BANNON v. MON HAR ENTERPRISES (1980)

This is an appeal by the administrator of the estate of Shorr from an order made by the probate court on February 6, 1980, denying the administrator's petition for a direction to withdraw from a sale of real property. Respondent, who is the buyer, has moved to dismiss the appeal on several grounds, one of which is that the appeal is frivolous. We have concluded that, under the circumstances, this appeal is legally frivolous and must be dismissed on that ground.

The material facts are not in dispute.¹ On December 14, 1977, the probate court confirmed a sale of real property by the Shorr estate to Mon Har Enterprises (hereafter buyer). The decedent's widow appealed from that order, which was affirmed by Division Two of this court in an unpublished opinion filed October 17, 1979 (Estate of Shorr, 2 Civ. 55043.)

On December 28, 1979, the administrator petitioned the probate court for an order directing him to withdraw from the sale and vacating the order confirming the sale, upon the ground that, due to the lapse of time, the terms of the sale were no longer fair and reasonable to the estate. The present appeal was taken from the order filed February 6, 1980, denying that motion.

The order is appealable under Probate Code section 1240 as an order instructing an administrator.² The motion which was denied by the February 6, 1980, order was not a motion attacking the 1977 order confirming the sale. The motion was based upon new circumstances which the administrator thought would justify his refusing to carry out the sale. The issue raised in this appeal did not exist at the time the earlier appeal was decided. The present appeal is not moot, nor is the decision on the former appeal res judicata as to this new issue.

We therefore turn to the administrator's contentions, as made in his 1979 motion and in his opposition to the motion in this court to dismiss the appeal as frivolous. The ground stated in the 1979 motion for instruction is that market conditions have changed substantially since 1977 and therefore “a sale on terms substantially more beneficial to this estate may now be effected.” The written motion goes on to say that since the 1977 confirmation of the sale the income from the property has increased substantially because rents have increased and property taxes have gone down.

No authority has been cited for this hindsight reexamination of the benefit to the estate. The authorities are to the contrary.

The adequacy of the price to be received by an estate from a sale of real property is determined by the probate court after a hearing pursuant to Probate Code section 785. That determination may not be set aside upon a showing made at a later time that a higher price could then be obtained. (Estate of Lewy (1976) 61 Cal.App.3d 635, 641, 131 Cal.Rptr. 291.)

Baldwin v. Stewart (1933) 218 Cal. 364, 23 P.2d 283 was an action by an administrator for specific performance of a contract to sell real property. Before the sale had been confirmed by the probate court the buyer had given notice of withdrawal. Nevertheless, the probate court confirmed the sale, and the buyer did not appeal from the confirmation order. In affirming the judgment of specific performance, the court said at page 368: “By requiring the court to inquire into the regularity and fairness of the sale; by making specific provision for the liability of the purchaser for a deficiency in the event of his default and a possible resale; and by giving the right of appeal from an order confirming sale, the legislature has evidenced a clear intent to make conclusive an order confirming sale which has become final.”

In Estate of West (1912) 162 Cal. 352, 357, 122 P. 953, the Supreme Court, in explaining why an order of the probate court purporting to vacate an order confirming a sale of real property was appealable, said “If the original order directing a sale and conveyance to the appellant was valid the appellant (buyer) had acquired a vested right by a conveyance and the court could make no subsequent order which would defeat that right.”

Counsel for the administrator cites two clauses in the contract of sale as justifying the present effort to escape the obligation incurred in 1977. These provisions are as follows:

“A sixty (60) day escrow will be opened with (sic) five (5) business days of confirmation of sale by the court

“

“The undersigned (buyer) agrees that if for any reason whatsoever, title in the manner set forth above cannot be conveyed by the seller, then in that event, the seller shall have the right to withdraw from said escrow, and be released and relieved of all liabilities of any kind or character whatsoever, by reason of said inability to convey said title as set forth above.”

