to which possession shall be given as soon as crop is harvested or at furtherest on October 1st following.
“It is further hereby expressly agreed that said party of the second part shall have the right to enter upon any part of said land, at any time, and clear the same; or to plant the same to fruit trees, between the first day of October, and the first day of March, in any season; and thereafter said party of the second party shall retain full
“This contract does not in any wise relate to or affect the growing crop now on said land, or any of the stock or other personal property thereon;
“In Witness "Whereof,” etc.
Between the date of the foregoing agreement and June 21st, following, the Stearns Fruit Land Company surveyed and platted the land into small lots, principally of five acres each, and placed the same on the market for sale under a guaranty contract to the effect that the company would plant the lot to prune trees during the first planting season after the date of the contract of sale, keep the same in a good state of cultivation, and have growing thereon of bearing age not less than a certain number of fruit trees per acre at the date of the maturity of the contract, further guarantying that when final payment should be made by the purchaser the lot should be deeded to him free from liens of every nature, and, by August 24, 1894, had contracted to sell some 309 acres of the land at prices aggregating $92,Y00, $6,660 of which it had received in cash. Feeling the necessity of being prepared to comply with the contracts under which it had promised to convey these lands, the Fruit Land Company reduced its agreement with Balfour, Guthrie & Company to writing, the McDonnells joining therein, under date of June 21, 1894. By this agreement the mortgagees agreed to extend the time of payment of the principal notes secured by their mortgage, and accept part payments thereof from time to time, if made in sums of not less than specified amounts, further agreeing to release from the operation of their mortgage
On August 28, 1894, the Stearns Fruit Land Company sold and assigned to the appellant its interest in the lands, together with its interests in the several outstanding contracts entered into for the sale thereof, as well as its interests in and to the several agreements heretofore referred to, subject however to the conditions of the following agreement entered into between the parties at the time bf the assignment:
“This Agreement made and entered into this twenty-eighth (28th) day of August, 1894, hy and between The Title Guarantee and Trust Company, party of the first part, and the Stearns Fruit Land Company, party of the second part, both of the parties hereto being corporations duly incorporated, organized and existing under the laws of the State of Oregon.
“Witnesseth: That Whereas, said party of the second part has this day assigned, transferred and set over unto the said party of the first part a certain contract m'ade between the said party of the second part and Columbus Me Donnell and wife of the State of Washington, bearing date February 12, 1894, and recorded in Book 21 of the Records of Deeds of Clarke County, Washington, on page 270 thereof, hy virtue of which contract said McDonnell and wife agree to convey to the said party of the second part herein certain lands upon terms therein specified, and
“Whereas, the said party of the second part has likewise this day transferred to the party of the first part a certain contract supplemental to the last mentioned contract and made between the party of the second part hereto and Robert Balfour, Robert Brodie Forman and Alexander Guth
“Whereas, the party of the second part has also this day assigned to the party of the first part certain applications for the purchase of lands made by certain parties with the said party of the second part hereto, which applications have been made by the said parties on the understanding that the lands referred to in the said applications should be selected by the said applicants therefor under the Home Guarantee Contract plan of the party of the second part, from lands described in the aforesaid agreements with Me Donnell and wife and Balfour, Forman and Guthrie, a schedule of which applications showing the names of the persons applying for such contracts, the payments made and to be made thereon, being hereto annexed and marked ‘Schedule A’ and made a part of this agreement, and a form of the. said Home Guarantee Contract being also hereto annexed and marked ‘Schedule B’ and made a part of this contract.
“How This Agreement Witnesseth, that the said party of the first part hereto shall and will hold all of the said contracts so transferred to it and the interest acquired by the party of the second part in the lands described in the aforesaid contracts, upon the following trusts:
“Upon the express understanding and agreement, however, that the party of the first part shall by the acceptance of any or all of the said contracts, incur no liability whatsoever for the payment of the sums of money covenanted by the party of the second part to be paid in the agreements with McDonnell and wife and Balfour, Forman and Guthrie, and no liability to the purchasers of any of the said lands by reason of inability to give title to the same unless the said failure shall result from default of the party of the first part; and it is further agreed between the parties that the party of the first part shall incur no liability by the acceptance of the said contracts aforesaid to the purchasers aforesaid by reason of the failure of the party of the second part to fulfill or perform any or all
“A. To receive all moneys paid in pursuance of such applications and the Home Guarantee Contracts thereby applied for, and which may hereafter in pursuance of said applications be issued to said parties by said Stearns Fruit Land Company upon the completion of the first payment called for by said applications.
