Case Name: Mary Smith, Appellant, v. Christopher C. Firth and Others, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1900
Citations: 53 A.D. 369
Docket Number: 
Parties: Mary Smith, Appellant, v. Christopher C. Firth and Others, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 53
Pages: 369–383

Head Matter:
Mary Smith, Appellant, v. Christopher C. Firth and Others, Respondents.
A sale of property set aside because of inadequate consideration, where a vendor of little business capacity dealt with business men in reliance upon their giving her a fair price.
In an action brought to set aside a conveyance of real estate it appeared that the plaintiff, a woman of little business capacity and of limited education, being in distressed circumstances and in need of money, made an application for relief to certain builders named Firth, who were her superiors in capacity and information. The plaintiff was at the time the owner of thirty-seven acres of land worth not less than §500 an acre. The whole property was worth §18,500 and was subject to a mortgage of §3,500, the foreclosure of which was not probable, as the plaintiff had at the time §17-3 in the bank applicable to the payment of interest, but she was troubled with regard to her ability to carry the mortgage in the future. The agent of the holder was willing to increase the mortgage by §500, but the plaintiff suggested that in the end she would be compelled to part with some of the land.
Under these circumstances, relying upon the Firths to give her a fair price for the land, she agreed to sell twenty-one acres of it. They at first agreed to pay §5,000 therefor, but before the deed was executed reduced'this offer to §4,500. ■ They also, on the claim that the title to one and three-fourths acres of the twenty-one was in doubt procured a conveyance of an additional acre and three-fourths out of the plaintiff’s remaining property. The actual eonsidera tion for the transfer was two mortgages given on the twenty-one acres, one for $2,500 to the holder of the §3,500 mortgage from which the plaintiff was-relieved, and a second purchase-money mortgage of §2,000 to the plaintiff, who-executed a mortgage of §1,500 upon the remainder of her property, and also received §500 in cash and merchandise. The value of the property sold was-at least §10,500.
Held, that the transaction was not fair and should not be allowed to stand;
That a case was presented thereby, of stronger parties taking advantage of a-weaker one, by depriving her of her property without adequate compensation.
Goodrich, P. J., and Hirschberg, J., dissented.
Appeal by the plaintiff, Mary Smith, from a judgment of the-Supreme Court in favor of the defendants, entered in the office of the clerk of the county of Queens on the 1st day of April, 1899,. upon the decision of the court, rendered after a trial at the Queens-County Special Term, dismissing the complaint upon the merits.
The facts of this case are more fully set forth in the dissenting-opinion of Mr. Justice Goodrich.
Ambrose G. Todd, for the appellant.
George M. Baker, for the respondents Christopher C. Firth and. Anna R. Firth.
James P. Philip, for the respondent Robert W. Firth.

Opinion:
Per Curiam :
On a reargument of this case, which was ordered because tliefour justices who heard the original argument were unable to agree,, a majority of the court adopt the following opinion of Mr. Justice Hatch, prepared before his transfer to the first department, as-expressive of their views :
Hatch, J.:
The plaintiff is evidently a woman of little business capacity and with small opportunity of informing herself with accuracy in respect-to the conditions as they existed at the time when the transactions-which are the subject of this controversy were had. She had little-education, and during her lifetime had lived in straitened circumstances, working partly in the fiouse and partly in the field.
The defendants were builders, and, in capacity, as measured by" that of the plaintiff, were in every view greatly the latter's superior,, so that, in respect of information and capacity, it is clear, beyond the-possibility of dispute, that the parties did not deal upon equal terms. The defendants' evidence and letters in this respect make clear disclosure of the facts.
When the plaintiff first made application to Christopher C. Firth she was in greatly distressed circumstances, being without money, her husband without work; her credit to obtain necessary food and clothing for the support of herself and family was low, and she was fearful of its being entirely refused. Some taxes were due upon the premises, but to what amount does not appear. Under these conditions she applied to the defendant Christopher C. Firth, stating to him her needs and necessities, and he promised to see wrhat he could do for her. What was thereafter done by Robert W. Firth was founded upon the original application to Christopher; Robert's negotiations are to be regarded as both for the benefit of himself and his father, as the deed of the premises ran to both.
The plaintiff at this time was the owner of thirty-seven acres of land, the value of which, as is fairly to be gathered from the testimony, was not less than §500 an acre ; and a finding that in December, 1896, it was in fact worth §800 an acre would have abundant support in the testimony. The defendants did not testify at any time that the property was worth less than §500 an acre, and the witness called by them to testify to value was clearly incompetent to give any correct estimate upon the subject.
It appeared that the extension of the railroad to Oyster Bay had added value to the property in that vicinity; that the opening of the Shore road had enhanced it to a considerable extent; and while in December, 1896, the Shore road had not been carried to completion, yet it was in process of construction and its existence was an assured fact.
