Case Name: Leggett vs. The Mutual Life Insurance Company of New York
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1872-11-04
Citations: 64 Barb. 23
Docket Number: 
Parties: Leggett vs. The Mutual Life Insurance Company of New York.
Judges: Ingraham, Gilbert and Leonard, Justices.]
Reporter: Barbour's Supreme Court Reports
Volume: 64
Pages: 15–31

Head Matter:
Leggett vs. The Mutual Life Insurance Company of New York.
The defendant, by a written contract, agreed to sell to the plaintiff, for §16,000 to be paid at the times and in the manner therein mentioned, certain premises which it had purchased at a foreclosure sale; and that on a day named, upon receiving from the plaintiff §5,000, and a bond and mortgage for the balance of the purchase money, it would execute and deliver to him, or to his assigns, “ a proper deed of conveyance, duly acknowledged, for the conveyance and-assuring to him or them, the fee simple of the said premises, free from all incumbrances.” And the plaintiff agreed to pay the purchase money, at the times and in the manner stipulated. On the day for the performance of this agreement, the plaintiff offered to perform, on Ms part, and the defendant tendered a deed. But, it appearing that prior to the foreclosure of the mortgage under wMch the defendant claimed to have acquired title, the mortgagor had died, leaving a will by wMch he devised the mortgaged premises to certain of Ms children for life, with remainder to Ms grandchildren, and that such grandchildren were not made parties to the foreclosure suit, the plaintiff refused to accept a conveyance.
Held, 1. That the grandchildren of the mortgagor had an interest, as remaindermen, in every portion of Ms estate, capable of being ascertained whenever the prior estate should terminate.
2. That the trustees under the will could not, and did not, represent such future estate of the grandchildren, at the date of the foreclosure suit.
3. That although such interest might have been foreclosed by making the grandchildren parties to the foreclosure suit, and by a decree of the court and a sale thereunder, yet, as they were not parties to the action, their right to assert their title, at the proper time, remained outstanding.
4. That the insolvency of the estate of the mortgagor did not affect the question.
5. That the title which the defendant contracted to convey was not free and clear of all incumbrance, and the plaintiff rightfully refused to accept the deed.
By an agreement in writing for the sale and conveyance of land it was stipulated that in case the vendor should fail or refuse to execute and deliver a proper deed of conveyance, at the time and in the manner agreed, provided the purchaser should be ready to perform the covenants on Ms part; or in case the purchaser should fail or refuse to pay, Ac., on Ms part, provided the vendor should be ready to deliver such deed; then that the party so failing should and would pay to the other party, or Ms or their assigns, the sum of $6,000; wMch was thereby “ declared, fixed and agreed upon as the liquidated amount of damages to be paid by the party so failing,” for his or their non-performance. Held that by this contract the damages for a breach thereof were liquidated at $6,000; and that upon the failure of the defendant to execute a proper deed of conveyance on the day specified, the plaintiff was entitled to recover that sum.
APPEAL, by the defendant, from a judgment entered upon the report of a referee.
On the 6th day of April, 1859, one Isaac Peck, being at that time the owner of certain real estate situated in the village of Flushing, county of Queens, mortgaged the same to the defendant to secure the sum of $20,000. The defendant was then, and still is an incorporated company, engaged in the business of insuring lives, and. clothed with the usual corporate powers.
On the 7th day of April, 1860, the said Isaac Peck executed and delivered two other mortgages, covering the same premises above referred to; one to Isaac Peck, as executor, &c., of William Peck, deceased, to secure the sum of $2,100.65; the other to Isaac Peck, Jr., George W. Peck and James M. Peck, as executors, &c., of Agnes Peck, deceased, to secure the sum of $5,293.97. These mortgages were duly recorded, May 19, 1860. On the 10th of May, 1860, the said Isaac Peck died, seized of the mortgaged premises, leaving a last will and testament, which was duly admitted to probate, by the surrogate of Queens county, June 11, 1860. By this will the testator provided that, after the termination of certain life estates given to certain of his children, Ms grandchildren should take as remaindermen.
