Opinion
January 10, 1951 —
February 6, 1951.
APPEAL from a judgment of the circuit court for Sawyer county: WM. F. SHAUGHNESSY, Circuit Judge, Presiding. Affirmed.
For the appellants there was a brief by Douglas Omernik of Spooner, and oral argument by E. E. Omernik.
G. A. Hagerty of Bruce, for the respondent.
Donald G. Kampmann and Mary Frances Kampmann, husband and wife, plaintiffs, commenced this action to recover the unpaid purchase price of tavern fixtures and merchandise sold to Martin McInerney, defendant. The defendant counterclaimed for a down payment of $100 made at the time the contract was entered into. Judgment was entered on July 18, 1950, dismissing the complaint of the plaintiffs and awarding judgment to the defendant for $100 and costs. The plaintiffs appeal.
On April 18, 1950, the plaintiffs agreed to sell to the defendant, and the defendant agreed to buy from the plaintiffs, tavern fixtures and a stock of merchandise located in the village of Couderay for the sum of $4,000. Defendant paid $100 to the plaintiffs as earnest money. The balance of the purchase price was to be paid upon delivery of possession of the property and as soon as the necessary documents could be executed, including a consent to the transfer of the intoxicating liquor stock by the Wisconsin beverage tax division. Plaintiffs retained an attorney to prepare the necessary documents and the parties contemplated that the sale would be completed on May 5, 1950. The attorney did not procure blanks from the beverage tax division until April 30th. On that date they were prepared and signed by the parties. On May 5, 1950, the consent to the transfer had not been received. It was approved on May 9th, and received by the attorney for the plaintiffs on May 10th.
The defendant appeared at plaintiffs' tavern on May 5th to complete the transaction, but the plaintiffs refused to deliver possession because the consent to the transfer had not been received. When it was received on May 10th the plaintiffs contacted the defendant and learned that he was ill. On or about May 14, 1950, the defendant notified the plaintiffs that he was rescinding the agreement because of a breach thereof by the plaintiffs in refusing to deliver possession of the property on May 5th.
The summons and complaint in this action were served on the defendant on May 24, 1950. The case was tried to the court without a jury, and the trial court held that the parties contemplated that the purchase and sale would be completed on May 5th; that time was of the essence of the contract; and that the plaintiffs were wholly at fault in not delivering possession on that date, thus warranting a rescission by the defendant.
Upon this appeal the plaintiffs claim that the trial court erred in finding that time was of the essence of the contract, and that the failure of the plaintiffs to deliver possession of the property on May 5, 1950, was not a breach of the contract warranting the defendant to refuse to take delivery thereof at a later date when offered by the plaintiffs.
The contract was oral. Upon the trial the parties disagreed as to the exact terms. It is clear that the parties had hoped to complete the agreement by May 5th. There was a delay of twelve days from April 18th to April 30th in procuring the blank applications to forward to the beverage tax division for its approval of the transfer. Neither party objected to the delay and both parties signed the application on that date and might welt have contemplated that this might occasion some delay beyond May 5th.
When the defendant asked to complete the sale on May 5th and plaintiffs refused to do so, he again called at their tavern on May 6th. When they again refused to deliver possession of the property because the consent to the transfer had not been received from the beverage tax division the defendant did not claim a breach of the agreement and did not attempt a rescission. Plaintiffs called the defendant on May 10th and learned that the defendant was ill. They notified his wife, however, that the consent had been received and they were ready to perform their part of the agreement, and to deliver possession. It was not until the 14th day of May that the defendant claimed that plaintiffs had breached the contract and that he was rescinding the same.
A contract may not be rescinded for every breach thereof. A breach of contract not so substantial as to defeat the object of the parties in making the contract does not entitle the other party to rescind. If time were of the essence of this contract, then failure to deliver possession on May 5th would have been a material breach of the contract that would have warranted a rescission. From the record here we must find that time was not of the essence and that there was not a breach of the agreement by the plaintiffs that warranted rescission of the contract by the defendant.
Upon the unwarranted refusal of the defendant to accept and pay for the property, the sellers' rights were governed by the provisions of the Uniform Sales Act, contained in ch. 121 of the Wisconsin statutes. Sec. 121.63 thereof reads as follows:
" Action for the price. (1) Where, under a contract to sell or a sale, the property in the goods has passed to the buyer, and the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the contract or the sale, the seller may maintain an action against him for the price of the goods.
"(2) Where, under a contract to sell or a sale, the price is payable on a day certain, irrespective of delivery or of transfer of title, and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed, and the goods have not been appropriated to the contract. But it shall be a defense to such an action that the seller at any time before judgment in such action has manifested an inability to perform the contract or the sale on his part or an intention not to perform it.
"(3) Although the property in the goods has not passed, if they cannot readily be resold for a reasonable price, and if the provisions of subsection (4) of section 121.64 are not applicable, the seller may offer to deliver the goods to the buyer, and, if the buyer refuses to receive them, may notify the buyer that the goods are thereafter held by the seller as bailee for the buyer. Thereafter the seller may treat the goods as the buyer's and may maintain an action for the price."
The action brought by the plaintiffs is governed by the provisions of the above section. It is apparent that subs. (1) and (2) thereof do not apply because the property in the goods had not passed to the buyer nor was the price payable on a day certain. It is equally apparent that this action cannot succeed under sub. (3) for two reasons: First, there was no notice to the buyer that the goods were being held by the seller as bailee for the buyer, and this is a prerequisite to the starting of an action for the price; second, there was no proof on the trial that the goods could not readily be resold for a reasonable price.
From the record we reach the same result as that reached by the trial court, although for a different reason.
By the Court. — Judgment affirmed.