HALE V. WHITLOCK, 1979-NMSC-028, 92 N.M.
657, 593 P.2d 754 (S. Ct. 1979)
George HALE and Sylester Hale,
Plaintiffs-Appellees,
vs.
Gerald M. WHITLOCK, Martha A. Whitlock,
Defendants-Appellants, and Albuquerque National Bank,
Defendant.
SUPREME COURT OF NEW MEXICO
1979-NMSC-028, 92 N.M. 657, 593 P.2d 754
Robinson, Stevens & Wainwright,
George F. Stevens, Albuquerque, William J. Lock, Albuquerque, for
defendants-appellants.
John J. Duhigg, Albuquerque, for plaintiffs-appellees.
FEDERICI, J., wrote the opinion. McMANUS,
Senior Justice, and EASLEY, J., concur.
{1} Appellees brought this
action asking the district court to declare that they were not in default on a
real estate contract and to restrain the escrow agent, Albuquerque National
Bank, from delivering the documents held in escrow to appellants. Appellants
counterclaimed, asking the court to declare the real estate contract to be in
default and to grant them possession of the property.
{2} The trial court held that
appellees were in default on the real estate contract and ordered the
Albuquerque National Bank to release the escrow papers to appellants. However,
in its order, the court, under its equity powers, granted appellees an
additional fifteen days following entry of its judgment to pay off the entire
contract balance plus interest and attorney fees. Appellees tendered the
required amount to appellants within the time allowed by the court. This appeal
followed.
{3} The following facts in
the case are stipulated. In 1966 appellees purchased the property in question
under a real estate contract. For several years following appellees' purchase
of the property, appellees failed to make some of the monthly payments on time.
The original seller did not object to the failure to make payments and
appellees were led to believe that prompt payment of twelve monthly
installments per year would not be insisted upon. The original seller assigned
her interest in the real estate contract to appellants in 1977. Appellees were
never put on notice that appellants would insist upon strict performance
regarding payment of the future installments under the contract. Soon after
appellants purchased the real estate contract from the original seller,
however, appellants demanded that appellees bring their payments up to date by
tendering $1,675 for twenty-five delinquent installments. Shortly thereafter
appellees brought this declaratory action.
{4} Appellants contend that
the court erred in giving appellees additional time to pay off the entire
contract balance after declaring the contract to be in default. Appellees
contend that the court had equity jurisdiction under the facts in this case.
{5} It is well settled in New
Mexico that the type of real estate contract involved in this case is
enforceable and upon default, the
{*658} vendor
may terminate the contract, regain possession of the property and retain the
payments made.
Eiferle v. Toppino, 90 N.M. 469,
565 P.2d 340 (1977);
Davies
v. Boyd, 73 N.M. 85,
385 P.2d 950 (1963);
Bishop v. Beecher, 67 N.M.
339,
355 P.2d 277 (1960). However, it is also recognized in each of these cases
that there are exceptions to this rule, and that under certain circumstances,
the contract and acts of the parties should be construed if at all possible to
avoid a forfeiture.
See Stamm v. Buchanan, 55 N.M. 127,
227 P.2d 633
(1951).
{6} Under the facts in this
case, the trial court properly exercised its equity jurisdiction in granting
appellees additional time within which to pay off the entire balance due under
the real estate contract along with interest and attorney fees. The result was
to place the parties in the positions they would have been in had the contract
been fully performed.
{7} The decision of the trial
court is affirmed.
McMANUS, Senior Justice, and EASLEY, J., concur.