Opinion
Jan. 25, 1972.
Editorial Note:
This case has been marked 'not for publication' by the court.
Page 378
Victor F. Crepeau, Denver, for claimant-appellant.
Robert R. Kayne, Boulder, for administrator-appellee.
SILVERSTEIN, Chief Judge.
The Laurell Company, appellant, filed a claim in the estate of Eleanor Gautheir, deceased, for specific performance of a contract for the purchase and sale of a parcel of real estate owned by the decedent. The claim was resisted by the administrator. After a hearing the trial court denied the claim for specific performance of the contract and ordered the administrator to refund to the claimant the down payment it had made to the decedent. The claimant appeals from the order denying its claim for specific performance. The administrator, appellee, does not challenge the order to return the down payment. We affirm the order of the trial court.
The following facts are undisputed. On March 8, 1969, the claimant and decedent signed a contract for the purchase and sale of the North one-half of Plots 40 and 41, North Federal Heights. The contract was prepared by claimant's president. It provided that the decedent, as seller, had received $1000 as part payment for the above described real estate, 'which property the purchaser (claimant) agrees to buy,' on the terms and conditions thereinafter set forth.
The terms of the agreement pertinent here were that the balance of the purchase price was to be paid on September 1, 1969, and that 'upon payment or tender' of the purchase price the seller was obligated to deliver a general warranty deed. An abstract or title insurance policy was also to be delivered to purchaser on September 1, 1969. The contract further provided, 'Time is of the essence, and if any payment or any other condition hereof is not made, tendered, or performed by purchaser as herein provided, then this contract shall be void and of no effect and both parties hereto released from all obligations hereunder.' There was also a provision that if merchantable title could not be delivered after thirty days written notice of defects, the buyer could declare the contract void and would then be entitled to a refund of the deposit.
On April 9, 1969, one month after signing the above contract, the seller, decedent, conveyed to the Town of Federal Heights the south forty feet of the property covered by the contract. This deed was recorded on April 10, 1969. On August 30, 1969, claimant mailed to decedent a letter dated August 29 which stated, '. . . we will exercise our option and purchase . . .' the property described in the contract. In response to this letter the decedent obtained a title policy dated September 3, 1969, which insured the title in decedent to the property described in the contract, except the south forty feet thereof. It was on receipt of the title policy that claimant first learned of the conveyance of the forty-foot strip. Claimant's president did not give any notice in writing of the defect but personally contacted decedent in an attempt to renegotiate the contract to reduce the purchase price because of the reduction in the size of the parcel. Claimant did not at any time tender the purchase price to the decedent, who died early in December 1969.
In the trial court the claimant asserted that the contract was an option which had been properly exercised thus entitling it to specific performance, while the administrator claimed the document was not an option but an agreement to purchase which had been breached by the buyer when it failed to tender payment on September 1. The trial court found that the contract was an option which claimant had failed to exercise and further found that there was a mutual mistake with regard to the forty-foot strip conveyed to the town and that it would be inequitable for the estate to retain the down payment.
In this court the parties have reversed their positions. The claimant now contends that the document was a contract and not an option, while the administrator asserts the trial court's determination that it was an unexercised option is correct. It is our opinion that the contract was not an option but an agreement which obligated the claimant to buy if the conditions of the contract were met; that both parties failed to comply with the terms of the contract, and that the result reached by the trial court was correct. '(W) hen the trial court enters a correct judgment for the wrong reason we will nevertheless affirm it.' Colorado v. Franc, 165 Colo. 69, 437 P.2d 48.
Our Supreme Court, in Stelson v. Haigler, 63 Colo. 200, 165 P. 265, stated, 'A contract of sale creates mutual obligations on the part of the seller to sell, and on the part of the purchaser to buy, while an option gives the right to purchase, within a limited time, without imposing any obligations to purchase.' Accord, Gray v. Quiller, 144 Colo. 54, 355 P.2d 99. The contract under consideration here specifically stated that 'the purchaser agrees to buy' the land described, thus creating an obligation on the part of claimant which negates the claim that this contract was an option.
The contract further required tender or payment on September 1. No such tender or payment was made. In Hopkins v. Underwood, 126 Colo. 224, 247 P.2d 1000, it was held that where time is of the essence of a contract, performance at or within the time specified is essential before the right to require counter performance arises.
In Stelson v. Haigler, Supra, it was stated that where the buyer did not know of any title defect when payment was due, his failure to pay was not excused by later discovery of the defect. So here the failure to make tender or payment when due destroyed claimant's right to specific performance of the contract and since the decedent was unable to perform her obligation under the contract, the buyer was entitled to have its deposit refunded under the terms of the contract.
The order is affirmed.
ENOCH and PIERCE, JJ., concur.