En Banc. Jennings, Justice. Struckmeyer, C. J., Bernstein, V. C. J., and Udall and Lockwood, JJ., concur.
This is an appeal from an action to quiet title to certain real property situated in Pinal County, Arizona. Following is the agreed statement of facts in brief: On the 23rd day of March, 1954, plaintiffs Ernest Hasso and Dorothy Hasso, hereinafter referred to as appellees, entered into an agreement with the defendants, L. Dean Steffey and Iva Fern Steffey, hereinafter referred to as the Steffeys, to purchase from the said Steffeys, together with other property, the following described property, to wit:
The South Half (S 1/2) of the West Half (W 1/2) of Section Thirty-one (31), Township One (1) North, Range Eight (8) East of the G. & S. R. B. & M., Pinal County, Arizona, recorded in the office of the County Recorder of Pinal County, Arizona, in Docket 102 at Page 526 thereof.
Pursuant to said agreement an escrow was on that date set up with the Phoenix Title & Trust Company, Mesa, Arizona, which escrow is still pending and in full force and effect.
On the same date Hassos (appellees) entered into an agreement to sell the above-described property to Chester H. Mason and Mary Mason, husband and wife, hereinafter referred to as appellants. No escrow was set up for this second agreement. The agreement provided that $100 was to be paid down, with a balance of $400 plus
5% interest to be paid on the down payment. The balance $1,750 was to be paid annually in installments of $350 or more plus 5% interest the first two years on the unpaid balance and 6% interest thereafter until the total purchase price of $2,250 was paid.
Upon execution of the agreement appellants paid to appellees the sum of $100. No payments on either principal, interest or taxes have been made by appellants since that time.
In April of 1955 (more than one year after execution of the agreement) appellants wrote a letter to appellees which read in part as follows:
"It would be impossible for us to go thru with the property deal and we are very sorry in more ways than one. We certainly have failed in our end of that bargain but I assure you we didn't intend for it to turn out this way. We had so many plans for that property and maybe if you don't sell it we can make new plans later when we have money before we plan anything. * * *"
No communication, either oral or written, was had between the parties until February 25, 1957 (almost two years later) when the appellees wrote to the appellants as follows:
"* * * I would like to know if you could take care of your present and past payments with your May 1st payment and your past payments of principle and interest * * *. If not, then please send me the papers * * * made between ourselves and I will return your down payment. Please leave me know soon if you can take care of your obligation."
Thereafter, and prior to the 1st of May, 1957, the appellants began negotiations with the Steffeys for the purchase by the latter of the property above described. No communication was had between the appellees and the appellants after the letter of February 25, 1957, until approximately the 10th day of April 1957, at which time the appellants ...