“B. To pay out the moneys so collected by it in each year for the following purposes:
“First: In the payment of all moneys falling due as the same shall fall due under the said agreements with Columbus McDonnell and wife, to the said Robert Balfour, Robert Brodie Forman and Alexander Guthrie, and the payment of all taxes upon the property, described in the aforesaid agreements, the payments made to the said Balfour, Forman and Guthrie to be payments in satisfaction in whole or in part of the mortgage by them held, and as payments upon the particular tracts of land which may be designated by the party of the second part hereto, a schedule of the payments falling due to the said McDonnell and to Balfour, Forman and Guthrie, being hereto attached and marked ‘Schedule C.’
“Second: In payment of all expenses falling due and payable for the planting, care and cultivation of the said lands, for fulfilling the covenants contained on the part of the party of the second part hereto to be performed in such Home Guarantee Contracts, and such other expenses as may from time to time become necessary in connection therewith, the party of the second part to be absolute judge of the propriety and necessity of such expenditure. A schedule of the estimated expenses is hereto annexed and marked ‘Schedule D.’
“It is further agreed that for the payments provided for in this second specification the party of the second part may from time to time draw orders upon said party of the first part, payable out of the funds so as aforesaid to be received by them. Provided, however, that the first year of the duration of this trust no moneys shall be withdrawn from the party of the first part for any of the purposes
“Third: Any surplus of moneys so received remaining in the hands of the party of the first part at the expiration of any year shall be carried over into the next year’s account to be used in paying the expenses and making the payments aforesaid for that year, and in securing the release from the aforesaid mortgage and from the remaining payments due to said McDonnell and wife of any part of the said land which may have been selected by any of the said intending purchasers, and which such purchasers may become entitled to under such Home Guarantee Contracts, prior to the expiration of the five years’ time contemplated by said contracts; otherwise, such funds shall remain in the hands of the said party of the first part until the completion of this trust, but subject to be used for any exigencies which, in the judgment of said trustee, may arise in carrying out this trust according to the true intent and meaning thereof.
“Fourth: To receive the title to such land upon final payment upon any part or parcel of the whole thereof in trust, as to portions completely paid for by the purchasers aforesaid, for the said purchasers, and as to the balance in trust for the party of the second part and for such purchasers under such Home Guarantee Contracts plan according to their respective rights.
“Fifth: Hpon the payment in full of all moneys to be paid to said McDonnell and wife and to the said Balfour, Fonnau and Guthrie, the remaining moneys in the hands of the said trustee shall be paid to the party of the second part or its assigns, either as to the whole or to any part or parts of such funds so remaining.
“It is expressly understood and agreed hereby that the party of the second part hereto may at any time substitute other purchasers in the place and stead of any who may at any time forfeit their rights under such applications
“And the party of the second part hereby covenants that it will from time to time procure purchasers to take the place of any so falling out by reason of the non-payment of the sums of money due from them.
“It is further expressly stipulated and agreed that the party of the first part hereto shall, within the first ten days of each month of the duration of this trust, make written report to the party of the second part, its successors or assigns, of all money received and paid out by them in the carrying out of this agreement.
“It is further agreed between the parties that in the event of any of the purchasers aforesaid exercising the option given them hy section 8 of the Home Guarantee Contract set forth in Schedule B aforesaid, that then and in such case the payment made by said purchaser at the time of the exercising of the said option shall be made to the party of the first part and be considered as one of the payments referred to in Schedule A to be disbursed by the party of the first part as set forth in this agreement; and it is further stipulated that the mortgage and promissory note executed at such time by the said purchaser shall run to the party of the first part and be held by the party of the first part pursuant to the terms of this agreement and as one of the assets of the trust, and as the same may be-disposed of, either by sale, or by assignment to said McDonnell in payments of amounts then due or to become due upon such contracts. Ho such sale or assessment shall be made at a discount without the consent of said party of the second part.
“It is further agreed that the party of the first part for
“In Witness Whereof,” etc.
