78 N.J. Eq. 488 | New York Court of Chancery | 1911
Tlie first question to be disposed of is the agency of Mr. Allaire He is a real estate broker having an office at Red Bank, near the property in question. Somehow he had the Patterson farm “on his books,” as property that was for sale, but in the beginning of his negotiations with Mr. Straus and his broker he had no special or definite authority from Miss Norris to represent her in the transaction in question. The evidence shows that when he received an offer from the complainant he submitted it to Miss Norris, and I gather from the circumstances that she, either expressly or tacitly at that time, authorized Mr. Allaire to represent her in the sale to the complainant. At any rate, if she did not expressly so authorize him, she took the benefit of his labor and effort, and to the extent to which she subsequently signed documents must be held to have ratified his authority.
There is no doubt but that Mr. Allaire represented that the farm contained eighty-two acres, or that the complainant went upon the land before the deed was delivered and was there shown the boundaries and extent of it. It is quite plain that everybody understood that he was purchasing eighty-two acres of land at a price of about $450 per acre. The facts resemble those in Paine v. Upton, 87 N. Y. 327, concerning which Chief-Justice Andrews says: “The facts affirmatively show a mutual mistake of the parties, in respect to the quantity of land, which commenced with the commencement of the negotiation for the sale of the farm, and pervaded the whole dealing from that time until the transaction was consummated, by the giving of the deed and the execution of the mortgage. This mistake, moreover, was as to an essential and material element of the contract. In the absence of any finding of special facts, and circumstances, the natural presumption is, that in a sale of agricultural land, the element of quantity enters into the transaction and affects the consideration agreed to be paid. But in this case it is plain that the representation of quantity was deemed material by the parties. The sale was, perhaps, not technically a sale by the acre. But the starting point of the negotiation was an inquiry by the purchaser as to the quantity of land in the farm, and the gross sum originally asked was fixed by the sellers by reckoning
I find, however, that the representations were not fraudulent, but were the result of an innocent mistake on the part of Miss Norris, which she was probably led into by a sort of general understanding in the neighborhood of the acreage of the tract, and particularly by a copy of a map of the Patterson farm, which came into her possession and which she showed to the complainant during the negotiations and produced at the hearing, on which the tract in question is marked “82 acres.” It must be kept in mind thát this suit is not a suit for the rescission or cancellation of the contract on the ground of misrepresentation, but is brought to recover back a portion of the purchase-money paid by the vendee upon the ground that he overpaid the vendor by reason of her misrepresentation of a then present fact. There appears to be no express authority in this state for such a proceeding. There are, however, many cases in which this court and the court of errors and appeals, in foreclosure suits, have ordered an abatement to be made in the amount secured by purchase-money mortgages which were the result of conveyances of land as to which the mortgagee misrepresented the number of acres in the tract combed and covered by the mortgage. These cases, to a large number of which reference will be made, are analogous in principle to the case at bar. The earliest one is Couse v. Boyles, 4 N. J. Eq. (3 Gr. Ch.) 212, in which there was a large deficiency of acreage, one surveyor making it twenty-two acres and another thirty-four acres out of a total of one hundred and twelve acres as represented. Chancellor Pennington says in that case: “The plain and sensible rule, as it appears to me, is this: When land is sold as containing so many acres 'more or less,’ if the quantity on an actual survey and estimation either overrunning or falling short of the contents named be small, no compensation should be recovered bjr either party. The words 'more or less’ must be intended to meet such a result, but if the variance
In Weart v. Rose (1863), 16 N. J. Eq. (1 C. E. Gr.) 290, the mortgagee, who was the vendee, brought suit to redeem the mortgage after deducting therefrom the price of the deficiency ascertained to exist in the quantity of acres as described in the deed. The relief was sought — first, on the ground of fraud; second, on the ground of mutual mistake. The court held that the charge of fraud was not sustained by the testimony, and that the deficiency in acreage was too small to warrant the interference of the court on the ground of gross mistake. It followed the doctrine of Couse v. Boyles, but refused relief because of the insignificance of the cause of complaint. In White v. Stretch (1871), 22 N. J. Eq. (7 C. E. Gr.) 76, this court, upon the same principle and upon the authority of Couse v. Boyles, deducted from the purchase-money mortgage the amount of assessments on the mortgaged premises which the mortgagor had paid. In Melick v. Dayton (1881), 34 N. J. Eq. (7 Stew.) 245, the court of errors and appeals, in a foreclosure suit, declared that the mortgagor might have relief if the mortgagee had fraudulently represented the number of acres to be greater than the actual number conveyed, and that abatement would also be made where there is a
It will be observed that this suit was not brought until after the transaction liad been consummated by the delivery of the deed and the payment of the purchase-money. It is undoubtedly the rule in England, and the defendants in this case rely upon it, that after the contract has been performed by the delivery of the deed and the satisfaction of the purchase-money, no action or suit will lie either at law or in equity to recover compensation or obtain the return of a proportionate amount of the purchase-money unless there is some covenant or agreement on which the suit or action can be based; that the vendee having chosen to accept his deed without making a survey of the property, and without having insisted upon protective covenants, he is entirely without remedy and must suffer the consequences of his folly^ and that the remedy by way of compensation is not an independent remedy
“The purchaser should also carefully inspect the whole of the property sold and have it surveyed prior to completion and should make inquiry of the tenants or occupiers with respect to the boundaries or other matters regarding the physical condition of the property, for if by reason of any material defect of the quantity or otherwise the property sold do not correspond with the description of it given in the contract, or in any representation which induced the purchaser to make the contract, and the error be caused by the innocent misrepresentation of the vendor, and not by fraud, the purchaser will be entitled to resist the specific performance of or to rescind the contract while it remains uncompleted; but when the contract has been fully performed the purchaser will not be entitled to any relief in respect thereof except — first, by virtue of an express agreement contained in the contract to make compensation for such errors, or second, if the defect be really a defect of title and compensation be recoverable under the covenants of title contained in the conveyance, or third, if the representation amounted to a warranty collateral to the contract for sale of the truth of the fact stated. Here it may be mentioned that if a man buy land without inspecting it he does so at his own risk, and must accept without compensation any defects in the physical condition of the property which are patent to any one who views it, and are not inconsistent with the description contained in the contract for sale.” 1 Wms. V. & P. 539.
At common law it must be conceded that after the delivery of the deed to the grantee and the payment by him of the purchase-money for the conveyance, no right of action remains except upon some covenant or agreement which still subsists as a separate and independent cause of action; and while none of the New Jersey cases above cited reaches to the question of liability after the consummation of the contract, the reasoning of Chancellor Pennington in Couse v. Boyles, supra, seems to establish the jurisdiction of equity, provided the complainant has done nothing which would interfere with his equities accruing from the transaction. Chief-Justice Beasley in Davis v. Clark, 33 N. J. Eq. (6 Stew.) 579, argues that the defendant’s obligation is a separate and independent one from the complainant’s obligation to pay the purchase-money, and that the ground of action exists wherever the vendor is liable to the vendee for damages in consequence of the failure of the land to come up to the represented acreage. He considered the claim as a set off to be allowed in equity by way of recoupment in order to avoid a multiplicity of suits and prevent undue litigation.
The decree will therefore be in favor of the complainant.
The complainant assumed the payment of a mortgage covering the lands in question and other lands. The defendant has applied for leave to amend his bill so as to offset the amount of Iris claim against the amount which he has assumed to pay. I will hear counsel further on this application at the time of the settlement of the decree.