Case ID: misc_64/html/0422-01.html
Source: Caselaw Access Project
Author: {"author": "Greenbaum, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Julius I. Bacot, Plaintiff, v. Levi A. Fessenden, Defendant.
    (Supreme Court, New York Special Term,
    August, 1909.)
    Reformation of instruments — Right to remedy — Grounds — Uncertainty.
    Vendor and purchaser — Waiver of performance or defects — Waiver of objections.
    Where it appears that the parties to a contract for the sale of real property intended to enter into a contract for the sale of the vendor’s interest only, and the contract is so drawn that it is susceptible of the construction that a sale of an undivided one-fourth part of the premises was intended, which the vendor could not perform by reason of an outstanding life estate, the contract will be reformed in a suit by the vendee for rescission and to establish a lien for the amount paid upon the contract.
    The rule that, where the parties have expressly contracted that the vendor shall convey free from incumbrances, the vendee may ordinarily be entitled to insist upon the terms of his contract, notwithstanding that at the time the contract was made he had notice of the existence of the incumbrances which are urged as grounds for rejecting the title, is subject to the qualification that, if the incumbrances be of a kind which the vendor cannot remove, such as an easement, it is not to be presumed that the purchaser, knowing of the existence of the easement, intended the insertion of a vain provision in the contract.
    Action by vendee for rescission and to establish equitable lien for amount paid thereunder.
    C. C. Nadal, for plaintiff.
    A. F. Sire, for defendant.
   Greenbaum, J.

It seemed reasonably clear to me when, this cause was first tried before me that the language of the contract originally entered into between the parties, interpreted in the light of the circumstances attendant upon its execution and of the effect to be given to the reference therein of the incumbrance upon plaintiff’s interests in the property of two certain mortgages aggregating $6,000, warranted the conclusion that the parties only contracted for the purchase and sale of plaintiff’s interest in the premises in question. The learned Appellate Division clearly misapprehended the fact established upon the trial that the mortgages to the amount of $6,000 only affected plaintiff’s interest and were not “ incumbrances upon the whole estate,” as erroneously stated in the opinion of the learned justice writing for the court. The deduction of the appellate court, so far as it rested upon the erroneous assumption of fact just adverted to, was necessarily fallacious, although it should be said that the reference in the contract to the life estate of the life tenant,” coupled with the language of the contract that plaintiff was to deliver a deed of “ the undivided one-quarter interest ” in the premises mentioned, well might justify the conclusion that the plaintiff had contracted to sell an undivided one-quarter of the premises ” and not merely his interest therein. Upon the second trial testimony was introduced additional to that presented upon the first trial bearing upon the relief sought by the plaintiff looking to a reformation of that contract upon the ground of mutual mistake. To my mind the evidence is most convincing that both parties understood that the contract expressed only a purchase and sale of plaintiff’s interest in the premises, subject to mortgages aggregating $6,000 which incumbered his interest. There was no occasion to have referred .to the outstanding life estate, which only tended to lead to a misinterpretation of the real contract that the parties supposed they had made. It appears that plaintiff was thoroughly familiar with the will of Levi Apgar, from which plaintiff’s interest is deducible and under which defendant, a cousin of plaintiff, derived certain interests. It was established that defendant had special knowledge of the particular easements and restrictive covenants which were subsequently urged by him as grounds for rejection of the title. The testimony of Hr. Fisher, a layman, who acted for both parties in preparing the contract, conclusively shows that long prior to the making of the agreement defendant was specially apprised of the existence of these easements and restrictions from a title insuranee company search which Fisher had procured for and exhibited to him. The testimony of Mr. Fisher as to what was said between the parties at the time of the execution of the contract tends further to emphasize the fact that the parties intended only a purchase and sale of plaintiff’s interest, whatever that may be. It is unnecessary to enter into all the details of the testimony, which unmistakably indicate that both parties intended to make a contract looking to the disposition of plaintiff’s interest in the premises, and that any words of the contract which might tend to convey the idea that a purchase and sale of an absolute undivided fourth part in remainder was intended were the result of a mutual mistake. The learned counsel for defendant lays stress upon the circumstances that plaintiff had no knowledge of the existence of the restrictive covenants and easements, and hence that there could have been no mutual mistake of fact. The fallacy of the reasoning lies in this, that it is wholly immaterial what restrictive covenants in fact existed or whether either or both of the parties were unaware of their existence, if as matter of fact both thought they were making a. contract only for the purchase and sale of plaintiff’s interest in the premises. It may further be observed that, where parties have expressly contracted that the vendor shall convey free from incumbrances, the vendee might ordinarily be entitled to insist upon the terms of his contract,- notwithstanding the fact that at the time of the making of the contract he had notice of the existence of the incumbrances which are urged as grounds for rejecting them. But this rule would be subject to the important qualification that “ if the incumbrance be of a kind which the vendor cannot remove, such as an easement, it is not to be presumed that the purchaser, knowing the existence of the easement, intended the insertion of a vain provision in the contract.” Maupin’s Marketability of Titles, § 85a. The defendant asks for equitable relief. He seeks a rescission of the contract and an equitable lien upon the property for the amount paid by him under the'contract. A court of equity will give no heed to the appeal of one who knew when he signed the contract that the easements and covenants to which he now objects existed and were incapable of removal by the other party to the contract. It follows that the contract must be reformed to express the true purpose and object of both parties at the time when they executed it, and that the counterclaim of defendant be dismissed, with costs.

Ordered accordingly.