28 N.Y.S. 485 | The Superior Court of the City of New York and Buffalo | 1894
This is an action at law by the plaintiff, the vendee in a contract for the purchase of real estate, against the vendor therein, to recover §750, a deposit made by the plaintiff at the time of the execution of the contract, and also the sum of §278, paid by him for examining the title, which was rejected by the vendee’s lawyer on the ground of the existence of certain incumbrances affecting "the title, which, it is alleged, disabled plaintiff from carrying out the sale. The contract was to have been - closed on May 10, 1892; but the time was extended, for the accommodation of the plaintiff, to May 26, 1892, at the office of the vendor’s attorney; and the vendee notified the vendor that he would then insist upon strict performance of the contract by the vendor. On the adjourned day the parties met, and it appeared that there were outstanding, of record, nine certain blanket mortgages, covering the lot in question, with four others. There was also unsatisfied of record a mortgage to one-William Gault (described on the record as “Ganed”) for §3,100. It appears by the evidence that the holders of the nine blanket mortgages were either present, or were represented, at the office of the vendor’s attorney, with releases of the lot, ready to deliver such releases upon receiving the proportionate amount of their several mortgages; that the Gault or Ganed mortgage had been paid, and a satisfaction piece executed and delivered, together with-the bond and mortgage. So that the Gault mortgage, as a subsisting obligation, had ceased to exist, though it was unsatisfied of record. The reason why it was not satisfied, as explained on the trial, was that by a clerical error the copyist in the register’s office inserted in the record of the mortgage the name “Ganed,” instead of “Gault,” as the mortgagee. The error was not a fatal one, for it appeared on-the face of the original mortgage itself, as well as upon the index book in the register’s office, in which the mortgage, at the time it
The vendee’s attorney raised another objection, in respect to which the vendor declined to do anything. The vendee insisted that a lis pendens filed in an action of one Hamilton against McMece (a former owner of the property) constituted a fatal objection to the title offered. That was an action to impress in favor of Hamilton, as against McMece, a trust in the lot in question and other property. Mr. Arnold explained that this objection was without force, for the reason that McMece had conveyed the property to the defendant before the lis pendens in the Hamilton suit had been, filed; that defendant was not chargeable with notice of that action, was not a party thereto; and that if the searches interposed by the vendee had been put in, in the usual form, the lis pendens would not have been returned upon it, for it would not have appeared in the chain of title. The court of appeals, in Hayes v. Nourse, 114 N. Y., at page 604, 22 N. E. 40, holds that a lis pendens is not'an incumbrance on property, nor does it furnish any reason why a purchaser should not complete his purchase. The court, in that case, aptly said, “All that the registration of a lis pendens does is to require persons to look into the claims of the plaintiff who registers it.” See, also, Aldrich v. Bailey, 132 N. Y. 85, 30 N. E. 264; Simpson v. Del Hoyo, 94 N. Y. 193; Valentine v. Lunt, 115 N. Y. 503, 22 N. E. 209; Jacobs v. Morrison, 136 N. Y. 101, 32 N. E. 552. Upon looking into the claims of Hamilton, the person who filed the lis pendens against McMece, it would have appeared that no matter what equity she had, as against McMece, it could not attach to the property in. the hands of the defendant, who took without knowledge or notice, and prior to the filing, of the lis pendens. As against the defendant, it was not operative for any purpose, nor would it have been against the plaintiff, if he had taken title.
With the Hamilton lis pendens out of the way, there remains the. question whether the vendor was able, at the time appointed for closing the title, to carry out literally the terms of his contract. In Morange v. Morris, 42 N. Y. 48, 3 Abb. Dec. 314, 32 How. Pr. 178, the court held that if, at the time appointed for closing a title, the premises are incumbered by taxes and assessments, the vendor is not in a position to convey, and the vendee, owing to such inability, has a right to recover his deposit, without any tender whatever upon his part. This case, explained in Bigler v. Morgan, 77 N. Y. 312, and Rinaldo v. Hausmann, 52 How. Pr. 190, has never been reversed,
“It is well settled that, unless a seller of land tenders a title which is free from reasonable doubt, the purchaser is not bound to complete. In the case at bar the records show a mortgage of $22,000, with interest at seven per cent The claim was made upon the part of the defendants that $6,000 had been paid upon this mortgage, and interest reduced to five per cent. They offered the certificate of Riggs & Co., bankers in this city, who were alleged to be the agents of the mortgagee, who had possession of the bond and mortgage, and also of the satisfaction piece thereof, to the effect that such payment had been made, and such reduction of interest had occurred. We do not think that the plaintiff was bound to accept the title upon evidence of this character,—that the apparent incumbrance upon the property had been partially removed. He was not bound to run the risk of being able at some future time to establish that Riggs & Co. were the agents of the mortgagee, or, if the bond in question should happen to have been destroyed, to rest his claim of payment upon parol evidence, the benefit of which he might at any time lose. He was entitled to a clear record title. He had the right to claim that his title should be put beyond the contingency of human life, or the continued existence of papers which could not be the subject-matter of a record. He was entitled to demand, if the mortgage had been reduced to the extent claimed, such evidence of the fact as would enable him to spread the same upon the record, so that, no matter who might die, or what might become of the original bond in question, the records would show precisely the extent to which the mortgage was a lien; and it does not seem that anything less than this would satisfy the requirements of the law.”
It has been held that, in an action by a vendee to recover damages for the breach of a contract to convey, the plaintiff must satisfy the court that the .title offered by the vendor was absolutely bad, and that it is not sufficient to show that it was doubtful. Ingalls v. Hahn, 47 Hun, 104; Bayliss v. Stimson, 53 N. Y. Super. Ct. 225. But this doctrine has since been repudiated, and it is now the law that the vendee may recover moneys paid in anticipation of performance, where the title of the vendor was doubtful, and not marketable. Moore v. Williams, 115 N. Y. 586, 22 N. E. 233. In this respect the equitable rule in regard to specific performance has been made applicable to actions at law. In equity, time is not regarded as of the essence of the contract. But at law the rule is different, time being always regarded as an essential element. Oppenheimer v. Humphreys, supra; Schmitt v. Reed (Super. Ct. N. Y.) 9 N. Y. Supp. 705, affirmed 132 N. Y. 108, 30 N. E. 373. So that the vendee had a right to insist that the contract be closed on the day finally fixed for closing the same, particularly in view of the fact that he had notified the vendor that he would insist upon strict performance at that time.
Even assuming that the unpaid taxes might have been deducted from the purchase money (Marsh v. Wyckoff, 10 Bosw. 202), and the releases from the blanket mortgages obtained, there still remains the undisputed fact that there was unsatisfied of record the $3,100 mortgage to G-ault or Caned. True, it had been paid, and a satisfaction piece executed by Gault. But this was not sufficient for the purposes of the vendee. He was entitled to a clean record title, and it was the duty of the vendor to have had this mortgage satis