Court Opinion

ID: 3704229
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:41:38.277493+00
Date Added: 2024-06-11T14:10:07.396721
License: Public Domain

This is an appeal on questions of law from the Lakewood Municipal Court.
Plaintiff, Mrs. Zella A. Mayer, appellee herein, brought an action in said court upon a written contract to purchase a vacant lot from the defendants, Mr. and Mrs. Irving Sumergrade, appellants herein. Upon trial had to the court without the intervention of a jury, a judgment in the amount of $396.38 and costs was entered in favor of the plaintiff and against the defendants.
We are not favored with a bill of exceptions. The pleadings in the trial court consisted of the petition, a demurrer, an answer and a reply.
The petition alleges these operative facts: That the defendants are husband and wife; that they executed an agreement with the plaintiff, a copy of which is attached to the petition, to *Page 238 
sell her a parcel of vacant land, located in the city of Westlake; that at the time of such agreement the city had levied special assessments upon said parcel of land for the years 1952 to 1961, inclusive, in the annual sum of $91.76, and certified the same for collection to the county auditor; that said annual assessments are a lien upon the land; that, in the agreement entered into by the parties, plaintiff agreed to purchase the real estate for a cash consideration of $6,250; that, "said consideration was paid and that defendants conveyed said real property to the plaintiff (the present owner of said realty) by deed filed July 8, 1958, and recorded as Cuyahoga County Recorder's instrument No. 227372"; that in the agreement defendants "specifically warranted that there were no assessments upon said premises"; and that defendants, on demand, have failed and refused to pay plaintiff damages for such assessments still unpaid in the amount of $367.04, for which, together with interest from the 8th day of July, 1958, plaintiff asks judgment against said Irving Sumergrade and Viva G. Sumergrade.
Defendants claim four specific assignments of error, each of which is merely an elaboration of the single claim that the trial court erred in overruling the demurrer to the petition since the petition fails to state a cause of action in averring a contract for the sale of land and the filing and recording of a deed conveying the real property to the plaintiff without averring facts which would remove the cause from the general rule that "a subsequent deed merges a pre-existing contract for the sale of the same property * * *."
The following language pertinent to the consideration of this claim of the defendants appears in the agreement:
"* * * Funds and documents to be placed in escrow at So. Side Fed. Sav.  L. Westgate office within 60 days. Fee 1/2 each. Present owner to give good and sufficient deed and title to said property and furnish a title guarantee at owners expense in the amount of $6,250.00 REC for ZAM showing same to be free from all encumbrances except restrictions of record and zoning ordinances, if any, and taxes not yet billed. . . . . . . . . . . . . . . Seller specifically warrants there are no assessmentsnor easements on above property." (Emphasis denotes sentence written in by hand on the printed form used in drawing up this agreement.) *Page 239 
The general rule with respect to the relation of a deed to a contract for the sale of real estate is stated as follows in 40 Ohio Jurisprudence, 1001, Section 90:
"In the absence of fraud or mistake, and except where the contract for the sale of land creates rights collateral to or independent of the conveyance, the general rule is that acceptance of a deed in pursuance of articles of agreement for the conveyance of land is prima facie the completion of the contract; and all stipulations contained therein, with certain exceptions hereinafter noted, are merged in the deed, although omitted therefrom. In Ohio, when a deed is delivered and accepted without qualification, the general rule is that the contract is merged in the deed; no cause of action upon the prior agreement then exists. The rights of the parties must be determined by the deed so given in execution of the prior agreement, unless the elements of fraud or mistake are involved, or perhaps, unless the deed was accepted under protest and with a reservation of the right to insist upon a strict adherence to the terms set forth in the prior agreement. The office of the deed is to execute the contract on the part of the vendor."
Does the provision, "seller specifically warrants there are no assessments nor easements on above property," come within any of the exceptions to the general rule? This is the basic question raised by the defendants in their appeal.
The answer to this question depends upon the import of the language used. Is it a covenant that runs with the land, or is it a collateral and independent engagement by the vendors by which they assure the purchaser that "no assessments" appear against the parcel of land they are selling and to indemnify her should they be mistaken about the matter? It is our view that it is not a covenant that runs with the land because the language does not import a warranty upon which the sale of the property is contingent nor a stipulation which can only be satisfied and executed in the conveyance itself. It does not concern the title, occupancy, size, enjoyment, possession, or quantity of the parcel of land conveyed nor does it set down any condition or contingency upon which the sale of the property depends and which could only be satisfied by incorporation in the deed. Rather, the statement sets out a private stipulation under which the *Page 240 
vendors specifically warrant that there are no assessments and, by clear implication, agree to save the purchaser harmless should there be such. It is an agreement, therefore, collateral to and independent of the main purpose of the transaction and obviously not intended to be merged in the deed. Moreover, its recitation in the deed would add nothing to nor detract anything from the same since the special assessments are certified to the auditor, are a lien on the land, and recorded. It is also patent that this specific warranty was a part of the consideration for the purchase price which was paid and under the circumstances calls for satisfaction apart from and in addition to the conveyance of the land by deed. It is stated in 84 A. L. R., 1009:
"A very general exception to the foregoing rule [general ruleas to merger of contract in deed] relates to collateralstipulations incorporated in the contract but not in the deed.In this regard it is to be observed that a contract for a deedantedates the execution of the deed, and may, and often does,contain many provisions which the execution of the deed neitheradds to nor takes away from. A deed is a mere transfer of the title, a delivery so to speak of the subject matter of the contract. It is the act of but one of the parties, made pursuant to a previous contract either in parol or in writing. It is not to be supposed that the whole contract between the parties is incorporated in the deed made by the grantor in pursuance of, or as the consummation of, a contract for the sale of land. There are many things pertaining to the contract which it is manifest are never inserted in a deed." (Emphasis ours.)