In January, 1861, tMs defendant brought an action for the foreclosure of its .mortgage. Neither the grandchildren of the testator, nor the holders of the second and third mortgages, were made parties to the foreclosure suit. Under a judgment of foreclosure and sale the mortgaged premises were sold at auction, and bought in by the plaintiff, the defendant in tMs action.
On the 18th of November, 1863, the parties to tMs action entered into the contract upon wMch tMs action is brought. By tMs contract the defendant agreed, among other things, to sell, on the 1st day of January, 1864, to the plaintiff, the premises purchased at the foreclosure sale above mentioned, for the sum of $15,000, “to be paid by the said party of the second part [the plaintiff] in the manner and at the times hereinafter mentioned and covenanted on the part of the said party of the second part; and the said party of the first part [the defendant] further agrees, that on the 1st day of January, A. D. 1864, on receiving from the said party of the second part the sum of $5,000 in cash, and a purchase money first mortgage upon the above described premises for $10,000, payable at or before the expiration of five years, at the option of the said party of the second part, with interest semi-annually, the said parties of the first part shall and will, at their office, No. 94 Broadway, in the city of New York, at twelve o’clock, meridian, and at their own proper' cost and expense, execute and deliver to the said party of the second part, or to his assigns, a proper deed of conveyance, duly acknowledged, for the conveying and assuring to him or them the fee simple of the said premises, free from all incumbrances, which deed of conveyance shall contain full covenants against grantor’s own acts.
And the said party of the second part hereby agrees to purchase of the said parties of the first part the premises above mentioned, at and for the price and sum above mentioned, and to pay to the said parties of the first part the purchase money therefor, in manner, and at the times following, to wit: $5,000 in cash upon the 1st day of January, a. d. 1864, and $10,000 at or before the expiration of five years from said last mentioned date, which sum of $10,000 shah be secured by the bond of the .said party of the second part, and a first mortgage upon the above described premises, payable as aforesaid, with interest semi-annually.
And it is further agreed, by and between the parties to these presents, that the said parties of the first part shah have and retain the possession of said premises, and be entitled to the rents and profits thereof until the first day of January, when fuh, possession of the same shah be delivered to the said party of the second part by the said parties of the first part; and it is understood and agreed that the stipulations aforesaid are to apply to, and bind the heirs, executors, administrators, and assigns, of the party of the second part, and the successors and assigns of the parties of the first part.
And it is hereby further agreed, that in case the said parties of the first part shah fail or refuse to execute and deliver a proper deed of conveyance in manner and at the time and place above specified for that purpose, provided the party of the second part shah be ready to fulfill and perform the covenants then to' be fulfilled on his part; or in case the said party of the second part shall fail or refuse to pay the said sum of $5,000 in cash, and to receive the deed of conveyance from the parties of the first part, and to execute and deliver to them the mortgage.for $10,000 hereinbefore mentioned, at that time and place as above agreed upon, provided the parties of the first part shall be ready to deliver such deed of conveyance, as aforesaid; then the party so failing shaE and wiE pay to the other party, or his or their assigns, the sum of $5,000, which sum is hereby declared, fixed, and agreed upon as the Equidated amount of damages to be paid by the party so failing as aforesaid, for his or their non-performance.”
By parol agreement between the parties the day for the fulfillment of the contract was changed to December 31, 1863. On that day the plaintiff attended, by his attorney, at the time and place agreed upon, and offered to perform the contract on his part, but refused to accept the title offered by the defendant, on the ground that it was defective. It was then mutuaEy agreed to adjourn the matter over untfl January 31, 1864, in order to give the defendant an opportunity to remedy the defects in the title. On the 31st of January, 1864, the parties again met, in pursuance of the adjournment, and the defects in the defendant’s title stiE existing, the plaintiff refused to accept a conveyance. The defendant thereupon admitted, by a written acknowledgement, that the plaintiff had tendered the money and the bond and mortgage provided by the contract. The plaintiff also acknowledged that the defendant had tendered a deed and demanded performance of the contract by the plaintiff.
