Court Opinion

ID: 9695713
Source: CourtListenerOpinion
Date Created: 2023-08-25 18:28:03.804407+00
Date Added: 2024-06-11T12:15:31.303881
License: Public Domain

EAGEN, Justice
(concurring and dissenting).
I am unable to agree with Mr. Justice Pomeroy that appellees have met their burden of establishing fraud with evidence that is sufficiently clear, precise, and convincing.
The record does not support the chancellor’s finding that Mr. Keeley assured appellees that he planned to build only single-family homes on the tract in question. Neither Mr. nor Mrs. Weibley testified to this clearly and unequivocally, although both were given opportunities to do so. For example:
[Mr. Weibley, on cross-examination]
“Q. Did Mr. Keeley ever promise you that he was going to build only single family residences ?
“A. He said he was planning to build single family houses, yes.
“Q. Did he ever promise you that was all he was going to build ?
“A. That is all we ever discussed was single dwelling homes.
“Q. That is all you ever discussed ?
“A. Yes.”
[Mrs. Weibley, on direct]
“Q. With reference to the occasion when the sale was being discussed did Mr. Keeley make any statement as to the plans he was then making for the use of this property if he could buy it from you?
“A. No, what he was planning to do with it?
“Q. With the tract, yes ?
“A. No, I just assumed that it was single family dwelling houses, he talked about homes, if that is what you mean.”
*27Mr. Weibley did testify that when Mr. Keeley originally came to see him about his mother’s property, “I asked him, I said are you interested in building apartments and he said no, I am interested in building a colonial type village.” Although Mr. Keeley’s indication that he was not “interested in building apartments” appears to have misled Mr. Weibley about the nature of the proposed “colonial type village,” I cannot find in the context in which it was given that it was either a misrepresentation or uttered with the intent to deceive. The record suggests that Mr. Keeley’s “interest” was not in building apartments per se, but in building a planned community in an integrated colonial style which would include a multitude of contemporary uses — including both apartments and detached homes — -all encompassed within the overall concept of a “colonial type village.” 1 Although Mr. Weibley testified that he and Mr. Keeley used Williamsburg “as a general theme” in discussing the proposed colonial village, he conceded on cross-examination that the colonial style is not confined to single-family detached residences. Nor, I might add, is a village.2 Moreover, even were I to regard this statement about Mr. Keeley’s “interest” a misrepresentation of his intention with respect to his “village,” it was not made in connection with the transaction in question, but with the earlier one involving Mr. Weibley’s mother’s land, upon which single-family homes were indeed to be built. In order to support their argument that there was fraudulent misrepresentation, appellees rely on the plan Mr. Keeley submitted to the Planning Commission on July 17 showing an intention to build *28apartments on the tract in question, but their evidence that they relied on his contemporaneous misrepresentations with regard to this tract is far from clear and convincing.
At one point Mr. Weibley did testify that he asked Mr. Keeley whether he planned to build apartments on this tract and that Mr. Keeley indicated his intention “to continue building single family homes”:
“Q. Now in the course of these negotiations did he tell you what plans he was making for the use of that ground if he acquired it?
“A. Well, he said he would like to continue the building of the Westover planned village, planned homes in that area, he knew of my objection to any apartments from the very time he started talking.
“Q. Did you again ask him if he planned to build apartments or anything other than single family homes ?
“A. Yes, I asked him about the apartments and he said he was going to continue building single family homes.”
At a subsequent point in his direct testimony, however, Mr. Weibley contradicted himself:
“Q. What were you relying on when you did enter the agreement?
“A. On Ms original word when he introduced himself and he was interested in building a colonial village of single residence homes and I have relied on his word and never questioned him about that since.” [Emphasis added.]
Thus, his testimony clearly established at most that he relied upon Mr. Keeley’s original statements that he was not “interested” in building apartments and that he in*29tended to build single-family colonial-style homes on the land he hoped to obtain from Mr. Weibley’s mother. The record indicates that these representations could not have been made later than April 24, the date of the first agreement of sale and well before the plan was submitted on July 17, and that single-family homes were indicated on the plan and indeed constructed adjacent to the Weibley farmhouse on the tract which had formerly been owned by the senior Mrs. Weibley.3 The testimony of his wife was no clearer in establishing fraudulent misrepresentation as to the intended use of the tract in question. Mrs. Weibley testified that Mr. Keeley stated to her mother-in-law in her presence that he was not going to build apartments on the first tract, but her testimony about the negotiations over the second tract was vague and unclear:
“Q. With reference to the occasion when the sale was being discussed did Mr. Keeley make any statement as to the plans he was then making for the use of this property if he could buy it from you?
