Jones v. Slocum — 21 N.Y. St. Rep. 934

Majority

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Victoria A. Jones et al., App’lts, v. William Slocum, Resp’t.

(Supreme Court, General Term, Third Department,

Filed February 7, 1889.)

Headnote

Contract—Breach—When party in default may redeem property.

The defendant had a contract with one Barnard and others for the purchase and sale of certain real estate. This contract with ail his rights and interest thereunder the defendant assigned to the plaintiffs, the latter agreeing to assume and perform all the obligations of the defendant therein to be performed. The plaintiffs failed to carry out their agreement. Various other agreements were entered into between the plaintiffs and defendant, mainly having regard to their first agreement, none of which were performed by the- plaintiffs. The Barnards finally obtained judgment against the defendant on their contract, and- the defendant having paid the sums of money therein adjudged, the Barnards executed a conveyance of the premises to him. Held, that the plaintiffs although in default in the matters covered by their several contracts with the defendant, might nevertheless acquire title to the premises by the performance of the various obligations and undertakings entered into by them.

Appeal from a judgment entered in favor of the defendant after a trial at special term.

On the first day of May, 1880, a contract was made by and between Henry F. Barnard, Mary E. Barnard and Alice G. Barnard, parties of the first part, and the defendant, party of the second part, for the sale by the parties of the first part and the purchase by the party of the second part, of certain real estate in the village of Saratoga Springs, commonly known as the Waverly Hotel property, being the same premises fully described and set forth in the judgment herein. The agreed purchase price of said premises was $15,137.25 to be paid in installments.

On the 19th day of July, 1880, a contract was made between the plaintiffs and the defendant, whereby the defendant assigned to the plaintiffs his contract with the Barnards, and all his right, title and interest therein and thereunder. By this contract the plaintiffs agreed that they would perform all the obligations and undertakings on the part of the defendant as undertaken by him in his agreement with the Barnards; and further, that when they should have acquired title to the premises under said contract, or procured a release of the “barn lot” (part of said premises), therein mentioned, that they would execute and deliver to the defendant or his assigns, a warranty deed of.“the barn lot,” the consideration of this conveyance of the “ barn lot” being the payment or allowance of $500; and the defendant was to have possession of the

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“barn lot” as of the first day of May, 1880. Defendant had paid $1,000 to the Barnards, and by this contract with the plaintiffs, the plaintiffs agreed to refund it to defendant by the first day of May next following: $500 was to be deducted for the “barn lot” and the balance, $500, to be paid to defendant. Plaintiffs also agreed that the sums paid for improvements, cleansing and repairing of premises by defendant, except the barn, and all other sums expended for additional furniture, for use of furniture, for taxes, insurance and interest and leases, and all other sums that he might pay as required under the contract, should be paid by them; that for the purpose of such payment and to secure the performance of the covenants on the part of the plaintiffs, the defendant was to retain the rents for the year, and to retain a lien on the succeeding rents to be applied until the plaintiffs should be entitled to demand and receive a deed of the premises under the first contract.

On the 20th day of August, 1883, another agreement was made between the plaintiffs and defendant. This agreement was preceded by a statement of certain amounts due from plaintiffs to defendant, and also of two notes, each of $2,261.63, given by each of the plaintiffs severally to the defendant. It recited the contract of July 19, 1880, and among other recitals, stated that certain notes had been made by the plaintiffs and endorsed by defendant and renewed from time to time, which were held by the First Hational Bank of Ballston Spa; also recited the sub-letting of a portion of the hotel premises to the Mt. McGregor & Lake George Railroad • Company. It also stated that the plaintiffs “have not in all things performed the covenants which they undertook to perform, to wit: the covenants which the said Slocum was to perform under his agreement with the said Barnards, so that the Barnards had secured a judgment against Slocum for principal and interest due on his contract with them, amounting to the sum of $1,926.25.” By this agreement, the plaintiffs reassigned all their interest in the Barnard contract to the defendant, and also their contract with the railroad company, and their right, title and interest in the furniture and fixtures in the Waverly Hotel, and agreed to execute a chattel mortgage to defendant, and assigned to defendant the rents thereafter to accrue from their renting of the hotel premises and furniture, and the accruing rents from the railroad company. The assignment, however, was expressed to be as collateral security only to the defendant, conditional that the plaintiffs should pay to the defendant the sum then due to the said Barnards on their agreement, and the sum of principal and interest that should become

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due the 15th of September following; and for the payment of other sums due from the plaintiffs to the defendant as therein expressed.