This action is brought to recover of the defendant the sum of $5,000, being the amount of damages stipulated by the parties. The cause was tried before Justice Mtjllin, without a jury, and every point of law and fact was decided by that justice in favor of the plaintiff, ex cept as to the construction of the liquidated damage clause in the contract; that clause he construed as penal, and found for the plaintiff six cents. The plaintiff appealed to the general term from so much of said decision as involved the construction of the liquidated damage clause; and upon the appeal this court held that the parties must be considered as having stipulated their own damages; that the clause in question did not prescribe a penalty; and that upon a breach of the contract by the defendant the plaintiff was entitled to $5,000 damages. The court, therefore, reversed the decision at circuit, and ordered a new trial.
An order of reference was subsequently entered, by consent of the parties, referring the cause to Hon. James Emott, as sole referee, to hear and determine; and the cause having been re-tried, and the referee having found for the plaintiff, in the sum of $5,000 damages, the defendant brought this appeal.
H. E. Davies and Noah Davis, for the appellant.
I. The damages named in the contract between the parties to this action are in the nature of a penalty, and not liquidated damages.
II. By the tender of the deed as admitted, the covenant to convey in the contract was so far performed as to relieve the defendant from liability for the alleged liquidated damages. 1. The deed conveyed the title, and assured it to be free from incumbrance. 2. It operated to assign to the grantee the defendant’s mortgage with interest, against all outstanding equities of redemption. (Jackson v. Bowen, 7 Cowen, 13. Robinson v. Ryan, 25 N. Y. 320.) 3. The defendant, by such tender, showed that it was not guilty of a willful failure to perform its contract, and therefore not liable to a greater extent than the value of the encumbrance alleged to exist. (See Master of Rolls in Eaton v. Lyon, 3 Vesey, Jr. 690.) 4. A proper interpretation of the contract forbids the supposition that the defendant bound itself to pay $5,000 if, on the day of performance, the premises were subject to an incumbrance of infinitesimal value that could not be immediately removed. The damages were stipulated against an intentional failure or refusal, and not an accidental discovery that could work only a temporary delay.
III. The plaintiff, to support his objection to the title offered him, that the grandchildren of Isaac Peck were necessary parties to the foreclosure suit, must establish that such grandchildren had a vested remainder in the premises in question. The will of Isaac Peck provides for the payment of his debts, and after certain devises and bequests, directs that the rest, residue and remainder of his estate, real and personal, shall be divided into five equal parts, three of which are to be held by the executors in trust; and in these three parts certain of the testator’s grandchildren, in certain contingencies are to share. The interests of these grandchildren in the parts of the rest, residue and remainder must be regarded as a contingent, and not a vested remainder. (Williamson v. Field, 2 Sandf. Ch. 552, 553.)
IY. Two things must necessarily occur under the will of Isaac Peck, before the trusts in which the grandchildren are interested can come into existence. 1. It must appear that there is a rest, residue and remainder to be divided according to the directions of the will. 2. That it has been divided into the five shares after the accounting directed by the will. The fact is found by the referee, that Isaac Peck’s estate was and is hopelessly insolvent, and that there never has been or will be any rest, residue and remainder to divide.
Y. The executors of Isaac Peck must be regarded as holding the legal title to the premises in question, under this will. (Brewster v. Striker, 2 Comst. 19. Tucker v. Tucker, 1 Seld. 416. Tobias v. Ketchum, 32 N. Y. 319. Tiffany & Bullard, on Trustees, 794, 804. 1 Edm. R. S. 679, § 60. Briggs v. Davis, 21 N. Y. 576.)
VI. The executors of Isaac Peck had the right to appropriate the mortgaged premises to pay the mortgage debt to the defendant, and they could have conveyed the premises under the power in the will for this purpose. (Hodine v. Greenfield, 7 Paige, 544.) The executors, as well as the heirs-at-law of Isaac Peck, were made parties to the foreclosure suit of the defendant, and elected to suffer the lands to be applied in payment of the mortgage debt, and thus prevented their passing into the residuum devised by Isaac Peck in trust to his executors.
