141 N.Y.S. 580 | N.Y. App. Div. | 1913
The defendant Orton owned certain vacant lots in Binghamton. On April 8, 1910, he entered into a written contract with the defendant Frey, whereby Orton agreed to sell nine lots to Frey at certain fixed prices (the prices being different on the different lots); to take back a purchase-money mortgage on each lot; to permit Frey to give a mortgage on each lot for $2,500 to the defendant Lestershire Lumber and Box Company, Orton’s mortgage to be second to the lumber company mortgage. Frey agreed to purchase the lots on these conditions; to erect a double dwelling house worth at least $2,900 on each lot; to have each house completed on or before October 1,1910; to pay all taxes on the property; to pay the interest as it became due on each mortgage; to have the buildings insured, the loss in case of fire payable first to the lumber company mortgage, second to the Orton mortgage.
A judgment of foreclosure has been entered, the property has been sold and, in distributing the money, the question arises here — Did the plaintiff have a right, as between herself and Orton, to give the $2,500 insurance money to Frey to enable him to rebuild or should she have applied it in reducing the amount of her mortgage ?
I concur in the conclusion reached by the trial judge and in the process of reasoning by which he reached it; a few additional observations, however, may not he out of place.
In a contract, wherein there are mutual promises, dependent the one upon the performance of the other, the violation by one party of the terms of the contract on his part releases the other party from the conditions to which he is bound. That is, one party cannot fail or refuse to perform the substantial promises in such a contract on his part and then hold the other party to his promises. Orton agreed to sell his lots to Frey upon the supposition and upon the arrangement that Frey by building upon them would make them more valuable. He consented to take a second mortgage on the lot in question upon the understanding and agreement that Frey should have a building erected and completed on the lot by October 1, 1910; that he should keep the taxes and interest fully paid up — the interest on Orton’s mortgage as well as upon the first mortgage; that Frey should build houses upon each, of the nine lots, it being the thought, undoubtedly, that each building would in some degree enhance the value of the others. On September 1, 1911, at the time the insurance money was paid, nearly a
No written condition of any contract gave the plaintiff the right to turn the insurance money over to Frey; on the contrary, the insurance policy forbade her to' do so and commanded her to apply it first upon her mortgage and then upon Orton’s mortgage. With her eyes wide open, knowing of Orton’s equities and of Frey’s failures, she deliberately violated the conditions of the policy and took her chances in defiance of Orton’s refusal and heedless of Orton’s rights. There is no excuse for her position; no equity in her contention.
The judgment should be affirmed, with costs.
Judgment unanimously affirmed, with costs.