After the execution of this assignment and agreement the appellant assumed full charge of the interests of the Stearns Fruit Land Company, and thereafter continued to represent such interest as if it had succeeded thereto with the full legal title. Later on the McDonnells suffered certain judgments to be entered against them, which became liens against the land and prevented its free transfer as contemplated in the several agreements. Thereafter a deed was made by the McDonnells to the appellant, and the following agreement entered into:
“This Declaration of Trust and Agreement entered into in triplicate on this 21st day of August, 1896, between Columbus McDonnell and The Title Guarantee and Trust Company, a corporation, of Portland, Oregon.
“Witnesseth: Whereas, on the twelfth day of February, 1891, said McDonnell and Margaret McDonnell, his wife, entered into an agreement with the Stearns Fruit Land Company, which said agreement appears of record in Book 21 on page 210 of the Record of Deeds of Clarke County, Washington, and is hereinafter known as said agreement,
“Whereas, the legal title to the lands mentioned in said agreement has since the date thereof remained in said McDonnell’s name, and whereas there have been several liens placed of record in said Clarke County, upon said property, which hamper the free and easy handling of the title to said lands as is required by said recorded agreement; and
“Whereas, it is for the benefit of said McDonnells, and more convenient in carrying out the purposes of said recorded agreement that said The Title Guarantee and Trust Company should be made trustee to act in lieu of said McDonnells, and whereas for this purpose said Columbus McDonnell and Margaret McDonnell, his wife, have this day deeded the lands mentioned in said recorded agreement to said The Title Guarantee and Trust Company, as trustee; and
“Whereas, said Stearns Fruit Land Company did for its benefit and convenience assign its said contract with said McDonnells to said The Title Guarantee and Trust Company on August 28th, 1894, which assignment appears of record in Book 24, page 235 of said records, under which assignment said The Title Guarantee and Trust Company acts as trustee for said Stearns Fruit Land Company in the matter of collections from sub-purchasers of parts of said lands
“Dow, therefore, in consideration of the premises, it is hereby agreed by the parties hereto that said The Title Guarantee and Trust Company shall act as Trustee for said McDonnells in carrying out the purposes of said recorded agreement, and that it will immediately notify by mail all sub-purchasers of parts of said lands of its sole right to collect the installments of purchase price from them.
“And in further consideration of the premises it is hereby agreed by said McDonnells that during the period of three years from date they nor their assigns shall have the
“In further consideration of the execution of said trust deed to The Title Guarantee and Trust Company and this agreement, said company at the execution hereof, makes a cash payment of $500 to said McDonnells on account of the purchase price of said lands. And in the execution of this trust it is hereby agreed that said Trustee shall apply the funds payable to said McDonnells under said recorded agreement, and coming into its hands from said Stearns Truit Land Company or said sub-purchasers of said land, to satify all record claims against said land and all orders of said McDonnells, or either of them, heretofore accepted by the said Title Guarantee and Trust Company, and after deducting for itself a commission of five per cent upon all collections made in the matter of this trust out of said receipts, which commission shall he chargeable to the account of the Stearns Truit Land Company, shall apply the balance of said receipts in payment of the amount due said McDonnells under the original agreement. It is further understood and agreed that the claims of Columbus McDonnell against the Stearns Trait Land Company for overdue payments up to the date hereof; for care and cultivation of the premises to date, for bonus paid for borrowed money; also all the claim of said McDonnell against said Stearns Truit Land Company for damages for being removed from the premises before the time specified in said original contract, and for rent, not only up to date hut up to the end of the term of this contract, towit: three
“Whereas, the said Stearns Fruit Land Company has employed said Columbus McDonnell to take charge of said lands and cultivate and care for them and the trees and the improvements thereon for the sum of twelve hundred dollars per year, which sum is to be paid quarter-yearly and is to be decreased proportionately per year as parts of said land are conveyed to the sub-purchasers thereof, said The Title Guarantee and Trust Company hereby guarantees the payment to said McDonnell by said Steams Fruit Land Company any sums accruing from the date of these presents to him by virtue of said contract of hiring to cultivate and take charge of said land. It is also understood and agreed that the amount of work to be done
“It is further in this matter agreed that at any time upon giving The Title Guarantee and Trust Company thirty days’ notice the said Columbus McDonnell may cease and discontinue the care and cultivation of said premises, whereupon his salary of twelve hundred dollars per annum above mentioned shall also be discontinued. It is further understood and agreed that the crop now growing on the said land shall be and is the property of the McDonnells and they shall have the right to harvest and take the same off of the said land.