VII. The plaintiff having, at all times previous to the bringing of this action, put his refusal to complete on the sole ground that the grandchildren of Isaac Peck were not made parties to the defendant’s foreclosure, must be held to have waived the right to make any other objection to the title offered him. (Gould v. Banks, 8 Wend. 567. Wright v. Reed, 3 T. R. 554. Grigby v. Oakes, 2 Bos. & Pull. 526. Campbell v. Webster, 2 Com. Bench, 258. Carman v. Paltz, 21 N. Y. 547. Walrath v. Redfield, 18 id. 457. Hall v. White, 3 Carr. & Payne, 242. The People v. Supervisors of St. Lawrence Co., 30 How. Pr. 173.)
VIII. The plaintiff now objects to the title offered him, in addition to the non-joinder of the grandchildren of Isaac Peck, as parties defendant in the defendant’s foreclosure suit: 1. That a mortgage from Isaac Peck to himself as executor of William Peck, deceased, and, 2. That a mortgage from Isaac Peck, to the executors of Agnes Peck, were, at the time of the defendant’s tender, outstanding incumbrances on the premises sought to be conveyed, and that the necessary parties to cut off the liens of these mortgages, had not been included in the defendant’s foreclosure suit. It is apparent that if • these objections had been raised on the 31st of Decern her, or even at the time of tender, they could have been met readily by the defendant’s obtaining satisfaction pieces of these mortgages.
IX. The judgment obtained by the defendant in its foreclosure, cut off the lien, if any, of the mortgage from Isaac Peck to himself, as "executor of William Peck, for the reasons that, 1. Isaac Peck, Jr., George W. Peck and James M. Peck, executors of William Peck, deceased, were made parties defendant. 2. They appeared in the action by H. C. Pratt, their attorney, and demanded a copy of the complaint. 3. They made default in answering. 4. They were duly served with notice of application for judgment. 5. Judgment was rendered against them upon appearance and default. It must be presumed that the persons so sued and appearing as executors of William Peck, were in fact his executors, and that all the facts necessary to support the judgment rendered by the court, were proved to its satisfaction. (Broom's Legal Maxims, 909, 910, 4th ed. Dubois v. Dubois, 6 Cowen, 494.)
X. The mortgage last referred to was a nullity and void. 1. There were no contracting parties to it, since it was made by Isaac Peck to himself. (4 Cruise, ch. 2. White v. Wager, 25 N. Y. 328. Winans v. Peebles, 32 id. 423.) 2. It was void as against public policy, since an executor cannot deal with his trust funds.
XI. The mortgage from Isaac Peck to Isaac Peck and others, executors of Agnes Peck, was cut off by the judgment in the defendant’s foreclosure, for these reasons. 1. The executors of Agnes Peck were made parties defendant in the original and amended complaint. 2. The affidavit of regularity recites that all the defendants have been personally served, or have appeared by attorney, and the judgment recites'this fact and bars all the defendants. 3. The executors of Agnes Peck, are correctly named in the body of the complaint, under a distinct averment that they have, and claim some interest as junior incumbrancers, or otherwise, in the premises, and are thereby made parties defendant. 4. The absence from the record of mere formal proof of service of process upon these executors, does not make the judgment void.' (Slat, of Jeofails, 3 R.S. 721, &c., 5th ed. Van Wyck v. Hardy, 20 How: Pr. 222. Best on Presumption, 79.)
XII. A corporation has power to do all ordinary acts to carry out the powers conferred upon it by its charter, and has no power beyond this. A contract to pay damages on failure of title is not an ordinary or necessary incident to the power to convey land, or even to contract to convey land. The Mutual Life Insurance Company, since such a contract as that in suit is not included in the express contracts authorized by its charter, and was not an agreement necessary or incident to any of these express contracts, had no power and could not make the agreement upon which this plaintiff seeks to recover so as to bind itself. (Kirk v. Bell, 16 Q. B. 290, and 12 Eng. Law and Eq. 385. Ang. & Ames on Cor. 286, 8th ed.)
