Palmer v. Fox

• Louis G. Palmer & Company = "Palmer" = plaintiff = seller of a lot in Detroit, Michigan outside the city
• Mr. Fox = "Fox" = buyer of the un-developed land
• Fox agreed to buy Palmer's land in September 1925 for $1,650
• Fox would pay $250 as down payment; thereafter, the monthly installments would be $16.50/month; so, this was a 5-year mortgage
• Palmer (seller) agreed to improve the sub-division; to wit, Palmer would provide
  • water mains (main pipe)
  • sewers,
  • sidewalks
  • grade & surface the streets with gravel or cinders
• Palmer completed most of the improvements except 1 avenue in front of Fox's lot
• In February 1931, Fox (buyer) left an unpaid balance of about $700

• Palmer sued Fox for breach of contract over the un-paid balance + interest.
• Palmer won in the trial court.

Are covenants dependent if the contracting parties' intent suggests the covenants were to be performed concurrently?

• Fox argued that Palmer (seller)'s breach by not improving the front street excused his performance. Thus, Fox didn't have to pay off the balance.
• Palmer contended that his breach was immaterial because (at the time) it would cost only $7 to surface the area in front of Fox's lot.
• Fox argued that the contract called for surfacing the whole street in front of Fox's lot--which would certainly cost much more than $7 even in the 1920s.

Yes. If the parties' intent demonstrates that covenants were to be performed concurrently, the covenants are dependent.

Palmer has committed a material breach of the contract by not surfacing the whole street facing Fox's new land.

Reversed

Dependent Covenants

Courts will presume that contracts are dependent covenants unless the contract or circumstances indicate otherwise.