It was provided in this agreement that a chattel mortgage should be given upon the furniture in the hotel, etc., which was, in like manner, to be a collateral security for the payment of the judgment and the other sums due defendant. The payments by the plaintiffs were to be made within two years from the date of the agreement, or within such time less, as the railroad company might pay the amount of principal contingently agreed to be paid by it. It was also agreed that plaintiffs should pay defendant $150 for services theretofore performed. The defendant agreed to pay from the proceeds of the property, and from the rents referred to in the chattel mortgage, the sum due on the judgment, the sum of principal and interest that should become due the 15th of September then next on the Barnard contract, and to indorse renewals of the notes of $1,614, and each of them as they became due from time to time, and a certain note of $200, 1 ‘ during and within the time ” that the plaintiffs had by the agreement to perform; ;and further agreed that from the receipt of the rents he would pay the taxes levied and assessed on the property, •and insurance thereon, rents on durable leases, interest and •discounts on notes, and renewals, and necessary repairs, not exceeding $100, annually as to the repairs, and $400 to the payment on the contract for the purchase of certain furniture spoken of as the “ Snyder furniture,” the balance to apply on the sums due from the plaintiffs on their undertakings.

A chattel mortgage was executed at the same time, as provided for in the agreement.

On the 20th day of January, 1886, the Barnards had brought an action in this court against the defendant and others (including the plaintiffs) upon their agreements, wherein they demanded judgment that the defendant pay the amount which has become due on the contract, principal and interest, and to pay the taxes and assessments and ground rents pursuant to contract, or surrender the possession of the premises; that judgment was rendered in such action, January 22,1887, whereby it was adjudged that the defendants therein, within ninety days after the entry of the judgment, pay all taxes and assessments and rents mentioned in the decision, and by payment reduce the principal found due to the sum of $15,000. And whereby it was further adjudged that the defendants therein, within six months after the entry of judgment, pay to the plaintiffs the installments which had accrued or which might be due on the contract, together with the costs of the action,

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with interest; and in default of said payment, surrender possession of the premises to the plaintiffs in said action, etc.

The plaintiffs in this action, who were defendants in the Barnard suit, paid to the attorney for the plaintiffs in said action the sum which was required to be paid within ninety days from the entry of judgment, besides taxes. .

The defendant, on the 22d day of July, 1887, paid to the attorney for the Barnards the sum which they were required to pay within six months, $5,225, which sum was paid by the defendant and received by the attorney of the Barnards in full satisfaction of the payment required to be made within six months after the entry of judgment. Thus he reduced the amount due to the Barnards on their contract to the sum of $10,000. Defendant also paid to the attorney for said Barnards the sum of $320 for costs of the action. Said costs had not been adjusted, and payment thereon was made by note of the defendant, which was accepted as cash, but with the understanding that if, upon adjustment, the sum of said costs should be more or less than the amount of said note, correction should be made, and the excess be refunded or deficiency made good by the defendant, as the adjustment should- result.

The Barnards thereupon executed a deed of the premises of the defendant, and the defendant executed a bond and mortgage for $10,000 in pursuance of his original agreement with them. The deed and bond and mortgage had not been delivered at the time of the decision. The attorney for the Barnards would have delivered it, but he was notified in writing not to do so by the attorney for the plaintiffs herein, and in pursuance and because of said notice the attorney for the Barnards refused to deliver the deed to defendant.

An order was made in the Barnard suit by which the attorney for the plaintiffs herein was directed to hold the deed and bond and mortgage until the further order or direction of the court.

The plaintiffs in this action did not pay, or offer or tender to pay, to the plaintiffs in the Barnard judgment, or their attorney, the said sum of $5,225, or any part thereof, and have not paid or offered to pay the same.

