Thomas v. Austin

| N.Y. Sup. Ct. | Sep 5, 1848

By the Court, Gridley, J.

This is an appeal from a decree of the late vice chancellor of the fourth circuit, directing the specific performance of a contract to convey certain lands situated in the town of Edwards, in the county of St. Lawrence. The bill was filed by Thomas, as assignee of one Jerome Wood-bury, setting out a contract, bearing date on the 26th of November, 1840, by which the defendant Austin, and one Pasco Whitford, (who has since died, leaving the other defendants his representatives,) contracted to sell and convey the premises in controversy, on the payment of the purchase price of $1620, in the manner stated in the agreement. The bill then set forth the payment, at the date of the contract, of $1079, and the endorsement of the receipt of that sum on the contract. This averment is followed by a statement of the payment of the further sum of $75 on the 2d* of January, 1843, of $161 on the 25th of November of the same year, of $235,18 on the 26th of November, 1844, and of the tender of $220,42 on the 26th of November, 1845, accompanied with the demand of a deed, and a refusal by Austin, the surviving vendor, either to accept the tender or to convey the land.

The stating part of the bill is followed by a statement of various pretences set up by the defendants, with the charges of the complainant thereon, among which is the following, relating to the payment of $1000 parcel of the endorsement of $1079 “And at other times the several persons aforesaid and their confederates, pretend that the said one thousand dollars was received in a farm, which was at the time of the taking of the same, subject to an incumbrance, which the said Woodbury was bound and did agree to pay off and discharge. And that unless paid and discharged, the said sum was not to apply as a payment on the said contract; whereas, in truth and in fact, the said farm was received at and for the sum of one thousand dollars, and to apply on the said contract at that sum, and .that such application was absolute and unconditional; and that the said Austin and Whitford took the covenant of the said Wood-bury, to pay off and discharge any incumbrance there might be on the said farm.”

From this brief statement of the contents of the bill, it appears that the ground of relief assumed by the complainant, was the payment of the entire purchase price of .the premises described in the contract; and this was made out by counting the farm which was conveyed to Austin and Whitford at $1000, as an absolute payment of that sum, notwithstanding it was incumbered by a mortgage for $625, to one La Farge, which Woodbury had agreed to pay off and discharge. It will be borne in mind that it is a part of the complainant’s own case, unequivocally stated on the face of his bill, that the farm was received at the price of $1000, Woodbury paying off the incumbrance ; so that if Woodbury should fail to pay it off, the amount actually received by Austin and Whitford would amount to only $375, instead of $1000.

The important point, therefore," for the defendants to admit or deny, was the fact whether by the agreement of the parties, the farm was to be regarded as an absolute payment, to the amount of the $1000, whether the mortgage should be paid off by Woodbury or not; and in the latter event, that Austin and Whitford were to look to the personal liability of Woodbury. This important fact, so essential to the complainant’s success, was positively denied in the answers, and we think they are fully sustained by the proofs. The receipt endorsed on the contract, is only prima facie evidence, and is open to explanation and contradiction. The explanation is furnished by certain instruments in writing, which bear the same date with the contract and the receipt; and which, we are to presume, were executed at the same time. Those instruments are the deed of the Jefferson county farm, and the covenant of Wood-bury to discharge the mortgage which La Farge held against it. The receipt endorsed on the contract, the deed executed by Woodbury, and the guaranty of Woodbury against the mortgage, appear by the. papers themselves connected with the statement in the bill and the evidence in the case, to have been executed at the same time, independently of the presumption arising from their bearing the same date. It is a familiar principle that papers executed at the same time and relating to the same subject matter should be construed together. (3 Wend. 233. 15 John. 458. 1 Hill, 601. Cowen & Hill’s Notes, 1421, 2.) Thus an absolute deed and a defeasance bearing the same date, are read together and are construed as a mortgage. Applying that rule to the case under consideration, and bearing in mind the allegations of the bill, we find this receipt endorsed on the contract, (which would prima facie prove the payment of so much cash,) to be false. No money was in fact paid, and instead of $1000 being received, a farm was conveyed, which was worth, subject to the mortgage upon it, but $375. The fair reading of the receipt, in connection with the cotemporaneous papers, would be this: “ Rec’d as part payment upon this contract a farm at the valuation of $1000, but inasmuch as this farm is subject to a mortgage of $625, which Mr. Wood-bury agrees to pay off, it is not to be ultimately taken as a payment of $1000 unless the ¡mortgage shall be discharged, pursuant to his agreement.” The receipt has thus been explained and contradicted; and, as it now appears that the mortgage was not paid by Woodbury, but was foreclosed and thé land sold, the payment of the moneys due on the contract, set out in the bill, has entirely failed.

