Ziehen (plaintiff) agreed to buy a tract of land from Smith (defendant). Ziehen paid $500 down upon the execution of the contract. The day designated by the contract for mutual performance—the remainder of the payment and transfer of the deed—was September 15, 1892. Unbeknownst to either party, there was a third-party mortgage on the land, and an action to foreclose the mortgage had commenced on July 21, 1892. On September 15, Ziehen did not offer to pay the purchase price, nor did he demand performance from Smith. The foreclosure was later granted on September 30. Ziehen brought suit to recover his down payment. The trial court found in Ziehen's favor, and Smith appealed.