Facts:
Price for land: 230k
Down payment: 100k
Annual payments of: $16,133
Improvements: $26k
In 1985, cannot make payment and default will go back to seller, including all
improvements
Buyers wanted to be treated like mortgage payers, which did not work
They then filed for recession in bankruptcy court
P’s rationale for recession:
– acreage shortfall
– no survey, therefore no marketable title
– easement not mentioned in the deed regarding the US Highway
Issue:
Holding: Affirmed.
Rationale:
– This was a sale of land “in gross” which is determined generally “when land is
sold in gross, a variation of acreage from what the parties have contemplated is
not ground for rescission or other relief. For a sale to be “in gross” that exact
phrase need not be used. If a purchaser looks at the property at least 3 times,
walks the boundary, and is told “you are looking at what you get.” Here, the
phrase, “more or less” and the land sold as one amount rather than per acre is
sufficient to infer an “in gross” sale and there is evidence that the purchaser
checked out the property numerous times and agreed to be nonspecific about the
amount of land. An acreage shortfall will only be a ground for rescission if the
difference is material. Here it would only be 6%, courts have held at as much as
30% will still not allow a rescission.
– As for the ‘no survey, no title” argument, P argues that Montana law requires a
survey prior to the recording of property “one thirty-second or larger aliquot parts
of a US gov’t section.” But, this is such a small step in the process that the court
is willing to look past it. The crux of the issue is whether the property is
identifiable. Further, D was willing to pay for the costs of the survey to ensure
the delivery of a recordable deed.
– P acknowledges that he was aware of a road and was shown the property
boundaries, under such circumstances this statement is sufficient to at least put P
on notice to inquire as to possible easements himself.