## Facts

- A real-estate developer platted and marketed the Mount Baker Addition in Seattle as a high-end residential district, with parks and boulevard improvements.
- The developer sold lots under written installment purchase contracts stating they bound the purchaser’s “heirs, assigns, successors, or legal representatives.”
- The developer contracted to sell a lot to Marguerite Foy.
- Foy assigned her contract interest to Susie Stone, a Black woman; the developer’s authorized agent signed an approval of the assignment on the contract.
- The Stones prepared to build a private residence on the lot.
- The developer sued to cancel and rescind the assignment, alleging the assignment was approved by mistake because the agent did not know the Stones’ race and asserting the Stones concealed their race knowing the developer would not consent.
- A claimed payment default (interest) was raised at trial but conceded to be incorrect and was abandoned on appeal.
- The trial court dismissed the action, and the developer appealed.

## Issues

1. Whether a developer may rescind an approved assignment of a land purchase contract based on unilateral mistake about the assignee’s race, where the contract expressly runs to “assigns” and contains no racial restriction.
2. Whether a purported right to “approve” assignments permits invalidating an assignment that was actually approved by the developer’s agent under a contract that contemplates assignment.
3. Whether anticipated loss of popularity or value of other lots due to Black occupancy is a sufficient equitable ground to rescind an otherwise valid, performed contract.

## Decision

- The Washington Supreme Court affirmed the dismissal for the defendants.
- The assignment, once approved by the developer’s agent, was binding under the contract’s express extension to “assigns.”
- The evidence did not establish fraud or misrepresentation by the Stones.
- Unilateral mistake about the assignee’s race did not justify rescission where no such limitation appeared in the contract.
- Alleged economic harm based on racial exclusion objectives was not a legally sufficient basis for equitable rescission.

## Legal Principles

- A written land purchase contract that expressly binds “assigns” is generally assignable, and an assignee succeeds to the purchaser’s contract rights.
- Equitable rescission for mistake is limited; absent fraud or a mistake going to an essential contractual term, a party’s unilateral mistake does not warrant cancellation.
- A party cannot enforce an unwritten, discriminatory limitation through rescission when the contract contains no such restriction and the other party has not engaged in actionable deception.
- Claimed injury consisting of reduced marketability or value stemming from discriminatory preferences does not supply an equitable ground to undo an otherwise valid contract.

## Conclusion

The court held that the developer could not cancel an approved assignment of a lot-purchase contract based on the assignee’s race, because the contract authorized assignment, no fraud was proven, and equity would not rescind a racially neutral agreement to protect the developer’s asserted desire for racial exclusivity.


Hunter Tract Improvement Co. v. Stone, 58 Wash. 661, 109 P. 112 (Wash. 1910)