Mills v. Skaggs

SPENCE, J.

Plaintiffs sought specific performance of an agreement for the purchase of real property, which agreement was evidenced by a “Deposit Receipt.” Defendants filed an answer and cross-complaint seeking cancellation or reformation of said agreement. The trial court found that defendants had executed said deposit receipt but further found “that said deposit receipt is so indefinite and uncertain in its terms as to be impossible of specific performance. . . .” Judgment was entered denying specific performance and from said judgment, plaintiffs appeal.

The deposit receipt was drawn by a real estate broker and the evidence offered by defendants showed that it was signed by the defendants, as sellers, without reading the same and in reliance upon the real estate broker’s representation that it contained the terms upon which defendants had agreed to sell. The terms to which defendants had agreed called for a purchase price of $4,750, as provided in the deposit receipt, but also called for a down payment of at least $600 and a monthly payment of at least $30 upon a second deed of trust to be executed in their favor. The deposit agreement, however, called for a down payment of only $200 and for a total monthly payment of $40 to cover payments on both the first and second deeds of trust without any specification of the portion of the $40 to be applied upon either.

The pertinent portion of the deposit receipt read as follows: ‘1 The total purchase price is Four Thousand Seven Hundred Fifty ($4,750.00) Dollars and the balance of same is to be paid within 10 days from date hereof, as follows: $200.00 cash and 1st deed of trust to American Trust Co. for $2,750.00 and 2nd deed of trust, to James E. Skaggs & wife for

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$1,800.00. Interest on notes to be 6% per annum; total monthly payments ine. interest to be $40.00.”

It appears that there was an existing first deed of trust on the property, the balance upon which first deed of trust was approximately $400 less than the amount provided in the deposit receipt for the first deed of trust with the American Trust Company; and it further appears probable that the real estate broker believed that a deal might be consummated by raising the amount of the first deed of trust by $400 and adding that amount to the $200 in cash to make up a cash payment of $600. But the deposit receipt was silent as to whether the new first deed of trust was to be executed by plaintiffs or defendants; as to what, was to be done with the money obtained by increasing the amount thereof; and as to the terms of said first deed of trust and particularly as to the portion of plaintiffs’ total monthly payment of $40 to be applied upon said first deed of trust. The deposit receipt, as above indicated, was likewise silent as to the portion of plaintiffs’ total monthly payment of $40 to be applied upon defendants’ second deed of trust. It is of course obvious that the raising of the amount of the first deed of trust would have had the effect of diminishing the security afforded by the second deed of trust and that the terms of the transaction, as set forth in the deposit receipt, were not the same as the terms to which defendants had previously agreed. We will make no further reference to this difference, however, as the trial court made no findings or conclusions with respect to the allegations of the cross-complaint relating thereto. The failure of the trial court to make such findings or conclusions is not an issue on this appeal which is one taken by plaintiff alone from the judgment denying specific performance.