Gross v. Salsich

TTr.-R.wTN, J. Tbe plaintiff grounds bis right to recover upon contract entered into June 22, 1905, by tbe terms of wbicb it was agreed that in case tbe defendant should not be able to give a deed of lot 18 be would pay $500 on tbe 21st day of December, 1905. Tbis contract must be construed witb tbe one made June 3, 1905, and referred to in tbe statement of facts, tbe contract of June 22d being simply an ex [424] tension of time given defendant to perfect bis title to tbe lot in question, it appearing that at that time the title to this lot was in litigation. The sixth clause of the contract of June 3d, by which it was provided that each of the parties should be entitled to the possession and receipt of the rents and profits of the premises agreed to be conveyed from the 1st day of July, 1905, obviously continued in force after the execution of the agreement of June 22d, and was so intended by the parties. So when the deal should be finally consummated and the deed of lot 18 given by defendant, if he were able to convey a merchantable title, the plaintiff was under obligation, by force of the agreement between the parties, to carry out the provisions of the contract of June 3d, which remained unperformed, and which still continued in force after the execution of the contract of June 22d. The plaintiff in his complaint claims the right to recover upon the express contract of June 22d, by the terms of which defendant promised to pay $500, but contends here that the case made is consistent with the theory of an, action for damages on account of defendant’s failure to convey, and that the •$500 is in the nature of liquidated damages which plaintiff may recover on account of the breach. It is not very material whether we treat the plaintiff’s claim to recover on one theory or the other, because in either case the action rests on the contract between the parties, and the question arises whether plaintiff has shown a right to recover $500 upon any theory under this contract. Clearly upon the established facts plaintiff cannot recover upon the letter of the contract, because it appears that defendant had a merchantable title to the lot and also the ability to convey it to plaintiff. The contract is that “in case I shall not be able to give then the deed I shall pay you the sum of $500 on the 21st day of December, 1905.” As the facts clearly show, the defendant was in doubt June 22, 1905, whether he would be able to give a title to the lot, hence the agreement that he would pay $500 in case [425] he was unable to do so. This provision of the contract was manifestly intended as security to indemnify plaintiff against loss in case it should turn out that defendant could not convey a merchantable title to the lot. We think it clear that this is the true construction of the agreement between the parties, and that it was not contemplated that the agreement be in the alternative for the conveyance of the lot, or the payment of $500 in case defendant were unable to convey a good title. Mow, even if it be conceded for the sake of argument that the plaintiff could recover in case of an absolute refusal to convey, we still think that the condition imposed here was reasonable and within the contract and contemplated by the parties when the contract was made, therefore the tender of the deed subject to the condition imposed was not a refusal to convey and gave plaintiff no right to recover the $500. If the defendant had refused to convey under any circumstances, the situation would be quite different. It is not necessary that we decide whether under such circumstances plaintiff could maintain an action to recover $500, or whether his remedy would be for specific performance, the defendant being able to convey title according to the terms of the contract. Here there was no refusal to convey within the spirit of the contract. On the contrary the deed was executed and tendered, subject only to the condition that plaintiff pay the amount which upon accounting in court it was found he was obliged to pay under the terms of the agreement of June 3d, and we think it was fairly within the contemplation of the parties under the contract that this amount should be paid at the time the deal was finally closed; and this being so, the condition attached to the delivery of the deed was within the-contract and within the contemplation of the parties, and the tender of delivery of the deed subject to this condition was a good-tender. The contention of the plaintiff that the deed should be first tendered absolutely and without condition or payment of the money due under the contract seems more [426] technical than substantial in view of the fact that tbe obligations of both parties under tbe contract were mutual. We are therefore of the opinion that upon the facts established the tender of the deed subject to the condition of payment of $75 found to be due from plaintiff under the provisions of the contract was a sufficient tender, and the defendant, being able to convey a merchantable title at the time,, complied with his agreement, and the court below was right in holding that the plaintiff could not recover and that the defendant was entitled to judgment on his counterclaim for the amount found due. By the Court. — Judgment of the court below is affirmed.