Opinion ID: 1144948
Heading Depth: 1
Heading Rank: 8

Heading: The Sellers Breached the Contract

Text: In a recent case before the appellate division of the Superior Court of New Jersey, the contract was to deliver a marketable title and one that will be insurable by a recognized title company. The court held the parties to their agreement. Mackenzie v. McLean, 20 N.J. Super. 517, 90 A.2d 515, 516 (1952). In Laba v. Carey, 29 N.Y.2d 302, 327 N.Y.S.2d 613, 617, 277 N.E.2d 641, 644 (1971), the court of appeals recognized that when a seller contracts to deliver a title approved by a responsible title company, he breaches the contract when the title company refuses to insure title unconditionally and without exception. In Korb v. Spray Beach Hotel Co., 24 N.J. Super. 151, 93 A.2d 578, 580, 581 (1952), the appellate division of the superior court adopted in part the decision of the trial division, in which it had been said: `Contracts whose performance is conditioned on the approval of third parties are not unusual. 57 A.L.R. 1322 recognizes the principle that a contract may properly contain a provision in effect obligating the vendor to convey such a title as a designated title insurance company will approve and insure.       `Since the vendor breached the covenant pertaining to the delivery of such goods and merchantable title as would be insured by the designated title company, it was the right of the vendee to promptly repudiate the contract. This he did, thereby entitling him to the return of his deposit, together with interest from the date of closing as well as the title search fees.' As was said in Royce v. Rymkevitch, 29 A.D. 1029, 289 N.Y.S.2d 598, 602 (S.C.A.C. 1968), where the agreement was that title insurance would be delivered by the seller to buyer: ... If a vendor of realty agrees to furnish title insurance to the purchaser, he must do so; otherwise the purchaser need not take title... . To the same effect is Drake v. Gaffney, 183 A.D. 577, 171 N.Y.S. 131, 132 (1918), affirmed without opinion, 228 N.Y. 596, 127 N.E. 911 (1920).