Marketable title and repudiation in property sale contracts justified refund of earnest money and refusal of specific performance.

A fixed completion date in an agreement for sale of immovable property does not automatically make time the essence unless the parties clearly intend it, and a notice demanding refund may amount to an unequivocal repudiation. The purchaser was entitled to rescind where the vendor could not perform as required. A vendor must also show a marketable title free from reasonable doubt; pending proceedings under the Estates Abolition law created serious uncertainty and justified refusal of specific performance. The court therefore upheld refund of the earnest money with costs.

---

---

Issues: (i) Whether the plaintiff was entitled to rescind the agreement and claim refund of the earnest money despite the stipulation for completion by a specified date and the extension of time; (ii) whether the vendor had a marketable title or a title free from reasonable doubt so as to justify refusal of specific performance and refund of the earnest money.

Issue (i): Whether the plaintiff was entitled to rescind the agreement and claim refund of the earnest money despite the stipulation for completion by a specified date and the extension of time.

Analysis: Under the law governing contracts for sale of immovable property, a fixed date does not necessarily make time the essence of the contract unless the parties clearly so intend. The notice demanding refund was treated as an unequivocal rescission of the bargain. Even if the specified date was not of the essence, the plaintiff could still decline to proceed where the vendor could not perform the contractual obligation in the circumstances that followed.

Conclusion: The plaintiff validly repudiated the contract and was entitled to seek refund of the earnest money.

Issue (ii): Whether the vendor had a marketable title or a title free from reasonable doubt so as to justify refusal of specific performance and refund of the earnest money.

Analysis: The pending proceeding under the Estates Abolition law created a substantial uncertainty over the vendor's title and showed that she could not convey a title free from reasonable doubt within the time contemplated by the parties. A purchaser is not bound to accept a title clouded by serious and rational doubt, and the court will not compel specific performance where doing so would force the purchaser into doubtful litigation or injustice. The relevant principles under the law of transfer, contracts, and specific relief supported the vendee's right to refuse performance and recover the deposit.

Conclusion: The vendor failed to establish a marketable title, and the refusal of specific performance with refund of the earnest money was justified.

Final Conclusion: The appeal did not succeed, and the decree directing refund of the earnest money with costs was maintained.

---