This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
While, at modern law, the covenants in a contract for the sale of realty which provide on the one hand for the conveyance, and on the other for payment of the purchase price, are regarded as concurrent in the absence of any provision in the contract which shows a contrary intention,1 such a contract frequently contains provisions which show that the parties intend that the performance of one or more covenants by one of the parties shall precede the duty of the adversary party to perform the covenants into which he has entered. Full effect is given to such provisions where the intention of the parties is clear.2 Such a contract may by its express terms require the purchaser to pay a part or all of the purchase price to the vendor in advance; and under such a contract such covenant on the part of the purchaser is precedent to the covenant on the part of the vendor to convey.3 Under a contract to sell certain land at a certain price if the vendee shall pay a pre-existing note to the vendor,4 or to convey certain realty and relinquish a tree-claim, such contract "not to be performed until" the grantee shall pay a debt owing by him to a third party and secured by' a mortgage upon personalty, the transfer of which is the consideration for such contract,5 the payment of such debt is in each case a precedent covenant. Under a contract by which A agrees to lease a tract of land to B and to pay for the building which B is to erect thereon, reserving to A the right of re-entry in case of B's default in paying rent, and B agrees to pay rent in certain instalments at certain intervals, as well as to erect such building, B's covenants to pay rent are precedent to A's covenants to pay for such building;6 and if B makes default in paying such instalments, and A elects to re-enter under such condition, A is not bound to pay for such building.7 Under a bond for a deed which declares that improvements to be made on the realty conveyed are the chief condition, and are to be made by a certain date, the construction of such improvements is precedent to the delivery of such deed.8
15 Quinlan v. Green County, 157 Fed. 33, 19 L. R. A. (N.S.) 849 [affirmed, Green County v. Quinlan, 211 U. S. 582, 53 L. ed. 335].
16 Lord v. Miller, 86 Wash. 436, 150 Pac. 631.
I7 Coffey v. Northwestern Hospital Assn., - Or. -, 183 Pac. 762.
18 Coffey v. Northwestern Hospital Assn., - Or. -, 183 Pac. 762.
1 See Sec. 2946 and 2964.
2 United States. Loud v. Pomona Land & Water Co., 153 U. S. 564, 38 L. ed. 822.
Indiana. Huff v. Lawlor, 45 Ind. 80.
Iowa. Granfield v. Rowlings, 53 Ia. 654, 6 N. W. 31.
Maine. Hill v. Fisher, 34 Me. 143.
Mississippi. Leftwich v. Coleman, 4 Miss. (3 How.) 167.
New Jersey. Huffman v. Hummer, 18 N. J. Eq. 83.
New York. Burwell v. Jackson, 9 N. Y. 535.
Pennsylvania. Parmentier v. Wheat, 33 Pa. St. 192.
Wisconsin, Gale v. Best, 20 Wis. 44.
By the terms of a contract for the sale of realty the vendor may agree to convey the realty before the purchaser is to pay part or all of the purchase price therefor; and under such a contract the covenants of the vendor to convey is precedent to the covenant of the purchaser to pay the purchase price or such part thereof.9 Under a contract by which the vendor covenants to convey the realty on the payment of a specified instalment of the purchase price, leaving other instalments due and unpaid, such covenant to convey is precedent to the covenant on the part of the purchaser to pay the remaining instalments; and the vendor can not, on the one hand, recover such subsequent instalments if he has not performed his covenant to convey;10 and, on the other hand, the vendor is bound to make such conveyance, although it is possible that the purchaser may not perform his covenant to pay the remaining instalments of the purchase price.11 If the vendor has agreed to remove the encumbrances upon certain realty before the purchaser is to pay therefor, such covenant on the part of the vendor is precedent to the covenant on the part of the purchaser to pay therefor.12 Under a contract for the exchange of realty providing that the contract is to be void unless each can furnish an abstract showing title, the ability of each party to furnish such abstract is precedent to his right to enforce performance against the adversary party.13 A covenant on the part of the vendor to construct certain improvements,14 or to construct a railway or other means of access to the realty,15 which by its terms is to be performed before the last instalments of the purchase price are due, is precedent to such covenants on the part of the purchaser. If B, who has purchased certain land from A under an executory contract, agrees to work on such realty for a certain time and to surrender such contract to A, in consideration of which A agrees to pay to B a certain amount, B can not recover such amount from A unless he can show that he has surrendered such contract and the possession of the realty which he has obtained thereunder.16 If A has agreed to reimburse B for money which B has advanced for the purchase of certain property from X for the benefit of A and B, B can not recover from A unless he is able to show that he has made a valid contract with X and has advanced money thereunder.17 If A agrees to purchase land for B, and B is to have a certain length of time in which to examine and investigate such land, A's covenant to get such land for B is precedent to B's duty to pay therefor;18 and B is not required to show that he was ready and willing to buy such land or that he offered to pay therefor.19
