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Ford v. Hagel

August 13, 1996

FRANCES M. FORD, APPELLANT,
v.
WAYNE E. HAGEL AND M. NADINE HAGEL, A MARITAL COMMUNITY, RESPONDENTS.



Appeal from SUPERIOR COURT LINCOLN COUNTY. Superior Court No: 94-2-00033-1. Date filed in Superior Court: 10/4/94. Superior Court Judge signing: PHILIP BORST.

Author: John A. Schultheis. Concurring: Dennis J. Sweeney & Philip J. Thompson

The opinion of the court was delivered by: Schultheis

SCHULTHEIS, J. -- Real estate purchaser Frances M. Ford filed a complaint to set aside a contract forfeiture obtained against her by the sellers, Wayne and Nadine Hagel. On cross motions for summary judgment, the court granted the Hagels' motion and dismissed the complaint. Ms. Ford appeals. Because there are issues of material fact concerning the Hagels' right to declare forfeiture when they purported to do so, the court should not have granted summary judgment in their favor. We reverse and remand.

In May 1989 Ms. Ford entered into a real estate contract with the Hagels for the purchase of approximately 320 acres of timber and grazing land. The purchase price was $46,400, with $10,000 down and payments of $375 per month. The contract contained a "time is of the essence" clause and provided "should purchaser fail to make any payment . . . vendors at their option may declare a forfeiture by written Notice of Intent to Forfeit to the purchaser, and at the expiration of 91 days after the recording of the Notice of Intent to Forfeit . . . the purchaser's rights under this contract shall be cancelled . . . ."

In May 1993 the Hagels sent Ms. Ford a notice of intent to forfeit for failure to make the March, April and May payments. Ms. Ford timely cured the default and brought the contract current through August 1993. She then failed to make the September, October and November payments.

On November 12, 1993, the Hagels sent her a second notice of intent to forfeit and recorded the notice with the Lincoln County Auditor. The Hagels rerecorded the notice on November 18 to correct the legal description (the range number had been omitted in the second line of the parcel 1 legal description and had been included in the last line instead), but did not send the rerecorded notice to Ms. Ford.

The notice of intent to forfeit provided "failure to cure all of the defaults listed . . . on or before February 10, 1994, will result in the forfeiture of the Contract." The notice required Ms. Ford to pay $1,125 in delinquent payments and $583.02 in costs, for a total amount of $1,708.02, plus any payments falling due after the date of the notice. The notice provided "monies required to cure the default may be tendered to [the Hagels' attorney at his address]." The contract required cash payment of the costs of preparing the notice of intent to forfeit, in an amount not to exceed $250, but did not require cash payment (or payment by certified check) of any other amounts required to reinstate the contract.

On February 10, 1994, Ms. Ford tendered a cashier's check for $1,800 and a personal check dated January 10, 1994 for $1,033.32 to escrow clerk Lynn A. McEachran at Adept Escrow Services, which held the contract. Ms. McEachran contacted the Hagels' attorney, who advised her to reject the tender. On February 11 Ms. McEachran returned both checks to Ms. Ford by mail, with a letter explaining: "We are returning the above checks to you as there is not sufficient funds in your bank to cover the personal check."

On February 17 an acquaintance of Ms. Ford delivered to Adept Escrow Services a cashier's check for $1,800 and Ms. Ford's personal check for $1,033.32. On instructions from the Hagels' attorney, the tender was rejected. The personal check was then converted to a cashier's check later that day. Since the total of the two cashier's checks was sufficient to cure the default, escrow agent Mary Freitag again contacted the attorney for instructions. He instructed her not to accept payment because the time for cure had lapsed. Consequently, Ms. Freitag returned the two checks to Ms. Ford by mail.

On February 17, 1994, the Hagels recorded a declaration of forfeiture with the Lincoln County Auditor. They sent a copy of the declaration to Ms. Ford by certified mail on February 21.

On April 13 Ms. Ford filed a complaint to set aside the declaration of forfeiture pursuant to RCW 61.30.140. Under the statute, Ms. Ford would have the right to set aside the forfeiture if the Hagels either (1) were not entitled to declare forfeiture at the time they purported to do so or (2) did not materially comply with the statutory forfeiture requirements. RCW 61.30.140(4). Both parties moved for summary judgment. The court granted the Hagels' motion and awarded them $600 attorney fees pursuant to RCW 61.30.140(5). Ms. Ford appeals.

When reviewing an order of summary judgment, this court engages in the same inquiry as the trial court. RAP 9.12; Hiatt v. Walker Chevrolet Co., 120 Wash. 2d 57, 65, 837 P.2d 618 (1992); Wilson v. Steinbach, 98 Wash. 2d 434, 437, 656 P.2d 1030 (1982). Summary judgment is appropriate only if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. CR 56(c). The moving party has the burden of showing there is no issue of material fact, which is one upon which the outcome of the litigation depends, in whole or in part. Barrie v. Hosts of Am., Inc., 94 Wash. 2d 640, 642, 618 P.2d 96 (1980). The court must resolve all reasonable inferences from the evidence against the moving party and should grant the motion only if reasonable people could reach but one Conclusion. Detweiler v. J.C. Penney Casualty Ins. Co., 110 Wash. 2d 99, 108, 751 P.2d 282 (1988).

Summary judgment was not appropriate in this case because the Hagels did not meet their burden of demonstrating no issue of material fact exists and that they are entitled to judgment as a matter of law. If Ms. Ford's personal check was good when tendered with the cashier's check on February 10, the Hagels would not have been entitled to declare forfeiture when they purported to do so on February 17 and Ms. Ford would have the right to have the forfeiture set aside. *fn1 RCW 61.30.140(4)(b). To be entitled to judgment as a matter of law, the Hagels needed to establish the check was not good. They could do that by showing the check was presented and dishonored or that presentment was excused because payment was definitely refused by the bank for want of funds. See Rains v. Lewis, 20 Wash. App. 117, 122-23, 579 P.2d 980 (1978); former RCW 62A.3-501 through -506, -511. *fn2

In support of their motion for summary judgment, the Hagels presented the affidavits of Ms. McEachran and Mrs. Hagel to show that Ms. Ford's check would not have been honored had it been presented to the bank. *f ...


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