Sternberger v. McGovern

By the Court.*—Larremore, J. —It is material in the decision of this case that the true construction of the contract between the parties should first be determined. > It should be interpreted in that sense in which the parties understood it at the time of its execution (Barlow v. Scott, 24 N. Y. 40, and cases there cited). Did the parties then intend to make an exchange of their respective pieces of land, or was the sale of each an independent transaction ? If there had been no reference in the terms of sale of the one to the other piece of property, there would be little doubt that each sale was entire and independent, although the conditions of each were contained in one instrument (Johnson v. Johnson, 3 Bosanquet & Puller, 162; Mayfield v. Wadeley, 3 Barn. & Cress. 357; Croome v. Lediard, 2 Mylne & Keene, 251). The price of the Thompson street property is stated at $125,000, part payment of which, to wit, $64,500, the plaintiffs agreed to receive by a deed from defendant and his wife of apiece of land at Mott llamen i/n said contract thereinafter more particularly described. Here is found a direct reference in plaintiffs’ agreement to that of the defendant, and from the nature thereof and the property which was the subject of it, it is apparent that the covenants and conditions therein contained [463] were mutual and dependent (Fry on Spec. Perf. § 540, p. 170 ; Ogden v. Fossick, Ct. of Appeals in Chancery, 9 Jurist, N. S. part 1, p. 288). In the case last mentioned the owner of a coal wharf agreed to let it, and at the same time agreed to act as the agent of the tenant in the coal business, and not to act for any other person, and it was held that the agreements were inseparable, and specific performance, was refused of the agreement to let, because the Court could not decree performance of the other. Under the contract in question the parties were entitled to a delivery of the thing in specie, and not its money valuation, whicli was intended as á mode of computation in adjusting the amount due on settlement between them. Any other construction of the contract would defeat its obvious intention. Suppose the Thompson street property had appreciated in value pending the execution of the contract and the time fixed for the delivery of the deed, would the plaintiffs’ obligation to convey have been discharged by the payment of the sum named as the consideration thereof? Would they have been allowed to claim the prospective increase which in equity belonged to the defendant ? Could the defendant have fulfilled his part of the agreement by refusing a deed and paying $64,500 ? What satisfactory means are there of “ determining what represents the money value of a specified estate to a specified individual ?” Having reached the conclusion that the contract was for the exchange of property between the parties, let us next inquire to what extent their relations under it were changed, by defendant’s inability to perform. It appears from the findings of fact that such inability resulted from the refusal of defendant’s wife to join in the deed of the Mott Haven property, although he in good faith endeavored to induce her to do so, and that no damages were claimed or proved as ensuing therefrom. Neither is there any imputation of fraud or collusion on the part of the defendant. As the court could not enforce the execution of said deed by defendant’s wife, it would not decree specific performance of the con [464] tract- in question and order performance of an impossibility (Fry on Spec. Perf. §§ 665 and 666, pp. 201, 202). If the agreement were for the purchase and sale of the,Mott Haven property only, the refusal of defendant’s wife to join in the deed would bar plaintiffs’ of their right to maintain specific performance, and leave them to their action at law for damages upon the covenant (In re Jane Hunter, 1 Edw. Ch. 1). Shall they now be allowed to claim the benefit of a unilateral right to enforce a contract of exchange, containing mutual covenants and conditions, where the same objection exists to its performance ? The subject of the contract is land, for the sale and conveyance of which it specifically provides. Such a contract is clearly distinguishable from those in Pinney v. Gleason (5 Wend. 393) ; Kimpton v. Bronson (45 Barb. 629); Murray v. Harrison (47 Barb. 493); and Fletcher v. Derickson (3 Bosw. 181), where a definite money indebtedness was created with an option to the debtor to discharge the same in an alternative mode of payment. This action was brought to enforce the plaintiffs’ lien as vendors upon the Thompson street property, for the purchase money thereof. They have never parted with its possession, nor received any payment on account of the purchase. “ This lien,” says Judge Story, “is wholly independent of any possession on the part of the vendor, and it attaches to the estate as a trust equally, whether it be actually conveyed or only be contracted to be conveyed” (2 Story Eq. Juris. § 1218). No transfer of the property by the vendor destroys the lien. The principle upon which it is sustained is that of an implied trust, as where the vendor delivers possession of an estate, without receiving the purchase money (Sugden on Vendors and Purchasers, chap. 19, §§ 1 and 2, pp. 670 and 671, 14 Eng. ed.) None of the authorities recognize the right to the lien where the vendor has not parted with the possession, or received part payment of the purchase money (4 Kent’s Com. sec. 58, p. 169; Burgess v. Wheate, 1 Eden, 211 ; Mackreth v. Symmons, 15 [465] Ves. 329, 337; Garson v. Green, 1 John. Ch. 308; Hughes v. Kearny, 1 Sch. & Lef. 132; Champion v. Brown, 6 John. Ch. 402; Bayley v. Greenleaf, 7 Wheat. 40; Daniels v. Davidson, 16 Ves. 249; Austen v. Halsey, 6 Ves. 483 ; McLean v. McLellan, 10 Peters, 625, 640; Ludlow v. Grayall, 11 Price, 58; Finch, v. Earl Winchelsea, 1 Peere Wms. Ch. 278; Smith v. Hubbard, 2 Dick. 730; Fish v. Howland, 1 Paige, 20 ; Warner v. Van Alstyne, 3 Paige, 513; Shirley v. Congress Sugar Ref'ry, 2 Edw. Ch. 505; Bradley v. Bosley, 1 Barb. Ch. 125 ; Clark v. Hall, 7 Paige, 382). That the vendor has surrendered possession of the premises, either by deed, or under contract of sale, or upon part payment of the purchase money, cannot affect his right to the lien, which rests upon the equitable principle, “ that a person who has gotten the estate of another, ought not in conscience,, as between them, to be allowed to keep it, and not to pay the full consideration money ” (2 Story’s Eq. Juris. §§ 1219). In Burgess v. Wheats (supra), the Master of the Bolls, in discussing the doctrine of equitable liens, says, “ as to the vendor’s keeping both the estate and the money, it is analogous to what equity does in another case, as when a conveyance is made prematurely before the money is paid, the money is considered a lien on that estate in the hands of the vendee. So, where the money was paid prematurely, the money would be considered as a lien on the estate in the hands of the vendor.” It would thus appear that the plaintiffs, who are still in full possession of their property (and to which defendant cannot now, on account of his default, make any claim), have not a lien thereon for the purchase money. They have parted with nothing and received nothing; and their only remedy, under the circumstances of the case, is an action at law for damages for a breach of the contract. If the conclusion at which I have previously arrived be correct, that the contract in question is an entirety, and the1 covenants thereof mutual and dependent, this action must fail. The plaintiffs not being entitled to a specific performance of the contract, cannot maintain their lien for the purchase money, [466] especially while in actual possession of the property itself, and without having received any payment thereon. The same objection necessarily applies to the proposition that the decree be modified and made a judgment for the amount of the purchase money. I think the decree should be reversed, and the complaint dismissed without costs. Footnotes [*] Present, Daly, Ch. J., Lakrbitoke, and J. F. Dalt, JJ.