Crane v. Andrews — 133 A.D. 349

Majority

p. 349

Frederick Crane, Respondent, v. Chase Andrews and Others, Defendants, Impleaded with Harold G. Villard and Hudson Iron Company, Appellants.

Second Department,

June 4, 1909.

Headnote

Contract—sale of land— acceptance of part performance.

Where the main purpose of a contract between the plaintiff and the defendant A., in pursuance of which plaintiff was to assign certain options to be received by him on three tracts of ore land to a specified trustee, was to rehabilitate a mining company and to make an indebtedness due plaintiff for money he had advanced to the company a lien on whatever, land it might •acquire from the trustee on reorganization, and it appears that although only two tracts were conveyed by the plaintiff this was acquiesced in by all interested in the company, which could scarcely pay for the land conveyed, a finding by the trial judge that the defendants accepted such performance as full performance of the contract is sustained by the evidence.

Burr and Jenks, JJ., dissented, with opinion.

Appeal by the defendants, Harold Gf. Villard. and another, from ¡a judgment of the Supreme Court in favor of the'plaintiff, entered in the office of the clerk of the county of Orange on the 23d day ■of September, 1908, upon the decision of the court rendered after .a trial at the Dutchess County Special Term.

William M. Wherry, Jr. [John A. Laing with him on the brief], for the appellants.

Graham Witschief [ William Douglas Moore with him on the brief], for the respondent.

I do not see any reason for reversing this judgment. Two tracts were conveyed and - accepted. There were no funds to buy the other, and no demand for it. This is not like a contract to sell three pieces of land. The main ob ject was to rehabilitate and establish a company, and get it in operation and on a working basis. They could do it with the three tracts or mines, or only witli one or two, and they all acquiesced in two. It is so found on ample evidence: There was an indebtedness to the plaintiff of the $94,000, and the- main object was to make that a lien on the land'of the' company, whatever it should get and go to work on.

Concededly one of the tracts was not acquired by the company, but it was rehabilitated' on the basis of two, and could scarcely pay for those. The point is, Was the finding; of the trial Judge to that effect without sufficient evidence ? It is scarcely questioned.

The judgment should be affirmed.

Hibschbero, P. J., and Woodward, J., concurredBurr, J., read for reversal, with whom Jenks, J., concurred.

(dissenting):

I dissent from the decision about to be made. I do not think that the judgment should be reversed on account of. variance between the complaint and the proof. The original agreement between Andrews and Crane, the plaintiff, related, among other things, to three parcels of land. ■ It was an indivisible contract, unless modified by consent of the parties. Only, two of the three parcels were actually conveyed. Although "full performance is alleged in paragraph 19 of the complaint, it seems to me that when this is read in connection with paragraph 7, to thé effect that the conveyances that áre there recited were made pursuant to the terms and provisions of the contract,, it may fairly be implied that the pleader intended to allege that there was a waiver of the conveyance of the third parcel. If the defendants Yillard and Hudson Iron Company, the only defendants appealing, had not admitted the validity of the contract sued upon, I should be inclined to think it was void on its. face for want of consideration and for non-existence of the subject-matter. By its terms Crane, the party of the second part thereto (the plaintiff her.e), was under no- obligation to do any-

Dissent

p. 351

tiling. It appears from the instrument itself that he did notj at the time that it was signed, have any options upon any of the property described in the agreement, nor control any, and he did not obligate himself -to secure any. To test its validity, assume that Andrews was suing Crane for damages for failure to assign options on the land described; it would be a perfect defense to-say, I have none, never had any, and never bound myself to secure any. Probably the admission in the answer estops them from raising this question, for there may have been a consideration not recited in the instrument itself, and for aught that appears in the complaint he may have been in a position to compel the delivery of options, although he did not actually have them. I think that the evidence conclusively establishes that the contract was never performed by Crane, and that any conveyances that were made of any portion of the property were not made in pursuance of its provisions, but in pursuance of an entirely new arrangement. Crane never secured an option upon any one of the pieces of property, and the court has so found, nor did he ever-control any. Mershon, who was the “promoter” of the various mining schemes which seem to have resulted in loss to every one concerned but him, pretended that he had some sort of an option or control upon two out of the three pieces, but the evidence clearly establishes the contrary. The proof ij overwhelming that there was no enforcible option in existence.' There had been one as to one of the parcels, but it had expired before the agreement in suit was made. Mershon’s claim that he voluntarily arranged to give Crane the benefit of any interest in or control over the property that he had is mere pretense. He had nothing. The conveyances that were made of parcels Ho. 1 and Ho. 3, as described in the contract, were manifestly not in furtherance of the provisions of the contract between Andrews and the plaintiff. By that contract $34,500 was to be paid by Andrews for all three pieces. The owners of parcels 1 and 2 received in cash $10,300 over and above mortgages of. $17,200. So far as they were 'concerned, therefore, the price for two pieces was $27,500. Andrews paid no part of this purchase price. Substantially all of the cash was paid by Villard. But when the property reached Eaton, the agent of the iron company, to hold it until they were ready t.o take ■ it over, there were mortgages upon the

p. 352

property which,with the cash paid, made the cost price of these two tracts $45,470.67. The difference, nearly $18,000, was represented in a mortgage held by one- Preston for about $22,00.0. It was conceded that Preston, was a mere, trustee for others'; that he personally had no- interest, in the- mortgage except- as. such trustee. .He testified that .he did not know whom, he was trustee for except Mershon. Villard participated in that mortgage on account of cash .advanced by him for the purchase-of the propei’ty to the extent of $4,000. The remaining $18,000 it is perfectly apparent was the profit which Mershon himself pocketed out of the transaction. He was misleading Crane- by pretending to him that he was, acting in 'his- interest,, although he swore he had no authority to hind him in .-any way. He Was misleading V’illa-rd by pretending that lie was .acting in his. interest. He was- pocketing the profit himself. After ■one piece of property had. been taken over by the Hudson Iron ■Company, which had cleared off the mortgages u-pon it,, and after it liad completed arrangements to- take over the second- piece, and had ¿spent, a large sum in getting the plant into workable shape, and .after nearly two-years-had expired-.,, during which time; Crane made no claim under his pretended contract,, this- suit is started, and Mershon is relied, upon to “swear it. through.” Crane does- not .appear on the trial as a witness at all.

The pidgment. appealed from should be reversed and-a new trial granted, costs- to abide the event.'

Jenks, J., concurred'.

Judgment affirmed,, with costs. ' . .