Opinion
Gen. No. 35,389.
Opinion filed March 16, 1932.
1. APPEAL AND ERROR — when courts may hear appeals from decisions which are not final. Because of peculiar circumstances and hardships courts may refuse to dismiss appeals from judgments and decrees which do not completely dispose of the cases in which they were entered.
2. APPEAL AND ERROR — when appeal from order vacating a temporary injunction will not be dismissed. An appeal from an order vacating a temporary injunction entered in a suit for a permanent injunction will not be dismissed where the parties have considered the order appealable, and dismissal of the appeal would compel complainant to appear again in the trial court to have the cause finally determined, resulting in delay and hardship to him, and the same question would then be before the reviewing court on appeal from the final order.
3. PENALTIES AND FORFEITURES — disfavor of and policy of chancery towards forfeitures. Forfeiture is a harsh remedy at best, and by no means a favorite with a court of chancery under any circumstances, and readily yields in that forum to the principle of compensation, if fair dealing and good conscience seem so to demand.
4. VENDORS AND PURCHASERS — when notice of intention to forfeit contract for breach of condition necessary after previous waiver of same. If the parties to a contract for the sale of real estate have waived a condition that time of payments is of the essence of the contract, then it becomes necessary for the vendors, if they wish to enforce their right of forfeiture under the contract, to notify the purchasers that in the event of future noncompliance with the contract in the matter of payment, a forfeiture will be declared.
5. VENDORS AND PURCHASERS — waiver of payment of instalments by acceptance of belated payments. Acceptance of belated payments by a vendor at frequent intervals constitutes a waiver of a provision in a contract for the sale of real estate that time is of the essence of the contract.
6. TENDER AND DEPOSITS IN COURT — when tender in bill for injunction to restrain forfeiture is sufficient. In a suit for an injunction to restrain a vendor from declaring a forfeiture on a contract for the sale of real estate for default in payment, it is not necessary to bring the money into court, and a tender in the bill is sufficient, the technical rules which govern pleadings of tender in actions at law not being applicable to proceedings in chancery.
7. INJUNCTIONS — when averments of bill justify injunction restraining forfeiture of contract by vendors. A bill seeking an injunction restraining vendors from declaring a forfeiture on a contract for the sale of real estate on the ground of default in payment, and restraining the prosecution of a forcible detainer suit against the complainants, states facts sufficient to entitle the complainants to a temporary injunction, where it alleges that most of the purchase price has been paid, that valuable improvements have been made on the property, that the defendants have waived previous defaults in payments by the acceptance of belated payments, and that they have never given notice that payments must be made on the due dates, as equity will prevent a vendor from invoking the aid of a court of law to enforce a forfeiture under such circumstances, if possible, so long as equity is done to all parties.
Appeal by plaintiffs from the Superior Court of Cook county; the Hon. ROSS C. HALL, Judge, presiding. Heard in the third division of this court for the first district at the October term, 1931. Reversed and remanded with directions. Opinion filed March 16, 1932.
JOHN E. VAN NATTA, for appellants.
HUSS REHM, for appellees.
Complainants filed their bill in chancery praying that the defendants be enjoined from declaring a forfeiture upon a real estate contract and from prosecuting a suit in forcible detainer in the municipal court of Chicago. A motion for a temporary restraining order was granted. Subsequently, on motion of the defendants, the restraining order was set aside and from that order this appeal was prayed and allowed.
No point is raised as to whether or not the order setting aside the temporary injunction was an appealable order. From the bill of complaint, however, it appears that the main purpose of the bill is for a permanent injunction and that complainants' right might be lost if a temporary injunction was not allowed to issue and remain in full force and effect until final hearing. Under the Practice Act, Cahill's St. ch. 110, ¶ 91, appeals in chancery will lie only from final orders. Owing to peculiar circumstances and hardships, the courts have refused to dismiss appeals from some judgments or decrees which did not completely dispose of the case in which they were entered. Bucklen v. City of Chicago, 166 Ill. 451. In the event this cause should be dismissed because of the fact that the order dissolving the injunction was not a final decree, it would result in complainant being forced to again appear in the trial court and ask to have the cause finally determined. This would result in a delay and hardship to the complainant. The same question would be before us on an appeal from the final order as is before us on this appeal. Under the circumstances, we consider the cause as coming within the exception to the rule and the parties having treated the order as an appealable one, it will be so considered by this court.