. XIII. A corporation can only act through its agents, but its agents must be authorized to bind it. There is nothing in the by-laws or charter of the company that authorizes the president to agree that the company shall pay damages on failure of title to land contracted to be sold by the company, and it cannot be shown that the board of trustees, or any competent committee, authorized the execution of the contract in suit, as to this particular. Without such authorization, the contract is not binding on the company, if then. (Watson v. Bennett, 12 Barb. 196. Bank of State of New York v. Farmers’ Bank &c. of Ohio, 36 id. 332.)
XIV. By certain writings endorsed upon the contract it appears that the time for the performance of the contract was first shortened to December 31, 1863, and on that day extended to January 31, 1864, and strict per formalice on the part of the plaintiff waived by the defendant’s president. It is claimed, on the part of the defendant, that these writings cannot bind it, for the reasons, 1. That they are parol alterations of a sealed instrument. (Stowell v. Robinson, 3 Bing. N. C. 928, 937. Blood v. Goodrich, 9 Wend. 68. Delacroix v. Bulkley, 13 id. 71. Friess v. Rider, 24 N. Y. 367.) 2. That the president had no authority to make the same. (Pratt v. Hudson River R. R. Co., 21 N. Y. 305.)
E. B. Hinsdale, for the respondent.
I. The agreement upon which this action is brought was a valid and binding contract of the defendant. 1. To overthrow the presumptions in favor of the instrument, the defendant sets up that any contract to convey better or other title than it then had, or to stipulate damages upon a breach, was beyond its corporate power, and therefore void. This plea of ultra ñires, when interposed by a corporation, to avoid the obligation of its own deliberate contracts, has been thoroughly examined and strongly denounced by the Court of Appeals as “a doctrine shocking to the reason and conscience of mankind.” (Bissell v. M. S. and N. I. R. R. Co., 22 N. Y. 258. N. Y. and N. H. R. R. Co. v. Schuyler, 34 id. 30, 74.) 2. But the doctrine of ultra ñires has no application to the case at bar. This agreement, and every part of it, was within the defendant’s corporate powers. The sale and conveyance contemplated by the agreement were authorized by the terms of the defendant’s charter, and the preliminary agreement was an incident of the transaction, convenient, if not absolutely necessary, to the proper conveyance of the title. Such agreements are so common, in the ordinary course of real estate business, that they are properly regarded as an essential part of every such transfer; and the agreement to give good title rests, for its validity, upon the same ground as the covenants for title in the actual conveyance. It is an out rage upon common sense to say that a corporation, which is clothed with power to convey by warranty, may not contract to execute such a conveyance. (Talman v. The Rochester City Bank, 18 Barb. 123, 135. DeGroff v. Am. Lin. Thread Co., 21 N. Y. 124. Jackson v. Brown, 5 Wend. 590.) 3. The clause in the agreement liquidating the damages of either party upon a breach by the other, is equally valid, as an exercise of incidental power. The authority for such a stipulation does not depend upon any express legislative enactment, but is involved in the right to carry on any business whatever. To deny this, is to deny the right to waive a trial by jury, or to submit claims to arbitration. The rule that a corporation is clothed with all powers that are requisite in the transaction of its legitimate business, is too well settled for argument. (Barry v. Merchants' Exchange Co., 1 Sandf. Ch. 280-289. Curtis v. Leavitt, 15 N. Y. 62-66,170. Smith v. Law, 21 id. 296-298.) 4. The agreement being within the corporate powers of the defendant, as already shown, and the plaintiff’s offer to purchase the premises having been duly accepted by the defendant, it cannot be seriously doubted that all minor details involved in the transaction were strictly within the powers of the president, as the general superintendent of the affairs of the defendant. (See By-law 6 of defendant; Am. Ins. Co. v. Oakley, 9 Paige, 496-501; Com. Bank of Buffalo v. Kortwright, 22 Wend. 348-360; Olcott v. Tioga R. R. Co., 27 N. Y. 546-556.) 5. Even assuming that the president had, in fact, no authority to bind the defendant by this agreement, yet the plaintiff had a right to infer his authority from his acts, and the acts of the defendant. The charter of the defendant is not a public statute, and the plaintiff was not bound to take notice of it. The authority of an agent of a corporation need not be shown by any resolution, or other written evidence, but may be implied from facts and circumstances, in like manner as if the principal were a natural person. The question of authority must be decided upon the general principles of the law of agency. (Perkins v. Wash. Ins. Co., 4 Cowen, 645. Bank of Columbia v. Patterson, 7 Cranch, 306. Mott v. Hicks, 1 Cowen, 513, 536, 537. Dunn v. The Rector &c. of St. Andrews Church, 14 John. 118. Randall v. Van Vechten, 19 id. 60. Ang. & Ames on Corp. § 284. Beers v. Phenix Glass Co., 14 Barb. 358, 360, 361. Bank of Vergennes v. Warren, 7 Hill, 91-94. Conover v. Mut. Ins. Co., 3 Denio, 254. S. C. affirmed 1 Comst. 290. Olcott v. Tioga R. R. Co., 4 Barb. 179 -187. S. C. affirmed 27 N. Y. 546, 560. N. Y. and N. H. R. R. Co. v. Schuyler, 34 id. 30, 50-58, per Davis, J. Phillips v. Campbell, 43 id. 271, 272.)