Robert W. Firth testified that the plaintiff thought twenty-one acres of land was worth §5,000; but nowhere is the testimony of the witnesses called by the plaintiff to establish the value of the property contradicted, either by oral evidence or, so far as appears, by existing circumstances. It is, therefore, established by practically undisputed proof that the whole property was worth not less than §18,500, and the twenty-one acres not less than §10,500. The whole was subject to a mortgage given by the plaintiff for §3,500. There is no evidence to show that this mortgage was likely to be foreclosed, or that its foreclosure was even contemplated ; on the contrary, $500 had been retained and was on deposit in the bank at Glen Cove to be used for the purpose of paying the installments of interest as the same fell due. When the transaction which is the subject of this action was closed there remained in the bank to the credit of the plaintiff, applicable to this purpose, over $173 ; so that, except for her anxiety, she was in no way troubled by the mortgage. She was evidently troubled, however, in respect to her ability to cany the whole matter in the future.
When the application was made by Christopher C. Firth to Mr. Eastman, the agent of the holder of the $3,500 mortgage, it was found that this mortgage could be increased by $500. It was then undoubtedly suggested by the plaintiff that while this increase would afford temporary relief, yet in the end she. would be required to sell some of the land in order to rid herself of the incumbrance, and I assume that she applied to Robert W. Firth to become a purchaser of the twenty-one acres. In respect to that transaction the testimony of Robert, the letters which he wrote, and the whole course of the dealing which finally culminated in the deed, showed beyond controversy that the plaintiff relied upon him to give her a fair price for her land.
To my mind the evidence and the inferences which arise therefrom leave no reasonable doubt that in respect to this sale she relied upon .and was influenced by Robert's statements to her, and dealt with him in the belief that he would pay the fair and reasonable value of the land. Under such circumstances the law requires that the transaction shall be absolutely fair, and does not tolerate the slightest advantage being taken by the stronger of the weaker party. (Ten Eyck v. Whibeck, 156 N. Y. 341.) Robert W. Firth first agreed to pay $5,000 for the twenty-one acres. This was less than half the sum which the evidence establishes that the premises were fairly worth. When the contract of sale came to be executed, he repented of his offer to the extent of $500, reducing it to $4,500. The transaction in respect to the mortgages was had with Mr. Eastman, who was the agent of the owner of the $3,500 mortgage. Robert arranged with him to place a mortgage for $2,500 upon the twenty-one acres, and he gave to the plaintiff a second mortgage for $2,000, upon the same premises, as part of the purchase price. The plaintiff gave a mortgage for $1,500 to Eastman upon the remaining part of her land. It is said by the respondents that she also received from Robert $500. It is evident that she received only $200 in cash out of the transaction, the balance being represented by merchandise. The money which was in the bank at Glen Cove belonged to her, and formed no part of the purchase price.
In addition to this there appeared to be some dispute about the title to an acre and three-fourths of the twenty-one acres, whereupon Robert insisted upon receiving, without making further compensation therefor, about an acre and three-fourths of land from the other piece, which gave him a rear entrance to the land upon Canoe road. Whatever may be the merits of the dispute regarding the title to the acre and three-fourths, it is clear beyond question that plaintiff's title to it, if any, was conveyed when the defendants took title under the deed. So that in this part of the transaction the defendants have secured all of the plaintiff's interest in the disputed tract, and also one and three-fourths acres reaching to the Canoe road, as a net result of the whole transaction; the plaintiff has a second mortgage for $2,000 on the twenty-one acres; she has been relieved from the $3,500 mortgage, but in its place there is a mortgage upon her own property of $1,500. She may have received $500 more in some form. This is the total benefit which she has received for property worth not less than $10,500, and is the result of dealings with parties who were professedly acting as her friends. Such a transaction, I think, ought not to be permitted to stand, and it seems to be condemned by familiar rules of law upon the subject. The learned court below stated, in support of its conclusion : " All her property was covered by a heavy mortgage. She had absolutely no means to pay taxes or interest. It .was only a matter of a short time before she must lose everything. She was obliged to sell at least a part of her land to save anything. By the sale of the 21 acres she saved her home and 15 acres of good land, and secured about $1,000 besides." It cannot be said that $3,500 was a heavy mortgage upon property worth at least $18,500. There is not a particle of evidence in the case to show that she had no means to pay interest; on the contrary, the proof "was that the balance in the bank was then sufficient to protect the mortgage. It is clear that anxiety was her only reason for selling. Her property was being enhanced in value every minute, and, if held, would shortly have produced a competence for a person in that station of life. She was not obliged to sell the land for any existing contingency ; Mr. Eastman stood ready to increase the $3,500 mortgage by $500, and it is evident that such sum would have'met all of her present necessities. Her anxiety was as to liability for the future, and of this anxiety the defendants seem to have taken advantage, to their considerable profit, and at an expense to them not to exceed $500. This latter consideration answers any claim that she was a gainer by the transaction to the extent of $1,000. If this transaction can stand, then I am unable to see how relief can be obtained in any case against the acts of the stronger party, who, whether intentionally or otherwise, deprives the weaker party of property, without adequate compensation.
This view leads me to the conclusion that the judgment should be reversed and a new trial granted, costs to abide the final award of costs.
All concurred, except Goodrich, P. J.,'who read for affirmance, with whom Hirschhkkg, J., concurred.