Case Name: WILLIAM CRANSTON, Appellant and Respondent, v. WILLIAM F. WHEELER, JOHN E. DUSENBURY, EDGAR G. DUSENBURY and WILLIAM A. DUSENBURY, Appellants and Respondents, Impleaded with HIRAM B. BURDICK and Others
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1885-06
Citations: 44 N.Y. Sup. Ct. 63
Docket Number: 
Parties: WILLIAM CRANSTON, Appellant and Respondent, v. WILLIAM F. WHEELER, JOHN E. DUSENBURY, EDGAR G. DUSENBURY and WILLIAM A. DUSENBURY, Appellants and Respondents, Impleaded with HIRAM B. BURDICK and Others.
Judges: BARKER, J., concurred; Haight, J., not sitting.
Reporter: Supreme Court Reports (Hun)
Volume: 44
Pages: 63–84

Head Matter:
WILLIAM CRANSTON, Appellant and Respondent, v. WILLIAM F. WHEELER, JOHN E. DUSENBURY, EDGAR G. DUSENBURY and WILLIAM A. DUSENBURY, Appellants and Respondents, Impleaded with HIRAM B. BURDICK and Others.
Contract for the sale of land — effect of an agreement by the purchaser not to assign the contract without the vendor’s consent — effect of the acceptance by the vendor of a surrender by the owner of an undivided interest in the land of hzs interest therein — when specific performance should be decreed.
September 18, 1880, tlie defendants, Wheeler and the Dusenhurys, entered into an informal written agreement with the' defendant Burdick, by which they agreed to sell to him 272 acres of land at six dollars per acre, to be paid in annual payments of $100 and interest. At the end of this agreement were the following words:l> A more complete contract to be hereafter executed.” • The plaintiff advanced $100 to be paid upon the contract, in pursuance of an agreement made between him and Burdick, by which the latter agreed to sell and convey to him one-half of all his right, title and interest in the said land. On December 4, 1880, Burdick executed a written instrument, selling and conveying an undivided one-half of his interest in the said land to the plaintiff, which provided that each party should pay one-half of the purchase-money, and that, if either should fail so to do, the other party should have the right to make the payment, and have the whole of said contract. In March, 1881, Wheeler and the Dusenburys entered into a formal contract with Burdick, dated September 18, 1880, for the sale of the said land, which contained, among others, the following provisions : “The said party of the second part (Burdick) also agrees not to assign this agreement without the consent of the party of the first part.’' Burdick thereafter indorsed upon this contract an assignment of one-half of his interest therein to the plaintiff.
In August, 1881, Wheeler, the Dusenburys and Burdick, with actual knowledge of the rights of the plaintiff in the land, and with intent to defraud him and deprive him of his interest and rights therein, and without his knowledge or consent, . entered into an agreement by which Burdick, delivered to the other parties a written instrument, canceling and surrendering to them the contract, and all his interest under it, and received from them a deed of 118 acres of the land. The 118 acres were conveyed to Burdick’s brother, by whom they were conveyed to Burdick’s wife.
The plaintiff having made a tender of the payments, as they came due, and kept the same good, brought this action, claiming to be entitled to a conveyance of the whole tract of 272 acres, and prays that the defendants be compelled to-specifically perform their contract
Held, that as the plaintiff took the assignment of one-half of Burdick’s interest after the execution of the informal contract, the statement therein contained, that a more complete contract was to be executed, rendered the interest so acquired by him subject to any stipulation which might be inserted in the completed contract, which was within the contemplation of the^parties when the original agreement was made, unless it should appear to have been inserted with the intent to defraud him.
That as no such intent was shown in this case, the agreement that the contract should not be assigned “without the consent of the party of the first part,” was binding upon the plaintiff.
That as the agreement not to assign was in the form of a covenant, and as there was nothing to show that it was intended to operate as a condition, compliance with which should be a prerequisite to the exaction of a conveyance, its insertion in the contract did not prevent the plaintiff from becoming, by virtue of the transfer from Burdick, the equitable owner of an undivided one-half of the land.
That by the -surrender of Burdick’s interest in the contract to "Wheeler and the Dusenburys, the latter acquired his equitable title to an undivided one-half of the premises, which merged in the legal title still held by them.
That the surrender by Burdick of his interest under the contract could not be treated as a failure on his part to comply therewith, so as to authorize the plaintiff to make the necessary payments and claim a performance of the whole contract.
