Community Industrial Land Co. v. Walker

BARNARD, P. J.

This is a quiet title action involving two parcels of land. By a written agreement dated November 25, 1940, the defendant agreed to purchase from the plaintiff about two acres, referred to as Parcel 1, for $1,000, payable $50 down, $50 on February 1, 1941, and varying monthly payments thereafter, the final payment being due February 1, 1942. No interest was provided for in the contract. Under the agreement the defendant also leased from the plaintiff an adjoining tract of land, known as Parcel 2, for one dollar a year plus taxes, with an option to purchase the same at any time prior to September 6, 1942, for $500 an acre payable in cash. It is conceded that before this agreement was entered into the parties had talked over the fact that in years past the land had been flooded at times and that the secretary of the plaintiff corporation had informed the defendant that a new dam had been installed in the Santa Ana River. While the plaintiff disputes this the defendant testified that he was also told that this dam would prevent any future flooding of the land.

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The defendant moved a building upon Parcel 1, as provided for in the agreement, and began operating a factory therein. There is evidence that this and other improvements were of the value of several thousand dollars. He paid the down payment of $50, and the $50 payment due February 1, 1941, was paid and accepted on February 27, 1941. At that time he also paid one dollar as the rental for Parcel 2 for the first year. Shortly thereafter the land became flooded, there being a foot or two of water on the floor of the building.

The defendant notified the officers of the plaintiff corporation about the flooded condition, asked them what they were going to do about it, and later sought a modification of the agreement. He made no further payments and did not pay the taxes as they became due. It is admitted that the officers of the plaintiff expressed a willingness to adjust the matter and entered into negotiations with the defendant which extended over a considerable period. The defendant was away for some months and nothing very definite seems to have been done until the spring of 1942, more than a year after the negotiations started.

In April, 1942, the defendant appeared at a meeting of the directors of the plaintiff corporation and the parties arrived at a tentative agreement to the effect that the defendant would be permitted to purchase a somewhat different parcel of approximately one acre, which embraced the land on which the building stood, for $750, payable in twenty-four equal instalments. The secretary of the corporation was instructed to have its attorney draw up such an agreement. This was done about two weeks later but the agreement was never delivered to or shown to the defendant. Theré is a conflict in the evidence as to whether failure of the defendant to sign the new agreement was due to his own fault or to neglect on the part of the plaintiff. The secretary of the plaintiff corporation testified that on several occasions he asked the defendant to sign it or told him where it could be found, that the last of these conversations was late in July or early in August, 1942, and that the defendant then said he would sign the contract soon.