Court Opinion

ID: 5189200
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:33:17.949038+00
Date Added: 2024-06-11T08:26:51.475113
License: Public Domain

Hirschberg, J.:
The action of the learned trial justice in setting aside the verdict secured by the plaintiff was based on the theory that the contract or memorandum upon which the suit is brought is insufficient under the Statute of Frauds. The suit is for damages for alleged breach of agreement. The complaint alleges that on or about the 26th day of March, 1897, the plaintiff entered into an agreement with the defendants whereby the defendants agreed to take entire charge of the-premises No. 100 West One Hundred and Ninth street, corner of' Columbus avenue, in the city of New York, to keep the same in good order and pay all expenses, taxes, interest on mortgage and other charges against said premises until May 1, 1900, the rents of the said premises to he received hy the defendants for thei/r own use, and in consideration thereof the defendants agreed to pay to the plaintiff the sum of seventy-five dollars per month, beginning May 1, 1897.
The defendants pleaded the Statute of Frauds as a defense, and as-the agreement is unquestionably one which by its terms is not to be performed within one year from the making thereof, it was void unless in writing. To meet the requirements of the statute the plaintiff produced upon the trial the following letter signed by the defendants and received by her under date of March 26, 1897, viz.:
“ Dear Mad amt.— We agree to take entire charge of the premises No. 100 West 109th Street, corner Columbus Ave., keeping it in good order and paying all expenses until May 1st, 1900. We-further agree to pay you the sum of seventy-five dollars ($75) per month beginning May 1st, 1897. If at the expiration of this agreement the rent of said property shall have advanced, and if said agreement shall be renewed, we will increase the monthly payment to you in proportion to the advance in rents.”
The principal breach of the agreement set up in the complaint is the failure and refusal on the part of the defendants to pay what is *122alleged as “the proportionate part ” of the taxes and the interest on the mortgage on the premises, such proportionate part probably being in relation to the amount of rent in excess of $75 per month, if any. The complaint alleges that the defendants, on or about January 25, 1899, informed the plaintiff that if she desired to avoid foreclosure she must pay the taxes on the premises to the amount of $440, which she did, and which sum she complains that the defendants have- failed to repay her.
The document relied on by the plaintiff is fatally defective in two par-ticularSj vizfirst, it does not express the consideration stated in the complaint to the effect that the defendants were to have the rents in excess of seventy-five dollars per month, nor indeed does it ■express any consideration for defendants’ promise; and, second, it -does not contain any agreement on the part of the defendants to pay taxes, interest on the mortgage debt and other charges, but expressly confines their liability to the outlay incident to keeping the property in good order.
As to the consideration, it needs no authorities to establish the-proposition that a valid promise requires a consideration to support it. It may be conceded that, as the statute does not require the consideration to be expressed in the agreement or note or memorandum, it would be sufficient if it appeared that a consideration existed, notwithstanding the precise nature of it was not manifest. Prior to the insertion in the- statute of the requirement that the consideration should be expressed in certain writings, the current of authority was to the effect that the consideration should be expressed ns an essential part of the agreement. After the passage of chapter 464 of the Raws of 1863, by which the clause requiring the consideration to be expressed in the writing was struck out of the ■statute, it was held that the effect was not to destroy or annul the requirement that the writing must contain all the substantial and material terms of the contract. (Drake v. Seaman, 97 N. Y. 230.) The writing, so far as the same is executory, must still show on its face what the whole agreement was. (Drake v. Seamm, supra.) In Barney v. Forbes (118 N. Y. 580) Chief Judge Follett said .(p. 585): “ A written guaranty given by a third party to a creditor, •that his debtor will thereafter pay to him a pre-existing debt, must, • notwithstanding the amendment of the Statute of Frauds by chap*123ter 464 of the Laws of 1863, expressly or by fair implication, disclose that the promise rests on a legal consideration. (Castle v. Beardsley, 10 Hun, 343; Drake v. Seaman, 97 N. Y. 230 ; Reed on Stat. Frauds, §§ 423, 426.) Since that amendment the courts have held, with great uniformity, that all of the essential parts of contracts within the amended section must be in writing. (Newbery v. Wall, 65 N. Y. 484, 488; Stone v. Browning, 68 id. 598, 604; Drake v. Seaman, supra) The existence, or the acknowledgment of the existence, of a legal consideration for the support of such promise, is not only essential, but is absolutely indispensable. The history of this question is fully given in Church v. Brown (21 N. Y. 331) and in Drake v. Seaman (supra), and it is quite unnecessary to again go over the cases or give reasons for the existence of the rule. Speyers v. Lambert (1 Sweeney, 335; 6 Abb. Pr. [N. S.] 309, and 37 How. Pr. 315) must be regarded as overruled. In Evansville National Bank v. Kaufmann (93 N. Y. 273) the defendants were held not to be liable upon their written guaranty, because there was, in fact, no consideration for it, nor was any expressed in the writing. It was said in Drake v. Seaman (97 N. Y. 234): £ What was said in Evansville National Bank v. Kaufmann (93 N. Y. 273) was not at all intended to decide the question upon which the courts have thus differed. The guaranty there was special and without consideration in fact, and the question now under discussion was not before the courts.’ ”
In Mentz v. Newwitter (122 N. Y. 491) the sa.me ruling was applied to a written memorandum of a contract of sale, and the memorandum was held void because it did not name or describe the vendor. The court said, per Bbowh, J. (p. 497): “ The whole current of authority in this state is that the memorandum must contain substantially the whole agreement and all its material terms and conditions, so that one reading it can understand from it what the agreement is.” (See, also, Newbery v. Wall, 65 N. Y. 484, and Stone v. Browning, 68 id. 604.)