That upon paying into court, the amounts tendered by the plaintiff he was entitled to a decree for the conveyance to him of the undivided one-half of the land jointly held by Wheeler and the Dusenburys, and of the undivided one-half of the 118 acres held by Burdick’s wife. (Corlett, J., dissenting, holding that no decree should he made in the nature of a decree for specific performance, hut that if any such decree were made the plaintiff was entitled to the full benefit of the entire contract and had the right to treat Burdick’s interest in it as extinguished by his fraudulent conduct.)
Appeal by both plaintiff and defendants from a judgment, entered on the decision of tbe Erie Special Term.
The action was brought to procure an adjudication establishing the alleged right of the plaintiff to pay for and take title to certain lands under a contract of purchase and sale. The case comes here upon the judgment-roll only, and the facts found by the trial court were: That on the 18th September, 1880, the defendants Wheeler and the Dusenburys owned 272 acres of land situated in Cattaraugus county, and made to the defendant Hiram B. Bur-dick an informal agreement to sell it to him for six dollars per acre, payable in annual payments of $100 and interest, and to put the agreement in more complete form thereafter. (This agreement will be found in full in the following opinion of Corlett, J.) At the time the purchase was made by Burdick there was an understanding between him and the plaintiff that the latter should have from him an equal undivided half interest in the purchase and property and advance the $100 for the first payment. The plaintiff advanced that amount and it was paid at the time the agreement was made, and pursuant to such arrangement Burdick, on the 4th December, 1880, by written agreement, sold to the plaintiff one-half of his interest in the premises, and it was thereby agreed that each should pay one-half the purchase-money. And it was further provided, that if either of them should fail to make one-half the payments, “ the other party shall have the right to make the payment and have the whole of said contract.” That about the 1st of March, 1881, the defendants Wheeler and Dusenburys entered into a formal contract under date of September, 1880, with Bur-dick, whereby they agreed to sell the land to him on the terms before mentioned, and on payment of the purchase-money to make and deliver to him a warranty deed. This contract contained this provision : “ The said party of the second part (Bur-dick) also agrees not to assign this agreement without the consent of the party of the first part.” (This contract will be found in full in tbe following opinion of Coelett, J.) Burdick, by assignment, indorsed upon this contract assigned one-half of Ins interest in it to the plaintiff. In August, 1881, Hiram B. Burdick, Wheeler and the Dusenburys, with intent to defraud the plaintiff and deprive him of his interest and rights in the said real estate and contract respectively, and with actual knowledge of the rights of the plaintiff in the premises, and without his knowledge or consent, entered into an agreement that Burdick should execute and deliver to Wheeler and the Dusenburys an instrument in writing canceling and surrendering to them the contract, and all his interest under it; that they should execute and deliver to him a deed conveying to him 118 acres of the land. This was done. Shortly thereafter Hiram conveyed to his brother defendant, Wayne S. Bur-dick, and he conveyed to Hiram’s wife, the defendant Kate Burdick, this 118 acres; all of which was done with knowledge of the rights of the plaintiff and with the intent to defraud him. The plaintiff tendered the payments as they became due unon the contract to Wheeler and the Dusenburys, which they declined to receive, and the moneys so tendered are preserved for them.
As conclusions of law, the court determined that the surrender of the contract by Burdick to Wheeler and the Dusenburys, and the deeds to him, his brother and wife, were respectively fraudulent and void as against the plaintiff, and did not affect his rights and interests under the contract of September 18, 1880. That by the assignment of it to him his right to an undivided half interest was fixed, and that the covenant of Burdick not to assign without the consent of the vendors, did not operate to affect his interest acquired by the previous assignment, that the release by Burdick to Wheeler and the Dusenburys, and the conveyance to him were binding as between those parties, and operated as a settlement between them and as a payment by him. to them, so far as related to his interest, and that the plaintiff is entitled to judgment declaring the transaction between them void, and that he has the interest in the contract so assigned to him and on payment will be entitled to a conveyance of such interest. The several parties respectively took exceptions to the portions of the conclusions of law adverse to them, and judgment being perfected they respectively appealed.
Hamilton Ward, for the plaintiff, appellant and respondent.
I). H. Bolles, for the defendants Wheeler and the Dusenburys, -appellants and respondents.