“A. No, I just assumed that it was single family dwelling houses, he talked about homes, if that is what you mean.
“Q. Do you have any specific recollection about it the day it was signed, did Mr. Keeley say anything to you about building single family homes or make plans for single family homes on that day?
“A. I don’t think there was too much said, we had talked about selling the ground, I don’t remember anything being said about single family residences at that time.”
*30Thus, I conclude that appellees’ evidence was insufficient to establish the affirmative defense of fraud.4 Cf. Carlson v. Sherwood, 416 Pa. 286, 206 A.2d 19 (1965).
The chancellor, however, also held that the contract was not specifically enforceable because Mr. Keeley, by petitioning for rezoning without notice to appellees engaged in a “sharp, albeit legal undertaking designed to frustrate the content of the parties’ negotiations.” 5 It is clear that under the unclean hands doctrine a chancellor in equity has the discretionary power to deny affirmative *31relief to a party whose conduct toward the party from whom relief is sought has, in the matter in litigation, been willfully inequitable. See, e. g., Universal Builders, Inc. v. Moon Motor Lodge, Inc., 430 Pa. 550, 244 A.2d 10 (1968); Shapiro v. Shapiro, 415 Pa. 503, 204 A.2d 266 (1964). Moreover, even where the conduct of the party seeking to enforce a contract for the sale of land has not been willfully inequitable and the contract itself is not susceptible to rescission, a chancellor may in his discretion deny specific enforcement if he reasonably determines that such enforcement would be inequitable. In Payne v. Clark, 409 Pa. 557, 561, 187 A.2d 769, 771 (1963), we stated that specific performance “should only be granted where the facts clearly establish the plaintiff’s right thereto; where no adequate remedy at law exists; and, where the chancellor believes that justice requires it.” See also Snow v. Corsica Construction Co., Inc., 459 Pa. 528, 329 A.2d 887 (1974). In the circumstances of this case, although 1 conclude that the evidence is insufficient to sustain the chancellor’s finding of fraud, I cannot conclude that the chancellor abused his discretion in denying specific performance.
As I have indicated, the evidence is unclear that, contemporaneously with the submission of his plan indicating his intention to build apartments on the land in question, Mr. Keeley was assuring appellees that he intended to build single-family homes on it. The evidence, however, does support the conclusion that, in connection with the negotiations over the prior sale of land, Mr. Keeley, whether intentionally or not, led the Weibleys to believe that his proposed colonial village would consist solely of single-family homes, and that they indicated to him their objections to having apartments constructed in the vicinity of their colonial farmhouse. Although a mere allegation that a party would not have entered into a contract had he known the truth may not be sufficient to show the materiality of a representation — see Hirsch v. Silber*32stein, 424 Pa. 486, 227 A.2d 638 (1967) — the record here clearly suggests not only that the Weibleys would not have entered into the agreement had they known that apartments would be built on the land, but that the prospect of having their own home the focal point of a “village” of colonial homes was a strong inducement for them to enter into it. Although the sale of the senior Mrs. Weibley’s land was a separate transaction from the one in question, that a certain continuity between them was presumed is evident from Mr. Keeley’s statement that he wanted to acquire the instant property for the continuation of his village. Since the record indicates that Mr. Keeley did in fact begin to build single-family homes on the first tract conveyed, since the area was then zoned for single-family dwellings, and since Mr. Keeley had previously indicated that he was not interested in building apartments, the Weibleys’ assumption that Mr. Keeley’s proposed continuation of the village would involve the construction of more single-family homes was reasonable under the circumstances.
This being so, I believe that Mr. Keeley’s admitted failure to disclose both his intentions with regard to the second tract and his contemporaneous petition for rezoning, following upon his earlier misleading indication of the nature of the proposed village, though not fraudulent constituted a sufficiently misleading concealment on the part of the buyer to justify the chancellor’s refusal to grant specific performance of the contract.6 Cf. Schaeffer v. Jones, 293 Pa. 529, 143 A. 197 (1928); Brown v. Pitcairn, 148 Pa. 387, 24 A. 52 (1892); Miller v. Fulmer, 25 Pa.Super. 106 (1906). This is the case even though I assume, unlike the chancellor, that Mr. Keeley did not de*33liberately deceive appellees and that, as he testified, he was under the impression that they were aware his proposed village was not limited to single-family homes. See 3 J. Pomeroy, Equity Jurisprudence (5th ed. 1941), §§ 889, 905. Accord, Bowker v. Cunningham, 78 N.J.Eq. 458, 79 A. 608 (1911).
Therefore, I believe that while the contract was not void because of fraud, the chancellor in an exercise of discretion could, under the circumstances, properly deny specific performance. Nonetheless, the complaining party may still be entitled to damages for breach of contract. In my view, the complaint which prayed for general relief, as well as for specific performance, should have been transferred to the law side of the court for proceedings to determine this question.

