CHARLES R. ELLIS, Appellant, v. EDDIE T. JOHNSON, Appellee.

APPEAL FROM THE JUDGMENT OF THE CIRCUIT COURT FOR THE SIXTH JUDICIAL CIRCUIT, MONTSERRADO COUNTY.

Heard: April 4, 2001. Decided: July 5, 2001.

1. Specific performance is an equitable suit whose essence is to ensure that fair play is done or accomplished.

2. Specific performance will not lie where the party who has paid money for a parcel of land is in constructive possession of the funds by virtue of its return to him by the seller on the demand made by him.

3. It is unfair and against the rule of equity to allow a party to have his money back, paid for a parcel of land or house spot, and at the same time take possession of the land or house spot.

4. He who goes to equity must go with clean hands.

5. Courts of law recognize that a contract may be rescinded by the acts and conduct of a party thereto which are inconsistent with the continuous existence of the contract.

6. Where the seller of land refunds to the buyer money paid by the buyer to the seller, the seller owes no further obligation to the buyer to part with his land or title thereto to the buyer, and a trial judge commits error in ruling granting specific performance in such a case.

The appellee had paid the appellant the amount of L$35,000.00 for a house spot, which the latter failed to deliver as a result of opposition from certain parties not party to the contract. The appellee, not satisfy with the non-delivery of the house spot and the time given by the appellant to deliver the property, had the matter reported to the Ministry of Justice, whose intervention resulted in the appellant being physically abused, and the repayment to the appellee, through his lawyer, of the amount which the appellee had paid to the appellant. Notwithstanding the repayment of the amount, the appellee proceeded to court to seek specific performance of the contract and delivery of the house spot.

The trial court, after hearing the evidence, ruled granting the specific performance. On appeal, the Supreme Court reversed the trial court’s judgment, holding that the lower court had erred in ruling in favour of the appellee. The Court held that once the appellee had received a refund of the amount which he had paid to the appellant for the land, he was no longer entitled to the house spot. The Court further held that the evidence which had been presented by the appellant clearly showed that the amount had been repaid by the appellant to the appellee, through the latter’s counsel who, while on the witness stand, admitted receiving the amount on behalf of the appellee. The Court reiterated the principle of equity that he who comes to equity must come with clean hands, and it opined that the appellee could not receive the refund and at the same time seek title to and possession of the property for which he had made payment and been refunded. The appellee’s actions and conduct, the Court observed, were tantamount to a rescission of the contract of sale, and hence, the appellant owed the appellee no further obligation under the contract. Accordingly, the Court reversed the judgment of the trial court and ordered that a mandate be send to the trial court to proceed in accordance with the opinion.

Francis S. Korkpor, Sr. of Tiala Law Associates, Inc. appeared for the appellant. James W. Zotaa, Jr. of the Liberty Law Firm appeared for the appellee.

MR. JUSTICE MORRIS delivered the opinion of the Court.

The appellant, Charles Robert Ellis, agreed to sell his house spot situated at the Old General Market in Monrovia (commonly known as Waterside) to the appellee, Eddie T. Johnson. The cornerstones demarcating the metes and bounds of the house spot were removed during the Liberian civil crisis. Hence, it was agreed by the appellant and the appellee that a resurvey would be conducted before the house spot could be turned over to the appellee. Subsequently, a survey permit was obtained from the Ministry of Lands, Mines & Energy and appropriate announcements were made to the public of the date of the resurvey. However, the resurvey was thwarted because a group of men disrupted the same upon the orders of the then Acting President of the Liberia Marketing Association (L.M.A.), Mr. Jerry Y. Gofa. While the appellant was making efforts to obtain security protection to have the resurvey done at a later date, the appellee became impatient and demanded the refund of the money he had paid as price for the house spot, the same being an amount of thirty thousand Liberian dollars (L$30,000.00) and five thousand Liberian dollars (L$5,000.00), representing costs of survey and other expenses the appellee had made. In spite of the fact that the appellant had promised to refund to the appellee the thirty-five thousand Liberian dollars (L$35,000.00), and was doing everything possible to raise the money, the appellee became impatient and filed with the Ministry of Justice a complaint against the appellant. As a result of the filing of the aforementioned complaint, security officers went to the appellant’s residence where they brutalized and seriously injured him, including damaging his left eye. After the aforesaid brutality was meted out against the appellant, because of the appellee’s demand for his money, the appellant, through his lawyer, Jessie Gould (now a circuit court judge) refunded to the appellee, through his lawyer, Counsellor J. D. Baryogar Junius, the amount of thirty-five thousand Liberian dollars (L$35,000.00), for which a receipt to that effect was issued, and regarding which the appellee’s counsel in his testimony admitted receiving. The receipts for the thirty thousand Liberian dollars ($L30, 000.00) and five thousand Liberian dollars (L$5,000.00) were marked by the trial court as “CA/1” and confirmed by the said court. All these and other documents were admitted into evidence by the trial court as “D/l” to ‘D/6.” Yet, and in spite of the fact that the evidence adduced during the trial of the case in the lower court showed that the appellee had been refunded the amount of L$35,000.00, representing the cost price for the parcel of land in question and survey thereof, and therefore warranted the court denying the petition for specific performance, the presiding judge, His Honour Varnie Cooper, on the 28th day of October, A. D. 2000 ruled against the appellant and granted the petition for specific performance. The final judgment of the court was excepted to by counsel for the appellant, and an appeal was announced in open court. Thereafter, a bill of exceptions was approved by the trial judge and duly filed with the office of the clerk of court. The appeal bond was also filed and a notice of the completion of the appeal served and filed, thereby completing the statutory steps required for perfecting an appeal within the statutory time.