Opinion:
Bbadlby, J.:
The questions presented are somewhat novel and may not be -entirely free from difficulty. As between Burdick, the vendee in the contract, and the plaintiff, the latter took, by the assignment to him, an equal undivided half of the interest afforded by the contract in the land, with the right to perfect title to it in the manner .agreed upon. He had the equitable title to that extent, unless his .right to thus acquire it was denied to him by the non-assignable provision of the contract. And that question could be raised only by Wheeler and the Dusenburys. It is upon this clause of the contract that the contention of the defendants' counsel rests. The fact that the transfer of the one-half interest in the premises was made by Bur-dick after.the first informal memorandum of agreement was made, containing no such clause, does not relieve the plaintiff from the force and legal effect of any provision in the-subsequent formal contract of sale. The provision in the 'former, to the effect that a more complete contract was to*be thereafter executed, will be- deemed to have brought any stipulations in the latter within the contemplation of the parties when the original agreement was made, unless it should appear that a particular provision was inserted in it with the intent to defraud the plaintiff and defeat his rights under such previous transfer. No such purpose is found. The plaintiff, therefore, must stand upon the contract as it is, and his rights as against the vendors must be deemed dependent upon and subject to its terms. Our attention is not called to any authority, text or judicial, as to the effect of such a non-assignable provision in an execu-tory contract for the sale of land.
By this contract the equitable title passed to the vendee and-there was no power reserved in the .vendor to defeat the right of the former to perfect legal title to the property. That depended wholly on the performance on the part of the vendee. And the vendors had no legal right to anything more than such performance, the failure of which, and that only, would give to them the right of restoration of the title. It is a stipulation or condition consistent with the rights of parties to a contract which may be operative and effectual. In ease of a grant without a reversionary interest retained by the grantor in the land a provision in terms restraining alienation is void. (De Peyster v. Michael, 6 N. Y., 467, 506, 508.) And the fact that a right of re-entry of the grantor may arise from default in payment of rent in case of a lease in fee, does not aid in support of such condition when that right of the grantor or his assigns, will exist only in action and is not founded upon any present interest in the land. {Hid.) At the time of the execution and delivery of the contract Burdick became in equity the owner of the premises, and the legal title was held by his vendors as trustees and as security for the payment of the purchase-money of which the vendee was the trustee, and his interest was in realty and inheritable, and that of the vendors personal estate. This conversion of relation to the property, produced by the contract, may be entitled to some consideration in the construction and effect of the clause in question. The vendors had the right to-impose any conditions precedent to the right of the vendee to take-the legal title which were not repugnant to the rights given by the contract in the land, or the covenant to convey, by way of qualification of estate or of rights appurtenant to the property to be observed in the conveyance to be made.. The covenant or condition not to assign the contract is not a condition or stipulation upon which the right of conveyance was-made to depend, the payment of the purchase-money was all that was required by this contract to give the right to the legal title, and require the conveyance. And it is clear that after the full payment of the purchase-money the vendors could not successfully resist the right of an assignee of the contract to a conveyance. They could then have no interest in the condition or covenant not to assign, to give it any support or validity. It would be repugnant to the right, which as of that time is given by the contract, and nugatory.
In the view taken of this case it is unnecessary to determine whether such a clause may have any and what effect' intermediate the execution of the contract and its performance on the part of the vendee. It did not prevent the transfer by the latter of an interest in the land to the plaintiff, and he became the owner in equity of tbe undivided lialf of it. The insertion in leases of covenants and conditions of that character is common and well recognized, but being in restraint of alienation are strictly construed. (Jackson v. Silvernail, 15 Johns., 278; Jackson v. Harrison, 17 id., 66; Lynde v. Hough, 27 Barb., 415; Crusoe v. Bugby, 3 Wilson, 234; Church v. Brown, 15 Ves., 258; Field v. Mills, 33 N. J. L. R. [4 Vroom], 254.)
Within the rule of construction as applied to leases the provision, even if it were a condition not to assign the contract, would not be •construed as a denial of the vendee's right to sell his interest in the land, which would take with it the right to its protection under the contract. Nor would the assignment of a specified interest in it, less than the whole, come within the terms of the restrictive clause.
