Walker v. MACKEY , 197 Or. 197 ( 1952 )

TOOZE, J.

This is a suit for specific performance of án oral contract for the sale and purchase of land, brought by Bobert Walker, as plaintiff, against Ena Fay Mackey, and E. John Mackey, her husband, and Oregon State Highway Commission, as defendants. The suit was dismissed as to the Oregon State Highway Commission. A decree was entered in favor of plaintiff against defendant Ena Fay Mackey, and the court awarded plaintiff judgment against said defendant in the sum of $2,547, with costs. Defendant Ena Fay Mackey appeals.

At the time of the negotiations between plaintiff and defendant Ena Fay Mackey as hereafter mentioned, said defendant was the owner and in possession of the southeast quarter of the northeast quarter of section 20, township 2 south of range 9 west, of the Willamette meridian, in Tillamook county, Oregon, and also of a parcel of land in the southwest quarter of the northwest quarter of section 21, in said township and range.

During the spring of 1946, defendant Ena Fay Mackey and plaintiff entered into an oral agreement for the sale and purchase of two acres of land located in the southeast corner of the tract of land owned by defendant in section 20, township 2 sonth of range 9 west of the Willamette meridian. It was agreed between the parties that each of the two acres was to be square in shape, one acre lying west of and adjoining the other. The price agreed upon was $1,000.

The parties also agreed that the description of the land so sold was to commence at an established government survey corner, which is marked by a stone, at the southeast corner, this being the common one-quarter corner for sections 20 and 21, in said township and range. Defendant pointed out this corner to plaintiff and directed that he commence his measurements from there. By the use of a table of measurements, plaintiff and defendant roughly figured the dimensions of the land necessary to comprise the two acres.

Immediately thereafter, plaintiff procured Mr. Mackey’s tapeline, and with the assistance of the small son of defendant proceeded to make the measurements. Starting at the corner stone, he measured 208.9 feet directly north, setting a stake at the end of each 50-foot measurement; then he measured west for a total distance of 400 “and some odd feet”, also setting a stake at each 50-foot measurement; he then measured south and then east hack to the place of beginning. He set a stake at each corner, except perhaps the starting point. Plaintiff does not claim that his measurements were exactly accurate, but states that defendant Ena Pay Mackey had agreed to have the tract surveyed.

In the summer of 1946, plaintiff took possession of the two-acre tract, built a barn thereon, and erected a fence for a corral in which to keep his horses. In 1947, at the request of defendant E. John Mackey, plaintiff permitted said defendant to cut some hay from the land. Also, in 1947, plaintiff constructed a fence around the greater portion of the two acres. Defendant Ena Pay Mackey purchased some of the posts used for this fence.

In 1948, plaintiff purchased materials, hired a carpenter, and commenced the construction of a dwelling house on the premises. About that time defendant Ena Pay Mackey was negotiating with a representative of the Oregon State Highway Commission for the sale of a part of the land for highway purposes. The land was necessary to the relocation of state highway No. 101. On August 14, 1948, defendants Ena Pay Mackey and E. John Mackey conveyed to the Highway Commission a tract of land for highway purposes. A portion of the land described and so conveyed included a part of the two-acre tract occupied by plaintiff.

It was about this time that defendant E. John Mackey told the carpenter employed by plaintiff, who was then working on the new house, that he “didn’t want Bob to go ahead and spend a lot of money, do a lot of work, you know, on that place and we didn’t have it settled.” This was the first objection either defendant ever made to plaintiff’s possession and use of the premises. It was not until November 22, 1948, and long after the sale to the Highway Commission, that the first formal objection was made. That was in a letter written to plaintiff by the attorney for defendant Ena Pay Mackey, which reads as follows:

“Robert Walker

Tillamook, Oregon

“Dear Sir:

“Mrs. Ena Macky [sic] has recently consulted me in reference to your building program upon her property.

