Barnard & Son, Inc. v. Akins

BISTLINE, Justice,

specially concurring.

I.

Notwithstanding that there are the necessary votes overruling Blinzler v. Andrews, 94 Idaho 215, 485 P.2d 957 (1971), and it is accordingly overruled, the dissenting opinion would utilize it to affirm the judgment rendered below.

The Blinzler case, Blinzer I in 94 Idaho, was a highly questionable decision at the outset. Justice Shepard, joined by Justice McQuade, dissented:

I dissent. The district court found that the Andrews had not performed covenants in the contract requiring title insurance to be provided within a reasonable time and that the Blinzlers were entitled to rescission. Thus, the only matter for decision here is the importance and materiality of the Andrews’ breach of the covenant to furnish title insurance.
The contracts were signed by the parties in November and December, 1959. Some four years later the purchasers had still not received the title insurance policies and refused to make the annual payment which was then due. The purchasers had made down payments amounting to $16,000.00. Their annual payments were $6,250.00, together with interest at the rate of five per cent per annum on the deferred payments. Obviously, the purchasers had a very substantial financial interest and investment in the contract for the purchase of the real property. In my judgment, they were absolutely entitled to a guarantee, as would be provided by title insurance policies, that upon the payment of the large sums of money involved herein they would indeed obtain what they had paid for, i.e., a free and clear title to the real property.
To state, as does the majority opinion, that the purchasers had the duty of continuing to make the large financial yearly investment without any assurance of performance by the sellers, simply disregards what any person of common sense would have done when faced with such a situation. The fact that the purchasers were given possession of the farms and the right to farm them, and that easements were procured by the sellers and that an estate was probated, simply has no bearing on the principal question. The failure to furnish the title insurance policies, in my judgment, was a material breach of one of the most significant covenants contained in the contract.
After making the $16,000.00 down payment, the purchasers in 1960, requested the title insurance. The annual payments of $6,250.00, together with the interest on the unpaid balance, were made in December, 1960 and December, 1961. In December, 1962, the purchasers delivered the annual payment to the *472escrow agent and directed that the agent should not transfer that money to the sellers until the title insurance policies were delivered. The purpose of the purchasers was defeated since the escrow agent nevertheless released the annual payment to the sellers. The following year the purchasers adopted another technique by refusing to make the December, 1963 annual payment until they had been furnished with the title insurance. Promptly thereafter, the sellers gave notice of default to the purchasers and of the sellers’ intent to cancel the contract and retain all sums paid by the purchasers pursuant to the forfeiture clause of the contract.
In my judgment, the purchasers had acted more than reasonably in tolerating the continuing breach of the contract by the sellers’ failure to furnish title insurance. It appears to me that they had attempted to obtain the performance of the sellers’ duty to furnish title insurance and had failed. It is understandable that they had no desire to jeopardize their very substantial financial investment in the real property, and finally, as any reasonably minded person would, came to the conclusion that they had best stop such investment at some point in time until they received what they were entitled to under the contract, i.e., a guarantee that they would receive good title to the real property in return for their investment. Rather than receiving that guarantee, they received notice that the sellers intended to oust them from the property and retain all of the monies that the purchasers had previously paid. At that point, they gave notice of rescission and, in my judgment, were entitled so to do. The district court so held and the action of the district court should be affirmed.
Blinzler I, supra, at 219-20, 485 P.2d at 961-62.

Notwithstanding the cogent views of Justice Shepard, the majority opinion reversed the district court on the shameless pretext that the buyers had waived any and all right to rescind when they did not so declare when they first were not furnished with a policy of title insurance. The majority misstated that the Blinzlers refused to make the 1963 payment. A review of that file, retrieved from the clerk’s office shows, however, as Justice Shepard pointed out, that the payment was being withheld until a title policy was forthcoming. The basis of the majority’s opinion was that rescission had to be promptly declared, or the right was waived, otherwise the party so entitled would be considered as “concurring in the continued validity of the contract.” The buyers in Blinzler I never questioned the validity of the contract, however. It was on reliance in the contract that they based their claim to see a long overdue title insurance policy before making further payment — which was done on the sound advice of counsel.

