Petersen v. Hartell - 40 Cal. 3d 102, 219 Cal. Rptr. 170, 707 P.2d 232 (1985)

Rule:

A vendee who has made substantial payments on a land installment sale contract or substantial improvements on the property, and whose defaults, albeit wilful, consist solely of failure to pay further amounts due, has an unconditional right to a reasonable opportunity to complete the purchase by paying the entire remaining balance plus damages before the seller is allowed to quiet title.

Facts:

Plaintiff purchasers entered into a land sales contract with a seller and made 58 of 65 payments. The vendor notified the plaintiffs of her election to terminate the contract, and refused to accept further payments. The plaintiffs brought suit for specific performance. The trial court denied plaintiffs' claim, and ordered restitution of the payments made by plaintiffs. According to the trial court, the granting of the relief was only discretionary and dependent upon a weighing of the equities. Plaintiffs appealed. 

Issue:

Under the circumstances, could the plaintiff purchasers still redeem the property, notwithstanding their willful default in payment? 

Answer:

Yes.

Conclusion:

The court reversed the judgment of the trial court, holding that where the seller of land retained title only as security for amounts payable under an installment sale contract, a vendee who willfully defaulted in one or more payments after having paid a substantial part of the purchase price nonetheless retained an absolute right to redeem the property by paying the entire balance of the price and any other amounts due. If the seller attempted to quiet title on account of the default, the right of redemption could be exercised before judgment or within a reasonable time set by the court. It appeared from the record that plaintiffs had such a right of redemption and exercised it by timely tender of the entire balance due.