Procedural Posture

Defendant real estate investment company challenged the decree of the Superior Court of Riverside County (California), which quieted title in favor of plaintiff development company and refused the real estate investment company's motion for a new trial, in the development company's action to quiet title, recover possession, and foreclose agreements for the sale of certain parcels of land.

Overview: unruh act statute of limitations

In 1906, the parties executed six separate written agreements, whereby plaintiff sold 1154.45 acres of land to defendant. The intention of the parties was to subdivide the land and reconvey to third parties. Defendant paid an initial sum of $ 5,000 and the balance was to be paid to plaintiff in annual installments upon the subsequent sales of the land to third parties. Defendant did not comply with the agreements and plaintiff agreed to purchase the lands back. After the deed was placed in escrow, plaintiff refused to pay or take the deed. Defendant contended that it was entitled to a lien on the lands and the court agreed. Defendant had an equitable interest in the land, which it had the right to convey. The act of defendant of yielding possession of the lands to plaintiff constituted a sufficient consideration for the contract. Additionally, the actual conveyance of the deed into escrow by defendant and the promise by plaintiff to pay the price constituted a valid contract. The transaction was, in effect, an agreement to rescind the previously executed agreements of sale and to limit and settle the amount to be restored to defendant as a consequence of such rescission.

Outcome

The court reversed and remanded. Plaintiff was entitled to a decree declaring it to be the owner of the lands free from all claim or right of the defendant, except for a lien in favor of defendant for $ 1,500, plus interest.

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