Again ; we think that the bill must have been dismissed without the aid of the conclusive testimony furnished by the cotemporaneous papers. If the endorsement had been made of the $1000 for the farm, as an absolute payment of that sum, (Austin and Whitford relying on the ability and integrity of Woodbury to keep his covenant, and to pay off the mortgage,) and Woodbury had, in violation of his covenant, permitted the land to be sold on the mortgage, and then, on paying up the residue of the moneys due on the contract, should demand a deed, he would invoke the powers of a court of equity in vain. That court never awards the pound of flesh, even when the agreement to pay it is strictly proved. The exercise of this equitable jurisdiction is never a matter of right, but always of discretion, and when the compulsory performance of a contract would be hard, unconscionable and inequitable, it is always refused. If this bill had been filed by Woodbury himself, the chancellor would have said to him, “ you must do equity to the defendants before you ask it of them. You must first make good your own covenant, by the violation of which the farm, which was received by them at $1000, has been utterly lost, before you ask them to perform theirs. Make good the $1000 payment which has failed by your own default and for which you are still liable, before you ask a decree founded upon a hypothesis of its actual receipt. You stand in the attitude of a party who demands the deed of a farm, which he has paid for in a consideration which he has guaranteed, and which has become worthless by the failure of the guaranty.”

The argument need not be further extended, to show that Woodbury’s claim to relief would be utterly hopeless. The complainant took the contract subject to all the rights and liabilities of Woodbury upon it when he assigned it, and must abide the same decision which would have been made against Woodbury. He, moreover, took it with full notice of what Austin claimed, as to the $1000 payment, and made provision in his contract with Woodbury for the very event that has occurred. He must, therefore, share the fate of his assignor.

We come now to a consideration of the ground upon which the late learned vice chancellor of the 4th circuit disposed of this case. And it is sufficient to say, that he did it by creating a new issue which the parties had not framed in the pleadings, and by adopting an hypothesis of fact not only not found in the bill, but in direct conflict with that portion of it which we have extracted and given in the very language of the complainant, verified by his oath. The hypothesis of the vice chancellor is, that the Philadelphia farm was received not at $1000, but at $1620, and that the purchase price of the farm of which the bill seeks a conveyance, has been fully paid, notwithstanding Woodbury failed to pay off the outstanding mortgage. It must be confessed that there is some evidence to justify that conclusion ; but the vice chancellor must have overlooked the fact, that this evidence was not within any issue which the parties had framed. In such a case, it is well settled that such evidence, though it may have been received without objection, must be disregarded on the hearing, and that a decree founded on evidence of that character, will be reversed. This principle, to this precise extent, was adjudged by the court for the correction of errors in the case of James v. McKernon, (6 John. Rep. 543, 559, 565.) See also to the same effect, 1 Barb. Ch. Pr. 339; 10 Wheat. Rep. 189; 1 John. Ch. Rep. 117. The rule is explicit and absolute, that a party must recover in chancery according to the case made in his bill, or not at all; “ secundum allegata,” as well as “ probata.”

There is also another principle of pleading, quite analogous to that now under consideration, which forbids the complainant from availing himself of the testimony on which the vice chancellor founded his decree ; that is this : that in a case in which the pleader has alleged a fact which is not denied by his adversary, such fact shall be taken as true, and cannot be contradicted in that suit. Of this description is the fact that the Jefferson county farm was received at $1000, and that Woodbury was bound to pay off the outstanding mortgage.

There is no force in the suggestion that this fact is alleged in the charging and not in the stating part of the bill. It is stated in its appropriate place, and furnishes one of the few instances in which the statement of a fact is legitimately reserved for the charging part of the bill. But it is just as much a part of the plaintiff’s case, and if the statement be untrue, the party is just as liable to an indictment for perjury, and the defendant is just as much bound to answer it, as though it had been .alleged in the stating part of the bill. (See 4 Paige's Rep. 365; Hoffman's Prac. in Master's Office, p. 260.) (a)

If the Jefferson county farm had been, in truth, taken at the price of $1620, the complainant should have amended his bill. He has not done so, however, and the consequence is that the whole of the evidence on that subject being not within the issue, should have been excluded from the consideration of the court. We have not deemed it necessary to examine the other questions discussed on the argument. The decree must be reversed, g.qd the complainant’s bill dismissed with costs.