37 A.2d 305 | Md. | 1944
Jesse A. McKeever and Guy Whiteford, partners in a real estate agency in Washington, brought this suit for injunction in the Circuit Court for Prince George's County to restrain Washington Heights Realty Corporation and Waldo M. Ward, its president, from selling lots in Forest Heights, a suburban development of 136 acres of land on Livingston Road, and from interfering with their own selling thereof during their exclusive agency.
In 1941 Ward applied to Whiteford for a loan of $25,000, to be secured by a deed of trust on the tract of land. Whiteford, finding that he could obtain a loan through David A. Baer, an attorney and expert in building construction, submitted to Ward an offer to arrange for the loan for a period of two years for the following compensation: (1) Commission of $1,000, (2) one-third *219 interest in a part of the tract set aside for a commercial area, and (3) exclusive agency for the sale of lots "during period of loan, namely, two years." Ward set the prices as follows: 200 lots at $650 each, $130,000; 200 lots at $450 each, $90,000; total, $220,000. He estimated that, in addition to $3,000 payable for interest on the loan for two years the corporation would spend $130,000 for road construction, water supply, advertising, selling and taxes.
On May 28, 1941, the corporation presented to McKeever Whiteford a written application for a loan for two years, bearing interest at six per cent. On the same day, after Baer reported that his client would have the money available within ten days, an agreement was executed wherein the corporation agreed to give McKeever Whiteford for procuring the loan the compensation as previousely decided upon: (1) Commission of $1,000 in cash, (2) one-third interest in the commercial area, containing approximately six acres, to be free of encumbrances within two years, and (3) exclusive agency for the sale of lots "during the period of the above described loan." It appears that a few days later Ward asked Baer to make the note payable "on or before" two years from date. Accordingly, on June 9, in his instructions to a title company, Baer requested preparation of a deed of trust to secure a note for $25,000 payable to the order of Virginia Manning "on or before" two years from date, with interest at six per cent. Miss Manning, while employed in the office of McKeever Whiteford, was merely a straw man in the transaction, and she endorsed the note without recourse, and the note was delivered to Marcus S. Goldnamer, lender of the money. In November, 1941, the corporation paid off the loan, and claimed that the agency was terminated. The Chancellor dismissed the bill of complaint, holding that McKeever Whiteford had failed to show that the term of the agency was for the unqualified period of two years.
It is elementary that where a contract has been entered into by competent parties, it is not within the power of *220
either party to rescind it without an option to do so or without the consent of the other party, in the absence of fraud, duress or undue influence, or unless the equities are such that he should not be permitted to enforce it. A meeting of the minds is required not only to make a contract, but also to rescind or modify it after it has been made. No party has a right to rescind or modify a contract merely because he finds, in the light of changed conditions, that he has made a bad deal. A court should not undertake to redraft a written instrument merely because one of the parties thereto has become dissatisfied with its provisions. Vincent v. Palmer,
Even if there were any doubt in this case whether extraneous evidence is admissible to explain the meaning of the agreement of May 28, 1941, there is certainly no question that such evidence is admissible under the principle that a written contract, which through accident or mistake, fails to express the actual agreement of the contracting parties, may be reformed in equity upon clear and satisfactory proof. Johnson v. National Mut. Ins.Corp.,
In this case appellants testified that Baer acted without their knowledge and consent, and they never saw the note and deed of trust, but they distinctly understood that they were to have the exclusive agency for the exact period of two years. Baer testified that, while he had been renting an office from McKeever Whiteford, he was not connected with the agency. He also stated that he did not receive any fee from them, but was paid by Goldnamer. He declared positively that he arranged to have the words "on or before" inserted in the note and deed of trust without mentioning this form to either McKeever or Whiteford. He said that, while he understood they were to have the sales agency, he did not read the agreement and knew nothing about the term of the agency. "I did not see, he explained, "where it concerned them at all what the terms of the loan were. * * * When I agreed on this proposition, I am frank to say the matter never occurred to me. I did not think it had any effect. I see now that it did; but it never passed through my mind at all." From the language of the offer made by McKeever Whiteford, the application of the corporation for the loan, the explanation made by Baer, and other facts and circumstances of the case, it becomes clear that the parties understood that the term of the agency was to extend without qualification for the period of two years.