“Mrs. Macky [sic] tells me that there was some oral talk about you buying two acres of land from her, but nothing has ever been put in writing. She further tells me that the buildings which you have recently constructed are not upon the property that she understood you desired to purchase; that she told you at least twice not to go ahead with your building program until the property which you desired was agreed upon. I believe you have paid several payments to Mrs. Macky [sic], but according to her understanding your house recently constructed is not upon any property that Mrs. Macky [sic] had any intention of conveying to you.

“Under all the circumstances, there being no binding contract at all, Mrs. Macky [sic] is tendering to you all money which she has received and you are authorized to remove any and all buildings which you have placed upon her property within thirty (30) days from this date.

“After thirty days from this date you .are notified not to trespass upon Mrs. Macky’s [sic] property in any manner without you have her written consent.”

It was defendants’ contention on the trial that the two acres plaintiff was to purchase consisted of one acre of upland and one acre of lowland or swamp, and they disputed plaintiff’s contention that each acre was to be in the form of a square. However, the weight of the evidence supports plaintiff’s contention with respect to that matter. The dwelling house was constructed upon the land plaintiff contracted to purchase.

It was conclusively established on the trial that the State Highway Commission was an innocent purchaser for value of all the land it purchased, including that part taken off the two-acre tract sold to plaintiff. For that reason, the suit was dismissed as to the Highway Commission.

The evidence discloses that in addition to making the improvements in question, plaintiff actually paid defendant Ena Fay Mackey a total sum of $425 on the purchase price. As typical of the receipts issued by said defendant when plaintiff made payments, we quote the following:

“Money Receipt No. 1. “Jan 20, 1947

“Received from Robert E. Walker $275.00 and /100 DOLLARS for Payment on land.

“Amount Due

Paid $275.00

Balance $725.00

“Received by [Sgd.] Mrs. E. J. Mackey.”

The last payment in the sum of $50, evidenced by a similar receipt, was made August 21,1947, or one week following the conveyance to the Highway Commission.

The trial court found that plaintiff was entitled to have the oral contract specifically performed, but because of the fact that a part of the land had been deeded to the State Highway Commission, complete performance could not be had.

Thereupon, the court indicated that it would retain jurisdiction in equity and award plaintiff judgment for the reasonable value of the improvements placed on the land upon the faith of the oral agreement and for a return of the $425 paid on the purchase price. Defendant Ena Fay Mackey filed written objections to the court proceeding further in equity as indicated and demanded that the cause be remanded to the law side óf the court where jury trial might be had. The objections were overruled, and the court entered the following decree (omitting formal parts):

“This matter came on for hearing on August 1, 1951, plaintiff appearing in person and by H. T. Botts, his attorney, defendants Mackey appearing in person and by George P. Winslow, their attorney and, the Oregon State Highway Commission and the Commissioners thereof appearing by Fred A. Miller and John R. McColloch, Assistant Counsel for the State Highway Commission and the Commissioners, and the parties announcing themselves as ready for trial, opening statements were made by counsel and testimony was offered by plaintiff and defendants Mackey, and the hearing was continued until August 2, 1951, whereupon the parties rested, and arguments for counsel were heard and the matter was taken up under advisement by the Court.

“And the court now being advised in the premises finds that the plaintiff has clearly established by a preponderance of the evidence that the defendant, Ena Fay Mackey, orally contracted to sell to Robert Walker, in 1946 or 1947, two acres of land situated along the south boundary line of said defendant’s property approximately bounded by the fence constructed by the plaintiff, Robert Walker, for the sum of $1,000.00, payable monthly at the rate of $50.00 per month; that the contract became enforceable by reason of the plaintiff making valuable improvements to the premises in constructing a house, barn and fencing, and paying $425.00 on the purchase price; that the defendant, E. John Mackey, husband of the defendant, Ena Fay Mackey, by his actions acquiesced and thereby became a party to the contract; that said contract cannot be specifically enforced by reason of the fact that the State Highway Commission, as a bona fide purchaser for value, acquired a right of way across a portion of the land covered by said contract and that plaintiff is therefore entitled to a decree compensating him to the extent of the improvements which he placed on the premises, which enhanced the value of the land, which value the court fixes at $2,122.00, plus the sum of $425.00 paid by plaintiff on said purchase price.

