Kresge v. Crowley

Mr. Justice Robb delivered the opinion of the Gourt: Under sec. 492 of the Code [81 Stat. at L. 1267, chap. 854], no estate of inheritance or for a longer term than one year may “be created or take effect except by deed signed and sealed by the grantor, lessor, or declarant.” Under sec. 498 no deeds of conveyance of either real or personal estate by individuals may be executed or acknowledged by attorney. Section 1116 [31 Stat. at L. 1367, chap. 854] provides that every estate in land for a greater term than one year, attempted to be created by parol or otherwise than by deed as above specified, “shall be an estate by sufferance.” The foregoing provisions, appellant points out, are based upon considerations of public policy; and he contends that the bill should be dismissed because the alleged lease described therein “is void upon its face and cannot bo made the foundation of a cause of action in either a court of law or a court of equity.” While the Statute of Frauds is equally binding upon courts of equity and courts of law, the rigid requirements of the statute frequently have been relaxed in courts of equity “for the purpose of hindering the statute made to prevent frauds from becoming the instrument of fraud.” Purcell v. Miner (Purcell v. Coleman) 4 Wall. 513, 517, 18 L. ed. 435, 436. And where one of two contracting parties has been induced or allowed to altor his position on the faith of a contract wfithin the statute, “to such an extent that it would bo fraud on the part of the other party to set up it's invalidity, courts of equity hold that the clear proof of the contract and of the acts of part performance will take the case out of the operation of the statute, if the acts of part performance were clearly such as to show that they are properly referable to the parol agreement.”' Williams v. Morris, 95 U. S. 444, 457, 24 L. ed. 360, 362. The distinct ground upon which courts of equity enforce the specific performance of a contract within the statute is “that otherwise one party would be enabled to practise a fraud upon the other; and it could never be the intention of the statute to enable any party to commit such a fraud with impunity. Indeed fraud in all cases constitutes an answer to the most solemn [17] acts and conveyances; and the objects of the statute are promoted, instead of being obstructed, by such a jurisdiction for discovery and relief.” 2 Story, Eq. ,Tur. ¶ 759. This statement of the rale was approved in Whitney v. Hay, 181 U. S. 77, 45 L. ed. 758, 21 Sup. Ct. Rep. 537, where, after reviewing the American and English cases, the court said: “They all proceed upon the ground that, although in a suit to enforce the specific performance of a parol agreement in reference to land the defendant cannot be directly charged upon the alleged contract itself, lie may be held — the evidence clearly showing part performance, in substantial particulars, of such agreement — to do what justice requires to be done under the equities arising from acts done after the making of the agreement and in execution of its provisions. To refuse under some circumstances to compel the full execution of an agreement of that kind which has been partly performed would make the statute an instrument of fraud, and that a court of equity will not permit.” And again, in Winslow v. Baltimore & O. R. Co. 188 U. S. 646, 658, 47 L. ed. 635, 640, 23 Sup. Ct. Rep. 443, the court declared that specific performance of a void contract will be decreed because of part performance, where fraud and injustice would result if the contract were held inoperative. In the present case the terms of the contract are susceptible of chair proof. It is alleged that the letter which Goldenbcrg authorized written, and which was handed to appellee in Golden-berg's presence, embodied the terms of the contract. That letter thereafter became merged in the contract itself, that is, the soealled lease, and had appellee immediately discovered its infirmity a court of equity would not have hesitated to compel Goldenbcrg properly to execute it. The court very properly would have received the so-called lease as evidence of an agreement concerning an interest in land which, under sec. 1117 of the Code [31 Stat. at L. 1367, chap. 854j, may be “signed by the party to be charged therewith or some other person by him thereunto lawfully authorized.” We perceive no reason why it may not be so received now. Appellee alleges that in reliance upon his contract he expended $1,250 in buying out the former tenant, for which he would [18] receive practically no return unless bis agreement with Golden-berg was carried out. , He further alleges that he expended.several hundred dollars in repairs and paid $1,500 for a baiToom license ending October 81, 191G,'and a like amount for a similar license ending October 31, 1917. These several expenditures not only are consistent with the contract set up, but inconsistent with any other. To illustrate: Had appellee merely alleged that he entered into possession of the premises and regularly paid or tendered the rent agreed upon,, such payments' would have been as consistent with a tenancy at will as with the contract set out, but the acts here relied upon are clearly inconsistent with a tenancy at will. We think it requires no argument to demonstrate that such an injustice would result if the contract in question should be held inoperative, as to take the case out of the statute. Appellant, having had notice of the agreement when he took title to this property, is in no better position than his grantor; for a purchaser with notice of a prior equity superior to the rights of his grantor takes his place and is bound to do that which in equity his grantor was bound to do. Specific performance will be decreed against such a purchaser in the same manner and to the same extent as it would have been decreed against his grantor. Cranwell v. Clinton Really Co. 67 N. J. Eq. 540, 58 Atl. 1030; Engler v. Garrett, 100 Md. 387, 59 Atl. 648. The orders are affirmed, with costs. Affirmed: