## Facts

- Claudia Walker agreed to buy 80 acres of unimproved land from Ellsworth MacFadden for about $2,500, initially by oral agreement; she paid a small down payment, took possession, placed a caretaker on the land, and paid taxes.
- In April 1953, the parties executed a written installment land contract for $2,484.50; Walker made additional payments including a drafting fee.
- The contract required $20 monthly payments with 6% interest and payment of all taxes; it also restricted timber removal without the seller’s consent, allowed prepayment, stated that time was of the essence, and authorized termination and retention of prior payments upon default.
- Walker paid monthly installments through November 1963 (about $2,500 total), paid taxes, and made improvements including materials purchases and electricity installation.
- After Walker discovered timber had been cut and removed from the property in late 1963, she stopped making installment payments, leaving a balance a little over $1,100.
- MacFadden attempted to terminate Walker’s rights under the contract and later sued to quiet title; Walker asserted she did not receive the termination notice.
- After being sued, Walker tendered the entire remaining principal balance plus compound interest; MacFadden rejected the tender.
- Walker cross-complained for specific performance requiring conveyance upon payment of the balance.

## Issues

1. Whether a purchaser who has substantially performed an installment land sale contract loses the right to specific performance due to a willful failure to make timely installment payments under a time-is-of-the-essence and forfeiture clause.
2. Whether equity should enforce contractual forfeiture and permit the seller to quiet title where forfeiture would be disproportionate to the remaining unpaid balance.

## Decision

- The California Supreme Court affirmed the judgment granting Walker specific performance, with equitable financial adjustments.
- The court held that substantial part performance prevents denial of specific performance merely because the buyer’s failure to pay on time is characterized as willful.
- The court rejected strict enforcement of the time-is-of-the-essence and forfeiture provisions where forfeiture would be inequitable.
- The court allowed the seller to be fully compensated through payment of the remaining principal and appropriate interest or other adjustments rather than forfeiture.

## Legal Principles

- Equity strongly disfavors forfeitures in installment land sale contracts, particularly where the buyer has made substantial payments and improvements.
- A time-is-of-the-essence clause and an express forfeiture provision do not control where enforcement would cause disproportionate forfeiture and unjust enrichment.
- Willful nonpayment, standing alone, does not automatically bar specific performance after substantial part performance; courts weigh comparative hardship and fairness.
- Specific performance may be granted conditioned on payment of the balance due and equitable adjustments designed to compensate the seller without imposing forfeiture.

## Conclusion

A buyer who has substantially performed an installment land contract may obtain specific performance despite willfully missing installment payments, because equity prefers compensation over forfeiture when forfeiture would be disproportionate and would unjustly benefit the seller.


MacFadden v. Walker, 488 P.2d 1353 (Cal. 1971)