“And the court having heretofore signed an order dismissing this cause as to the defendants the Oregon State Highway Commission and its commissioners ;

“And that the objection of the defendant, Ena Fay Mackey, throughout the trial of this cause, and never waived, that this court has no jurisdiction, sitting in equity, to award plaintiff solely a money judgment and that this cause should be transferred to the law side of this court so that said defendant could have a jury trial, be and the same is hereby overruled;

“THEREFORE, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that plaintiff have and recover from the defendant, Ena Fay Mackey, $2,547.00, together with his costs and disbursements of this cause, taxed and allowed at $58.16, and the Clerk of the Court shall pay over to plaintiff to apply thereon the $425.00 tendered into court by said defendant for plaintiff.”

There is an abundance of testimony in the record to establish the reasonable value of the improvements placed on the land by plaintiff as fixed by the court in its decree, and, of course, there was no dispute between the parties as to the total payment by plaintiff of $425.00 on the purchase price.

Upon this appeal defendant again urges the lack )f authority on the part of the trial court to retain jurisdiction in equity and award a money judgment as it did.

We are today handing down an opinion in the case of Powell et al. v. Sheets et al., in which we discuss many of the principles of law involved in the instant litigation. We shall not repeat that discussion. In that case we held that the trial court lacked jurisdiction in equity to award a judgment for money against defendants. But the basis of our decision in that case was the entire lack of evidence to establish the cause of suit alleged in the complaint, and upon which equitable jurisdiction was predicated. We held that it is necessary not only to allege a cause of suit in equity, but also to establish it by proof on the trial, before an equity court is permitted to award relief otherwise cognizable only at law.

In the instant ease the situation is entirely different. Here plaintiff not only alleged a cause of suit in equity, but on the trial clearly established the same by proof. The evidence disclosed beyond all dispute that an oral agreement for the sale and purchase of two acres of land had been entered into; that, acting upon said oral agreement, plaintiff actually took possession of the land and erected improvements thereon; that plaintiff paid a total of $425 upon the purchase price. Everything plaintiff did in the premises arose out of and was directly referable to the oral contract. His right to specific performance of the contract was fixed and complete long before defendants Mackey sold a part of the same land to the Oregon State Highway Commission. By his conduct, as shown by the evidence, defendant E. John Mackey acquiesced in the oral agreement and was estopped to take a position inconsistent with his acts. Hayward v. Morrison et ux., 194 Or 335, 241 P2d 888; Young v. Neill et al., 190 Or 161, 166, 220 P2d 89, 225 P2d 66; Marshall v. Wilson, 175 Or 506, 154 P2d 547; Dunis v. Director et al., 121 Or 500, 507, 255 P 474; Cantwell v. Barker, 62 Or 12, 15, 124 P 264; Barrett v. Schleich, 37 Or 613, 617, 62 P 792; Walter v. Hoffman, 267 NY 365, 196 NE 291, 101 ALR 919, and note commencing at page 926; 37 CJS, Statute of Frauds, 753, § 247; Pomeroy, Specific Performance 3d ed, 283, § 247.

In Stalker v. Stalker, 78 Or 291, 298, 153 P 52, we said:

“The possession of real property, when taken pursuant to an oral contract for the sale thereof, is generally held to be such an act of part performance as to take the case out of the statute of frauds, even without any additional circumstance, such as the payment of the consideration, or the making of improvements [citing cases].”

