Lapse of time in payment of the purchase-money may generally be recompensed by interest and costs. (v) § 1049. Time may be implied as essential in a contract, from the nature of the subject-matter with which the parties are dealing. "If, therefore," said Alderson, B., (w) "the thing sold be of greater or less value according to the effluxion of time, it is manifest that time is of the essence of the contract: and a stipulation as to time must then be literally complied with in equity as well as in law." In respect of reversionary interests, therefore, it is held to be of the essence of justice, that contracts for sale should be executed immediately and without any delay, (x) unless indeed the terms of the contract are such as to show that the parties contemplated the possible occurrence of a delay, and intended, in the event of that delay occuring, to keep the bargain alive.(y)' § 1050. So, again, where the subject-matter is from its nature exposed to daily variation, the court inclines to hold time to be material, as in the sale of the stock in a public house,(z) in contracts for granting annuities on lives, (a) and in purchases of government stock. (b)* (v) Vernon v. Stephens, 2 P. Wms., 66. 416. (z) Newman v. Rogers, 4 Bro. C. C., 391; Spurrier v Hancock, 4 Ves., 667. (3) Patrick v. Milner, 2 C. P. D., 348. See infra, § 1057. (2) Coslake v. Till, 1 Russ., 376; Weston v. Savage. 10 Ch. D . 741. (a) Withy v. Cottle, T. & R., 78. (b) Doloret v. Rothschild, 1S. & S., 590. See also Lewis v. Lord Lechmere, 10 Mod., 503 John.'s Ch., 370, a clause to the effect that if the plaintiff failed in either of his payments the agreement was to be void, was thought to be abundantly distinct, and to render time of the essence of the contract. See Mitchell v. Wilson, 4 Edw.'s Ch., 697. Time is of the essence of the contract wherever it appears material to the parties, and, therefore, where the value of the property has greatly diminished and injustice might be done, equity will not decree a specific performance. McKay v. Carrington, 1 McLean, 50. Therefore, in Pillow v. Pillow, 3 Humph, 644, where it was agreed between a judgment creditor and debtor, that the latter should pay the judgment in land, at a value to be fixed by persons designated, and the debtor defeated the performance of the agreement until his land had risen in value, it was held that he could not maintain a bill to compel a specific performance of the agreement. See, also, Holt v. Rogers, 8 Pet., 420. And where land has been purchased to sell, and such a purpose a lawful one, which may be considered by a court of chancery, time will be deemed of the essence of the contract. McKay v. Carrington, 1 McLean, 50; see Jones v. Robbins, 29 Me., 351. "It seems the doctrine of the court that in almost every case, except the purchase of lands in fee simple (but in that case only by express agreement; Sug. V. & P., 292), time will be considered as of the essence of a contract. The cases establish that it will be considered essential in the purchase of a house for residence (Levy v. Linds, 3 Mer.. 81), or of lands or houses for the purposes of trade (Coslake v. Till, 1 Russ., 576; Walker v. Jeffreys, 1 Ha., 341), § 1051. And so, again, where the object of the contract is a commercial enterprise, the court is strongly inclined to hold time to be essential, whether the contract be for the purchase of land for such purpose, or more directly for the prosecution of trade. (c) This principle has been acted on in the matter of a contract respecting land which had been purchased for the erection of mills, (d) and in several cases of contracts for the sale of public houses as going concerns. (e) For the purchaser of a public house presumably buys it for the purpose of carrying it on, and it would be ruinous to him if he were kept out of it. (f) § 1052. The same principle applies with especial force to contracts relating to mines. The nature of all mining transactions is such as to render time essential: for no science, foresight, or examination can afford a sure guarantee against sudden losses, disappointments, and reverses, and a person claiming an interest in such undertakings ought therefore to show himself in good time willing to partake in the possible loss as well as profit.(g) So in several cases time has been held of the essence in contracts for the sale of mines and works. (h) § 1053. Again, where the contract had relation to the supply of coal, and eleven months were allowed to elapse before filing the bill, the article being one fluctuating from day to day in its market price, the court held the delay a ground for declining its interference:(i) and where the contract contemplated the payment of moneys to be applied (c) Walker v. Jeffreys. 