Case ID: misc_16/html/0164-01.html
Source: Caselaw Access Project
Author: {"author": "Gildersleeve, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Louis Blanck, Plaintiff, v. Frank X. Sadlier, as Receiver, Defendant.
    (Supreme Court, New York Special Term,
    February, 1896.)
    Vendor and purchaser — Bescission of contract — Gold clause In mortgage.
    A purchaser of real estate at auction, subject to a mortgage, is not entitled to rescind the contract and recover the deposit and expenses merely because an examination of. the title discloses the fact that the mortgage is payable in gold. '
    Motion for new trial-.
    Spink & Martin, for motion
    Johnson & Lamb, opposed.
   Gildersleeve, J.

The action is brought to recover the deposit' of ten per cent, of the purchase money and the auctioneer’s fees, paid by plaintiff at an auction sale of real estate, as well as the expenses of the examination of title. The terms of sale, prepared on behalf of defendant, state that the property is sold subject to a mortgage of $16,000, at five per cent, interest. • The plaintiff agreed to the terms of sale, paid his ten per cent, deposit, and directed his attorney to examine the title. After the.contract was. signed, but before the time for the closing of the title and before the examination of the title had been completed, the plaintiff’s attorney discovered the fact that the mortgage was payable in gold. On defendant’s refusal to have the mortgage changed from a “ gold ” one. to a “ lawful money ” one, .the plaintiff rejected the title and refused to carry out the contract;, and on the defendant’s declining to return the ten per cent, deposit or to pay the expenses of tiie auction and the searching of title, plaintiff brings this action. It would seem that the plaintiff, if he objected to a gold clause in the mortgage, should have made inquiries as to the existence of such clause before he signed the contract; for there is no evidence in the case tending to show that a gold clause is such an unusual occurrence as to permit plaintiff to assume, in the absence of information to the contrary, that it was a “ lawful money ” mortgage, rather than a “ gold ” one.

Ror was any proof offered at the trial that would support a finding that the plaintiff, in taking the property subject to the “ gold clause in the mortgage, would be injured to any extent whatever. I think the case turns upon this point, and for the reason that the plaintiff is unable to show any injury it follows that he was not justified in rejecting the title, and, therefore, he should not recover in this action. It does not appear from the testimony that there is any certainty that the consequence of the gold provision in the mortgage would be injurious to the plaintiff. True, it may be said that there is a possibility that in providing the gold for the purpose of discharging the mortgage the plaintiff might sustain some damage; but such a result is too conjectural and uncertain, and. cannot he said to he established by the evidence as a matter of fact.

"While the question is not entirely free from doubt, it is my opinion that the disposition made at the trial should stand, and the motion for a new trial be denied.

Motion denied.