“It is agreed by and between the parties hereto, that the payment by the said Title Guarantee and Trust Company to the said McDonnell of the sum of twenty thousand dollars ($20,000.00) payable as follows: The sum of Thirty dollars per acre August 21st, 1896; Ten dollars per acre January 1st, 1897; Ten dollars per acre January 1st, 1898; Ten dollars per acre January 1st, 1899; Ten dollars per acre January 1st, 1900; and the balance due on or before April 1st, 1900.
“The said sum of three thousand dollars to be payable on or before the. .. .day of......189. . . . and the same sum of $600.00 as attorneys’ fees to be payable on or before the. .. .day of......, 189. ., and the other sums of money heretofore set forth, together with interest on all overdue payments at the rate of eight per cent per annum, and the payment of all sums due and to grow due to Balfour, Guthrie and Company as under said original agreement provided, shall be a full and complete payment and settlement of all moneys to be paid to said McDonnell under the said original agreement.”
It was found, however, that the appellant could not make deeds to the contract purchasers, because the receipts under the contracts were not sufficient in amount to pay the costs of planting and caring for the orchards and the price
“This Agreement, made and entered into this 8th day of January, 1897, between Columbus McDonnell and Margaret McDonnell, his wife, the parties of the first part, by their trustee and agent, The Title Guarantee and Trust Company, a corporation, the Stearns Fruit Land Comjoany, a corporation, party of the second part, The Title Guarantee and Trust Company, a corporation, the party of the third part, and Yincent Cook, party of the fourth part.
“Witnesseth: Whereas, the parties of the first part were on the 20th day of March, 1893, the owners in fee of the following described real property, towit: [Describing the lands in question and certain other lands, a part of which are situated in Walla AYalla County, in this state, and the remainder in Multnomah County, Oregon.] And on said day mortgaged by a mortgage hereinafter referred to as ‘said mortgage’ to Robert Balfour, Robert Brodie Forman, and Alexander Guthrie, which mortgage was recorded at page 82 of Book 19 of Records in the office of the Auditor of Clarke County, State of Washington, and at page 266 of Book 41 of Mortgage Records in the office of the Auditor of AYalla Aballa County, State of AVashington, and by a trust deed to AY. J. Bums, which said deed was recorded at page 32 of Book 196 of Records of Deeds in the office of the Recorder of Conveyances of Multnomah County, State of Oregon, all of the herein-above described lands as security for the payment of two
''And whereas, the said parties of the first part did on the 12th day of February, 1894, enter into a written contract with the party of the second part, contracting to sell all of said land in Clarke County to the party of the second part and thereafter on the 28th day of August, 1894, the party of the second part did assign all of its right, title and interest in, to and under said last mentioned contract to the party of the third part, and thereafter on the 21st day of August, 1896, the parties of the first part did by quit claim deed convey all their interest in said land in Clarke County to the party of the the third part, and the legal title to said land in Clarke County is now vested in the party of the third part as trustee for the benefit of the parties of the first and second parts, and whereas the jiarty of the second part has made certain contracts for the sale of portions of said lands in Clarke county, and the party of the third part desires to make deeds conveying title free of encumbrance to such portions and other portions of said lands, but is unable to do so on account- of the mortgage above mentioned.
“And whereas, the party of the fourth part is willing to buy said mortgage notes, mortgage and trust deed from the present holders thereof, and to make partial releases of said portions and other portions of said land in Clarke county from the lien of said mortgage upon the considerations hereinafter stated, and the parties of the first and second and third parts each and all desire said partial releases so made and said mortgage and trust deed and mortgage notes to be assigned to the party of the fourth part as aforesaid.
“IsTow, Therefore, in consideration of the premises and of the considerations hereinafter mentioned, the parties of the first part for themselves, their heirs, executors, administrators and assigns, and the party of the sec
“And the party of the second part in consideration of the premises and the other considerations mentioned herein agrees to make and deliver to the party of the fourth part at the execution of this agreement its promissory note payable to the party of the fourth part forty-two months after date for the sum of fourteen thousand eight hundred and eight and forty-hundredths dollars ($14,808.40), bearing interest at the rate of ten per cent per annum, payable quarterly, said note to be held by the party of the fourth part with said mortgage notes, mortgage and trust deed, and all payments hereafter made on the principal of said mortgage notes to be also credited on said note of the party of the second part as of the first interest paying date after said payment to the said party of the fourth part. The party of the second part also agrees to repay to the party of the third part all moneys expended by it for recording mortgages or assignments of mortgages or other instruments of any kind authorized or made pursuant to this agreement, and on account of the difference of interest between said mortgage notes and the note of the said party of the second part, and also all other expense caused to the party of
“In Testimony Whereof,” etc.
