## Facts

- A buyer and sellers entered a written contract for the sale of two lots for a stated price, with \$60 down and the balance payable in \$10 monthly installments.
- The contract stated that time was of the essence and that, after a payment default lasting 31 days, the sellers could void the contract and retain all prior payments as liquidated damages.
- In 1922, after payments made, the sellers conveyed one lot to the buyer; the contract remained in effect as to the other lot.
- Over several years, the buyer made payments late and irregularly, and the sellers accepted those payments without objection.
- The buyer’s last payment was made in March 1926; when he later tendered another payment in November 1926, the sellers refused, stating they had elected in August 1926 to close the account and treat the contract as terminated.
- Before suit, the buyer offered to pay the entire amount due, but the sellers refused based on their claimed termination and asserted a right to keep prior payments.
- The buyer filed a bill in equity for specific performance; the trial court found for the buyer and ordered conveyance, and the sellers appealed with a full report of the evidence.

## Issues

1. Whether sellers who have repeatedly accepted late installments without objection may suddenly enforce a time-is-of-the-essence forfeiture clause without first giving reasonable notice that strict punctual performance will be required.
2. Whether, given the parties’ course of performance, equity will grant specific performance notwithstanding contractual language providing for termination and retention of payments as liquidated damages.

## Decision

- The Supreme Judicial Court affirmed the decree ordering specific performance for the buyer.
- The trial judge’s findings were supported by the evidence and were accepted on appeal.
- The sellers’ extended acceptance of overdue payments established a course of dealing inconsistent with rigid enforcement of forfeiture.
- The sellers could not terminate and forfeit the buyer’s rights without first giving reasonable notice of an intention to insist on strict punctual performance.

## Legal Principles

- Repeated acceptance of overdue payments can establish a course of performance inconsistent with strict enforcement of time-of-payment provisions and contractual forfeiture remedies.
- After such indulgence, a party seeking to reimpose strict punctual performance must give reasonable notice and an opportunity to comply before declaring forfeiture.
- Equity disfavors forfeiture and penalty-like results, particularly where the buyer is willing and able to make full performance and the default is not shown to be wilful.

## Conclusion

Because the sellers accepted late payments over a substantial period without warning, they were not entitled to abruptly declare the contract void and retain prior payments; equity required reasonable notice before insisting on strict punctuality, and specific performance was properly ordered.


Porter v. Harrington, 159 N.E. 530 (Mass. 1928)