It is to be observed that the writing in question makes no mention or suggestion of a consideration emanating from the plaintiff and inuring to the benefit of the defendants. The defendants agree to take charge of the premises, to keep them in order, to pay the expenses, and to pay the plaintiff seventy-five dollars per month. The *124plaintiff does not agree to do anything, or to pay anything. There is no statement that the defendants are to receive anything as a consideration for what they are to do. The plaintiff says they were to collect and receive the rents, paying the séventy-ñve dollars per month out, of the rents and retaining the balance. The memorandum does not-say so. It does not even say that the seventy-live dollars is to be paid from the rents. It does say that if the rents advance the monthly payment shall increase in proportion, but that does not necessarily involve-the proposition that the payment shall come from the rents collected. The plaintiff further claims that the possession and control of the-property by the defendants is a consideration. Here too the agreement is defective for there is no statement that the defendants are-to-have control, the plaintiff not even agreeing that they may take charge of the premises. The case is not unlike the one of Lees v. Whitcomb (5 Bing. 34), where the defendant agreed in writing to- remain with the plaintiff for the period of two years for the purpose of learning the business of a dressmaker, and the memorandum was-held insufficient because the whole agreement did not appear, the engagement on the plaintiff’s part to teach being essential, and no-such engagement appearing in the writing. In Wright v. Weeks (25 N. Y. 153) Judge Allen said (p. 161): “ It was decided, as early as 1804, in Wain v. Warlters (5 East, 10), that a writing could not be a memorandum of an agreement, unless it contained the-whole agreement,— that is to say the parties cmd the consideration■ cmd the subject matter, as well as the promise,— and this is now well established as law. It was then held that the word agreement, in the statute, included not only the promise, but the consideration-for it; and that parol evidence could not be given of the consideration of a promise, which, upon the face of the written engagement-, was a nudum pactumP This doctrine has not been substantially-modified. While a ¡seal or the words “ value received,” have been held sufficient, and while the consideration- accordingly need not be expressed, there must at least be some expression of a consideration or the fair and necessary inference of one arising from the language used to indicate that the note or memorandum embodies a. binding- and valid agreement.
It is equally obvious that if the parties actually made the agreement alleged in the complaint-, and the undertaking on the part of *125the defendants was to pay. the taxes, the interest on the mortgage, water rates, insurance, and all other charges in addition to the -expenses of keeping the property in repair, the writing does not contain the whole agreement in this respect, and, therefore, fails to comply with the requirements of the statute. The deficiency cannot be supplied by parol, or the purpose of the statute would be •destroyed, which is to free contracts which extend beyond a year •from the uncertainties and possible frauds of speech. There is no ¡ambiguity. The defendants agree to keep the premises in good ■order, paying all expenses. The collocation indicates that the expenses referred to are those incident to the keeping of the property in good order; and such expenses can no more be extended by construction to the taxes, insurance and interest than they could be to a judgment or the principal of the mortgage, or the interest on a mew mortgage which the plaintiff might put upon the place. The case of Foster v. Goddard (1 Black, 506) is quite distinguishable. 'There the court had under consideration a contract to pay a share of the net profits in a business enterprise which would remain after ■deducting “ the actual expenses that may appertain to the goods •themselves, including the cost of said Foster’s living,” and the court field that the taxes, clerk hire and advertising were necessary disbursements to be deducted in ascertaining the net profits. The •court said (p. 51é): “ It was certainly not the intention, of the parties that the defendant should make a donation by any expenditure in the business.” In the case at bar, however, there is no suggestion of the ascertainment of net profits, viz., the difference between .receipts and disbursements, nor do I think the word “ expenses ” indefinite even, or that oral testimony could be received to explain its meaning independently of the requirements of the statute. But be that as it may, it is clear that it does not necessarily embrace and include the items of expenditure.which are essential to the plaintiff’s claim. The language of Judge Finch in Drake v. Seaman (supra).is quite applicable (p. 237): “We cannot hold this memorandum sufficient without a dependence upon parol evidence which would practically nullify the statute, and since we have held that •one party may be bound by his signature while the other party, not ¡signing, is not bound at all (Mason v. Decker, 72 N. Y. 595), it becomes very important for the party who does sign and is bound, *126that the rule should he firmly adhered to which requires the real contract to be stated with its substantial terms and conditions.”
The cases cited by the appellant’s counsel adjudging the specific performance of contracts voidable but partly performed, or performed in full by one party, relate solely to equitable jurisdiction and have no application to an action at law to recover damages for the breach of such a contract.
The order should be affirmed, with costs.
All concurred.
•Order setting aside verdict and granting new trial affirmed, costs to abide the event.