After the execution of the contract of August 20th, plaintiffs continued in the possession of the premises and continued to collect the rents, or the greater portion thereof, and expended the rents in improvements and repairs upon the premises, and did not pay the taxes assessed upon the premises therewith. The defendant has paid for the bam lot $500, and the same has been leased to the railroad company, as alleged in the complaint.

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The defendant did at one time refuse to sign a receipt when presented to him by the agent of plaintiffs, but the ground of his refusal was that the agent of the plaintiffs proposed to apply the money upon one of the notes held by the First National Bank of Ballston Spa, and not to apply it upon the Barnard contract, and the defendant insisted that the same should be applied on the Barnard contract. Since the commencement of this action, the receipt has been signed by the defendant, and the money has been received and applied on the Barnard contract.

In consequence of the failure of the plaintiffs to pay their notes, and to keep the defendant harmless and indemnified on account of his indorsement in pursuance of their agreement, judgments have been recovered in favor of the First National Bank of Ballston against the defendant and others, one for $1,741.87, and the other for $1,745.49, both recovered in December, 1885, both of which judgments were at the time of the decision unpaid and unsatisfied of record.

John C. Hurlburt, for app’lts; Matthew Hale, for resp’t.

We have examined this case and are convinced that it was correctly decided by the court at special term. The findings of fact are sustained by the evidence, and the conclusions of law are supported by the facts found by the court. The case shows that this action was carefully tried, and deliberately examined and decided by the court. The findings of fact cover the entire case, and we are satisfied that substantial justice has been reached and administered by the court at special term. It seems needless to undertake a discussion of the facts, after the careful consideration thereof by the trial court. We do not discover that any legal error has intervened which has injuriously affected the plaintiffs or their case.

The judgment should be affirmed, with costs.

Learned, P. J., and Landon, J., concur.

The following is the special term decision:

This action having been duly brought to trial at a special term of this court, held at the town hall in the village of Saratoga Springs on the 22d day of July, 1886, and having been tried before the court without a jury by the consent of the attorneys and counsel for both parties, and the case having been heard from time to time upon the pleadings and proofs offered by the respective parties, and a decision herein dated April 19, 1888, having been rendered and duly filed: Now, on motion of Hale, Cowen & Bulkley, attorneys for the defendant, it is adjudged and decreed:

First. That the plaintiffs herein have not performed their contract with the defendant, referred to in the pleadings herein, but are in default therein.

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Second. That the defendant is not in default in respect to his contract with plaintiffs, and has not omitted to perform any part o£ said contract, except so far as he has been prevented from so doing by the failure of the plaintiffs to perform their contract.

Third. That the plaintiffs, although in default in the matters covered by the several contracts referred to in the pleadings herein, may nevertheless and are hereby allowed to acquire title to the premises mentioned in the pleadings herein and hereinafter described, upon the terms and conditions following, to wit, namely:

If the plaintiffs shall, on or before the 21st day of May, 1888, pay and satisfy two certain judgments recovered by the First National Bank of Ballston Spa against the defendants and others, one for one thousand seven hundred and forty-one dollars and eighty-seven cents ($1,741.87) damages and costs, recovered and docketed in the office or the clerk of Saratoga county, on the 23d day of December, 1885, and the other for one thousand seven hundred and forty-five dollars and forty-nine cents ($1,745.49) damages and costs recovered and docketed in said clerk’s office on the same day last above-named, and pay to the defendant the sums mentioned in said decision as having been paid by him upon the Barnard contract, so called, and upon the judgment in the Barnard action, so called, and for costs and taxes, in all amounting with interest, to the date of said decision, to the sum of nine thousand eight' hundred and twenty-seven dollars and fifty-five cents ($9,827.55), and shall pay to the defendant or his attorney herein, his costs in this action, as adjusted, amounting to the sum of three hundred and fifty-eight and 2-100 dollars, and shall also pay to the attorney for Henry F. Barnard and others the amount of costs in the action, wherein said Barnard and others were plaintiffs, and these plaintiffs, the defendant and others were defendants, as the same has been or may be adjusted, or pay to the defendant the amount of a certain note given by defendant to Hon. J. W. Crane, the attorney for said Barnards in said action for the costs in said action, and shall also pay to the said attorney for the said Barnard and others, interest on the draft for four thousand seven hundred and fifty-nine dollars and forty cents from July 22, 1887, to January 30, 1888, as provided in a certain order made in said action, wherein said Barnard and others were plaintiffs, dated January 30, 1888, that then the title to said premises, except as hereinafter provided, shall be conveyed to the plaintiffs herein; that the deed now held by J. W. Crane, the attorney for said Barnard and others, which was executed by said Barnard and others to defendant, be delivered to the defendant, and that the bond and mortgage executed by said defendant be delivered to the said Henry F. Barnard and others,