3 United States. Loud v. Pomona Land & Water Co., 153 U. S. 564, 38 L. ed. 822.
Maine. Hill v. Fisher, 34 Me. 143.
Mississippi Leftwich v. Coleman, 4 Miss. (3 How.) 167.
Pennsylvania. Parmentier v. Wheat, 33 Pa. St. 11)2.
Wisconsin. Gale v. Best, 20 Wis. 44.
4 Schields v. Horlach, 30 Neb. 536, 46 N. W. 629.
5 Wright v. Wilcox, 52 Minn. 438, 54 N. W. 483.
6 Toellner v. McGinnis, 55 Wash. 430, 24 L. R. A. (N.6.) 1082, 104 Pac. 641.
7 Toellner v. McGinnis, 55 Wash. 430, 24 L. R. A. (N.S.) 1082, 104 Pac. 641.
8 Haggerty v. Elyton Land Co., 89 Ala. 428, 7 So. 651.
9 California. Danziger v. Benson, 175 Cal. 565, 166 Pac. 313.
Indiana. Huff v. Lawlor, 45 Ind. 80.
Iowa. Granfield v. Rowlings, 53 Ia. 654, 6 N. W. 31.
New Jersey. Huffman v. Hummer, 18 N. J. Eq. 83.
New York. Burwell v. Jackson, 9 N. Y. 535.
•
10 Burwell v. Jackson, 9 N. Y. 535.
11 Danziger v. Benson, 175 Cal. 505, 166 Pac. 313.
12 Negley v. Jeffers, 28 O. S. 90.
13 McLaughlin v. McAllister, 36 Fed. 745.
14 Ihrke v. Continental Life Ins. & Investment Co., 91 Wash. 342, L. I*. A. 1916F, 430, 157 Pac. 866.
"The second contention is that the clause in the contract relating to the planting of the fruit trees is an independent covenant, a breach of which is not ground for a rescission of the contract. In support of the contention the cases of Crampton v. McLaughlin Realty Co., 51 Wash. 525 21 L. R. A. (N.S.) 823, 99 Pac. 586; Spokane Canal Co. v. Coffman, 54 Wash. 645, 103 Pac. 1106, and Benham v. Columbia Canal Co., 74 Wash. 110, 132 Pac. 884, are cited. While in each of these cases the covenants were held to be independent, it can be conceded that they were rightly decided without requiring the holding that the covenants in the present case are so. In the first case the covenant was in regard to building restrictions and the making of street improvements, and in the others it related to water rights. The reason given for the holdings was that there was no connection in the matter of the promises; that they were to be performed at different times, and went only to separate parts of the consideration. Here the covenants are mutual and dependent. The very contract is to convey a tract of land with a bearing orchard, which was to be planted and matured prior to the time the last of the payments were due. There was no separation in regard to the consideration. The land with the orchard was to be conveyed as a whole for the one price, and there is no means of determining what part of the consideration was to be paid for the land and what part for the orchard." Thrke v. Continental Life Ins. & Investment Co., 91 Wash. 342, L. R. A. 1916F, 430, 157 Pac. 866.
15 Southern Colonization Co. v. Derf-ler, 73 Fla. 924, L. R. A. 1917P, 744, 75 So. 790.
 
Continue to: