Little v. Kennedy

California Court of Appeal Oct 25, 1927 No. Docket No. 4933.Published

Before: McLucas

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Holding. The court held that a vendee in default under a written contract for the sale of real property cannot recover sums previously paid on the purchase price in the absence of a mutual rescission. The court further determined that the parties' escrow instructions constituted a binding contract with independent, rather than concurrent, obligations.

Issues

Whether the plaintiff was in default under the terms of the escrow instructions.
Whether the obligations of the parties were mutual, concurrent, and dependent.
Whether the evidence supported a finding of mutual rescission of the contract.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The rule is well settled that a vendee in default, in the absence of a mutual rescission, cannot recover sums previously paid on account of the contract.”

“In contracts of this description the undertakings of the respective parties are always considered dependent unless a contrary intention clearly appears.” But here a contrary intention clearly appears.”

McLUCAS, J., pro tem.

laintiff appeals from a judgment rendered in favor of the defendants in an action brought for money had and received.

Plaintiff and defendants entered into a verbal agreement for the sale of real property whereon plaintiff made a payment of $1,000 to the defendants, which payment was to be applied upon the purchase price of $9,250. Thereafter, on April 9, 1923, the parties went into escrow, and plaintiff signed escrow instructions containing the following language :

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“I will hand you $8250.00 in 20 days, and will deliver to you any instruments which this escrow requires shall be executed by me, all of which you are instructed to use, provided within 30 days from date the- necessary instruments are delivered to you to enable you to have a Guarantee Certificate of Title or a Continuation Certificate of Title made by the T. I. & T. Co. covering the following described property: (Here follows a description of the property.) Showing title vested in O. W. Little and Josephine M. Little, his wife, as joint tenants. Free from incumbrance except: 1. All taxes for fiscal year 1923-1924. 2. Conditions, restrictions and reservations of record. (Here follow certain agreements made by the buyer, together with provisions relating to the certificate of title.) In the event that the conditions of this escrow have not been complied with at the expiration of the time provided for herein, you are instructed to complete the same at the earliest possible date thereafter, unless I shall have made written demand upon you for the return of the money or instruments deposited by me.

“(Sgd.) O. W. Little.”

Defendants’ escrow instructions were given at the same time, as a part of the same instrument, and contained the following:

“The conditions as above are hereby approved and I will hand you herewith a deed executed by Blanche McKee and Buth E. Kennedy in favor of O. W. Little and Josephine M. Little, conveying property above described which you -are authorized to deliver provided you hold for my account the sum of $8250, together with above mentioned instruments executed as above set out, within the time as above provided. (Here follow provisions relating to payment of fees and an agreement that the property is to be free and clear of incumbrance.) All- of the demands of the purchaser of the property, as set forth above are hereby agreed to and the provision for extension of time within which escrow may be closed applies equally to me.

Little v. Kennedy

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