Mohrlang v. Draper
219 Neb. 630, 1985 Neb. LEXIS 985, 365 N.W.2d 443 (1985)
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Rule of Law:
A seller's discovery that a contractually agreed-upon obligation is more expensive than anticipated does not constitute undue hardship sufficient to excuse specific performance of a real estate contract, particularly when the seller neglected to ascertain the cost before entering the agreement.
Facts:
- On June 8, 1981, John R. Mohrlang submitted a written offer to purchase an unimproved lot from Larry Draper for $14,875.
- The purchase agreement required Draper to bear the cost of relocating a Kansas-Nebraska Natural Gas Company gasline located on the property and pave an adjacent street.
- On June 9, 1981, Draper signed and accepted Mohrlang's offer.
- Following the agreement, Mohrlang hired an architect to design a solar home specifically suited for the lot's southern exposure.
- On July 7, 1981, Draper was informed by the gas company that the cost to relocate the gasline would be $10,050.
- The continued presence of the gasline rendered the lot unusable for the residential construction Mohrlang intended.
- Draper failed to relocate the gasline or pave the street and offered Mohrlang a substitute lot, which Mohrlang refused.
Procedural Posture:
- John R. Mohrlang filed a petition against Larry Draper in the district court for Adams County, a court of first instance, requesting specific performance of their real estate contract.
- Draper answered, alleging that performance was impossible and that Mohrlang had an adequate remedy at law.
- The district court found for Mohrlang but denied specific performance, ruling it would work an "undue hardship" on Draper.
- Instead of specific performance, the district court awarded monetary damages to Mohrlang.
- Draper, as appellant, appealed the award of monetary damages to the state's highest court.
- Mohrlang, as cross-appellant, appealed the denial of specific performance to the same court.
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Issue:
Does a seller's belated realization that a contractually-mandated obligation is more expensive to perform than anticipated constitute an undue hardship that excuses the seller from the equitable remedy of specific performance?
Opinions:
Majority - Shanahan, J.
No. A seller's subsequent discovery that a contractual obligation is more difficult or burdensome than anticipated does not constitute a hardship that would excuse specific performance. Specific performance should generally be granted for a valid real estate contract because land is considered unique. The defense of hardship is evaluated based on the circumstances existing when the contract was made, not by subsequent events. In this case, Draper made an absolute and unqualified undertaking to relocate the gasline. The information regarding the cost was available when he entered the contract, and his failure to investigate this cost constitutes self-inflicted hardship through his own inexcusable neglect. An imprudent or bad bargain, in and of itself, is not a legally sufficient excuse for nonperformance.
Analysis:
This decision reinforces the strong legal preference for granting specific performance in real estate contract disputes, underscoring the principle that each parcel of land is unique. It significantly narrows the applicability of the "undue hardship" defense, clarifying that hardship cannot be self-inflicted through a party's failure to conduct due diligence. The ruling solidifies the idea that courts will not reform a contract to save a party from a bad bargain, thereby promoting certainty and holding parties accountable for the obligations they voluntarily undertake.
