Appeal by defendant from the Circuit Court of Sangamon county;
the Hon. DeWITT S. CROW, Judge, presiding. Heard in this court at
the February term, 1950. Reversed. Opinion filed March 3, 1950.
Rehearing denied April 17, 1950. Released for publication April
MR. PRESIDING JUSTICE WHEAT DELIVERED THE OPINION OF THE COURT.
Rehearing denied April 17, 1950
This is an appeal from a judgment of the circuit court of Sangamon county in an action at law brought by plaintiff appellee against defendant appellant wherein plaintiff recovered judgment on directed verdict in the amount of $4,061.47, plus interest, being the amount of his down payment under a contract for purchase of real estate located in Iroquois county, Illinois.
The contract upon which the action is based was executed by the parties hereto on February 22, 1946, the material parts of which are as follows:
"If the second party shall first make the payments and perform the covenants hereinafter mentioned on his part to be made and performed, the said first party hereby covenants and agrees to convey and assign to the second party in fee simple by good and sufficient Warranty Deed" the real estate in question, "and the said party of the second part hereby covenants and agrees to pay to the said party of the first part the sum of $27,076.50 in the following manner: $4,061.47 on this date and the balance on or before 90 days from this date . . . and in case of failure of said party of the second part to make either of the payments . . . this contract shall at the option of the party of the first part be forfeited and determined and the party of the second part shall forfeit all improvements and payments made by him on this contract. . . .
"The first party agrees to furnish an abstract showing title to said real estate in accordance with this contract and allow second party reasonable time to have same examined and thereafter first party shall within a reasonable time correct defects, if any, and shall make such abstract show a merchantable title. . . . It is mutually agreed by and between the parties hereto that time of payment shall be the essence of this contract. . . ."
Plaintiff apparently took possession of the premises about March 1, 1946, which possession does not appear to have been disturbed at any time thereafter. On or about May 15, 1946, plaintiff received an abstract of title as to the real estate in question certified to May 8, 1946. About May 18, plaintiff's attorney advised him by written opinion that there were certain defects in the title and that it was not merchantable. On July 2, 1946, plaintiff notified defendant of his intention to rescind the contract, and started this suit some months later.
For the purpose of this opinion it is immaterial whether or not the title was merchantable. The pertinent and controlling question relates to the necessity of tender of the purchase price by the plaintiff as a prerequisite of suit, thus putting defendant in a position of default, inasmuch as the time of performance (ninety days from February 22, 1946) had elapsed when plaintiff attempted to rescind on July 2, 1946. Defendant so contends and sets this up as a defense in his amended answer.
There was no proof of tender of the balance of the purchase price by plaintiff, and he has not contended either by his pleadings or in his argument on appeal that he at any time performed or offered to perform his remaining obligations under the contract, or that he at any time demanded performance of defendant. He relies, however, on the decision in Cobb v. Willrett, 313 Ill. 92, and Hayne v. Fenton, 321 Ill. 442, to support his position that tender was unnecessary. In relying on these cases plaintiff does not address himself directly to the point in issue. He argues that under the contract "the defendant was obligated to furnish an abstract showing merchantable title and tender his good and sufficient Warranty Deed on or before May 23, 1946" and that "there was no obligation upon plaintiff to pay the balance of the purchase money until there was tendered him such an abstract and deed." These are subtle half-truths which invite false conclusions. It is true that had defendant done these things he would have performed fully his part of the contract, and it may be assumed that plaintiff was not bound to actually pay the balance of the purchase price until there was such tender of deed and abstract. It does not follow, however, that because defendant did not do these things, he was in default, or that plaintiff is entitled to recover, or that there was no obligation on his part to tender the balance in order to become entitled to recover.
In each of the aforementioned cases cited by plaintiff, the problem before the court was a determination of the circumstances under which a vendor is entitled to specific performance of a contract for the sale of land, and it was held that the vendor must first show that he is ready, able and willing to perform on his part, and that the furnishing of merchantable title in accordance with his contract is a prerequisite to the purchaser's obligation to pay the purchase price. There is no discussion, however, in these cases of the circumstances under which a purchaser may recover payments made under a contract, a distinct and separate problem. There is further no suggestion in either decision, nor does it follow on principle, that because the vendor is not entitled to specific performance, the purchaser is automatically entitled to recover payments made.
The following language in Eames v. Germania Turn Verein, 8 Ill. App. 663, is pertinent:
"It is idle to talk about it being unsafe for this purchaser to proceed with the performance of the contract; for, when they were ready and offered to perform, if the sellers had not then such a title as they agreed to give, the purchaser need not part with his money. It is the object in making such acts of payment and conveyance mutual, dependent, and to be simultaneously performed, that the purchaser need not part with his money, unless he can get the title bargained for; and that the vendor need not part with his title, until he receives the consideration."
Cobb v. Willrett, supra, specifically sustains defendant's contention that "in contracts like the one before us the undertakings of the vendor and vendee are generally construed to be dependent unless a contrary intention clearly appears." The contract in such case contained the identical language as in the instant case: "if the purchaser shall first make the payments and perform the covenants" as thereinafter agreed, the vendor "agrees to convey and assign" the property in question.
A number of the Illinois cases concerning the circumstances under which a purchaser of real estate may rescind and recover payments made are discussed in Glenn v. Price, 337 Ill. App. 637. The rule there reasserted is that the purchaser must ordinarily put the vendor in default by tender of performance on his part before he can maintain his action to recover payments made (see also Bedinger v. May, 323 Ill. 187). This follows as a corollary of the above-stated rule ...