199 A.D. 150 | N.Y. App. Div. | 1921
Lead Opinion
Judgment having been granted on the pleadings, the affirmative defense contained in the answer has been overruled as matter of law. In my opinion such defense presents a question of fact in support of which the defendant was at liberty to
In Diamond Match Co. v. Boeber (106 N. Y. 473, 486) it is stated: “It is, of course, competent for parties to a covenant to agree that a fixed sum shall be paid in case of a breach by the party in default, and that this should be the exclusive remedy. The intention in that case would be manifest that the payment of the penalty should be the price of non-performance, and to be accepted by the covenantee in lieu of performance. (Phoenix Ins. Co. v. Continental Ins. Co., 87 N. Y. 400, 405.) But the taking of a bond in connection with a covenant does not exclude the jurisdiction of equity in a case otherwise cognizable therein, and the fact that the damages in the bond are liquidated, does not change the rule. It is a question of intention, to be deduced from the whole instrument and the circumstances; and if it appear that the performance of the covenant was intended, and not merely the payment of damages in case of a breach, the covenant will be enforced.” (The italics in the above quotations are mine.)
It follows from the foregoing authorities that it is a question of intent whether the action for damages shall constitute the exclusive remedy and such intent is ascertainable not alone from the contract but from the contract construed in the light of surrounding circumstances. It is this question which is raised by the answer. It was, therefore, permissible for the defendant under his answer to introduce evidence bearing on the question as to whether or not the parties intended that in case of a breach of contract the payment of $5,000 should constitute the exclusive remedy for such breach. He was not confined to the contract but was at liberty to introduce extraneous evidence to show the intent of the parties. I apprehend also that if after the breach the parties had agreed that the initial payment of $5,000 which the plaintiff had received should be retained by her in settlement of the satisfaction of the broken contract such agreement would be as binding as if the plaintiff had received any other
It should further be observed that when this action was commenced the plaintiff was not entitled to full performance of the contract. The defendant had until July 1, 1921, to take title and make full performance of his contract. According to the uncontroverted allegations of the complaint, which are the only ones which can be considered in support of this judgment granted on the pleadings, the only default of the defendant at the time of the commencement of the action was in respect to the payment of $15,000 on April 1, 1921. For the recovery of that amount the plaintiff did not need an action in equity. The answer alleges among other things that the plaintiff had an adequate remedy at law. Whether a court of equity under such circumstances could or should exercise its jurisdiction is a question which need not now be determined in view of the conclusion already reached.
The judgment should be reversed and motion for judgment on the pleadings denied, with costs to the appellant to abide the event.
Woodward, H. T. Kellogg and Van Kirk, JJ., concur; John M. Kellogg, P. J., dissents, with a memorandum.
Dissenting Opinion
The terms or effect of the written agreement cannot be changed by parol evidence. The intent of the parties is to be gathered from the agreement “ from the particular language, construed in the light of the surrounding circumstances.” An allegation that the parties intended that the agreement should have a meaning different from the one it has is ineffectual unless a definite statement of facts is made showing that the agreement is not properly written, in which case a reformation may be asked. The complaint may be searched in vain for any allegation of facts tending to show any agreement between the parties other than the written agreement produced, and no facts are alleged which would tend to change the ordinary construction of it as written. A motion for judgment admits
Judgment and order reversed and motion for judgment on the pleadings denied, with costs to the appellant to abide the event.