Codding v. Wamsley — 8 N.Y. Sup. Ct. 585

Majority

p. 585

MARY A. CODDING, Appellant, v. THOMAS WAMSLEY, Respondent.

Headnote

Contract—tíme, when of the essence of—Specific performance—reciprocity of obligation not necessary—Distinction between mutual obligations and those obligatory on one pcerty only.

When the obligation to sell real estate rests on one party, and it is optional with the other party to purchase or not, a specific performance of the contract will not be decreed, if the party does not exercise his option within the time given him.

Time will be deemed of the essence of a contract which gives a mere right of election to purchase real estate upon certain conditions.

Appeal by plaintiff from a judgment entered on the report of a referee, dismissing the complaint in an action brought for the specific performance of a contract for the purchase of a house and lot in the city of Rochester. On the 1st day of April, 1871, the respondent, by written lease, demised and rented to the appellant a house and lot of land in Rochester, for one year, at the yearly rent of $1,200, to be paid monthly in advance. In. the instrument, it was further agreed and covenanted by said Wamsley, that at any time within three months from the date thereof, the appellant might become the purchaser and owner in fee of said lot of ground, for the price of $9,500, with interest, and all taxes, assessments, etc., levied or charged thereon. Of this sum, $3,000 were to be paid immediately at the expiration of the three months, $3,000 to be paid by assuming a bond and mortgage on the premises, and $3,000 to be paid within one year from the date of the instrument.

The plaintiff paid the rent monthly in advance, up to and including November 1, 1871, and also paid taxes and insurance to the amount of $56.61. Nothing mor# was paid, nor did plaintiff assume the mortgage or offer to do so, or to pay any money, except in and by the complaint in this action, which was commenced in August, 1872, nor did she pay any taxes or assessments except those above mentioned.

The defendant, after the expiration of the three months, expressed to plaintiff’s agent a willingness to receive the $3,000, but made no agreement to do so, and declined to extend the time for

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her to become the purchaser. In February, 1872, the plaintiff, by hér agent, told the defendant to have the papers made out, that the money was ready. The defendant refused to convey the property at the price specified in the contract.

JEL. R. Selden, for the appellant.

Damson & Ohumasero, for the respondent.

At one time, a purchaser was not allowed to maintain a bill against the seller, for the specific performance of a contract to. sell lands, unless he himself was bound by the same contract to purchase. Reciprocity of obligation was necessary.^[3] But this rule, it seems, is not now in force. All that is requisite, is that the ■contract on the part of the seller, be founded upon a sufficient consideration, and be made conformably to the requirements of the statute of frauds. If these facts concur, and the circumstances be such as establish a right to equitable relief, the fact that the contract was not mutually binding, is no longer an insuperable bar, although it is a material ingredient in restraining the exercise of the equitable jurisdiction of the court. The plaintiff, by filing the bill, makes the remedy mutual, and, therefore, the objection to a decree to compel the performance of a unilateral contract is taken away.^[4]

The contract in this case, is not an absolute one to sell, but gives to the plaintiff merely an option, or right of election, of becoming the purchaser of the lands, at any time within three months from the date thereof. The plaintiff did not avail herself of the privilege thus given, within the time limited. The court is now asked to say that the time specified, is not of the essence of the contract, and that the option may die exercised after such time. We cannot accede to that proposition. It would, in effect, make a new contract for the parties.