In Crusoe v. Bugby a covenant not to assign a lease was held not to interrupt the right of the lessee to sub-let by lease for part of the term; and the other cases before cited held the same and vice versa. The provision referred to in the contract is not a condition but a covenant on the part of the vendee only. It has the form of a covenant, and there is nothing in the contract itself, nor does anything appear, which can give to it the purpose or effect of a condition. It is in no sense an essential element in relation to the performance of the contract, but merely collateral to it. The plaintiff took an interest in the land under the contract by the transfer made to him by Burdick on 4th December, 1880, prior to the execution of the formal agreement, and there seems to be nothing in the way of giving effect as against the vendors to the assignment to the plaintiff of the one-half interest in the latter contract. It follows that his rights were not divested or defeated by the transaction between the vendors and vendee and^ the subsequent conveyances of the 118 acres through Burdick's brother to his wife.
The remaining question is: What relation was produced by that transaction of the parties to it, to each other, and to the plaintiff, and what are their rights in respect to the premises ? The motives of the vendors and vendee have ho particular importance as relates to the plaintiff, and only as affects their rights to affirmative relief against each other.
The vendors had the right, by arrangement with Burdick, to take his interest, or, what amounts to the same thing, extinguish it, in the contract and in the premises, and convey their legal title to-him in any portion of the land, although they could not disturb-any existing rights of the plaintiff.
The vendors in the contract took the interest of Burdick, and paid him for it by the conveyance to him of the 118 acres. By that arrangement and its execution, Wheeler and the "Dusenburys, as-between them and Burdick and as to the plaintiff, must be deemed to have dischai'ged Burdick from the stipulations of the contract. They have taken the equitable title to the undivided half of that, portion of the premises not conveyed to him, and thus it is merged in the legal title held by them, and the equitable title to the undivided half of the whole remains in the plaintiff.
The consequence of having so discharged Burdick from liability to-pay one-half the purchase-money, is that the vendors may be treated as having the beneficial interest, to that extent, of the vendee in the contract united with the legal title in them, and thereby assuming such relation to the plaintiff in respect to the contract that the latter is entitled to pay to them one-half the unpaid purchase-money, .and, on such performance, to take a conveyance from them of half of the portion which they hold, and from the party holding under them a like share of the 118 acres. And for that purpose his relative-situation in practical effect is no different than it would have been if he had been a co-vendee with Burdick in the contract- The extinguishment-' by agreement between the vendor and the latter of his interest would not in such case affect that of the plaintiff. They have voluntarily discharged their vendee in the contract from liability to pay as part of the consideration of its relinquishment, to them. And it is not necessary to inquire whether they have the personal liability of the plaintiff. The vendors, by the transaction, have neither reduced his interest or increased his liability to-pay, but have reduced their liability to convey to one-half of that part retained by them of the premises. And the contract has in practical effect become one to sell and convey that to the plaintiff. There is nothing in the way of specific performance in behalf of the plaintiff, on performance by him. The land is charged with his interest under the contract, and the vendors or any persons holding the legal title under them may by force of it be required, on his performance, to make the conveyance. The contention on the part of the plaintiff that Burdick has so failed to make payment of the portion of the purchase-money which he undertook to pay, as to permit the plaintiff to pay the whole and take title to the entire premises, is not supported. Burdick is not in the situation of default in that respect, nor has he paid one-half the purchase money. He has disposed of his interest in the contract, or in behalf of his vendors has consented to the extinguishment of such interest for a consideration, which is the legal title to 118 acres, and the equitable title to one-half of it. His creditors have taken from him that liability to pay and the consideration on which it rested, which they were at liberty to do. The plaintiff by that is denied no legal right. He had none requiring an opportunity of Burdick to make default.
This view protects the rights of the plaintiff and preserves those of the other parties in the position they have voluntarily assumed. It may be that the latter have not accomplished what they designed. The law will not permit the attempted cancellation of the contract in fraud of the plaintiff to be effectual to his prejudice. While the fraudulent purpose may be entitled to consideration as characterizing the transaction between the vendors and vendee, and the several conveyances of the 118 acres so as not to vest title in a dona fide purchaser, the i-ights of the plaintiff in this action and to relief are not necessarily founded in such fraudulent intent on the part of the original parties to the contract, but in his legal rights derived from the transfer to him. They alone, in view of the facts, support his remedy and entitle him to the relief given by the conclusion of the trial court.
The defendants Wheeler and the Husenburys are entitled to the moneys so tendered by the plaintiff as payment of purchase-money, and he should be required to pay it into court to the credit of this action, and the judgment should be so modified as to direct him to do so.
The judgment should be affirmed, without costs of this appeal to any party.
BARKER, J., concurred; Haight, J., not sitting.