Hoffmann v. Danielson

Action begun October 10, 1946, by Fred H. Hoffmann to rescind a contract for the purchase of a house from Mrs. Mae Danielson and to recover the down payment of $4,000. He also asked for damages of $600. From judgment dismissing the complaint with costs, plaintiff appeals.

In July, 1946, defendant Mrs. Mae Danielson had a house under construction in the city of Appleton. Mr. Joseph A. Kohl was the contractor supervising the work with the understanding that he was to perform the labor and that both he and the defendant would try to get materials. Sometime shortly before July 23, 1946, the plaintiff, Fred H. Hoffmann, who with his wife was then living at the home of his mother in Neenah, where two other relatives were also living, began negotiating with the defendant for the purchase of the house in question. The price of $16,500 for building and lot was agreed upon. Hoffmann visited the premises and inquired whether the house would be ready for occupancy by October 1, 1946. Mrs. Danielson, in Hoffmann's presence, made inquiry of Kohl about the matter and was told and reported to Hoffmann that the contractor expected the house would be ready by then. Hoffmann prepared in his own handwriting two copies of the contract which is set forth below. He brought the contract to Mrs. Danielson, and both signed them after she had talked to her lawyer over the telephone. Each party kept a copy of the agreement.

"Appleton, Wis.                          July 23, 1946.

"I, Mrs. May Danielson of Appleton Wis. hereby agree to for Fred H. Hoffmann and Verna Hoffmann a new home on the corner of 1528 Schneider place according to plans and specifications furnished by Joseph A. Kohl contractor and builder of Appleton Wis., and I further agree to furnish clear title and abstract for this property for the total sum of (16,500) sixteen thousand five hundred dollars to be paid by Fred H. Hoffmann as follows: $4,000 down at the signing of this agreement, $10,000 more when possession of property is given to Fred H. Verna Hoffmann, which shall be not later than Oct. 1st, 1946, sooner if possible, and the balance of $2,500 on total completion of home and grading of lot. More time will be allowed by Fred H. Hoffmann in case of strikes, etc. This home is now under construction.

"Signed this 23rd day of July 1946
[Signed] "Mrs. MAY DANIELSON.
"I hereby agree to the above terms of this agreement
[Signed] "FRED H. HOFFMANN."

Plaintiff made the agreed down payment of $4,000 on July 23d.

Thereafter plaintiff made frequent visits to the premises. He requested some changes from the original plans. Accordingly, bookcases were removed from the living room, the driveway was widened, and the construction of the breezeway was changed.

Shortages of materials and difficulty in getting skilled workmen caused delay. Mrs. Danielson tried to hurry the completion by urging the contractor to speed up construction, offering him double time to work on Sundays. She tried to get certain needed supplies herself.

A few days before October 1, 1946, it was apparent the house would not be complete by that date, and Hoffmann asked the return of his down payment of $4,000. This was refused, and the present action was begun. Plaintiff, meanwhile, arranged to rent a home from October 1st, and paid $600 in advance for six months' rent.

It is admitted that the house was not completed on October 1, 1946. It appears from the testimony that on that date not all of the hardwood floors had been laid, the steps were not finished, the plumbing and lighting fixtures were not connected, and the connecting pipes for the furnace were not in place. Defendant had spent $11,563 by October 1, 1946, and by the time of trial had spent an additional $1,444.16. It was expected that further expenditures of $350 would complete the building.

The court made its findings of fact and conclusions of law, including the following:

"FINDINGS OF FACT. "6. That the parties to said agreement did not intend that the said home and garage would be entirely completed by October 1, 1946. . . .

"9. That because of a serious nation-wide shortage of building materials, especially cement and rock lath, necessary and required for the completion of the house and garage, the defendant was delayed and was not able to complete the building of the home and garage by October 1, 1946, although she did everything in her power to do so, even to the extent of offering to pay time and a half for overtime and double time for Sunday work to be performed by skilled workmen.

"10. That the inability of the defendant to secure some of the materials for the completion of said home and garage on October 1st, 1946, was also the result of strikes, especially the steel strike and the coal strike, which occurred in the spring and early summer of 1946.

"CONCLUSIONS OF LAW. "1. That by the terms of the agreement, and by the conduct of the parties thereto, and by all of the surrounding facts and circumstances, time was not of the essence of the agreement of July 23, 1946. . . .

