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GEORGE E. HARRIS v. JOHN T. DAWSON (07/19/78)

decided: July 19, 1978.

GEORGE E. HARRIS, IV AND MARGARET L. HARRIS, APPELLEES,
v.
JOHN T. DAWSON, JR. AND DIANE L. DAWSON, APPELLANTS



No. 562 January Term, 1976, Appeal from the Order of the Superior Court of Pennsylvania at No. 973 October Term, 1975 Reversing the Order dated February 14, 1975 of the Court of Common Pleas, 17th Judicial District, Union County Branch, Civil Action, Law, at No. 45 of 1974.

COUNSEL

Rice, Rice & Boop, Carl Rice, Sunbury, for appellants.

Frederick D. Kessler, Lewisburg, for appellees.

Eagen, C. J., and O'Brien, Roberts, Pomeroy, Nix, Manderino and Packel, JJ. Packel, J., did not participate in the decision of this case. Roberts, J., files a dissenting opinion joined by Eagen, C. J.

Author: Nix

[ 479 Pa. Page 465]

OPINION

Appellees (sellers) instituted an action in assumpsit for damages incurred by reason of an alleged breach of contract for sale of land by the appellants (buyers). The appellants filed preliminary objections in the nature of a demurrer to the complaint which was sustained by the court below. On appeal to the Superior Court the ruling of the Common Pleas Court was reversed with three judges of the Superior Court dissenting. We granted review.

Appellants entered into a purchase agreement with appellees for the sale of a tract of land in East Buffalo Township, Union County, Pennsylvania for a recited price of Sixty Thousand Dollars ($60,000). One Hundred Dollars ($100.00) of this amount was paid upon the signing of the agreement and Twenty-Nine Thousand, Nine Hundred Dollars ($29,900) payable in cash was to be made at the time of settlement. The remainder of the purchase price was to be satisfied by the conveyance of the buyers to the sellers of the title to a home owned by the buyers. The purchasers declined to complete the contract and refused the deed tendered to them at the time of closing. The sellers thereupon sold the property to a third party for Fifty-four Thousand Dollars ($54,000) and instituted the said law suit against appellants

[ 479 Pa. Page 466]

    for the difference between the contract price and the price obtained on resale.

The demurrer interposed by the defaulting appellants contended that the sellers precluded themselves from suing for the purchase price by reselling the property and are now limited to the retention of the One Hundred Dollars ($100.00) as liquidated damages pursuant to a provision of the original contract for sale. We agree with this contention and reverse the Order of the Superior Court and reinstate the Order of the Court of Common Pleas.

As a general rule the seller of land upon a breach by the buyer has the option of tendering a deed and suing for specific performance, or of instituting a suit in assumpsit for damages resulting from that breach. Where there has been a resale of the premises the measure of damages in a suit in assumpsit is ordinarily the difference between the price agreed to be paid by the purchaser and that obtained on the resale, Paul v. Grimm, 183 Pa. 326, 38 A. 1006 (1898). It is also not uncommon in contracts for sale of land for the parties to include a provision providing an additional alternative wherein the seller may rescind the contract of sale and keep the deposit money as liquidated damages. Baney v. Killmore, 1 Pa. 30 (1845).

The question involved in this law suit is the interpretation to be placed upon the default clause in the instrument under ...


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