At the trial, the appellant produced three witnesses and their testimonies were corroborated. Mr. Charles Ellis himself took the witness stand and testified essentially that he and the appellee had entered into an agreement under which he agreed to sell a house spot to the appellee. It was necessary to locate the meters and bounds of the spot, but the exercise met with resistance from some people. The appellant, however, assured the appellee that the place was his and that it was only a matter of time before he cleared the hurdle so that the appellee could receive the house spot. However, the appellee became impatient and demanded a refund of the thirty thousand Liberia dollars (L$30,000.00), which he had paid for the spot, as well as five thousand Liberia dollars (L$5,000.00), which had been used for the purpose of surveying the land and other related expenses. When the appellant did not pay the money as early as the appellee had demanded, or as the appellant had promised, the appellee filed with the Ministry of Justice a complaint against the appellant, which resulted in him being manhandled, serious injuries being inflicted upon his person, including damage to his left eye.

The appellant’s testimony established the fact that he refunded in full the amount given him by the appellee, and that the refund was made through Counsellor J. D. Baryogar Junius, who then served as lawyer for the appellee. Further, the next witness who testified for the appellant, Mrs. Marpue Alex, essentially corroborated the testimony of the appellant. The third witness for the appellant, Counsellor J. D. Baryogar Junius, who served as lawyer for the appellee in the case, testified that he did receive from the appellant, thru Counsellor Jessie Gould, the total amount of thirty-five thousand Liberian dollars (L$35,000.00), for and on behalf of the appellee. The receipts issued for the amount paid were identified by the witnesses and marked by the court as “CA/l”. The basic and essential point established by the testimonies of the appellant and his witnesses was that even though the appellant had received money from the appellee as purchase price for the house spot in question, the said amount had already been refunded because of the demands made by the appellee.

From the foregoing, this Court deems the following issues to be relevant to the determination of this case:

1. Whether specific performance will lie where the buyer of a parcel of land has demanded a refund of the money paid for the parcel of land and has received the refund of the purchase price through his lawyer?

2. Whether the final ruling of the judge granting specific performance was supported by the evidence adduced at the trial?

Given the facts and circumstances of this case, specific performance will not lie. Firstly, specific performance is an equitable suit whose essence is to ensure that fair play is done or accomplished. In the instant case, the facts show that the appellee is in constructive possession of all money he paid for the house spot in question and that he seeks to also take possession of the said house spot, as per the October 8, 2000 ruling of the trial judge. It would be unfair and against the rule of equity to allow the appellee to have his money and at the same time take possession of the house spot. That would be tantamount to unjust enrichment for the appellee, at the expense of the appellant. We agree with the appellant that as the appellee is in constructive possession of the refund, representing the price of the land as well as related expenses, the appellant had met his obligation to the appellee. We also reiterate herein, as we have done in previous cases, the principle of equity is that he who comes to equity must come with clean hands.

The appellant further submitted that while it was true that he and the appellee had agreed that the former would sell land to the latter, yet, by the subsequent conduct of the appellee in demanding and receiving a refund of the price and related amounts paid for said land, he (the appellee) had effectively rescinded the contract and discharged the appellant from any further obligations thereunder. Courts of law do recognize recission of contract based on the acts and conduct of a party thereto inconsistent with the continuous existence of the said contract. 17 AM JUR 2d., Contract, § 494.

Clearly the trial judge did not make use of or take into account the evidence adduced at the trial in arriving at a just conclusion. As a consequence thereof, there was a glaring miscarriage of justice. The evidence from the testimonies of the appellant’s witnesses established that whatever money was paid by the appellee for the land, subject of this law suit, was refunded. Where the seller refunds to the buyer money paid by the latter to the former, there remains no further obligation upon the seller to part with title to his land or to transfer such title to the buyer. The ruling of the trial judge should therefore have been in favor of the appellant, and the action for specific performance should have been dismissed in its entirety. This Honourable Court accordingly so holds.

Wherefore and in view of the facts and circumstances stated in the case and the laws controlling, it is the considered opinion of this Honourable Court that the trial court’s final judgment of October 8, 2000 should be, and same is hereby reversed. The Clerk of this Honourable Court is ordered to send a mandate to the court below, directing the judge presiding therein to resume jurisdiction over this case and give effect to this opinion. Costs are ruled against the appellee. And it is hereby so ordered.

Judgment reversed.