Mode of Giving or Service of Notice of Nonpayment or Protest of Bill or Note Other than by Mail....

233

Communications with Counsel Through or in Presence or Hearing of Others as Privileged..

359

Proposals or Bids for Government Contracts.

456

Guaranties of Work and Stipulations for Repairs in Contracts for

Public Improvements..

562

138 C.C.A.

(xx)†

CASES

ARGUED AND DETERMINED

IN THE

UNITED STATES CIRCUIT COURTS OF APPEALS

(223 Fed. 573)

CLARK v. BELT.

(Circuit Court of Appeals, Eighth Circuit. March 16, 1915.)

A contract for an exchange of real estate, although conditioned on the acceptance of one of the parties after examination of the property of the other, is not void for want of mutuality, where after such examination he accepts and at the request of the other party makes advance payment of the difference agreed upon in the contract between the value of the two properties.

[Ed. Note.-For other cases, see Contracts, Cent. Dig. §§ 21-40; Dec. Dig. 10.

Mutuality in contracts, see notes to American Cotton Oil Co. v. Kirk, 15 C. C. A. 543; Oakland Motor Car Co. v. Indiana Automobile Co., 121 C. C. A. 326.]

2. CONTRACTS 145-CONSTRUCTION

CONTRACT.

AND OPERATION-PLACE OF MAKING

The place of a contract is the place at which the last act was done by either of the parties essential to a meeting of minds.*

1

3. COURTS 372-FEDERAL COURTS-AUTHORITY OF STATE DECISIONS. In the absence of any state statute on the subject, the measure of damages for breach of a contract to convey land is a matter of general law, upon which the federal courts exercise their independent judgment.

[Ed. Note.-For other cases, see Courts, Cent. Dig. §§ 977-979; Dec. Dig. 372.

Conclusiveness of judgment between federal and state courts, see notes to Kansas City, Ft. S. & M. R. Co. v. Morgan, 21 C. C. A. 478; Union & For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes *See note at end of case. 138 C.C.A.-1

Planters' Bank of Memphis v. City of Memphis, 49 C. C. A. 468; Converse v. Stewart, 118 C. C. A. 215.]

4. VENDOR AND PURCHASER 351-ACTION BY PURCHASER FOR BREACH OF CONTRACT-MEASURE OF DAMAGES.

Under the rule of the federal courts, the measure of damages for breach of a contract to convey land is the difference between the contract price and the market price at the time of the breach.

[Ed. Note.-For other cases, see Vendor and Purchaser, Cent. Dig. §§ 1017, 1047-1058; Dec. Dig. 351.]

5. APPEAL AND ERROR 854-HARMLESS ERROR-ERRONEOUS GROUND OF DECISION.

A judgment will not be reversed because rendered on an erroneous theory on proceedings in error by the adverse party, where the findings of fact on which it was based entitled the prevailing party to a larger judgment.

[Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 3403, 3404, 3408-3424, 3427-3430; Dec. Dig. 854.]

Hook, Circuit Judge, dissenting.

In Error to the District Court of the United States for the District of South Dakota; James D. Elliott, Judge.

Action at law by Denton Deo Belt against Stanley L. Clark. Judgment for plaintiff, and defendant brings error. Affirmed.

Sterling & Clark, of Redfield, S. D., for plaintiff in error.

Tinley, Mitchell & Pryor, of Council Bluffs, Iowa, and W. F. Bruell, of Redfield, S. D., for defendant in error.

Before SANBORN and HOOK, Circuit Judges, and POPE, District Judge.

POPE, District Judge. Belt owned property in the city of Essex, Iowa. Clark had a farm in Spink county, S. D. They exchanged. By the terms of their agreement the South Dakota farm was to be taken at $32,000, subject to a mortgage of $16,800, thus leaving the net equity $15,200. The Iowa town property was placed at $18,500, with a mortgage of $4,000, making the net equity $14,500. To cover the difference of $700 in the two equities, resulting from the valuations thus placed, Belt was to pay Clark $700 in cash. The contract gave Belt one-third of all crops raised on the farm, evidently for the current year, 1908, but Belt was to assume a contract outstanding for 150 acres of breaking at the rate of $2.75. While there is some ambiguity in the contract as to the date when the papers were finally to be delivered, it seems reasonably clear that November 1, 1908, was the final date for such delivery. The contract was made by an agent of Clark on his behalf, and was subject to his approval of the trade, as it was subject also to an inspection of the South Dakota land by Belt. Clark subsequently approved the trade, but upon the further condition that Belt was to let Clark have $800 on or before July 2, 1908, and thus in advance of the exchange of deeds. This amount, it will be noted, was $100 more than the cash payment which Belt ultimately was to make to Clark, but the difference was to be protected by a lien given by Clark to Belt on part of the town property received on the exchange. This proposition was agreed to by Belt after an inspection by him of the

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes

South Dakota property, and the sum of $800 was, pursuant to such agreement, paid to Clark by Belt in July, 1908. On October 31, 1908, Belt tendered Clark the necessary papers covering the town property, and also the sum of $700 as stipulated, and demanded a deed to the South Dakota property in return. Clark had, however, previous to this, transferred the property to another, and refused to make the deed in return. Following the refusal of Clark to make title, Belt filed this suit for damages for the breach of the contract. The damages claimed were in three items:

(a) The $800 advanced in July, 1908, and for which, with interest, a return is demanded.

(b) A number of items representing the value of one-third of the crops raised in 1908 on the South Dakota property, and aggregating $1,517.53.

(c) The difference at the date of the breach between the value of the South Dakota property and the Iowa property. Upon this point the allegation of the complaint is that the South Dakota property was, at the date of the breach, worth $25,184, with an incumbrance of $16,800, leaving an equity, which would have come to the plaintiff had the trade gone through, of $8,384. The actual value of the Iowa property at the date of the breach is alleged to have been $8,500, allowing against which an incumbrance of $4,000, there was left $4,500 as the equity which would have gone to the defendant, or a difference of $3,884 in favor of plaintiff had the trade been consummated.

These three items aggregate $6,201.33, for which judgment was asked, with interest from November 1, 1908. The answer sets up various allegations of fraud by Belt in pointing out the town property, and which, it is claimed, relieved Clark from a compliance with his contract. There is in the answer a tender back of the $800 paid in July, 1908. Upon the trial, which by stipulation was to the court, there were findings against the defendant on the issue as to fraud, and a finding that plaintiff should recover. The court in assessing the damage allowed the $800 advanced, and also the value of one-third of the crops grown on the land in the season of 1908, which value was fixed at $1,207.06. The court declined to allow anything for the alleged loss to plaintiff as contained in allegation (c) above set forth. There is a finding by the court, however, that on or about September 1, 1908, the South Dakota equity was worth $8,384, and the Iowa equity amounted to $3,800, thus leaving a balance of $4,584 in favor of the South Dakota property had the trade been effected.

There is no bill of exceptions in the case, so that the only question is as to the sufficiency of the facts found to support the judgment. R. S. 700. In the absence of the evidence, of course, the findings of fact must be deemed to have been properly supported at the trial.

[1] The point is made against the judgment below that the arrangement was void for lack of mutuality in that the acceptance of the South Dakota property by plaintiff was left dependent upon his being satisfied with it upon inspecting it, and particularly because the contract provided that "if found [by Belt] to be otherwise than as represented or as understood by said second party [Belt] this agreement to