Fagen v. Davison — 9 N.Y. Super. Ct. 153

Majority

p. 153

Fagen v. Davison.

(Before Oakley, Ch. J., Campbell and Bosworth, J.J.)

April 6 ;

April 30, 1853.

Headnote

Tn an action to recover damages for the breach of a contract, relative to the sale and exchange of lands, if the only defence set up in the answer is, that the premises were in fact encumbered by judgments, the defendant is not permitted to show that there were outstanding judgments, which, although not a real, were an apparent lien, rendering the title unsatisfactory, and justifying his refusal to accept it.

The judge, upon the trial of a cause, has no right to strike out the only defence made by the answer, and substitute another, which is distinct and inconsistent.

A title, which is required to be satisfactory to the party by whom it is to be received, means a title to which there is no reasonable objection, and with which the party ought to be satisfied. Such a title he is bound to accept.

When the complaint alleges that the defendant was requested, and refused, to convey, and the allegation is not denied by the answer, no proof of a demand of the deed is necessary to be given upon the trial.

When it is proved that the premises to be conveyed by the plaintiff were of less value than those to be conveyed to him by the defendant, this difference of value, together with the expense of examining the title, is the true measure of damages.

Special damage is only necessary to be averred, when it constitutes in part the cause of action.

Appeal, by defendant, from a judgment at special term, in favor of the plaintiff, for $1,441.25.

The action was brought to recover damages for the breach of an agreement, relative to the sale and exchange of certain real estate in the city of New York.

The complaint averred that, on the 1st of April, 1851, the plaintiff and defendant entered into an agreement, in writing, under seal, and then set forth the agreement verbatim. The following are its substantial provisions :—The defendant agreed to sell and convey to the plaintiff a house and lot in the city of New York, known as No. 149 Fourth Avenue, for the price of $7,500 ; to be free and clear of all encumbrances, except a certain mortgage for $5,000 which the plaintiff agreed to assume. The balance of the price, $2,500, the plaintiff agreed to pay, by conveying to the defendant four lots of ground in

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the city of New York, on NT. W. corner of 41st street and the NTinth avenue, for the price of $7,500, to be free and clear of • all encumbrances,’ at the time of the delivery of the deed; at which time the defendant agreed to execute and deliver to the plaintiff a bond and mortgage on the lots so conveyed, conditioned for the payment, in one year, of $5,000, with interest.

The deeds were to be warranty deeds, and were to be executed and delivered, together with possession of the premises, on or before the 15th of the same month.

“The title to be good and satisfactory to the party to receive the same.”

The complaint then alleged that at the time of making the agreement, the plaintiff was and had continued to be the owner in fee of the lots which he agreed to convey, and that he had at all times been ready and willing, and had offered to perform the agreement on his part, but that the defendant had wholly neglected and refused to perform the same; and demanded judgment for $2,500 as damages.

The answer of the defendant denied none of the allegations in the complaint, but averred upon information and belief, that the lots which the plaintiff agreed to convey were not, on the day appointed for the delivery of the deed, “ free and clear of all and every incumbrance,”-but that there were several judgments outstanding of record against one John McDonald, a former owner of the lots, which were at that time a lien thereon. The reply took issue upon this defence.

Upon these pleadings the cause was brought to a trial before Mr. Justice Sandford, and a jury, on the 12th December, 1851. It was proved upon the trial that there w4ere no judgments unsatisfied of record against John McDonald, from whom the plaintiff derived his title.

A. witness, however, on the part of the defendant, swears, that the plaintiff, in a conversation with him about eight days after the agreement, had admitted, that there was a judgment against McDonald, unsatisfied of record.

The plaintiff proved that the house and lot bio. 149 Fourth avenue was worth from $1,500 to $2,000 more than the lots which he had agreed to convey. To the decision of the judge . admitting this evidence, the counsel for the defendant excepted.

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The judge also admitted in evidence an abstract of the title of the plaintiff to the lots he was bound to convey, with the proper searches annexed thereto, and an affidavit of McDonald, the grantor of the plaintiff, that certain judgments against John McDonald, which it appeared from the searches were unsatisfied of record, were not against himself, but against some other person of the same name. It was proved that all these papers had been exhibited to the defendant before the commencement of the suit. The defendant’s counsel excepted to the decision admitting them to be read in evidence. It was also proved, on the part of the plaintiff, that the defendant was not, and never had been, the owner of the house and lot which he had agreed to convey to the plaintiff.