The bill charges that the parties entered into a contract for the purchase of a piece of real estate, March 26, 1925; that the contract price was $8,250, payable $1,625 in cash and $50 or more on or before the first of each month starting May 1, 1925, until the principal sum of $3,625 was paid in full with interest at 6 per cent. Upon the payment of $5,250, complainants were to receive a deed and assume a mortgage of $3,000, dated February 27, 1930; charges that the contract contained the usual clauses as to taxes, time of payment, etc., and that payments were made and accepted without objection on various dates from 1925 to 1930; that all of the payments, with one exception, were made on dates subsequent to the first of the month and in some instances were not even made during the month at which they were due; charges that in September, 1930, payments were made and accepted without objection; charges that the defendants have never given notice that further payments should be made on the dates provided in said contract and that the purchase price has been nearly paid and only approximately $848.94 remains; charges that on April 24, 1931, the defendants began a forcible detainer suit in the municipal court of Chicago for the purpose of recovering possession of the premises in question; charges that irreparable injury will be done the complainants if said suit is allowed to proceed and offers to pay all and any moneys due under the contract; asks for an injunction and offers to do equity as the court may find proper. The bill also charges that the complainants have invested approximately $5,400 in cash in the premises which will be lost in the event of a forfeiture.
It is insisted that complainants have an adequate remedy at law by showing the facts set out in the bill of complaint and that these facts, if true, would constitute a defense. It is further insisted that the tender in the bill of complaint is not sufficient, but that the money should be actually tendered in open court. From the facts charged in the bill it appears that the payments have been going over a number of years and that the condition of the agreement, namely, that time is of the essence of the contract, has, at frequent intervals, been waived by the parties. Forfeiture is a harsh remedy at best, and is by no means a favorite with a court of chancery under any circumstances, and readily yields in that forum to the principle of compensation, if fair dealing and good conscience seem so to demand. Watson v. White, 152 Ill. 364.
The bill charges that valuable improvements have been made on the property, and these facts are often incapable of proof in a law proceeding. No declaration of forfeiture appears to have been served on the complainants and from the record we gather that the first intimation complainants had of the purpose of the defendants was the beginning of the suit for forcible detainer in the municipal court. If the parties themselves had waived the condition that time of payments is of the essence of the contract, then it became necessary for the defendants to have notified complainants that in the event of future noncompliance of payment in accordance with the terms of the agreement, they would declare a forfeiture. The waiver of this condition was shown by the conduct of the parties. The Supreme Court in the case of Watson v. White, 152 Ill. 364, in its opinion says:
"By the terms of the agreement here in question time was made of the essence of the contract. It was not only provided therein that if the purchaser should fail to perform the contract promptly on his part, at the time and in the manner therein specified, then that 'the earnest money paid as above' — i. e., the $500 first paid by White, — should, at the option of the vendor, be forfeited as liquidated damages and the contract become null and void, but it was also expressly stipulated, 'time is of the essence of this contract and of all the conditions thereof.' But an agreement that time shall be of the essence of a contract may be waived or set aside, and more especially so in the contemplation of a court of chancery, either by the mutual consent or conduct of the parties, or by the consent or conduct of the party in whose favor and for whose benefit such stipulation is made. ( Allen v. Woodruff, 96 Ill. 11; Palmer v. Ford, 70 id. 369; Peck v. Brighton Co., 69 id. 200; Morgan v. Herrick, 21 id. 481; Bishop v. Newton, 20 id. 175.) In the case at bar, both parties, by tacit but mutual consent, seem to have waived and ignored, from the very start, the provision that time should be of the essence of the contract and of all the conditions, stipulations or specified terms thereof."
The tender in the bill was sufficient. It was not necessary to bring the money into court. The technical rules which govern pleadings of tender in actions at law do not apply to proceedings in chancery. The Supreme Court in Watson v. White, supra, in its opinion says: "Equity will not demand of him that which is wholly useless for any purpose. The technical rules that govern pleas of tender in actions at law are manifestly inapplicable to the circumstances of this suit in chancery. The general rule is, that to entitle a purchaser to demand a deed and maintain a bill for specific performance, it is sufficient that he is ready and offers to pay any sum that may be found to be due and still unpaid, and to comply with the contract on his part. Mix v. Beach, 46 Ill. 311; Maughlin v. Perry Warren, 35 Md. 352; Jenkins v. Harrison, 66 Ala. 346." To the same effect see Hinton v. Tyler, 163 Ill. App. 454; First Nat. Bank of Hayward, Wis. v. Gerry, 195 Ill. App. 513.
The bill charges facts which, if true, would entitle the complainant to relief, and the action of the trial court in dissolving the temporary injunction was error. It would be a harsh rule which would permit the defendant to receive belated payments extending over a number of years and then suddenly invoke the aid of a law court to enforce a forfeiture, and equity should prevent such a thing, if possible, so long as equity is done to all parties.
For the reasons stated in this opinion the order of the superior court is reversed and the cause remanded with directions to expunge the order dissolving the temporary injunction, to allow the temporary injunction to stand, and to proceed in accordance with the views expressed in this opinion.
Order reversed and cause remanded with directions.
HEBEL, P. J., and FRIEND, J., concur.