It follows, therefore, that appellants were entitled to injunctive relief. Undoubtedly a person may invoke the *223
aid of a court of equity to prevent the conveyance of real estate where such conveyance would be inequitable. 2 Story, EquityJurisprudence, 12th Edition, Sec. 953. We realize that a court of equity will ordinarily not specifically enforce a contract for personal service, because (1) the mischief likely to result from the enforced continuance of the relationship incident to the service when it has become personally obnoxious to one of the parties is so great that the best interests of society require that the remedy be refused, and (2) the court would find it difficult to enforce such a decree. Fitzpatrick v. Michael,
Inasmuch as the term of the sales agency has expired, it is now too late to grant injunctive relief. But the Chancellor *224
should have assumed jurisdiction, not only to grant the injunction, but also to award appellants any compensation to which they are entitled. Under a prayer for general relief, the court is not confined to the relief which is specifically prayed for, but may grant any needed relief which is not inconsistent with the special prayers. Even where the nature of the case is such that the prayer for specific relief cannot be granted, relief may be granted under the general prayer suitable to the peculiar nature of the case. While a complainant is not entitled to relief beyond the general scope and object of the bill or inconsistent with it, the court is left free to adopt any mode by which it can most readily and effectually administer that relief which the equity of the case may require. Townshend v. Duncan,
2 Bland 45, 48; Polk v. Rose,
The record in this case discloses that, while the commission of $1,000 has been paid, the corporation has not yet conveyed the one-third interest in the commercial area, and the real estate agents are claiming commissions and damages. Where land, or any estate therein, is the subject-matter of an agreement, the equitable jurisdiction is firmly established. Whenever a contract concerning real estate is in its nature and incidents entirely unobjectionable, it is as much a matter of course for a court of equity to decree its specific performance as it is for a court of law to give damages for its breach. 4 Pomeroy, Equity *225 Jurisprudence, 5th Edition, Sec. 1402. The reason for the rule is that the measure of damages in a court of law for breach of a contract for conveyance of land is uncertain, and there can be no adequate remedy other than in a court of equity where specific performance can be decreed. Maryland Clay Co. v. Simpers,
The Chancellor should also award to appellants the commissions to which they are entitled. According to the record, Ward represented that the lots in the development had been approved for loans guaranteed by the Federal Housing Administration. Appellants relied upon that representation, but later discovered that no such approval could be obtained. When it was learned that some of the purchasers were unable to obtain such loans, the District Attorney demanded that their deposits be returned. When a person intentionally misrepresents a material fact or produces a false impression in order to mislead another, or to entrap or cheat him, or to obtain an undue advantage of him, there is a positive fraud. But as Justice Story said: "Whether the party, thus misrepresenting a material fact, knew it to be false, or made the assertion without knowing whether it were true or false, is wholly immaterial; for the affirmation of what one does not know or believe to be true is equally, in morals and law, as unjustifiable as the affirmation of what is known to be positively false. And even if the party innocently misrepresents a material fact by mistake, it is equally conclusive, for it *226
operates as a surprise and imposition upon the other party. 1Story, Equity Jurisprudence, 12th Edition, Secs. 192, 193. However, appellants did not pray for recission of the contract. They ask that the corporation be required by the court to pay them their commissions, not only on the sales for which the purchase price has been paid, but also on the sales which were not consummated on account of the fact that the purchasers were unable to obtain loans guaranteed by the Federal Housing Administration. Where an agent has done all he undertook to do and has procured a buyer as contemplated, he cannot be deprived of his right to compensation by the fact that the sale has fallen through on account of the inability or unwarranted refusal of the principal to consummate the sale according to the prescribed terms. Singer Construction Co. v. Goldsborough,
Appellants are also entitled to any damages which may have been caused by breach of the agreement or interference with their work as sales agents. A party may commit breach of contract, not only by failing to perform it in whole or in part or by disabling himself from performing it, but also by making it impossible for the other party to perform his part. If one party is guilty of a substantial breach of contract, the other party has the right to treat the contract as rescinded and recover as damages the profits which he would have received through full performance.Anvil Mining Co. v. Humble,
For these reasons we reverse the decree of the Chancellor dismissing the bill, and remand the cause for the taking of any additional testimony that may be required, and for the passage of a decree granting specific performance and an award of any commissions and damages to which appellants may be entitled.
Decree reversed, and cause remanded with costs.