Later on the following supplemental agreement, being the last of the written agreements, was entered into between the same parties:
“The Supplemental Agreement made and entered, into
“Witnesseth: Whereas, heretofore on the 8th day of January, 1897, all of the above named parties entered into an agreement pursuant to which said party of the fourth part purchased from Robert Balfour, Robert Brodie For-man and Alexander Guthrie that certain mortgage and the notes secured thereby, made and executed and delivered by the parties of the first part to said Balfour, For-man and Guthrie on the 20th day of March, 1893, which was recorded at page 82 of Book 19 of Records, in the office of the Auditor of Clarke county, state of Washington, and at page 266 of Book 41 of Mortgage Records in the office of the Auditor of Walla Walla county, in said state; and whereas, said agreement of January 8th, 1897, provided for making partial releases from the lien of said mortgage of portions of the land mortgaged in Clarke county, but did not provide for such releases as to the land in Walla Walla county; and whereas, the parties of the first part have sold all of said land in AValla Walla county and desire to have the same released from the lien of said mortgage; and whereas, on condition of the said parties of the first part making to the party of the fourth part an assignment of the mortgage and notes for nine hundred and fifty dollars received by them on sale of said land in Walla Walla county as security to be held by the party of the fourth part in lieu of said land in Walla Walla county, the parties of the second and third parts are willing to consent to said release of said land without prejudice to any of the conditions of said agreement of January 8, 1897, and the party of the fourth part is now willing to make said release of said land from said first mentioned mortgage.
“Row, Therefore, in consideration of the premises and said release of said land in Walla Walla county by the party of the fourth part, the parties of the first and second
“In Testimony Whereof,” etc.
During the period which intervened between the time of the making of the first contract and the commencement of this action many of the contracts of sale made by The Stearns Fruit Land Company, as well as others made by the appellant as its successor in interest, were forfeited by the purchasers, so that the net result was that appellant actually deeded of the land only 147.975 acres, leaving remaining thereof undisposed of 243.505 acres, something over one hundred acres of which had been planted to prune trees. Of the land deeded, however, all was not paid for in cash. Where such was the fact, a mortgage
This action was begun in February, 1900. In its amended complaint the appellant set out the several contracts before referred to, and contended that the effect of the same was to make it a trustee of both the Stearns Fruit Land Company and the McDonnells, responsible only for a faithful performance of the trust evidenced by the several writings; that it had performed the same so far as it was able; that in doing so it had expended over and above its receipts the sum of $2,200.29; that it was entitled to tlie sum of $3,145.26 for its services; and that'$809.98 was due it as interest. It prayed an accounting, for judgment for the amount found to be due it, that the amount found to be due be declared a lien on the second mortgages in its hands, and the land remaining unsold, and that the lien be foreclosed, the mortgages sold, and the proceeds applied in satisfaction of the amount due, and that the lands be sold for any deficiency which should remain thereafter. For answer the respondents admitted the execution of the several written agreements mentioned, but denied that the appellant was a mere trustee thereunder, and denied, also, that the appellant had correctly stated the account. They alleged affirmatively that the effect of the several agreements was to make the appellant a purchaser of the land mentioned; that the appellant was by reason thereof, and by reason of other matters alleged in the answer, indebted to the respondents in the sum of $36,810.54, with interest aggregating another large sum.
