102 N.Y.S. 648 | N.Y. App. Div. | 1907
Lead Opinion
Many, and perhaps most, of the objections to the title urged by plaintiff are insufficient to justify its refusal to perform, but I think there is a practical impossibility of accurately fixing the lines of the land proposed to be conveyed, and the difficulty arising therefrom
The ground upon which the lien exists is thus stated by Lord Chancellor Westbuby in Rose v. Watson (10 H. L. Cas. 672): When -the owner of- an. estate contracts- with- a purchaser for, the immediate sale of it, the ownership of- the- estate is* in equity, transferred by that contract. Where the contract undoubtedly is an executory contract in this, sense, namely, that the ownership of the estate is, transferred subject, to the payment, of the, purchase money, every portion of the purchase, money paid in pursuance of that con-. tract is. a part performance and execution of the. contract, and to the extent of the purchase money so paid* does, in equity finally t-rans^ fer to the-purchaser- the ownership of the corresponding portion of the estate.” This principle is so firmly established in- this State that when lands have been sold by contract by a testator* the purchase price not having been paid, and the title remaining in him at his decease, the premises contracted to be sold' are not to .be considered as embraced in his real- estate, fqr the interest remaining in the vendor is not real but personal estate. (Lewis v. Smith, 9 N. Y. 502.)
. In such- a case,, upon- the execution of' the- contract, the vendor becomes a -trustee of- the land for the pul-chaser, retaining a lien for the purchase- price, and the vendee becomes the" equitable owner of the land. (Ferry v. Stephens, 66 N. Y. 321; Thomson v. Smith,
Thus it was firmly established m England more than half a century ago, and has been repeatedly reiterated since, that a vendee had a lien for the consideration paidf and that equity will enforce it, and neither before 1855 nor since has there been any authority in that jurisdiction which has held to the contrary. That such a lien exists and that' equity will enforce it, has been uniformly held in every State in this country in which the question has ari'sen. It would be wearisome to cite all the authorities to this effect. A few will suffice to indicate the universality of the rule. (Alabama, Hickson v. Lingold, 47 Ala. 449; Illinois, Swetitisch v. Waskow, 37 Ill. App. 155; Wisconsin, Taft v. Kessel, 16 Wis. 273; Mississippi, Davis v. Heard, 44 Miss. 50; North Carolina, Costen v. McDowell, 107 N. C. 546 ; Tennessee, Jones v. Galbraith, 59 S. W. Rep. 350 ; Kentucky, Bullitt v. Eastern Kentucky Land Co., 99 Ky. 324; Indiana, Coleman v. Floyd, 131 Ind. 330; Shirley v. Shirley, 7 Blackf. 452.) In California and North Dakota the Civil Codes specifically provide for a vendee’s lien (Cal. Civ. Code, § 3050 ; N. D. Rev. Codes [1899], § 4834 [Civ. Code, § 1805]), and that such a lien exists and will be enforced in equity is stated by the text writers- of the highest fame and authority and questioned by none. (Pom. Eq. Juris. [3d ed.] § 1263; Washb. Real Prop. [6th ed.] § 1039 ; 2 Story Eq. Juris. [13th ed.] § 1217 ; Jones Lien [2d ed.], §§ 1105, 1106; Fry Spec. Perf. [3d Am. ed.] § 1452.)
In our State the vendee’s lien has frequently been recognized. (Clark v. Jacobs, 56 How. Pr. 519; Parks v. Jackson, 11 Wend. 442; Tompkins v. Seeley, 29 Barb. 212; Gibert v. Peteler, 38 N. Y. 165 ; Chase v. Peck, 21 id. 581.) The whole weight of
In Klim v. Sachs (supra) the learned court held that no lien existed in behalf of a purchaser when nothing more appeared than that the vendor was unable to convey the title which lie had contracted to convey and -seems -to. have considered that süch a lien attached-only when the purchaser'had gone into possession under the contract of sale and had made improvements on the land upon the faith thereof. In -support of this view the court cited King's Heirs v. Thompson (9 Pet. 204) and Gibert v. Peteler (38 N. Y. 165). An examination of these cases shows that while they support the proposition that a purchaser going into possession under a contract of sale and making improvements upon the faith thereof-may-have a lien for the money thus expended, they contain nothing limiting a vendee’s lien to such a case. On the contrary, in both cases the lien was allowed specifically upon the ground that the moneys paid out for improvements constituted part payment of the consideration which the vendee was to pay for the- land. It is .said' that in all the eases (at least in the appellate courts) in which" a vendee’s lien has been sustained in this State, there have been found other equities in favor of the vendee besides the mere fact of the vendor’s inability or refusal to completely perform his contract. It is quite true that in many of the cases there have been other matters which have been much discussed, but I have been able to find none in which the right to a lien and to enforce it has been made to depend in the slightest degree' upon any equities in favor of the vendee apart ftom the fact that he has paid a' part of the consideration and that the vendor lias failed to perform.
