De Leon appealed a trial court judgment that granted restitution to purchaser who defaulted in payments for the contract for the sale of a tract of land.
A defaulting buyer is entitled to restitution damages if the amount paid by the buyer exceeds the loss to the seller.
The De Leon’s agreed to sell land to Aldrete for $1,500.00. The contract for sale of land permitted Aldrete to pay the purchase price in installments until April 1, 1961. By July 6, 1961 Aldrete paid a total amount of $1,070.00. The De Leon’s thereafter sold the land to Guillermo Hernandez and Aldrete sued for restitution of the entire amount he paid for the tract of land. The trial court granted judgment in favor of Aldrete and awarded him restitution damages, the De Leon’s appealed.
Whether a defaulting buyer is entitled to restitution damages?
Yes. Aldrete paid 70 percent of the purchase price for the tract of land, causing the De Leon’s to suffer only $200.00. The judgment of the trial court is affirmed because the De Leon’s would be unjustly enriched if allowed to retain the $1,070.00.
Aldrete already paid 70 percent of the purchase price when the De Leon’s terminated the contract by selling the tract of land to Hernandez. Aldrete suffers more loss because a majority of the contract price was paid before termination.