From the judgment entered it will be observed that the trial court adopted the respondents’ view of the several contracts. It held that the contract between the Stearns Fruit Land Company and the respondents was a contact to convey, optional, perhaps, before the company entered upon the performance of it, but absolute after that time, binding it to make the several payments therein specified as the purchase price of the land, notwithstanding the contract seemingly expressly provided otherwise; construing the provision of the contract to the effect that the owners would make deeds to parcels on the payment of a particular price per acre to be a provision to enable the company to make sales in advance of the final payment. But, however plausible the reasoning may be by which this conclusion is reached, it seems to us that it is not the correct interpretation of the contract, when considered by itself, or in the light of the acts of the parlies
"We cannot, however, accept the appellant’s theory that it is a mere trustee, entitled, to compensation from the Mc-Donnells for its services. As between itself and the Mc-Donnells, it was substituted in the place and stead of the Stearns Fruit Land Company, and has such rights and privileges and is subject to the same obligations as that company would have had or would have been subject, had no assignment been made. In other words, so far as the McDonnells are concerned, the Stearns Fruit Land Company and the appellant are one and the same person. It is true there was language used in the contract of August 21, 1896, from which it might be inferred that the parties intended to make the appellant trustee for both of the original parties with a limited liability; but the subsequent acts of the parties, as well as the agreement of January 28, 1891, show the true intent of the parties was to make their relations as we have defined them to be. It remains, then, to inquire what the rights and liabilities of the parties are which grew out of these relations. Taking up the question of the appellant’s liabilities first, it is at once apparent that it became liable for the land sold to third persons under the guaranty contracts. These aggregated, as we have said, 141,895 acres, a part of which bore the minimum price of $125 per acre, and a part $200 per acre, the total being, according to the findings of the trial court, $19,546.88. In addition to this, it was obligated to pay the sum fixed in the contract of August 21, 1896, as liquidated damages, together with the judgment and attorney’s fee herein named; the whole amounting to the sum of $3,100. It also obligated itself by the contract of August 21, 1896, to pay Columbus McDonnell for his services in tending the orchard. There is a dispute in the evidence
Land sold......................$19,5-1-6,.88
Liquidated damages, etc........... 3,700.00
Total......................$23,246.88
As against this it is entitled to credit for the sums paid on account of the purchase price of the land to the mortgage holders and to the McDonnells personally. Also for the amount paid for taxes accrued prior to April 1, 1894, as per the stipulation in the original contract, and the amounts paid as the purchase price of the Slocum and Wintler judgments which gave rise to the trust deed. Those several items are as follows:
Amount paid mortgagees..........$15,194.03
Amount paid McDonnells.......... 2,60 6.9 5
Taxes due prior to 1894........... 483.04
Slocum and Wintler judgments..... 515.75
Total......................$18,800.37
Deducting this sum from the sum which the appellant is obligated to pay leaves a balance owing from the appellant to the McDonnells of $5,446.51. As this sum has been long overdue, it is right that the appellant pay interest upon it for a reasonable time. From the somewhat meager data in tire record on this point it is difficult to find a starting point from which to make the calculation, but we think it no more than just to make the interest equal to the difference between the principal sum found to be owing as above stated and the balance due at the time of the trial on the mortgage to Balfour, Guthrie & Company, now in
It is ordered, therefore, that the judgment appealed from be reversed, and the cause remanded with instructions to enter a judgment to the following effect:
1. That the appellant be required to pay to Vincent Cook the amount remaining due on the Balfour, Guthrie & Company mortgage, cause the same to be satisfied of record, and turn back to the respondents the note and mort
2. That the appellant cause satisfaction to be entered of record o'f the Slocum and Wintler judgments, and cause Robert Hall to make such a conveyance of his purported title to the respondents as will clear the record of any interest he may seem to have in the land sold under those judgments.
3. That the appellant convey to the respondents all of the land conveyed to it in 1896, not heretofore conveyed by it to the contract purchasers.
4. That on compliance with the foregoing conditions the appellant be awarded all of the mortgages now in its hands or in the hands of Vincent Cook as its own property, save the mortgage on the Walla Walla land above mentioned.
5. That the appellant be given sixty days after the remittitur from this court reaches the lower court to comply with the foregoing requirements, and, if at the end of that period it fails or refuses to comply therewith, that judgment be entered against it for the value of the land deeded to it and remaining unsold by it at the rates named in the contract between the Steams Fruit Land Company and the McDonnells, for the amount remaining due on the mortgage in the hands of Vincent Cook, for the amount of the face value of the note and mortgage on the Walla Walla land, and that the same be declared a lien upon all of the unsold lands, and the mortgages remaining in the hands of Vincent Cook pledged to secure the Balfour, Guthrie & Company note and mortgage, first and superior to any claim thereon of the appellant. The appellant will recover its costs on this appeal.
Mount, Hadley, Anders and Dunbar, JJ., concur.