II. The defendant failed to fulfill the agreement upon which this action is founded. 1. The agreement calls for “ a proper deed of conveyance,, duly acknowledged, for the conveying and assuring * * * the fee simple of the said premises, free from all incumbrances.” A conveyance of a doubtful, or an incumbered title, is not a compliance with this covenant. (Fletcher v. Button, 4 Comst. 396, 399. Burwell v. Jackson, 5 Seld. 535. Traver v. Halsted, 23 Wend. 66. Pomeroy v. Drury, 14 Barb. 418.) 2. The title offered by the defendant was clearly defective. The grandchildren of Isaac Peck, being devisees under his will, were necessary parties to the foreclosure suit through which the defendant took title. All persons having the right to redeem the premises must be brought before the court in an action to foreclose a mortgage. (Hall v. Nelson, 23 Barb. 88. Reed v. Marble, 10 Paige, 409.) The grandchildren of Isaac Peck had the right to redeem. In view of the facts stated above, this is a fundamental proposition of the law of mortgages, which no elaborate refinements or ingenious subtleties of counsel can obviate. The argument, in contravention of this elementary theorem, is grounded in the necessity of the defendant’s case, and not in any principle of law or reason. Chancellor Kent says: “The right of redemption exists, not only in the mortgagor himself, bnt in his heirs and personal representatives and assigns, and,, in every other person who has an interest in, or a legal or equitable lien upon, the lands.” (4 Kent's Com.162.) Judge Story says: “All persons having an interest in the equity of redemption should be made parties to a bill of foreclosure, and a fortiori to a bill to sell the mortgaged property; .for it will not, in general be sufficient, if the equity of redemption is conveyed or devised to a trustee in trust, to bring him before the court; but the cestuis que trust (the beneficiaries) also should be made parties.” (Story's Eq. Pl. § 193 and cases cited § 197. The Eagle Fire Ins. Co. v. Cammet, 2 Edw. Ch. 127. Nodine v. Greenfield, 7 Paige, 544. Rawson v. Lampman, 1 Seld. 456. Williamson v. Field, 2 Sandf. Ch. 533. Claverly v. Phelp, 6 Mad. 231. Thomas v. Dunning, 5 De Gex & Smale, 618. Coles v. Forrest, 10 Beav. 552, 557.) 3. The person or persons having the first vested estate of inheritance must be brought into court in an action, to foreclose a mortgage. (Nodine v. Greenfield, and Williamson v. Field, above cited.) The rule, indeed, goes further; and it is held that if a person in being claims under a limitation by way of executory devise, not subject to any preceding estate of inheritance by which it may be defeated, he must be made a party to a bill affecting his rights. (Story's Eq. Pl. § 147.) 4. The estate of the grandchildren was a vested remainder in fee, expectant upon the lives of their respective parents, and subject to open and let in after-born grandchildren. De Peyster v. Clendining, 8 Paige, 295, 307.) The direction to the executors to pay debts, &c., did not suspend the vesting of the remainders. A devise subject to such a direction is not contingent upon the payment of debts. (Eagle Ins. Co. v. Cammet, and Nodine v. Greenfield, above cited.) 5. It is apparent, therefore, that the insolvency of the testator at the time of his degth, has no bearing upon this case; since the remainders vested in his grandchildren immediately upon his death. The irrelevancy of this testimony further appears from the fact that more than six years have elapsed since the death of the insolvent, and the legal presumption is that the estate is discharged from the debts by limitation. The power of sale granted to the executors by the will, did not enlarge their estate. (Dominick v. Michael, 4 Sandf. 374.) 7. No substantial distinction can be drawn between the case at bar and the case of Williamson v. Field, above cited. The referee was right in holding himself bound by the decision of the court in that case. 8. The defendant’s title was further defective by reason of the incumbrances of two outstanding mortgages, which were liens upon the premises until after the commencement of this action.