In ordinary cases of contracts between vendor and purchaser,

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the time fixed for the payment of the purchase-money, is not of the essence of the contract, unless the parties themselves have, either expressly or by reasonable implication, agreed that it shall be so considered. The reason is, that the contract gives a present interest in equity, and forfeitures are odious. In this case, however, the defendant has agreed to convey, only upon condition that the plaintiff shall perform the requisite acts on her part, within three months. The plaintiff not being bound to purchase, it would be inequitable to hold the defendant bound to sell, after the time fixed by the contract; for, by so doing, the defendant would be held to a performance if disadvantageous to him, and yet, if advantageous to him, he could not compel a performance by the plaintiff. It is not an answer, to say that the plaintiff agreed to pay an excessive rent, as a consideration for the option granted to her. That was the quid pro quo, for the privilege conferred. It was competent for the parties to agree upon any consideration therefor. It appears that the defendant, acting under advice of counsel, took special pains to avoid incurring the obligations of a vendor in an ordinary contract of sale. The language of his covenant effectually secures that object. Straining it to the uttermost, it is a covenant, contained in a mutual contract, to give an option or right of purchase, and gives no present interest. There being nothing in the nature of the contract, contrary to law or equity, we ought to give it effect, .accordingly. And such is the rule, governing the exercise of the jurisdiction of the court, in this class of cases. It is stated in Story's Eq. Jur. (§ 777 a, 11th ed.) as follows : “ But notwithstanding the rule is well established in courts of equity, that time will not be regarded as indispensable, in regard to decreeing specific performance of contracts for the actual sale of lands on one side, and the actual purchase on the other, it is different where the contract gives a mere election to purchase upon certain conditions. Accordingly, where upon a lease, with the right of purchase within seven years, upon giving three months’ notice, and paying a fixed sum at the expiration of such notice, and the lessee gave the requisite notice, but did not pay the money in time, a bill for specific performance was dismissed. And a similar decision was made by the Lord Chancellor, where his Lordship said : ‘ The things required must be done in the order of

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sequence stipulated. These were notice, and the payment of the money, on a day certain.’ ”^[3]

In Mason v. Payne,^[4] the suit was founded upon a stipulation in a lease, giving the lessee the option of purchasing the demised premises in fee, at any time within five years, but required him, if he elected to purchase, to give thirty days’ notice of his intention to purchase, and to make payment of one-fourth. The court held that the thirty days’ notice was of the essence of the contract, and that notice, given two days before the expiration of the five years, was too late.^[5] We think, therefore, that time was of the essence of the contract in this case, and that the failure of the plaintiff to comply with the terms on which the option was granted, deprived her of the benefits thereof, unless the defendant waived the noncompliance with the condition. A party for whose benefit a condition is imposed, may waive the strict performance thereof; but mere indulgence is never to be construed into such waiver.^[6]

Upon this subject, the referee finds that the defendant, several times, expressed a willingness to the plaintiff’s agent, and to her attorney, to allow her to become the purchaser of the premises, on the original terms, notwithstanding the expiration of the time limited, but that he declined to make any agreement to extend such time. Although the evidence on this point was conflicting, yet we see no reason to disturb the finding of the referee. The result is, that the defendant indulged the neglect or inability of the plaintiff, without waiving his rights. Such indulgence can have no legal effect in determining the case. If the referee had found that the defendant either caused, or sanctioned, or authorized the plaintiff’s default, the case might have been different. But there is no such finding, and the evidence on the ' part of the defendant, is, that he merely expressed a present willingness to take the money, while, at the same time, he refused to make any promise for the future. Nor did he do any act, indicative of his intention to waive the forfeiture unless the money were paid pres

* Weston v. Collins, 34 Law Jour. (Chan.), 353; S. C., 11 Jur. (N. S.), 190; Lord Ranelagh v. Milton, 10 Jur. (N. S.), 1141.

† † 47 Miss., 517 .

‡ ‡ See also German v. Machin, 6 Pai., 288 ; Brucher v. Van Buskirk, 2 A. K. Marsh, 345 ; Geiger v. Green, 4 Gill, 472 .

§ § Gray v. Blanchard, 8 Pick., 284 .

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ently. Under such circumstances, it is impossible to hold that there was a waiver.

We have no power, on this appeal, to reform the contract, even if the case showed proper grounds for such a decree.

The judgment must be affirmed.

Judgment affirmed.

Footnotes

* Newland on Cont., 153 ; Fry on Spe. Per., § 286 et seq.; Fonb. Eq., Bk. 1, C. 6, § 13.
† † Adams Eq., 82; Batten Cont., Chap. 5 ; Willard Eq., 267 ; Justice v. Lang, 42 N. Y., 492 , and cases cited on this point; sed vide S. C., 53 id., 323.