Case Name: Jettine Gotteberg, Respondent, v. Park Terrace Company, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1915-07-09
Citations: 168 A.D. 800
Docket Number: 
Parties: Jettine Gotteberg, Respondent, v. Park Terrace Company, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 168
Pages: 800–805

Head Matter:
Jettine Gotteberg, Respondent, v. Park Terrace Company, Appellant.
First Department,
July 9, 1915.
Real property — suit for cancellation of contract to purchase — agreement to sell in future as an inducement to purchase does not constitute fraud in execution of contract.
Where, in a suit to cancel contracts for the purchase of real estate and to recover the amount paid thereunder upon the ground that the defendant’s agent falsely and fraudulently represented to plaintiff and signed an agreement to the effect that he would, at plaintiff’s request after one year, sell the property for her at a profit of at least ten per cent, there is no evidence that plaintiff was induced to enter into the contract by reason of any fraudulent representations, the complaint should be dismissed.
An agreement to sell property in the future as an inducement for one to purchase, does not constitute a fraud in the execution of the contract in case of a failure to sell in the future. It is merely a breach of contract, and the remedy is an action for damages.
Ingraham, P. J., dissented, with opinion.
Appeal by the defendant, Park Terrace Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 25th day of January, 1915, upon the decision of the court after a trial at the New York Special Term.
H. Schieffelin Sayers, for the appellant.
Julian M. Wright, for the respondent.

Opinion:
McLaughlin, J.:
Action in equity to cancel two contracts for the purchase of real estate and to recover the sum of $785 paid thereon.
On February 21, 1911, the plaintiff entered into a written contract with the defendant, by the terms of which she agreed • to buy and defendant to sell, two lots of land in the city of New York, payments therefor to be made in stipulated monthly installments, and title to remain in the vendor until the full purchase price was paid. The parties, on the 2d of November, 1911, entered into a similar contract for the purchase of another lot. At the time this action was commenced the plaintiff, pursuant to these contracts, had paid the defendant $785. The ground upon which she seeks to have the contracts set aside, as alleged in the complaint, is that defendant's duly authorized agent " falsely and fraudulently represented to plaintiff that as a part of said agreement [the same allegation being made as to each contract] defendant was bound and obligated to plaintiff that should plaintiff desire to cancel said purchase and resell the property at any time after one year from the execution of the same, then defendant would sell said parcel of property on behalf of plaintiff at a profit to plaintiff of at least ten per cent, and that plaintiff could not in any case lose any of the money she might pay to defendant on account of said purchase."
The defendant was represented in the transaction with the plaintiff by one Skold, who was in the employ of John W. Paris & Son, the defendant's sales agent for the lots in question. In support of her alleged claim the plaintiff introduced in evidence the following memorandum, which was given her by . Skold upon the execution of the first contract:
"Feb. 21/11.
" John W. Paris & Sons, Ino.
"It is agreed and understood that should Miss Jettine G-otteberg the purchaser of lots 1666 and 1667 Park Terrace property, Flushing, L. I., desire to sell the same one year from this date the lots will be sold by me at a profit of at least 10%.
"40 days notice in such case.
" EDMUND SKOLD,
"% John W. Paris & Son."
No such memorandum was given upon .the execution of the second contract, but the plaintiff testified that on that occasion Skold told her that he, and then that they, referring to the defendant, would resell the property for her at a profit of fifty dollars if she would keep it for three months.
The plaintiff, a Norwegian, came to this country in 1907, and at the time the contracts were executed spoke and read the English language only fairly well, for which reason the conversations leading up to their execution were carried on partly in English and partly in Swedish. She testified that Skold came to see her three or four times and told her she ought to invest her money in real estate, to which she replied she did did not want to invest her money in that way unless she was sure she could get it back after a year, if she needed it; that he said if she bought the property which he had for sale she would make from twenty to thirty per cent profit; that the company's contract was better than contracts of other real estate dealers and if she needed her money they would guarantee she could get it back after a year with an increase of ten per cent at least; that he would give her an agreement to that effect; and she, relying upon this statement, made the purchase and took the agreement, copy of which has been set forth.
It will be noticed that the memorandum signed by Skold does not purport to bind anybody but himself, but assuming that she understood it bound the defendant and that Skold was authorized to make such agreement, I do not think it enables the plaintiff to maintain this action. It was an agreement to do something in the future, and if defendant has failed ta carry out its agreement, then plaintiff's remedy is to recover, damages for a breach of contract. There is not a particle of evidence in this record which would justify a finding that plaintiff was induced to enter into the contract by reason of any fraudulent representation. An agreement to sell property in the future, as an inducement for one to purchase, does not constitute a fraud in the execution of the contract in case of a failure to sell in the future. It, at most, is a breach of contract, and nothing else.
The record is silent as to the value of the lots in question, and if the action were treated as one to recover damages for breach of contract, it would be impossible to compute the damage.
I think the judgment appealed from should be reversed, the findings tending to establish fraud on the part of the defendant; and the conclusions of law that the plaintiff is entitled to recover should also be reversed, and the complaint dismissed, with costs.
Clarke, Scott and Hotchkiss, J J., concurred; Ingraham, P. J., dissented.