24 N.J. Eq. 298 | New York Court of Chancery | 1873
By a written contract of May 12th, 1868, Elisha Ruckman agreed to sell and convey certain lands to Benjamin W. King. Ruckman afterwards refused to convey, and King thereupon filed his bill for specific performance. By a final decree of the Chancellor duly made in the cause, the bill was dismissed. On the 5th of December, 1870, this decree was reversed by the Court of Appeals, and the bill and proceedings remitted to this court, to make a decree in favor of complainant in conformity with the directions of the appellate tribunal.
By the terms of the contract, Ruckman was to sell and convey two descriptions of premises: first, all the lands that he owned, and second, all the lands that he held contracts for, within certain geographical limits — being the counties of Rockland, New York, and Bergen, New Jersey, and also two lots in Hackensack — containing in all about two thousand acres, for the price of §275 an acre. §100 was paid at the execution of the contract; §19,900 were to be paid on the first of the following June; and §80,000 on the first of the following July, when the deed was to be delivered, and the balance of the purchase money secured by mortgage on the premises, payable in five annual equal sums from the date of the agreement, with interest at six per cent, yearly.
By the terms of the order of the Court of Appeals, Ruck-man is to execute the contract so far as he has the ability to do so, provided if he shall be able to perform it in part only, then the value of the lands embraced in the contract and which he is unable to convey, shall be ascertained, and damages awarded to the complainant or allowance made to the defendant, as the principles of equity may require. If the contract cannot now be fully executed, it is directed to be carried into effect on equitable principles, as far as circumstances will admit.
First. As to the interest upon the purchase money during the five years, or thereabouts, that intervened between the dates fixed by the contract and the date of the final decree. The purchase money, with the exception of the $100 paid when the contract was signed, having been refused to be accepted by Euckman when he refused to execute the contract, and subsequent possession of the premises having also been retained by him, is he entitled to interest on the principal during this interval, as well as the principal itself?
Second. $100,000 of the purchase money was to be paid at or before the delivery of the deed, and the balance to be secured by mortgage, payable in five equal instalments. The five years having elapsed, is a mortgage' of like terms to be given for the balance of principal, or is the balance to be paid now in cash ?
Third. "What compensation or allowance, if any, is to be made to either party in respect to lands which Ruckman held contracts for but is unable to convey ?
The quantity of lands which he owns and is able to convey, is one thousand three hundred and fifty-three acres and seventy-seven hundredths of an acre. At $275 an acre, the total price is $372,286.75. Deducting $100,000 for purchase payments as above, the unsettled balance is $272,286.75. The rents and proceeds on the other hand, of the lands which Ruckman has continued in possession of, are inconsiderable
It seems to me clear that Ruckman is not entitled to the interest, and that the complainant is entitled to give the mortgage for the above stated balance, for the time it would have run, and on the terms it would have had, if given on the 1st of July, 1868, in pursuance of the contract. By this adjustment Ruckman is prevented from taking advantage of his wrong in repudiating his bargain, and the just rights of the complainant, as far as practicable, are protected. That Ruckman was wrong in seeking to escape from his contract, is not open to doubt. It has been adjudged, and cannot now be considered. The Court of Appeals in so adjudging, directed that conveyance should be made according to the contract, so far as he was able to do so. In respect to lands actually owned, no modification of the terms of the contract was suggested, and none is required. It can be carried out in substance and in form. That can be done now which ought to have been done then. The time that has intervened is due to Ruckman’s default, and ought not to be computed in his favor.
The conclusions thus expressed are abundantly sustained by the cases. The doctrine relied on for the defendant in assorting claim to the interest, is the doctrine that in equity, the result of a contract of sale is, that the tiling sold thereupon becomes the property of the purchaser, and the purchase money the property of the vendor; that, as a corollary, the purchaser is entitled to the rents of the estate from the time fixed for completion, and the vendor is entitled to interest on the purchase money from the same time; that the estate and the purchase money are things mutually exclusive, and neither party can at the same time be entitled to both.
A condition of sale there provided that the purchaser should pay in the remainder of the purchase money on or before the 26th of December, and on payment, to have possession, or the rents and profits from the preceding day; but if the purchaser should fail so to pay, then from whatever cause the delay in consummating the sale might occur, he should pay interest on the balance of the purchase money from that day till paid. Notwithstanding the explicit agreement for interest during any delay in consummating the sale, and notwithstanding the strength of the words, “ from whatever cause the delay might occur,” Lord Cottenham held that the interest should not be allowed. He did not find, he said, in any case, a contract that a purchaser is to pay interest from a day certain, although prevented from performing his part of the contract by the acts of the vendor; no purchaser would make such an agreement. Nothing, he adds, would be more unjust than to hold that a purchaser, having contracted to pay interest on his purchase money, (in almost all
X think the same considerations pertain to and must govern the question of the mortgage. The benefit accruing to the purchaser from having time for the payment of the bulk of the principal, and of the rate agreed on for interest, is apparent. It is a material ingredient of the bargain, as much so in reality, though not in degree, as the price, and cannot be withheld from the purchaser in this ease by the willful misconduct of the vendor, for the sole benefit of the vendor himself.
Whether or not, the purchaser here made use of the purchase money after the defendant refused to accept it, is not, in my judgment, an important point in the suit. He tendered himself ready to fulfill his agreement, and has so continued since. It is not the ease of a debt where, if interest is to be stopped, the principal must be held unemployed or paid into court. It is the case, as before said, of mutual trustees, one refusing and the other desiring- to transfer in fulfillment of the trust. If one wrongfully retains and makes use of the land, the other is not thereby precluded from retaining and making use of the money.
The remaining question relates to compensation for lands which Ruckman is unable to convey. They are only the lands described in the agreement of May 12th, 1868, as those for which contracts were held. In the schedule appended to the master’s report, they are shown to consist of eight tracts, containing in all seven hundred and sixty-two and thirty-five hundredths acres. No title was ever got by Ruckman to any of them. In respect to six of the tracts, the contracts were verbal, and in respect to tract numbered eight in the schedule, containing six hundred and seven and eighty-five hundredths acres, no contract whatever, sufficiently appears. For one tract of eighteen acres, belonging to John
The above, briefly stated, are the reasons on which my conclusions in regard to the three controverted questions are grounded.