Hilton v. Nelsen

283 N.W.2d 877 (1979)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

Nelsen (D) entered into negotiations to sell their 720-acre farm to Hilton (P). D was not represented by an attorney until after the contract was signed. The sale was for $180,000 with a down payment of $52,200 and D to take back a mortgage or deed of trust for $127,800. The maturity was to be 10 years from the date of closing with only interest at 7% at the end of the first five years, and in years 6-9 interest plus principal of $2,000, and a balloon payment of $119,800 on the tenth year. D thought he was getting a contract for deed. However, when he got an attorney, he learned that the agreement provided for title and possession to pass at closing. D then instructed his attorney that he would not close unless he got a contract for deed. P threatened to sue for specific performance. D changed his mind but did not inform P until one day before the initial closing date set in the contract. D had cleared his title of defects except for a real estate mortgage, a reservation of mineral rights by the State and an easement for public roads and utility cables. D bought another farm and moved to Nebraska. D called P and advised him that he was ready to close. D then alleged that P called and asked for a reduction in the price of $16,000. P denied making this demand, and the evidence supported D's version of that event. D thought P had defaulted, but on May 1, 1976, P informed D that he was ready to close again on May 1, 1976, the last closing date on the contract. D then informed P that he decided not to sell the farm. P sued for specific performance. P then discovered that D's mortgage was about to be foreclosed. Hilton decided to try to purchase the mortgage at the upcoming foreclosure sale. The mortgage was foreclosed, and P got the bid at $67,000 subject to a one-year right of redemption. Another party, Lyle Mandt agreed to purchase the farm by redeeming the mortgage. D gave Mandt a quitclaim deed, and Mandt gave D an option to repurchase the farm by January 1, 1978, for $121,074.05. The trial court found that D had breached the contract and ordered specific performance against both D and Mandt and allowed P to deduct $39,600 from the original price as the fair market rental value during 1976, and 1977. D appealed.