It did not appear until the trial of the case that the defendant State Highway Commission was in truth an innocent purchaser for value, and was, therefore, entitled to a dismissal of the suit as to it. Nor until the trial did plaintiff discover the interest of the Highway Commission in the land. This development rendered it impossible to decree specific performance of the entire contract, because defendants Mackey had put it beyond their power to fully perform. There could have been a partial performance decreed, with an abatement in the purchase price, had plaintiff been willing to accept such partial performance. Bartholomew v. Bason, 188 Or 550, 214 P2d 352; Van Horn Construction Corp. v. Joy, 186 Or 473, 207 P2d 157; 49 Am Jur, Specific Performance, 83, § 67. But plaintiff could not be compelled to accept partial perf ormance.

Under the facts and circumstances of this case, partial performance would have raised other questions. State highway No. 101, as relocated, is a designated non-access highway, and had partial performance been decreed, plaintiff would have had no access thereto, nor any other means of ingress to and egress from his land except by the establishment of an easement of necessity across the remaining lands of defendant Ena Pay Mackey., In the light of the facts in this ease, it is clear that partial performance would have been impracticable and unjust. In such circumstances the trial court was justified in retaining jurisdiction in equity and awarding plaintiff compensation in money, although the recovery of money is ordinarily obtainable only at law.

In 49 Am Jur, Specific Performance, 198, § 174, the following rule is stated:

“Equity may, when its jurisdiction is invoked to obtain the specific performance of a contract, not only award damages in lieu of a decree of specific performance when the plaintiff has made out an equitable case for intervention but performance has become impossible or impracticable, but may, when decreeing specific performance, award damages or pecuniary compensation to the plaintiff along with specific performance when the decree as awarded does not give complete and full relief. This is a further outgrowth of the right long exercised by equity courts of adjudicating all matters properly presented by and actually involved in the case at hand, when jurisdiction is once assumed on equitable grounds.”

See also 49 Am Jur, Specific Performance, 199, § 175; 30 CJS, Equity, 429, § 73.

The rule applicable to this case is well stated in Oregon Growers’ Co-op. Assn. v. Riddle, 116 Or 562, 569, 241 P 1011. That was a suit for specific performance of a written contract for the sale of certain fruits. It appeared on the trial that specific performance might be rendered impossible by the sale of the fruits to others than the contract purchaser. The trial court decreed that if delivery was not made to the purchaser as provided in the contract, then he should recover from the seller liquidated damages in the amount named in the contract. At page 569 of 116th Or, this court said:

“When a court of equity has acquired jurisdiction over some portion of a controversy, it will proceed to decide the whole issue and award complete relief, though the rights of the parties are strictly legal and the final remedy is of a kind that may be granted by a court at law: Shultz v. Shively, 72 Or. 450 (143 Pac. 1115); Templeton v. Bockler, 73 Or. 494 (144 Pac. 405); O. W. R. & N. Co. v. Reed, 87 Or 398 (169 Pac. 342, 170 Pac. 300); Phez Co. v. Salem Fruit Union, 103 Or. 514, 545 (201 Pac. 222, 205 Pac. 970, 25 A.L.R. 1090). There are circumstances under which a court of equity will grant compensation in money, ordinarily obtainable at law. One of these cases is where the plaintiff established his equity, but equitable relief is found impracticable : 21 C.J. 143, § 123. The general rule as to the test of jurisdiction of a court of equity is stated thus in 21 C.J., Page 145, Section 124(c):

George P. Winslow, of Tillamook, for the petition.

“ ‘Where Equity Fails After Suit Brought. The test of the jurisdiction of a court of equity is whether facts exist at the time of the commencement of the action sufficient to confer jurisdiction on the court. If plaintiff is then entitled to the aid of equity the jurisdiction will not he defeated by subsequent events which render equitable relief unnecessary or improper. This rule is applicable, not only where the relief sought is prevented by act of the defendant, but also where the change of circumstances arises from lapse of time, rendering the specific relief unsuitable or inequitable. * *’

“Equitable rights must be both averred and proved before purely legal rights will be determined by a court of equity.” (First italics ours.)

The trial court did not err in retaining equitable jurisdiction and awarding judgment against defendant Ena Fay Mackey.

The decree is affirmed. Plaintiff is entitled to costs.