Hazard v. Wilson

Spring, J. On March 22, 1894, the defendant Wilson was the owner of the lands and premises .described in the complaint, and' on that day executed, the bond'and mortgage in suit. On June 1, 1895, Wilson, by written agreement, sold to the defendant Grant these lands for $15,665, $750 whereof were to-be paid September 1, 1895; a like sum December 1st -of'that year,, and the.residue in. payments of $1,'500 each every'six months; — 398 — thereafter, and he was to receive a warranty deed when $5,000 were paid on the purchase price, and give hack a mortgage to Wilson to secure the amount then unpaid, and he was to assume as part ■of the purchase price whatever there was unpaid on this mortgage in suit, and by the terms of the mortgage the mortgagee was tó release any portion of the land upon being paid $500 for each acre so released. ■ July 19, 1895, Grant, also .by written contract, sold to the defendants Jamison and four others one-half of the lands in controversy, excepting three and ninety-five hundredths .acres situate west of the Buffalo & Lockport Railroad track, for the sum of ■$9,583. Fifteen hundred dollars of this purchase price were paid in cash, and Grant agreed to pay out of the cash payment $500 •on plaintiff’s mortgage. Grant' was to giñe a deed upon receiving $5,876, and the grantees were to assume the payment, amorig other burdens undertaken- by them, of one-half the balance remaining unpaid on plaintiff’s mortgage after'the payment of $500 Ead been applied thereon. This agreement, though bearing date July 19th, was not, in fact, executed until the 27th of that month. Contemporaneously with this agreement Wilson and Grant entered into a contract in writing whereby Wilson undertook to assume Grant’s, part of the' same and Grant assigned the agreement to Wilson. .'■ In September Wilson conveyed" to Grant the three, and ninety-five - hundredths acres, and an undivided one-half of the other lands described in the mortgage, and took back a mortgage to secure the payment of $6,449.67. While the terms of this mortgage do not coincide with those embodied in the agreement of Juñe 1st, yet that agreement is the only basis for the conveyance, and the only evidence of any interest in the land held-by Grant. By the deed Grant assumed the payment of one-half of the incumbrances on- the'lands, including that of plaintiff, This modification of the agreement of June 1st was. rendered- necessary by the contract Grant had made in selling a portion of the lands to Jamison and: others, and which had been ratified by Wilson. In compliance with the agreement executed "July 27th, Wilson' subsequently conveyed-the lands described therein to Jamison and his'covendees. So in the summer of 1895 Grant became the.eqiu-. table owner of all the. lands' covered by the mortgage' in suit and later of the- three--and ninety-five ’hundredths’ acres ' west' of the railroad lands, and jari-undivided ofie-haif of the remaining prem — 399 — ises, and was liable to pay one-half of plaintiff’s mortgage, and also by his agreement with Jamison and the other vendees was to pay $500 thereon. These agreements were all completed before August 1, 1895, so the liability to pay the $500 attached before that day. Plaintiff’s mortgage was then" due and any payment made upon it could not, of itself, be made the basis of any legal consideration. Arend v. Smith, 151 N. Y. 502. And. beyond that the payment of $500 had explicitly been provided for. So far as the evidence shows, plaintiff had no actual knowledge of any of these transactions. Grant designed to erect a factory upon an acre of this land west of the railroad. He or Wilson procured,a release from a mortgage lien prior to that of plaintiff’s and sought to obtain a release of plaintiff’s mortgage to an acre of the land. Mr. Mason was then acting as attorney for the plaintiff to make collections on this mortgage, and had it with the bond in his custody. Wilson interviewed Mason, explaining.to him the project-of the factory site,- and the enhancement of values that would follow to lands in that vicinity, and, asked for a release of an acre of the land for the purpose of putting up the manúfáctory thereon. Mason advised plaintiff of the desire of Wilson and she requested him to see Mr. Arend, whom she at times consulted. Mason then explained the situation to Arend, who believed "the erection of the factory advisable, and recommended giving the release. Mason thereupon wrote the following letter to'Wilson: ' “ July 25, 1895. “ Mr. E. F. Wilson, Tonawanda.: “ Dear Sie.-— Miss Hazard will extend your mortgage for two years, to be paid in two equal annual payments, ■ and also release one acre on the payment of $500, provided the payment is made before August first, 1895. “ Edward O.. Mason, “Atty. for Miss Hazard.” This letter was shown to Grant and the $500 were paid July 31st, and Grant immediately proceeded to erect his factory, and expended over $8,000 on that venture, and seeks to have the acre •covered by these buildings relieved from the lien of the mortgage which plaintiff is now foreclosing.- ' WMle the payment of the $500 cannot be urged as a considera — 400 — fion for the release of the land, it is forceful as a circumstance showing compliance with the conditions contained in Mason’s letter. Mason had authority sufficient to bind the plaintiff. She was apprised- of the request of Wilson, and in effect turned the com sideration of the matter over to Arend, and when the latter ad-^. vised extending the time for the payment of the mortgage, and to give the release, that was substantially her direction. She did not tell. Mason .to get Arend’s '.advice and report to her, but her inability to meet the exigency of the situation was manifest,, and so she committed it to- her friend, and adviser. That Mason so-construed her commission and the authority of Arend is obvious from the letter he wrote. Mason must have realized that on the strength of this letter money would be expended in the erection of the factory, and he did not suggest calling to get the release,., but imposed one condition --- the payment of the $500. This money was paid to him within a week after his letter, and he evidently expected that was in compliance with the requirement he had exacted. Mason is too reputable a lawyer to write this letter without any suggestion from plaintiff, as she would have us believe. She was, therefore, responsible for what