Appeal from the Circuit Court for Prince George's County; Parker, J.
Brune, C. J., and Henderson, Hammond, Marbury and Sybert, JJ. Marbury, J., delivered the opinion of the Court.
The appellants, Milton T. Pierson and Jean Hess Pierson, his wife, entered into a contract for the purchase of lot 30 in block 2 as shown on a plat of an unrecorded subdivision known as Gordon's Corner, Spaldings District, in Prince George's County. The record title to the property was in W. Eugene
Pyles at the time the contract was made. He has since died, leaving a will which vested title in Harvey E. Pyles, Sr., appellee, as trustee.
The contract, dated June 13, 1946, provides, inter alia, as follows:
"The total purchase price of the aforesaid property is Fifteen Thousand ($15,000.00) Dollars, of which sum the above deposit of Sixty-five ($65.00) Dollars is to be a part; the purchasers covenant and agree to pay the balance of the purchase price, amounting to Fourteen Thousand Nine Hundred Thirty-five ($14,935.00) Dollars at the rate of Sixty-five ($65.00) Dollars per month, including interest on the unpaid balance amounting to four per centum (4%) per annum, without the privilege of anticipating said monthly payments, which monthly payments are also to include all taxes and fire insurance which the sellers are hereby authorized and directed to pay from the aforesaid monthly payments of $65.00."
At the inception of the contract in June 1946 adjusted taxes in the amount of $38.78 were added to the principal amount due, and the first payment of $65.00, made July 18, 1946, had deducted from it $49.79 for interest, thus permitting $15.21 to be applied to the reduction of the principal. Assuming that this approximate amount of reduction continued, it would require 333 months, or 27 3/4 years to reduce the principal indebtedness by $5,000. By another clause the parties had provided that when the purchasers shall have paid this amount on account of the principal the seller shall execute a deed for the property and take back a mortgage for the unpaid balance of $9,935, payable on the same terms and conditions.
Payments of $65 per month have been regularly paid up to and including the time of the filing of this proceeding, and as of June 16, 1962, the balance due on the contract was $15,222.44, a sum greater than the original purchase price. The reason for this curious result is that the assessable basis of the property has arisen sharply since 1946, causing an increase in the annual taxes to a point where eventually no money was available for
amortization of principal. The trustee has refused to permit the acceleration of the contract by permitting the purchasers to pay the purchase price therefor, but is willing to accept from them the annual real estate taxes, as well as the insurance premiums covering the property, over and above the monthly payments.
The vendees at the time of the hearing were residing in Ohio, and the premises had been rented for some time prior to this litigation for $100 per month, which amount had been collected by the vendees. In addition, the appellants had signed a contract to sell the property for $17,000 (the catalyst in this proceeding no doubt).
Appellants filed a bill of complaint for declaratory relief, seeking interpretation and construction of the contract. Appellee demurred to the bill, but the court overruled the demurrer, whereupon an answer was filed. The case was heard by Judge Parker upon a ...