Brief Fact Summary. The Plaintiffs entered into a land purchase agreement with the Defendants for sale of property to be paid in monthly installments to the Plaintiffs. Defendants defaulted and Plaintiffs sued for possession.
Synopsis of Rule of Law. Upon execution of a contract for the sale of land, the vendor holds legal title in trust for the vendee and the vendee for all practical purposes is the owner of the property subject only to the terms of the contract.
Issue. What are the rights between a vendor and a defaulting vendee under a land purchase contract?
Held. Reversed. Plaintiffs must pursue an appropriate remedy and a suit for ejectment is not a remedy available to them.
Upon the execution of a contract for the sale of land, the seller (vendor) holds the legal title in trust for the buyer (vendee). The vendor also has an equitable lien on the property. Further, for all practical purposes, the vendee in possession is the owner of the property, subject only to the terms of the contract.
The vendor may not enforce his rights by an action in ejectment. Instead, a vendor must instead proceed to foreclose the vendee’s equitable title or bring an action at law for the purchase price. The same options that a mortgagee would have.
Forfeiture would also be appropriate where the vendee has paid a minimal amount on the contract at the time of default and seeks to retain possession while the vendor is paying taxes, insurance, and other upkeep in order to preserve the premises.View Full Point of Law