Mason did. The-letter was submitted to Grant. He relied upon it and expended the large sums of money required in the erection of this plant and equitably shoiild be protected. • The inducement for the release of the acre and extension of the mortgage was not the payment of the $500, but the plaintiff' owned a large tract of vacant property. The erection of the factory was expected to increase its value. That was the inspiring-purpose-for the release. Owners of property who pay a bonus to factory-men for establishing a plant in which workmen -are to be employed are not making a donation, but it is quid pro quo\ ' -They make it as an investment and anticipate returns in The-enhanced value of their property. It was expected the erection of the plant would, follow the release, and that expectation was realized, and now that Grant, for whom Wilson acted, has performed, the plaintiff should not be-heard -in a court, of equity to resisfeperforinance on her part. ..-ii: It is not of the utmost importance whether or not the letter-in terms is;a release of. the la-nd from the operation of the mortgage; The design was to have it operative for-that-purpose. ' Gránt construed it and erected1 his buildings in the faith-that tit Was= — 401 — tantamount to a release, and the plaintiff is estopped to assert that it is not so in effect. The doctrine of estoppel in pais is simply the declaration of an equitable principle to prevent injustice, and to protect those who have relied upon the acts or admissions of others, made with the expectation that such reliance would be placed upon them. The authorities are a unit that where a person has induced another to act in a particular manner he will not be permitted to evade the effect of his admission where injury would result to one who has parted with value on the strength of such admission. Town of Brookhaven v. Smith, 118 N. Y. 634; Crawford v. Ormsbee, 6 App. Div. 50; Brown v. Bowen, 30 N. Y. 519-540 et seq.; Dezell v. Odell, 3 Hill, 215; Pomeroy’s Eq. Juris., §§ 802 et seq. Intentional fraud is not the essence of the doctrine of equitable estoppel. Continental N. Bank v. National Bank of Commonwealth, 50 N. Y. 575; Dean v. Benn, 69 Hun, 519-529; Rice on Evidence, 714; Pomeroy’s Eq. Juris., § 803. The letter of Mason granted two favors, which had been sought by Wilson — the extension of the mortgage for two years and the release of an acre. They are inseparably connected in the letter. There is no pretense of any definite promise of an extension except that contained in the letter of Mason. The plaintiff denies any knowledge of-the conversation with Mason authorizing the release or referring the matter to Arend, or of the letter of Mason, and yet her complaint, verified by her, avers an extension was granted, which tallies precisely with' that allowed by Mason. If she knew of the extension, the conclusion seems irresistible she must have- possessed information of the other coincident fact. It is urged that the release fails to designate any particular acre, and is, therefore, void for indefiniteness, and authorities are cited to support that contention. There is no suggestion that any fraud was perpetrated or advantage taken in the selection of the acre chosen. The $500 per acre made the highest price of the land sold, as appears from the agreements, and it was stipulated releases would be executed upon the basis of that sum per acre. It does not appear, the acre in question exceeded in value any of the rest of the land. Therefore, the position of plaintiff is not based upon any sinister motive in Grant locating his factory on the precise spot he erected it. The letter of Mason designated no particular acre. He or the plaintiff had a right to make the selection. That privilege seems to have been waived by the plaintiff or his alter — 402 — ego. The defendant then had a right to make the designation, and when once fixed fairly and honestly the selection was irrevocable. On thank v. L. S. & M. S. R. R. Co., 71 N. Y. 196. There was no uncertainty as to the quantity. The release was of one acre and that is all Grant assumed to take under the release. The uncertainty as to designation was cured by a fair selection made by Grant, resting upon the implied consent in the letter for him to do so. Grant was not a stranger to the transaction. He was the equitable owner of the land. He had agreed to pay one-half the plaintiff’s mortgage, and she could enforce that undertaking though not a party to- the agreement. Bowen v. Peck, 94 N. Y. 86; Post v. W. S. R. R. Co., 123 id. 580; Round Lake Assn v. Kellogg, 141 id. 348-356; Thomas on Mortgages, §§ 567 et seq. It was not expected Wilson would erect the factory. He did ' not so represent to- Mason, but stated it was to be done by others. Wilson was interested because he was the plaintiff’s mortgagor and obligor* and also had large claims upon the land. The augmentation in value would inure to his benefit. The indebtedness represented by the bond and mortgage in suit- was primarily Wilson’s, and he was, therefore, the one who would be likely to procure the release. But no deception was practiced upon Miss Hazard or Mason. The man who was after the release was Grant, for- he was to put money into the plant, and while all lienors and parties legally interested in the land were to reap indirect benefits accruing from the erection of the factory, yet he above all others needed and solicited the release. - It was not incumbent upon Wilson to disclose the name of his principal, and even if it had been supposed he was the real party to erect the buildings, still the principal in fact would have been liable to plaintiff and could, therefore, have insisted upon the release. Ludwig v. Gillespie, 105 N. Y. 653. Nothing could be charged against Grant, because he did not obtain the release in form at the time. Plaintiff might well refuse . to execute that instrument until the factory was erected. If a formal release had been delivered by Miss Hazard July 25th, when the letter was written, she would be at the mercy of Wilson or his undisclosed principal, Grant. Their refusal to comply might involve her in litigation, but her agreement to release is as en-forcible against her upon performance by Grant as an agreement to convey. — 403 — The plaintiff is entitled to the usual judgment of foreclosure, but exempting from the sale the acre described in the answer of defendant Grant. Ordered accordingly.