"3. That said home was in such a state of completion on October 1, 1946, that the defendant was able, ready and willing to deliver possession thereof to the plaintiff so as to comply with the terms of the agreement of July 23, 1946." The result sought by appellant is rescission of the contract of July 23, 1946, set forth in the statement of facts. Before a party not in default may be entitled to the relief of rescission, there must be so serious a breach of the contract by the other party as to destroy the essential objects of the contract. 17 C.J.S, Contracts, p. 906, sec. 422; 12 Am. Jur., Contracts, p. 1020, sec. 440. The breach alleged here is the respondent's failure to have the house ready for occupancy on October 1, 1946. Whether such a breach would justify rescission would depend on whether time were of the essence of the contract. Language expressing a hope, shared by all parties and based on the assumption of the contractor that the house would be complete by October 1st, is sought to be interpreted to fix a definite time and to positively require the full and complete finishing of the interior, at least, on that date. There is too much in the contract, drawn by appellant, indicating an uncertainty as to the time of completion, to permit the interpretation sought. The circumstances attending at the time the contract was drawn, disclosing general inability to secure men and materials, strongly militate against such an interpretation. The findings of the trial court on the material and controlling points requiring dismissal of the complaint are sustained. The trial court concluded that time was not of the essence, and that conclusion appears to be fully warranted by the facts.

The complaint did not include Verna Hoffmann as a plaintiff, nor did the respondent attempt to interplead her as a party. But because of the result reached below, which is affirmed here, it is unnecessary to treat questions which might arise affecting Mrs. Hoffmann's interests.

Time is not of the essence of a contract unless it is clear that the parties intended to make it so. 4 Page, Contracts (2d ed.) p. 3661, sec. 2106; Restatement, Contracts, p. 406, sec. 276; Anno. 12 L.R.A. 241. The fact that a date for performance is set by the terms of a contract does not make time of the essence. In Buntrock v. Hoffman, 178 Wis. 5, 13,189 N.W. 572, a case involving sale of real estate where the contract provided specifically for completion of the transaction within fifteen days, the court said: "Time will not be regarded as of the essence of the contract merely because a definite time for performance is stated therein, without any further provision as to the effect of nonperformance at the time stated." See also Boardman v. Courteen, 167 Wis. 625, 628,167 N.W. 814; Droppers v. Hand, 208 Wis. 681, 686, 242 N.W. 483;Miswald-Wilde Co. v. Armory Realty Co. 210 Wis. 53, 55,243 N.W. 492, 244 N.W. 589, 246 N.W. 305.

In construing the contract involved here in the light of these principles, it is to be remembered that the contract was drawn by appellant and is subject to the rule requiring the construction to be most strongly. against him. 6 R.C.L., Contracts, p. 854, sec. 242. The sentence in the contract which reads: "More time will be allowed by Fred H. Hoffmann in case of strikes, etc.," and the reservation of a considerable amount for payment only upon completion substantiate the view that the parties, in making the contract, did not regard the date, October 1st, to be so vital a provision that they would not have entered into the contract without it. That appellant wanted to occupy the house by October 1st was clear from the beginning, but he was aware of the difficulties to be encountered, and was willing to allow more time under certain circumstances. Nothing is said in the contract about what the parties intended the consequences to be if the house were not ready by October 1st. These things support the conclusion that time was not of the essence of this contract, and that conclusion is further justified by the conduct of the appellant. He visited the premises frequently and was in a position to know of the reasons for delay. Yet, although he was admittedly eager to have the house finished by October 1st, there is no evidence that he indicated any intention until just before October 1st of not being bound by the contract if the house were not ready to be occupied by that time. Indeed, his giving instructions for certain changes using time and material indicate that time was not the vital consideration.

The language of the contract which provided that more time would be allowed "in case of strikes, etc.," is broad enough to cover the very things that were responsible for the delays in construction of this house. The complaint alleges that the respondent represented to the appellant at the time the contract was made that she had in her possession all of the necessary materials to complete the house. This does not appear to be the case, although the evidence does show that at that time she had obtained many supplies for which there was a shortage. Considering all the testimony, there is ample justification for the trial court's conclusion that the delay in construction of this house was due to the difficulty in getting skilled workmen and the general shortage of materials, which was at least affected by, if not caused by, strikes which occurred earlier in the year. It is not unreasonable to hold that these circumstances fell within the scope of "strikes, etc.," for which the contract expressly provided an extension of time. This is especially true in view of the fact that respondent was doing everything in her power to complete the house.

We agree with the trial court that the respondent did not breach the contract of July 23, 1946, that rescission must be denied and appellant's complaint dismissed.

By the Court. — Judgment affirmed.