72 N.J. Eq. 157 | New York Court of Chancery | 1906
The bill is filed by a vendee for specific performance of an agreement in writing to convey to complainant, for $4,500, by deed of warranty, free from all encumbrances, a tract of land in Newark. The property belonged to defendant Maurice Ftynn, and the agreement, which was made between Flynn as sole party of the first part and Saldutti as of the second part, was signed and acknowledged by Flynn, and recorded. Before the recording it was also signed by Mrs. Flynn, but was not acknowledged by her. On signing the agreement $25 was paid to Ftynn on account of the purchase, and the mortgage and other liens upon the property were about $2,975, leaving about $1,500 as the balance of the consideration to be paid on the delivery of the deed. When the time arrived for carrying out the contract, Mrs. Fljmn,
“which contract is alleged to have been broken by the purchaser, Felix Saldutti, though there may be some question as to the validity of the hereinbefore-mentioned deed, owing to said previous contract,”
and then agreed that in case Saldutti or his assigns should set aside the said deed made to the Napuranos, then Maurice Flynn should repay to the Napuranos the $200, together with one-half of the costs and expenses in defending the deed; and further, that if the deed should be declared valid, or not questioned for a reasonable period, then the Napuranos should pay the balance of the consideration to the Flynns—$500 in cash to Mrs. Flynn for her dower rights, and the balance of $4,400 by assuming the existing mortgage, with interest; $575 in cash, and $1,500 by a mortgage, payable in five years, with interest.
To this claim there are two answers: First. The agreement to convey free of all encumbrance is not satisfied by a mere conveyance containing a covenant against encumbrance, but the vendee is entitled under such contract to a conveyance by the husband and his wife before paying the purchase-money. Young v. Paul, 10 N. J. Eq. (2 Stock.) 401, 405 (Chancellor Williamson) ; affirmed on appeal (Court of Errors and Appeals, 1855). The wife’s inchoate right of dower was an encumbrance, and its existence is a breach of a covenant against encumbrances. Carter v. Denman, 24 N. J. Law (3 Zab.) 260, 272, 273 (Supreme Court, 1852). In the second place, a vendor is in equity a trustee for the vendee from the time of the execution of the agreement. King v. Ruckman, 21 N. J. Eq. (6 C. E. Gr.) 599, 604 (Court of Errors and Appeals, 1870); Houghwout v. Murphy, 22 N. J. Eq. (7 C. E. Gr.) 531, and opinion of Justice Depue, 546, 547 (Court of Errors and Appeals, 1871). The failure of the vendee to perform the contract on his part strictly at the time fixed, if the vendor is ready to perform, does not in equity discharge the contract, unless by the contract itself,' or circumstances proved in the case, time is made or has become of the essence of the contract, or the delay has made specific performance inequitable. This is the radical difference between the equitable and legal rights on failure to perform strictly the terms of such contract. The equitable remedy remains, although •neither party was ready on the contract day, and no action at law would lie in favor of either party. King v. Ruckman, 21 N. J. Eq. (6 C. E. Gr.) 605; Zimmerman v. Brown, 36 Atl. Rep. 675, 677 (Vice-Chancellor Emery, 1897); Freeson v. Bissell, 63 N. Y. 168, 176 (1875). Flynn therefore was not released
The deed to the Napuranos, being executed and acknowledged by both husband and wife, also passed to them the lands free of Mrs. Flynn’s inchoate right of dower, and if they now convey the lands to complainant the complainant will receive from them a title free from the inchoate dower. Complainant could not have compelled Mrs. Flynn to convey her interest, as the agreement, although signed, was not acknowledged under the statute. P. L. 1898 p. 685 § 39, tit. "Conveyances;" Goldstein v. Curtis, 63 N. J. Eq. (18 Dick.) 454 (Vice-Chancellor Pitney, 1902); Ten Eyck v. Saville, 64 N. J. Eq. (4 Dick.) 611 (Vice-Chancellor Stevens, 1903). And Mrs. Flynn, not being bound in any way by the agreement, was entitled to bargain for the sale of her inchoate right of dower as her own property. Ten Eyck v. Saville, supra. By the conveyance to the Napuranos this estate is in fact released and discharged altogether, and their conveyance to complainant would convey the property free from this encumbrance, which they have discharged by a purchase and conveyance from the wife. This encumbrance cannot be reinstated or retained by directing the Napuranos to convey only Flynn’s former estate in the lands, or to convey the lands subject to this dower, for the wife’s inchoate right of dower is an interest, created by operation of law, in lands of which the husband is seized, and it would seenpto be beyond the power of a court to create in a third person an estate of this character, and having its incidents, irrespective of the husband’s seizin. The experiment of creating such an anomalous interest in lands should certainly not be made, but" the equities of the parties should be worked out under the conditions' the parties have themselves created, so far as practicable. Defendant’s counsel, in view of this status of the inchoate dower right," suggests that in order to
The next question is whether the complainant is entitled to compensation from Flynn for this payment. Complainant’s counsel suggests indemnity by a retention of a portion of the fund in court, but as the inchoate right of dower is in fact gone, and the conveyance from the Napuranos would be free of any estate in dower, there is no estate or encumbrance to be indemnified against. By reason of this fact the case does not come within the application of the decisions relied on by counsel for Flynn as establishing the rule that on the refusal of the wife to join in the conveyance the husband cannot, on a bill for specific performance, be required to make compensation or .give indemnity unless the wife’s refusal has been at his instance or by collusion. This question arose in these cases only because the wife’s interest was still outstanding at the time of the conveyance directed by the court, and the purchaser received