Harvison v. Charles E. Davis & Associates, Inc., 310 Ark. 104, 835 S.W.2d 284 (Ark. 1992)
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- Citation: 310 Ark. 104, 835 S.W.2d 284 (1992) (No. 91-286).
- Court / Year: Arkansas Supreme Court, 1992.
- Topic tags: forfeiture | foreclosure | equitable_interest | substantial_equity
- Facts: The Harvisons sold approximately 10.76 acres in Washington County to Charles R. and Vera Howard under a contract for deed dated June 4, 1982 — a 10,000 down, the balance financed at 10% per annum. The contract contained a forfeiture clause: on a default lasting 30 days, the sellers could declare the entire balance due within 20 days, and if unpaid, retake possession without legal process and keep all payments as liquidated damages. The Howards paid for almost seven years — roughly 60% of the purchase price — then defaulted in 1989. The Harvisons hired attorneys (Davis and Watson), who foreclosed the contract rather than declaring forfeiture and repossessing. The Harvisons then sued the attorneys for legal malpractice, claiming the lawyers should have pursued forfeiture (keeping the land and the payments) instead of foreclosing.
- Holding: The attorneys were not negligent, because forfeiture was not an available remedy. Once the Howards had paid roughly 60% of the price over nearly seven years, they had acquired an equitable interest in the land, and “principles of equity abhor a forfeiture of the [buyers’] equitable interest under these circumstances, even when the contract expressly provides for the right of forfeiture.” Foreclosure was therefore the correct (and legally compelled) remedy; pursuing forfeiture would have failed.
- Reasoning: Arkansas follows the long-standing equitable rule (tracing to triplett-v-davis-1964) that a defaulting installment-land-contract buyer who has built substantial equity cannot be stripped of it by a contractual forfeiture clause. The buyer’s equitable interest is protected the way a mortgagor’s equity of redemption is; the seller’s remedy is to foreclose the contract like a mortgage (a judicial sale with an accounting), not to declare a strict forfeiture.
- Practical impact for CFD operators/buyers: This is the controlling modern Arkansas authority making clear that a forfeiture clause in an Arkansas contract for deed is unenforceable against a buyer with substantial equity — the seller must foreclose. It aligns Arkansas with the Skendzel national drift (skendzel-v-marshall-1973). Operators cannot rely on a “keep-the-land-and-the- money” forfeiture once meaningful equity exists; they must foreclose, and the buyer recovers surplus value through the sale.
- Good-law status: Good law; routinely cited in Arkansas land-contract disputes.
- Source (retrieved): https://law.justia.com/cases/arkansas/supreme-court/1992/91-286-0.html · also indexed at https://www.courtlistener.com/opinion/1674397/harvison-v-charles-e-davis-assoc/ · Verified: 2026-06-08 (reporter citation and holding language confirmed across Justia and CourtListener indexes; full opinion text not directly rendered this run — see needs_verification on the Arkansas page).
Jurisdictions that follow / cite: arkansas
Disclaimer. Legal information, not legal advice. Confirm the opinion is still good law before relying on it.