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56 Utah 533

Rose v. Garn

Utah Supreme Court

Decided July 10, 1920

Utah Supreme Court · decided 1920-07-10

<p>Specific Performance — Vendor Not Entitled Where Agreement Provides for Liquidated Damages on Buyer’s Breach. • Under an agreement whereby abstract and deed were placed in escrow and were to be delivered to grantee “upon payment’’ of certain amounts and providing for forfeiture of sums paid as liquidated damages, on buyer’s breach, held, that failure of grantee to make one of such payments terminated the transaction, and vendor was entitled only to retention of installments paid and repossession of the property and could not specifically enforce the agreement as a contract of sale of the property.</p>

Cited by 3 later decisions — most recently April 1931

3 state decisions

Good law ✅— No negative treatment on recordhow we know

Affirmed · Decided 1920-07-10

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FRICK, J.

¶1I concur both in the reasoning and in the conclusions reached by the CHIEF JUSTICE. In my judgment the doctrine laid down in the case of Wilcoxson v. Stitt should not be extended by implication or construction. That case and the eases which follow it go to the very limit of following a technical rule and, as I view it, lose sight of the intention of the parties. In the case at bar, the parties to the contract clearly contemplated that the defendant might make default in paying the full purchase price, and in view of that fact provided what the consequences of such default should be. The provision of the contract respecting that matter is as much a part of the contract as any other provision and is binding upon them and should be respected by the courts. In ease a controversy arises between the par*539ties to a contract respecting its purport or meaning, courts are required to consider all the language used by the parties in determining tbeir intention. As an aid in arriving at sucb intention, tbe language must be viewed and considered in connection with the circumstances surrounding the parties when the contract was entered into as well as the subject-matter of the contract, and force and effect must be given to all the language. Technical words or phrases, if any are used, must not alone be given controlling force and effect unless from a consideration of the whole contract such was the manifest intention of the parties. Parties to a contract, unless prevented by public policy or some positive law, have the same right to determine and fix the consequences of a breach of the contract that they have to agree upon any other proper provision, and, in case they have so agreed, courts must enforce their agreement. In that regard the case at bar, in my judgment, falls squarely within the rule laid down in the case of Foxley v. Rich, 35 Utah, 162, 99 Pac. 666.

GIDEON. J.

¶2I concur in the conclusion of the CHIEF JUSTICE, I do so, however, solely on the ground that the contract in question is, in my judgment, nothing more than an option. There is no promise or undertaking on the part of the optionee to pay the purchase price named in the contract. To my mind the forfeiture clause discussed by the CHIEF JUSTICE would not defeat the right of plaintiff to specific performance if there was any assumption or agreement by the defendant to pay the purchase price.

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