1 Ha., 341, 348; Coslake v. Till, 1 Russ., 376. (d) Wright v. Howard, 1 S. & S., 190. (e) Seaton v. Mapp, 2 Coll, 556 (where the essentiality of time was arrived at from the conditions as well as from the subject matter); Day v. Luhke, L. R. 5 Eq., 336; Cowles v. Gale, L. R 7 Ch., 12. See too judgment of Hall, V. C., in Weston v. Savage. 10 Ch. D., 741, and Claydon v. Green, L. R. 3 C. P., 511. (f) Per James, L. J., in Cowles v. Gale, L. R. 7 Ch, 15. (g) Per Knight Bruce, L. J., in Prender gast v. Turton, 1 Y. & C C. C, 110, and in Clegg v. Edmondsou, 8 De G. M. & G., 814. (h) Parker v. Frith, 1 S. & S., 199 a.; per Lord Eldon in City of London v. Mitford, 14 Ves., 58; Walker v Jeffrevs, 1 Ha., 341; Alloway v. Braine, 26 Beav., 575; and cf. Eads v. Williams, 4 De G M. & G. 674; Clegg v. Edmondson, 8 ib 787; Huxham v. Llewellyn, 21 W. R., 570, 766; Glasbrook v. Richardson, 23 W. R, 51; infra, § 1078. (i) Pollard v Clayton, 1 K. & J., 462; per Lord Redesdale in Crofton v. Ormsby, 2 Sch. & Lef, 604 Cf. Huxham v. Llewellyn, 21 W. R, 570, 766; infra, § 1079. in dealing for reversionary interests (Newman v. Rogers, 4 B. C. C., 391), or concurrent leases (Carter v. Dean of Ely, 7 Sim., 211), where the contract is for the grant of an annuity for the life of an individual (Withy v. Cottle, T. & R., 81), and in covenants to renew leases for lives or years (Eaton v. Lyon, 3 Ves., 690), where the contract relates to stock in the public funds (Forrest v. Elwes, 4 Ves,, 492), or where there is a reference to arbitrators as to the price (Morse v. Merest, 6 Mad., 27), or where the vendors are an ecclesiastical corporation or other fluctuating body. Carter v. Dean of Ely, ubi sup." Batten Spec. Per., 126, 127; see Southern Life Ins. Co. v. Cole, 4 Flor., 359. towards obtaining patents, time was from the nature of the object in view held to be of the essence.() § 1054. So, again, where a contract specified a time by which calls were to be paid up, or in default the shares were to be forfeited;(k) and where a contract gave an option to be exercised before a certain time to convert loan notes into shares :(7) in both these cases time was from the nature of the subject-matter of the contract held to be essential. § 1055. The case of Macbride v. Weekes(m) is a strong illustration of this principle; for there the plaintiff by the contract undertook to purchase a field adjoining his own, to procure an assignment of a term, and to do other things which usually require time: but the nature of the subjectmatter of the contract, which was a colliery, was held to make time of the essence of the contract, to the extent of rendering it incumbent on the vendor to use his utmost diligence in completing the contract, and giving the purchaser a right to decline completing, if the vendor failed in so exerting himself. In this case the purchaser, after little more than two months had elapsed from the date of the contract, gave the vendor notice that, unless he completed it within another month, the purchaser would rescind, and the time so limited by the purchaser was held to be, under the circumstances, reasonable. § 1056. The essentiality of time may also be implied from the surrounding circumstances connected in each case with the particular contract. (n) Thus where a man purchasing a house with the object of immediately occupying it as his own residence stipulated in the contract that possession should be given on a specified day, and the vendor failed to show a good title by that day, it was held that the stipulation as to time was of the essence of the contract,(0) and the vendor, though he offered actual possession, failed to enforce specific performance. (p) Possession in such a contract means possession with a complete title previously shown.(q) (j) Payne v. Banner, 15 L. J. Ch., 227. (k) Sparks v. Liverpool Waterworks Co., 13 Ves.. 428. (1) Campbell v. London & Brighton Rail. way Co., 5 H. A., 519, 529. (m) 22 Beav., 533, 539; cf. Huxham v. Llewellyn, 21 W. R., 570, 766; and, as to the notice, infra, § 1062 et seq. (n) Per Turner. L. J., in Roberts v. Berry, 3 De G. M. & G., 291. (0) See Gedye v. Duke of Montrose, 26 Beav., 45. (p) Tilley v. Thomas, L. R. 3 Ch., 61. (9) Per Rolt L. J., L. R. 3 Ch., 68. As to 'possession,' see also Lake v. Dean, 28 Beav., 607. § 1057. The later case of Webb v. Hughes(r) is not at variance with this principle, but illustrates a limitation of it. There, too, the house and land, the subject-matter of the contract, were required by the purchaser for immediate residential occupation, but the conditions of sale after naming a day for completion went on to provide that if, from any cause whatever, the purchase should not then be completed, the purchaser should pay interest on the unpaid purchase-money from that day until the actual completion of the purchase; and it was accordingly held that, inasmuch as parties to the contract evidently contemplated the possibility of the completion being postponed beyond the day named, time was not of the essence. The ratio decidendi of this case is obviously applicable whatever the nature of the subject-matter of the contract, and it has accordingly been applied even to the sale of a reversionary interest.