III. The plaintiff fully performed all the covenants of the agreement upon his part, except in so far as he was prevented from such performance by the act of the defendant. 1. The change of time for performance of the agreement was within the general powers of the president, (see By-law 6,) and was valid as a parol contract; and the plaintiff, therefore, was not bound to demand performance on the day originally named for the transfer of title. (Friess v. Rider, 24 N. Y. 367. Havens v. Patterson, 43 id. 218-220.) 2. The defendant, being unable to perform, at the time finally agreed upon, a formal tender of money and. demand of deed by the plaintiff was unnecessary. (Burwell v. Jackson, 5 Seld. 535-547. Holmes v. Holmes, 12 Barb. 137.)
IV. The defendant having broken its contract, the plaintiff is entitled to damages, and to the amount of damages stipulated in the agreement. This point has already been decided by this court on a former appeal. (See 50 Barb. 616;) and under that decision the defendant’s offers to prove the value of the premises described in the agreement were properly refused. Y. The defendant has no equity in the case which will support a claim for extraordinary relief. The actual injury resulting to the plaintiff from the defendant’s failure to perform its contract, would have justified a verdict for a larger amount than the sum agreed upon by the parties. The property which the defendant contracted to sell for $15,000 was the same property upon which the defendant had previously loaned $20,000; and as the defendant’s charter provides that the real estate securing its loans shall, in every case, be worth twice the amount loaned thereon, it is evident that the officers of the defendant must have estimated the property at not less than $40,000. The amount of damages agreed upon by the parties for a failure to perform the contract now before the court, was by no means excessive. (See Clement v. Cash, 21 N. Y. 253. Glosson v. Beadel, 7 John. 72.)

Opinion:
By the Court, Leonard, J.
The grandchildren were interested, as remaindermen, in every portion of the estate of Isaac Peck, their grandfather. Although there was no divided interest in any specific property in which the grandchildren had a present or future estate, at the time the contract was made, they had an interest in the property in question capable of being ascertained whenever the prior estate should terminate. The estate of the executors or trustees under the will terminated when that of the grandchildren began. The trustees could not, .and did not, represent the future estate of the grandchildren at the date of the foreclosure action. Their interest might have been foreclosed by making them parties to the action of foreclosure, and by a decree of the court, and a sale thereunder. They were not, however, parties to the action, and them right to assert their title, at the proper time, remains outstanding. The present insolvency of the estate of Isaac Peck does not affect the question. The lands were his at the time of his death, subject to the mortgages, and the equity of redemption passed to the legatees under his will. Their right of redemption has been foreclosed, but not the right of the grandchildren. The value of the property may be largely enhanced when the grandchildren become entitled' to demand their rights, upon the termination of the prior estate for life. I can perceive no legal impediment to the assertion of their right to redeem, when that period arrives. Hence the title which the defendants contracted to convey was not free and clear of all incumbrance, and the plaintiff rightfully refused to accept the deed.
[First Department, General Term, at New York,
November 4, 1872,
Ingraham, Gilbert and Leonard, Justices.]
The defendants were liable in damages as upon a breach of their contract. The damages were liquidated, under the contract of sale, at $5,000.
The decision of the General Term, when this case was before the court on a former occasion, (50 Barb. 616,) is conclusive now, on the question of damages.
The judgment must be affirmed, with costs.