"When the testimony was closed-, the counsel for the defendant requested the judge to charge the jury, 1. That there being no special damage alleged, the plaintiff could only recover under the general allegation of damage, the expense of his searches, and of preparing his papers. 2. That as there was no sufficient proof of a demand of a deed from the defendant, the plaintiff was not entitled to a verdict. Lastly, that the existence of judgments against John McDonald was an apparent lien, and that the defendant was, therefore, not bound to be satisfied with the plaintiff’s title.

The judge charged the jury that the case turned upon the point whether or not the plaintiff’s lands were encumbered when he tendered his deed to the defendant. The only incumbrances alleged are judgments against John McDonald. If there were any judgments outstanding against the John McDonald through whom the plaintiff derived his title, he cannot recover. If there were no outstanding judgments, the plaintiff is entitled to recover the amount of the difference in the value of the ^premises agreed to be exchanged, together with his costs and expense of preparing his papera, and abstract tendered.

The defendant’s counsel excepted to this charge, and also to the omission of the judge to charge as requested.

The jury found a verdict for the plaintiff for $1,250.

The motion for a new trial, upon the exceptions, was denied at special term, and judgment rendered upon the verdict.

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The exceptions were npw argued upon an appeal from this judgment.

Newton, for the defendant,

insisted that a new trial ought to be granted, and argued the following points.

I. The court erred in refusing to charge that a demand of a deed from defendant to plaintiff was not necessary. (Fuller v. Hubbard, 6 Cowen R. 14; Sage v. Ranney, 2 Wend. R. 532; Connolly v. Pierce, 7 Wend. R. 130.)

H. There were apparent liens upon the premises in the Seventh Avenué, rendering the title doubtful; and the defendant was not bound, according to the terms of the agreement, to be satisfied with the title; because one of the conditions particularly mentioned in the agreement between the parties, required “ the title of the respective premises to be good and satisfactory to the party to receive the same.” There is no rule of law that will oblige a party to be satisfied when it is one of the conditions of the agreement that it is optional with him to be satisfied or not.

HI. The rule of damages, as laid down by the court, was incorrect. 1. There being no special damages alleged in the complaint, the plaintiff could only recover under the general allegation of damages, the expenses of his searches and preparing his papers. 2. The recovery should be limited to the actual injury sustained, without regard to the profits plaintiff might have made by a sale of the premises. (Peters v. McKeon, 4 Denio R. 546.)

IY. The court erred in allowing the affidavit annexed to the abstract to be read to the jury ; the searches attached to the abstract, and not the abstract, were put in evidence by the defendant.

R. S. Emmet and A. L. Robertson, for plaintiffs,

claimed the affirmance of the judgment upon the following grounds.

I. The defendant could not, on the trial, set up any other defence than that contained in his answer, to wit, actual incumbrances upon the land agreed to be conveyed by the

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plaintiff, "by judgment against John McDonald, a former owner.

II. The demand of a deed by the plaintiff, if necessary, was admitted by the failure of the defendant, to deny the allegations of it in the complaint (Code, § 168).

m. The defendant admits the title was good and satisfactory by not objecting, except as to judgments against Mr. McDonald, which issue was found against him by the jury.

TV". Even if the defendant could reject the title on the ground of an apparent incumbrance, he has placed his objection on the ground of an actual incumbrance, which has been found against him.

V. The rule of damages was correct, at least so far as the defendant is concerned. 1. This was an agreement not merely for the sale of lands, but for the exchange of them. 2. The evidence showed that the defendant had no title to the lands agreed to be conveyed by him, so that the plaintiff could not enforce specific performance (Florence v. Thornhill, 2 W. Bl. 1078; Hopkins v. Grazebrook, 6 B. & C. 31; Robinson v. Hannan, 1 Ex. 849; Betner v. Brough, 11 Penn. St. R. 127 ). 3. If the defendant could have given a title, and refused, he was also liable (Driggs v. Dwight, 17 Wend. 71 ).

