New York Life Insurance & Trust Co. v. Rector, Church Wardens & Vestrymen of St. George's Church

Larremore, J. The defendant’s counsel struck the keynote of this controversy in anticipating plaintiff’s position — that generous dealing by a religious incorporation with a trustee of an express trust, would be expected and enforced. Prior to 1880 neither party had a copy of the lease. The only papers then in plaintiff’s possession were the assignment, dated December 2, 1873, and defendant’s consent thereto, dated December 20, 1873, both of which refer to the date of [513] the lease (December 30, 1818), but not to the commencement of tiie term thereby granted (September 25, 1818). The plaintiff was evidently misled by the recital in the assignment into the belief that the lease did not expire until December 30, 1881. In the absence of any express intention on its part, it cannot be reasonably presumed that the plaintiff would knowingly surrender so valuable an interest as it had in this lease without adequate compensation. Neither should its honest mistake of a fact, under all the circumstances, be regarded as laches. Without any imputation of unfairness on the part of the defendant, the acts and statements of its collector were calculated to mislead the plaintiff as to the date of the expiration of the lease. Time was not originally of the essence of the contract. It-was not engrafted into it by subsequent notice, and the delay on plaintiff’s part in expressing its option was not so great as to constitute laches (Myres agt. De Mier, 4 Daly, 343; affirmed, 52 N. Y., 647; Hubbell agt. Van Schoening, 49 N. Y., 326). I cannot assent to the proposition that there was no mutuality in the covenant to renew. The case mainly relied upon to sustain it (Codding agt. Walmsley, 1 Hun, 585) fails to substantiate the point. That was an action to enforce specific performance of a contract "for the sale of real estate, based upon an option to purchase reserved in a lease within a specified time upon the payment of a specified sum of money, and the assumption of certain liabilities as a condition of the purchase, which was not complied with within the time prescribed. As the plaintiff failed to show a performance of the condition, the court properly lield that he had not acquired any vested interest in the property, and the contract was "unilateral. The principle thus established falls far short in its application to a case in which, prior to the alleged forfeiture, a party [514] having a vested interest in property to the extent at least of $30,000 omits by pure accident or mistake to give notice of ¡his option until thirty-six days after the contract time (Van Campan agt. Knight, 65 N. Y., 580; see, also, White agt. Schuyler, 31 How. Pr., 38; Ex parte Hunter, 1 Ed. Ch. 1). Admitting the theory as stated by the lord chancellor and ■justices in Hughes agt. Metropolitan Railway Company [Eng. Law Report Appeal Cas. [vol. 2], 439), that a court of •equity has no right to grant relief by way of mercy, or merely to save a forfeiture, all the authorities concede that an honest mistake or ignorance of facts is a good ground for •equitable interference (Henry agt. Tupper, 29 Vt., 358; Rawstorne agt. Bentley, 4 Brown’s Ch. R., 415). The plaintiff continued in possession and the defendant •received the rent after the expiration of the term. Such continued possession shows an intention to claim a renewal of ■the lease (Holsman agt. Abrams, 2 Duer, 446); and although ■it was not a literal compliance with the contract which required •a written notice within a specified time, yet in the absence of .gross laches or willful neglect, it clearly meets the ruling of lord Redesdale, in Lennon agt. Napper (2 Sch. & Lef., 682), •that where a party has acted fairly, and no injury has been ¡done to the other party by a failure to perform within the dime prescribed, equity will grant relief (Maxwell agt. Ward, 11 Price, 16). In Wheeler agt. Connecticut Mutual Life Insurance Company (82 N. Y., 543), it was the peculiar nature of the con,tract of life insurance that gave emphasis to the decision. It is not applicable or controlling in the present case. The defendant knew that plaintiff’s option expired on September 25, 1881, and while under no legal obligation to give ¡notice .of that fact, equity in all candor asks, if it was the .intention do make time of the essence of the contract, and ■assume the ownership of such valuable interests, why was the plaintiff left without notice of such intention ? As .a corporate body, the defendant rested and had legal [515] authority to rest upon its rights. But when it appears that a rigid enforcement of its demand would work substantial in justice, equity intervenes and carries out the contract according to its original intention. The plaintiff is entitled to the relief, and judgment is ordered as asked for in the complaint.