(s)' § 1058. Again, where the members of a company in general meeting agreed to certain conditions on which dissenting members should be allowed to retire from the company, and one of those conditions fixed a date by which the option to retire was to be declared, the House of Lords held that that date was so essential a part of the arrangement, that the directors had no power to allow any member to (r) L. R. 10 Eq., 281. (8) Patrick v. Milner, 2 C. P. D., 342. 1 Where no time has been designated.] An action for specific performance cannot be maintained, where no time has been designated for the performance of the contract. Potts v. Whitehead, 20 N. J. Eq., 55. Contracts for the sale of real estate; time not usually "of the essence."] In such cases the intent usually is, that the purchase shall be completed within a reasonable time under the surrounding circumstances of the case. Rader v. Neal, 13 W. Va., 374; Chadwell v. Winston, 3 Tenn. Ch., 110; Abbott v. L'Hommedien, 10 W. Va., 677. Parol proof that time was "of the essence."] In an action for specific performance, parol evidence may be introduced to show that time was to be considered as of the essence of the contract when it was made. King v. Ruckman, 20 N. J. Eq., 316. When performance within a given time material.] Time is of the essence, where the other party would be seriously injured by a non-performance within the stipulated time. Doar v. Gibbes, Bailey's Eq., 371 Or, whenever from change of circumstances, a performance, which would alone answer the ends of justice, has become impossible. Pratt v. Low, 9 Cranch, 466; Longworth v. Taylor, 1 McLean, 395; Garnett v. Macon, 6 Call., 308. See as examples where time was held material, Hipwell v. Knight, 1 Y. & C. Ex., 401; Newman v. Rogers, 4 Bro. C. C., 391; Merritt v. Brown, 19 N. J. Eq., 286; Gall v. Archer, 42 Barb., 320; Edwards v. Atkinson, 14 Tex., 373. retire who had not declared his option within the limited time.(t) § 1059. Where hardship would result from considering time immaterial, as where delay in completion would involve one of the parties in a serious liability or loss, the court will incline to consider time as being of the essence. Thus where a tenant, without any definite interest, agreed for the sale of his goodwill and business to a purchaser to be completed on the 25th of March, that day was considered essential, inasmuch as if the contract were not then completed, the vendor might render himself liable as tenant for the ensuing year. (u) And so, again, where the body to participate in the purchase-money, being a chapter, was liable to variation, non-payment of the consideration money at the specified time was held fatal to the subsistence of the contract. (v)' § 1060. Where the vendor stipulates that time shall be of the essence in respect of some of the conditions in his favor, the court inclines to hold it essential in respect of others also against him. Vendors so stipulating for the essentiality of time in their favor, "cannot fairly," said Knight Bruce, V. C., "complain of being held strictly to the conditions themselves * ** The plaintiffs' proposition is that the purchaser shall be held by a cable, and the vendors by a skein of silk." (w) Accordingly where it was, by one clause of the contract, provided that the vendors should deliver the abstract to the purchaser within twenty-one days from the date of the contract, and by another clause, that the purchaser should send in his requisitions within twenty-eight days from the delivery of the abstract, and in this respect time should be of the essence of the contract; and the vendors did not deliver the abstract until more than two months after the date of the contract; the court refused to hold the purchaser bound to comply with 263 (t) Houldsworth v. Evans, L. R. 3 H. L., (u) Coslake v. Till, 1 Russ., 376; Wells v. Maxwell (No. 1), 32 Beav., 408, affirmed 33 L. J. Ch., 44, 11 W. R., 842; Green v. Sevin, 13 Ch. D., 589; Roberts v. Perry, 3 De G. M. & (v) Carter v Dean of Ely. 7 Sim, 211. Doar v. Gibbes, 1 Bailey's Ch., 371; Colcock v. Butler, 1 Dessau., 307, where the court refused to decree specific performance of a contract for the sale of a house, where there had been a delay of eight months in completing the house, which had greatly depreciated in the meantime. See Jackson v. Edwards, 22 Wend., 498. |