The cases cited by the majority in support of the waiver holding — found at 94 Idaho at 218, 485 P.2d at 960, top of the right column, were wholly inapplicable. Each has been studied, and the only conclusion to be drawn is that those who joined the opinion for the court simply did not find the time to examine those cases. For instance, Perry v. Woodall, 20 Utah 2d 399, 438 P.2d 813 (1968) involved a claim of rescission for fraud in the inducement. The holding in that case, both proper and well-recognized, is that a person induced to enter into a contract by misrepresentation or other fraud on discovery thereof has two remedies, one of which is to rescind for the fraud, or, two, to stand on (affirm the contract) and sue for damages in fraud and deceit. Exercise of the first option must be promptly made. The other Utah case, Farrington v. Granite State Fire Ins. Co., 120 Utah 109, 232 P.2d 754 (1951), held nothing more than that an insurance carrier which accepts premiums after a fire loss which it has investigated and had at hand at the time of thereafter receiving and keeping the premiums all of the facts upon which it would over a year later claim rescission because of the insured's misrepresentation and concealment, has waived the right to rescind. There are Idaho cases to the same *473effect — all of which are as totally irrelevant as the cases cited by the Blinzler I majority — simply because the buyer in Blinzler I did not rescind for fraud in the inducement, but rather by reason of the arbitrary actions of the sellers in not producing a title insurance policy (placing them in default) and at the same time taking the papers out of escrow on a wrongfully declared forfeiture. With the sellers’ (respondents’) briefs before me, it must be said to the credit of their attorneys, that those cases were not cited to the court. The Milton Andrews’ brief relied on Metzker v. Lowther, 69 Idaho 155, 204 P.2d 1025 (1949), and disagreed with the trial court’s reliance on Sorenson v. Larue, 43 Idaho 292, 252 P. 494 (1926).

The James Andrews’ brief relied on the Metzker case, and also on Williams v. Havens, 92 Idaho 439, 444 P.2d 132 (1968) and Scogings v. Andreason, 91 Idaho 176, 418 P.2d 273 (1966). Even the ill-starred majority opinion in Blinzler I did not find these cases applicable on the claimed waiver issue. Nor did the majority opinion make any mention of Sorenson v. Larue, 43 Idaho 292, 252 P. 494 (1926), on remand 47 Idaho 772, 278 P. 1016 (1929), let alone embark on an attempt to show that the district court had not properly applied it in a well-written memorandum decision.

The Blinzler I trial judge, the Honorable James G. Towles, would later, in rendering a decision in Blinzler v. Andrews, 95 Idaho 769, 519 P.2d 438 (1974) (Blinzler II), not hesitate to pass judgment on the majority opinion in Blinzler I:

The undersigned has made an exhaustive review of the record in the trial court as well as of the opinion of the majority on appeal and trusts that the principles of waiver announced in the majority opinion would not long remain the rule of law in this state.1

Blinzler I this day goes into the well-deserved state of oblivion forecast for it by Judge Towles.

II.A.

Without hesitation I am in agreement that the plaintiff is at the least entitled to a decree of rescission, and for that reason have concurred in the opinion for the Court and in the Court’s judgment to reverse with directions. Logically, it appears that only the questionable use of a jury in this complex case and Blinzler I led the trial court astray. In addition to the authority cited in the Court’s opinion for the proposition that one cannot declare a default when he himself is materially in default, the case of Sorenson, relied upon by the trial court in Blinzler I, is applicable, although there it went unmentioned.

B.

Although the plaintiff may be content with rescission, it appears to me that the trial court erred in not granting a new trial for a multitude of reasons well-documented in the plaintiff’s brief. I also note that at oral argument counsel for the defendants Akins et ux seemingly stipulated that if the plaintiffs would even at that late date tender the full amount of the purchase price, then the agreement would be fulfilled. Where the Court is not awarding a new trial, it would seem equitable to direct that the plaintiffs be extended that alternative.

. A beautiful case of poetic justice would have taken place had fate brought Judge Towles, now retired and sitting sometimes with this Court and also on the Court of Appeals, to sit on this case and participate in the overruling of Blinzler /, for which overruling he saw the immediate need fourteen years ago.