Doctorman v. Schroeder

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Brief Fact Summary. In this case Doctorman (Plaintiff) entered into a contract to purchase property from Schroeder (Defendant). The contract specifically stipulated that unless the payment was made on that day all monies paid on the account would be forfeited and the agreement would be null and void, however Plaintiff convinced Defendant to accept a partial payment.

Synopsis of Rule of Law. Repeated acceptance of late payments by a vendor can lead to a finding that the vendor has waived enforcement of the time constraints within the contract.

Facts. In this case Plaintiff entered into a contract to purchase property from Defendant, and paid $500.00 as the down payment. She was to pay an additional payment of $1,500.00 on December 19, 1919. The contract specifically stipulated that unless the payment was made on that day all monies paid on the account would be forfeited and the agreement would be null and void. The Plaintiff, on December 19, convinced Defendant to accept $500.00 as partial payment. The Defendant wrote a receipt which provided that the remaining $1,000.00 due was to be paid on December 20, by 2:30 p.m. in a specific office, time was of the essence, and any failure to make the payment on time would result in the termination of the agreement. Plaintiff was about forty minutes late and Defendant refused to accept her payment.

Issue. Should the court supply a different outcome than what the parties clearly intended?

Held. No. Complaint dismissed.
The court began by noting that the intent of the parties was specific and unquestionable in the memorandum of the receipt, which provided the exact time for payment. The court found that there was nothing unlawful about the contract or the contract extension.
The only possible exception to the contract extension would be a waiver. A waiver is a frequent defense of a purchaser in “time of the essence” cases. Repeated acceptance of late payments by a vendor can lead to a finding that the vendor has waived enforcement of the time constraints within the contract.
The court found that in this case there was no evidence of any waiver. Clearly the Defendant was unhappy with the actions and irresponsibility of the Plaintiff and gave Plaintiff another chance to be prompt, of which Plaintiff did not take advantage. Thus, the court found no choice but to enforce the contract as written, and, because Plaintiff was late, Plaintiff forfeited all monies paid up to the time of the breach.

Discussion. Repeated acceptance of late payments by a vendor can lead to a finding that the vendor has waived enforcement of the time constraints within the contract. However, in this case, the court abided by the parties contract extension. It did not find that the initial acceptance of the partial payment was a waiver on the part of Plaintiff.