140 A. 319 | N.J. | 1928
The bill in this case was filed to compel the performance of a contract in writing for the sale of a piece of real estate in Paterson, the complainants being the intending vendees and the defendant the vendor. The contract, drawn by the vendor himself, provided for the transfer of the title for the purchase price of $45,000, of which $2,000 was to be paid upon the execution of the agreement and the remainder in the manner specified therein. The conveyance was to be made on January 2d 1926, but when the time for performance arrived the defendant refused to make the deed. His contention was and is that his refusal was justified because, as he testified, that at the time the contract was executed he was having trouble with his children, and that it was then orally agreed between the parties that, in the event that he became reconciled with them before the time for performance arrived, he was not to convey the property to the complainants, but he was to pay them $500 as liquidated damages for failure to perform, and that such reconciliation actually took place before the time for performance arrived. The testimony supporting this contention on the part of the defendant was objected to, but was admitted, and the vice-chancellor considered that the evidence justified him in refusing to decree specific performance. Accordingly he advised a decree dismissing the bill.
The theory upon which that conclusion was based was that it was open to the defendant to prove by oral testimony that the agreement was not to become effective unless a reconciliation between the defendant and his children had not taken place before the time fixed for the delivery of the deed, and that the proofs showed that this was the arrangement between the parties.
It seems to us that the learned vice-chancellor misconceived the situation. The defendant's proofs did not show that the agreement was not to have life unless the quarrel between the defendant and his children continued to exist at the time of the performance of the contract. On the contrary, *247
the proofs conclusively showed that the contract was a valid and existing one. The contract was actually executed and delivered; it was partly performed by the payment of $2,000 on account of the purchase-money and the acceptance and retention of that payment. It contained a provision that, in case of default in the performance of it by the defendant, he should pay the complainants $500 as liquidated damages, and the defendant at the trial in effect admitted that the contract was a valid and existing one by his admission that thereunder he became liable in that amount because of his default. This being the situation, the attempt in reality was to alter or vary the terms of an existing written agreement by parol evidence, and this is not permissible under the doctrine of Naumberg v. Young,
The vice-chancellor relied upon O'Brien v. Paterson BrewingCo.,
Since the oral evidence referred to was legally inadmissible, and since no lawful excuse for failure to perform appeared, we think that the defendant should have been decreed to specifically perform the contract in question.
Although the contract contained a provision for liquidated damages in case of a breach, where, as here, such provision is intended merely to secure performance, and not to give an option either to perform or to pay damages, the court of chancery will disregard the provision and enforce performance. Brown v.Norcross,
The decree below will be reversed, with costs, and the record remitted to the court of chancery for further proceedings in accordance with the views herein expressed.
For affirmance — None.
For reversal — THE CHIEF-JUSTICE, TRENCHARD, PARKER, MINTURN, KALISCH, BLACK, KATZENBACH, CAMPBELL, LLOYD, WHITE, VAN BUSKIRK, McGLENNON, KAYS, HETFIELD, DEAR, JJ. 15. *249