Palmer v. Fox

Louis G. Palmer & Company (Palmer) (plaintiff) contracted to sell a lot in one of its subdivisions to Fox (defendant). The contract provided a purchase price of $1,650, of which $247.50 was to be paid when the contract was executed, and the balance was to be paid in monthly installments of $16.50 over the next five years. In exchange for Fox tendering the purchase price, Palmer agreed to provide cement sidewalks on the property and to grade all streets, and either cinderize or gravel the streets. The contract also provided that at its election, Palmer would furnish water mains and lateral sewers in the streets and alleys of the subdivision. Palmer provided the water mains, lateral sewers, and cement sidewalks, but failed to cinderize or gravel the streets. Fox paid the initial price of $247.50 after the contract was executed, and paid additional monthly installments of $16.50 until February 11, 1931. Fox ceased making additional payments after that time due to Palmer’s failure to cinderize or gravel the streets. On February 7, 1933, Palmer brought suit in Michigan state court against Fox seeking the balance due on the contract plus interest, or $855.91. Fox argued that his promise to pay was dependent on Palmer’s promise to perform improvements, including cinderizing and graveling the streets. Fox argued that Palmer’s breach of this covenant excused his own performance. The trial court awarded damages of $855.91 to Palmer, and Fox appealed.