. As for the indication on the July 17 plan that part of the tract in question was a “potential high rise site,” Mr. Keeley testified: “I don’t think we plan to put a high rise apartment because I am not sure that a high rise belongs in a suburban area.” He also stated: “I will say it was my intention to have this subject tract of ground as being a part of the colonial village, I am not saying I planned to do something entirely different with it.”

. But see Incorporation of Borough of Edgewood, 130 Pa. 348, 351, 18 A. 646 (1889).

. There was no evidence presented as to when the plan submitted at the July 17 meeting was drawn up or formulated.

. Appellant advances additional arguments that the record demonstrates its alleged fraud is not “intrinsically probable,” such as: (1) Mr. Weibley pointed out and commented favorably upon to Mr. Keeley a magazine article about another planned village which stated: “Like any good village or planned community, there is a variety of housing types available. Town houses, rental apartments, and single-family houses of either colonial or contemporary design offer a full range of choice.” (2) The agreement of sale for the first tract of land indicates that the parties removed restrictions from the property, making it unlikely that appellees expected the second tract to be restricted to single-family homes. (3) Although he protested the rezoning, Mr. Weibley did not disaffirm the contract on the ground of fraud when he learned of Mr. Keeley’s plan in September, and even the following March, rather than accusing Mr. Keeley of fraud, he instead attempted to supplement the agreement with restrictions he drafted himself and was clearly capable of drafting at the time of the agreement had such restrictions then been important to him. On the other hand, Mr. Weibley testified that he had not read the entire article abput Montgomery Village and only discussed it in the context of a picture showing bicycle paths, while the record is unclear about the nature of the restrictions removed from the first tract. My conclusion that fraud was insufficiently established is based on appellees’ evidence alone, rather than upon an attempt to weigh the significance of this additional and generally ambiguous evidence.

. The language quoted is from the opinion supporting the final decree. Appellant argues that the chancellor’s finding of bad faith with regard to the rezoning petition was influenced by his erroneous assumption that, although Mr. Keeley had petitioned for aréa-wide rezoning rather than for a variance, the “design and effect” was that of a petition for a variance, and it was thus “a misrepresentation of interest” to the Planning Commission since the agreement of sale had not yet been made. Although the chancellor did take this approach in his adjudication, his final opinion recognized the legal validity of appellant’s petition and clearly based the finding of unclean hands not on the petition itself but the context in which the petition was presented.

. I note also that, although the July 17 plan indicated that single-family homes would be built on the portion of the first tract conveyed nearest to the Weibley farmhouse and although single-family homes were in fact built in that area, the plan also indicated that townhouses and garden apartments would be built on this tract further to the south and Mr. Keeley testified that he intended to build them there.