In Tompkins v. Seeley (supra) the court found strong equities in favor of the vendee, but these influenced the court, not in awards ing him a lien, but in holding him free from any obligation to com
, The right of a vendee to a lien, and to invoke the aid of equity to enforce it cannot be defeated upon the ground that he has an adequate remedy at law for damages. As well refuse a decree for the foreclosure of a mortgage because the mortgagee can collect his debt at law. To oust equity of its jurisdiction the legal remedy must be as efficient as the remedy both in respect to the final relief and the means of obtaining it. (Kilbourn v. Sunderland, 130 U. S. 505, 514.) It certainly cannot be contended for an instant that an action for damages, with the more or less doubtful chance of collecting the judgment by execution, is equal in efficiency or certainty to the remedy of foreclosing the lien in equity. It certainly would be far from equal in a city like this, where the transactions in real estate are of great number and are, no doubt, fre quently entered into between total strangers. Under our cumbersome and complicated system of transmitting title to lands, and
We find no satisfactory authority, however, for extending the lien so as to cover the cost of examining'the title. This is undoubtedly an item of .plaintiff’s damage, but it is neither money paid as part of the consideration nor money expended in improvements upon the property, and the principle of law upon which the doctrine of a vendee’s lien rests does not warrant such an extension of the lien.
We also think that the extra allowance should have been limited to five per cent upon the sum sought to no recovered by the plaintiff. In one sense, the whole consideration was involved, but practically the controversy turned upon the plaintiff’s right to recover its deposits.
With these modifications the judgment should be affirmed, with costs.
Ingraham, McLaughlin and Houghton, JJ., concurred \ Patterson, P. J"., dissented, j
Dissenting Opinion
The question arising upon the appeal from the judgment in this action is presented to this court in this department directly for definite decision-for the first time, and that question is whether, simply on the default'of a vendor in performing an executory contract for the sale of land, the vendee, seeking to recover a deposit made on account of the purchase money and the expenses of examining the title to the premises embraced in the contract, may have not only an equitable lien imposed upon such premises, but also a decree of foreclosure and sale, with the same effect as if he were a mortgagee pro tanto' of such premises.
The facts of the case are simple. The defendant agreed to sell and convey to the plaintiff certain premises in the city of blew York, for the stipulated sum of $8,500, of which $500 were to be paid at the time of the execution of the contract and $8,000 on the delivery of the deed and the closing of title. Five hundred dollars were paid. On an examination of the title by the purchaser there were various defects disclosed, such as incumbrances, encroachments and slight deficiencies in quantity, or, at least, such vagueness and uncertainty in description as made it difficult to determine what property would pass under a deed. The plaintiff declined to complete the purchase, and I will assume, for the purposes of this decision, that some, at least, of its objections were well founded and that it was justified in refusing to take the conveyance and pay the residue of the purchase money. Thereafter the plaintiff began this action, and in its complaint sets forth the transaction with the defendant and makes appropriate allegations concerning the payment of the deposit money and the outlay for examining the title, and then specifically asks that a lien be declared to exist in its favor upon the premises for the amount of both the deposit and the outlay for examining the title, and prays that a foreclosure of such lien and a sale of the property be directed. The learned judge at Special Term has granted to the plaintiff all the relief it sought, has directed a sale of the right, title and interest of the defendant in the premises and what shall be done with surplus money arising after a sale. The learned judge held that the plaintiff was entitled to a vendee’s .lien, based upon the theory that the vendor became a trustee of the land which he had sold and held in trust for the
It is suggested by the respondent in the present case that a special equity does appear, namely, that the vendor represented that he was the owner of the premises the subject of the contract, and that the deposit of $500 was paid upon that representation; but there is nothing to show that Palmer made a willful, false representation. In every contract for the sale of real estate the purchaser- must make it upon the belief that the person with whom he is contracting has the ability to. perform the contract. There is no special
As I look at this record- it merely presents the case of a person who is entitled to recover at law the amount of a deposit which he has made upon a contract for the purchase of land, which contract has failed by reason of the inability of the vendor to make title, the purchaser being also entitled to recover at law the amount he had expended in searching the title. The right to enforce a vendee’s lien in equity, in such circumstances, has been passed upon and determined adversely to the right in the case of Klim v. Sachs (102 App. Div. 44). That was. an action for specific performance brought by the purchaser against the vendor. There the plaintiff refused to aceept a deed on. the ground that the title was unmarketable because of certain encroachments of adjoining buildings upon the premises and also because the buildings on the property to be conveyed encroached upon the street, and he asked that if the defendant could not specifically perform he should have judgment for the amount deposited and for expenses of -examining the title, and that judgment be impressed as a lien upon the land described in the contract. The justice at Special Term granted the full relief, bu-t it. was held by the Appellate Division that the judgment was. erroneous in so far as it impressed the sum, together with interest and costs, as a lien upon the premises which were the subject of the contract, and the court struck from the judgment such poz-tions thez-eof as related to the alleged lien and the foreclosure thez-eof and affirzned the' znoney judgznent for the deposit and the expenses;
In. wliati may be 'eonsidez-ed the pioneer ease of Wythes v. Lee (supra) the learned vice-chancellor, referring to the embarrassment which existed by reason of the want of authority upon the subject, said: “I should feel mu eh pressed by the absence of any such cases if I could see that maintaining such a lien could he attended with danger or incozivenience. But I do not see any inconvenience in establishing the rule. 1 do not see any hardship izi it.” The inconvenience and the hardship are made manifest in this case,
Judgment modified as directed in opinion, and as modified affirmed, with costs. Settle order o;n notice.