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plaintiffs in said other action, or their attorney; and .that the defendant then convey the said premises, except as hereinafter provided, to the plaintiffs, subject to said bond and mortgage of ten thousand dollars, payment of which shall be assumed by the plaintiffs; the said deed from the defendant to the plaintiffs to reserve and except that portion of the premises known as the “bam lot,” which is to remain the property of defendant, free and clear of said mortgage as against the plaintiffs herein.

And it is further adjudged and decreed, that in case the plaintiffs shall fail to make all or any of the said payments on or before said 21st day of May, 1888, then all the right, title and interest of the plaintiffs in and to said premises under and by virtue of the agreements and contracts mentioned in the pleadings herein or any of them, shall cease and determine, and the said premises shall be and remain the property of the defendant as if no agreement or contract had ever been made between him and the plaintiffs; and in case of such failure, it is further adjudged and decreed, that the complaint herein be dismissed, and that the defendant recover of the plaintiffs the above named sum of three hundred and fifty-eight and 2-100 dollars costs.

And it is further adjudged and decreed, that in case of such failure, the chattel mortgage mentioned in the said decision, and a copy of which is annexed to said decision, be foreclosed, and that the property mentioned therein be sold by and under direction of the sheriff of the county of Saratoga, and that the avails of such sale be applied in payment of the judgments above mentioned, recovered by the First National Bank of Ballston Spa, against the defendants and othprs.

The premises above referred to, and which are covered by the agreement between the plaintiffs and defendant and which are to be conveyed by the defendant to the plaintiffs except as hereinabove provided, in case of their making the payments above provided for, are described as follows: All those pieces and parcels of land situated in the village of Saratoga Springs, N. Y., on the east side of Broadway, and bounded and described as follows: Commencing at the southwest comer of the premises belonging to Maria B. Clark, and running from thence southerly along the east line of Broadway about two hundred and sixteen feet (216) to a point where the northerly line of the land of the Saratoga and Whitehall Railroad Company intersects the easterly line of Broadway aforesaid, and from thence easterly along the northerly line of the lands of said company, to a point where it intersects the westerly line of the lands of said

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railroad company. And from thence northeasterly along the westerly line of the land of said railroad company about four hundred and thirty-eight feet (438), to the southeast -corner of the premises belonging to James P. Butler, and running from thence westerly along the south line of the said James P. Butler’s land, to the northeast corner of lands of William Slocum, and from thence southerly along the easterly line of said Slocum’s lot to the northerly line of the lot of the said Maria B. Clark, and running from thence easterly along the northerly line of the said Clark lot, to the northeast corner thereof, and running from thence southerly along the east line of said Clark’s lot to the southeast corner thereof, and from thence westerly along the south line thereof to the place of beginning, being the premises now known as the Waverly Hotel premises.

The barn lot above mentioned which is tobe reserved and excepted from the said premises, to be conveyed to the pi aintiffs by defendant, is described as follows: The aforesaid barn lot is situated immediately in rear of William Slocum’s lot on the east side of Broadway, Saratoga Springs, being about forty-five feet wide (be the same more or less), and lying south of a lot belonging to and occupied by James P. Butler, and north of a lot in rear of Maria B. Clark’s lot, and west of the R. and S. Railroad.