Ordinarily the failure of one or both parties to perform within the time specified for closing the escrow does not automatically revoke the contract. (See Chan v. Title Ins. & Trust Co. (1952) 39 Cal.2d 253, 258, 246 P.2d 632; Weisberg v. Ashcraft (1963) 223 Cal.App.2d 793, 36 Cal.Rptr. 188; Leiter v. Handelsman (1954) 125 Cal.App.2d 243, 251, 270 P.2d 563.)

The contract involved here does not contain any provision for automatic cancellation of the sale. There is no showing that either party attempted to cancel the contract by reason of the delay in performance until the administrator filed his 1979 petition in the probate court requesting the court to authorize such a cancellation.

The record shows that both parties initially construed the sale contract to be effective notwithstanding the pendency of the first appeal. The record contains a letter from the administrator to the buyer dated October 26, 1978, which concludes: “Demand is hereby made upon you that you perform all things on your part to be performed under said contract between us, as confirmed by the Los Angeles Superior Court; specifically that you complete payment of the purchase price through escrow in accordance with the terms of our contract.”

The opposition to the motion to dismiss this appeal incorporates a letter dated November 2, 1978, from the buyer's attorney replying to the administrator's demand. That letter states that the buyer “has placed with the escrow company a check sufficient to cover all monies due from them to close this estate (sic).” The letter also suggests that the money be held by the estate in trust, or that the estate provide a bond or other adequate security to protect the buyer “in the unlikely event the appeal is successful.”

We agree with the 1978 position of the parties that failure to close the escrow within 60 days did not operate to cancel the contract.

The option given the estate to withdraw if title could not be conveyed has no effect in the present state of the record. The short answer is that as of the time the court ruled on the administrator's motion (February 6, 1980) the estate had not withdrawn, and as of that date had no legal ground for withdrawing.³ So far as the record shows, there was no flaw in the title other than the pendency of the appeal from the 1977 order, and that impediment expired with the remittitur issued December 17, 1979.

At oral argument on the motion to dismiss, we asked counsel for the administrator to submit a memorandum discussing whether there was any justification, other than economic, for what the administrator was attempting to accomplish by this appeal. The response of counsel acknowledged that the administrator's action was purely for the economic benefit of the estate, and that the legal justification was in the theories which had previously been argued.

The administrator's theory would give an estate the advantage of speculating on the real estate market at the sole risk of the buyer whenever a legatee saw fit to appeal from an order confirming a sale. If, pending appeal, the market went down, the buyer would be held to the agreed price (Baldwin v. Stewart, supra, 218 Cal. 364, 23 P.2d 283); but if the market went up the administrator would be free to seek a higher bid. The probate court's concern for the best interest of the estate does not extend to that kind of advantage.

Ordinarily, this court is reluctant to examine an appeal prior to briefing to determine whether it should be dismissed as frivolous. We have done so in this case because, as counsel agree, the issue is one which should be put to rest as soon as practicable, and the controlling issue has been fully argued.

The party identified as the buyer here, in apparent good faith, purchased real property in November 1977. Because of one unmeritorious appeal, and then this second appeal, the buyer has been and is denied the use of the property. No further proceedings here are required.

The appeal is dismissed.

FOOTNOTES

1.  Counsel for both sides have been most helpful to the court in expediting this decision. Appellant's counsel has provided the equivalent of a clerk's transcript so that we need not wait for the preparation of an official transcript by the county clerk.The memorandum of points and authorities submitted on behalf of the administrator states: “If the Court should find the order not appealable, however, appellant submits that in view of the completeness of the record and the briefing it would be appropriate to treat this memorandum and accompanying materials as a petition for writ of mandate and decide the merits at this time; such treatment would spare the parties the harm likely to result from additional delay (citations).”We have concluded that the motion procedure, which is even more expeditious than mandate, is the appropriate medium.

2.  Probate Code section 588: “In all cases where no other or no different procedure is provided by statute, the court on petition of the executor or administrator may from time to time instruct and direct him as to the administration of the estate and the disposition, management, operation, care, protection or preservation of the estate or any property thereof ”

3.  The probate court's order from which this appeal was taken contains this finding: “7. There is no factual basis for preventing completion of sale as there is no present impediment to title.”

FILES, Presiding Justice.

KINGSLEY and WOODS, JJ., concur.