VI. The damages given by the jury, under the rule laid down by the judge, were admissible under the pleadings. I. The loss of the difference in value to the plaintiff between the completion and the agreement, and its valuation, was a direct and immediate consequence of the latter, and need not have been stated, even in a declaration at common law. 2. Even consequential damages could be recovered under an allegation of general damages in such case ( Ward v. Smith, 11 Price, 19). 3. The plaintiff could formerly have had the same relief in equity, and the principles applicable to pleadings in equity did not require an allegation in the bill of special damages to recover them in an issue of guamtmm dammificatus. 4. An allegation of such special damage cannot form part of a complaint. (a .) It is not part of the cause of action, which the complaint is to contain (Code, § 142, subd. 2); if so, it will be admitted, unless issue be taken on it by the answer (Code, § 168, s. 149), which was not permitted or required under the

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former system of pleading (Robinson v. Merchant, 7 Q. B. 918; Wilby v. Elston, 8 Man. Gr. & S. 142). (b.) If it form part of the cause of action, a defendant might confine his defence to taking issue on it alone, (c.) They may be recovered under the demand for relief (Code, § 142, subd. 3 ; § 275, 276).

VII. The whole abstract of title, with papers annexed, was properly in evidence. 1. It was called for by the defendant, who thereby made the whole evidence. 2. The introduction of the affidavit of McDonald was proper, to show that every reasonable mode had been adopted to inform the defendant as to the' state of the title. 3. The whole abstract and papers were proper, to show that the declaration of Mr. Fagen, that there was an outstanding judgment, if ever made, was corrected by the contents of these papers.

The pleadings in this case furnish a full answer to nearly all the objections that have been raised on the part of the defendant.

The answer, by not controverting, admits all the material allegations in the complaint, and sets up as a sole defence that the judgments against McDonald were a subsisting lien upon the plaintiff’s lots, on the day appointed for the exchange and delivery of the deeds. The answer, therefore, admits that but for this objection the title was satisfactory, and that if the objection were proved to be groundless, the refusal of the defendant to perform the agreement was without justification or excuse.

The defendant could not, therefore, be permitted upon the trial, nor can he now be permitted, to shift his ground, by saying that the judgments against one John McDonald, which the searches disclosed, although not a real were an apparent lien, which, as clouding the title and rendering it unsatisfactory, justified his refusal to accept it. Whether had this defence been set up in the answer it could have availed the defendant may well be doubted, but it is quite certain that it could not be admitted under the pleadings. The judge could not strike out the answer that had been put in and substitute another, nor make any addition to the answer by which a new and

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entirely distinct issue would be raised ; and were it admitted that he might have carried the power of amendment to this extent, no application for its exercise was in fact made to him. His charge therefore to the jury, that the case turned wholly upon the question whether the plaintiff’s lots were in fact encumbered when he offered to convey them, was entirely correct. It is the only charge that he could have given.

The assertion that the provision in the agreement that the title should be satisfactory to the party who was to receive it, gave to the defendant an absolute right to reject that which was tendered, scarcely requires an answer. We cannot give a construction to the agreement that, by enabling each party to rescind it at his pleasure, would have robbed it wholly of its obligatory character. We cannot say that there was no contract for the breach of which an action could be maintained. A title, satisfactory to the party to whom it is to be given, means a title to which there is nq reasonable objection, and with which therefore the party to whom it is tendered ought to be satisfied. When such is its nature, so far from having a discretion to reject, he is bound to accept it.

The objection that there was no proof upon the trial of a • demand of a deed from the defendant is untenable. As we read the case the fact was sufficiently proved, but in truth no such proof was necessary to be given. The complaint expressly alleges that the plaintiff requested the defendant to perform the agreement by conveying or causing to be conveyed the house and lot which he had agreed to convey, and that the defendant had refused to comply with the request. These allegations are not denied by the answer, and their truth is therefore admitted upon the record. In the actual state of the pleadings the plaintiff was not required to give any proof whatever in order to maintain his action. He had only to show the amount of the damages he had sustained, and to repel the evidence on the part of the defendant.

It only remains to say, that in our opinion the rule of damages laid down by the judge was entirely correct, and that the abstract of title, with all the papers annexed, under the circumstances and for the reasons stated by the plaintiff’s counsel, was properly admitted in evidence. It is an erroneous suppo

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sition that the plaintiff was not entitled to recover the whole damages that were given, because no special damage was alleged in the complaint. Special damage is only necessary to he averred where it constitutes in part the cause of action. In other words, where the right to maintain the action depends upon the fact that the damage has been sustained. (Kendall v. Stone, 1 Selden, 14. Linden v. Graham, 1 Duer, 670 .)

All the exceptions that appear in the case being overruled, the judgment appealed from is affirmed with costs.

Cases cited

Driggs v. Dwight 17 Wend. 71 N.Y. Sup. Ct. p. 157