Lindenbaum v. Marx

parties. The plaintiff offered in evidence, a writing, Exhibit 1, signed by the defendant, which reads as follows:

“Upon receipt of $50 deposit on prop, located Maple Avenue, No. 37, size 50x100, with buildings on same. Contract to be drawn July 18; on signing contract 10% to be paid in cash, the balance on the delivery of deed. The price to $5,200; $1,500 cash and a standing mortgage for 5 years at 5%% for $3,700.

“Flushing, N. Y., July 14, 1908. Herman Marx.”

The plaintiff then admitted upon the record:

“That no contract was made as provided for in that paper, and that the plaintiff refused to sign such a contract, and demanded an alteration of its terms."

It was also admitted that the defendant was always ready to carry out the terms of the deposit receipt, and that the defendant had received the -amount specified in the writing, that the same had been demanded of him, and that he refused to pay the same to the plaintiff. The court below thereupon rendered judgment in favor of the plaintiff for said sum of $50.

The sole question to be determined is, Was the deposit of $50 made as part of the purchase price, or was it given merely as security for the making of a future contract? If the writing was so ambiguous as to require parol evidence to show the real intent of the parties, then it would have devolved upon the plaintiff to show that the payment was made as a guaranty, or security or penalty for nonperformance, and not as a deposit on account of the purchase price, as it is incumbent upon the plaintiff to prove every essential necessary to sustain his cause of action. This he failed to do. The learned trial justice, in making his decision, relied upon the case of the Broadway Renting Co. v. Walpin, 59 Misc. Rep. 199 , 110 N. Y. Supp. 151 . That was a case of rental, and the payment there made was “a deposit given by the proposed lessee as security for the plaintiff’s fulfillment of its promise to execute a lease.” There is a material distinction between a contract for a purchase and an agreement to rent. Upon a contract for a lease, the deposit is usually given as a guaranty that the lease will be made and as a penalty for nonperformance. Upon a contract for purchase a deposit is ordinarily made upon the purchase price.

The writing under consideration does not indicate that the deposit was intended to be a guaranty that the plaintiff would enter into a contract, or as security for his doing so, or as a penalty or forfeiture in case he did not do so. It is crudely drawn; but in construing' writings of that nature we must apply the ordinary rule governing transactions of this kind. The writing clearly declares .that it is a deposit “on prop.,” and because it provides for the future execution of a more formal contract it is none the less a valid, enforceable contract for the purchase of real estate. If the defendant had refused to convey, there can be no question but that a court of equity would compel him to do so, and, had the plaintiff been willing to perform, no question could have been made as to his right to have the $50 paid by him credited on the amount of the purchase price. It was a real estate transaction pure and simple, and falls squarely within those cases like Abramowitz v. Gray, 50 Misc. Rep. 638 , 98 N. Y. Supp.

-1096; Roth v. Goodman, 52 Misc. Rep. 509 , 102 N. Y. Supp. 683 ; Kroshinsky v. Klein, 51 Misc. Rep. 674 , 101 N. Y. Supp. 13 . In the case last cited the receipt read, “As a deposit on house No. 20 Ames street, Brooklyn,” and then specified price, mortgages, payments, etc., and provided that “contract shall be drawn on 24th March”; and it was there held to be a deposit on the purchase, and that it could not be recovered back. . In the case at bar the deposit is “on prop.,” which is equally as indicative of the intent of the parties as a deposit “on house.”

Judgment reversed, and new trial ordered, with costs to appellant to abide the event. All concur.