In Reid v. Sycks, 27 Ohio St. 285, the Supreme Court stated the following, at page 290:
"The obligation to pay the purchase money was not merged by the deed, which was only in performance on the vendor's part. This deed is to be considered part of the transaction, in connection with, and not to the exclusion of, the title bond.
"Both papers are parts of one transaction, and the rights of the parties must be determined by the terms of the whole contract. An executory agreement for the sale of lands is not satisfied and performed when the deed is made. The covenant to convey is performed by the conveyance; but covenants relating *Page 241 
to other things than a mere conveyance are not thus performed or satisfied."
And, at page 291, the court stated:
"There is no presumption that a party, in giving or accepting a deed, intends to give up the covenants of which the deed is not a performance or satisfaction."
In Saville v. Chalmers, 76 Iowa 325, 41 N.W. 30, the Supreme Court stated in a case quite analogous to the instant case the following in the syllabus:
"A prior parol warranty as to the quality of land conveyed by an ordinary warranty deed is not merged in the deed, and for a breach of it the grantor is liable to the grantee in damages."
Also, see Dawson v. McKinnon, 226 Iowa 756, 285 N.W. 258.
The Supreme Court of New Jersey, in Janitscheck v. MelbroRealty Corp., 107 N. J. Law, 450, 154 A. 749, 84 A. L. R., 999, in a case similar to the one here under consideration, stated in the syllabus:
"Clause in a contract for sale of real estate that `all street assessments for the improvement of Liberty avenue are to be paid by the seller,' held, under the circumstances disclosed by the evidence, an independent agreement to save vendee harmless from an assessment laid for an improvement inaugurated or in immediate contemplation, and not merged by delivery and acceptance of the deed."
The great weight of authority supports this view. Allen,Admr., v. Lee, 1 Ind. 58, 48 Am. Dec., 352; Brennan v.Schellhamer, 13 N. Y. Supp., 558; Caveny v. Curtis, 257 Pa. 575,101 A. 853; Close v. Zell, 141 Pa. 390, 21 A. 770, 23 Am. St. Rep., 296; Culver v. Avery (N. Y. S. Ct.), 7 Wen., 380; Everett
v. Gilliland, 47 N. M., 269, 141 P.2d 326; Fries v. Gannon,9 Ohio App. 387; Goodspeed v. Nichols, 231 Mich. 308,204 N.W. 122; Green v. Batson, 71 Wis. 54, 36 N.W. 849; Levin v.Cook, 186 Md. 535, 47 A.2d 505; Minor v. Edwards,12 Mo., 137; Monell v. Colden, 13 Johnson (N. Y.), 395; Newton v.Middleton, 3 N. J. Misc., 157, 127 A. 580; Siebros FinanceCorp. v. Kirman, 232 App. Div. 375, 249 N. Y. Supp., 497;Thompson v. Reising, 114 Ind. App. 456, 51 N.E.2d 488. *Page 242 
It would seem from the above, therefore, that the specific warranty as to assessments was not merged in the deed and that when the purchaser discovered that special assessments for installation of water pipes existed and that such assessments were a lien upon the property she had purchased from the vendors, the specific warranty, given by the vendors and included in the contract of sale, was breached and a cause of action accrued in favor of the plaintiff against the defendants.
We hold, accordingly, that a good cause of action is stated in the petition and that, therefore, the trial court was not in error in overruling the demurrer.
The joint answer of the defendants alleges, inter alia, that the agent of the plaintiff got them "to include the warranty that there were no assessments" when he knew that there were and they did not; that the offer this agent brought from the plaintiff was changed from $6,000 to $6,250 by the agent; that the plaintiff chose the escrow agent; that plaintiff's attorney drew the deed; that the deed was executed by defendants before plaintiff's agent delivered it to plaintiff; that plaintiff accepted the deed without objection or reservation and filed and recorded it; that the deed in part provides "* * * that the same are free from all encumbrances whatsoever except zoning ordinances and restrictions of record, taxes, both general and special, for the year 1957 and thereafter, which the grantee agrees to assume and pay * * *"; and that the deed merged any pre-existing contract and fully discharged any liability of defendants under any such contract and under any warranties.
The reply of the plaintiff admits that during negotiations the purchase price was increased from $6,000 to $6,250 and avers that the phrase, "sellers specifically warrant there are no assessments nor easements on the above property," was written in by hand prior to the execution of the contract by the defendants; plaintiff denies that she or her agent had any knowledge of any special assessments; avers that the specific warranty against special assessments was part of the consideration for the increase in price; denies that the sale was consummated with an escrow agent of her sole choosing or that the plaintiff's attorney drew the deed; avers that the escrow agent was agreed upon by her and the defendants and that defendants *Page 243 
prepared, executed and delivered the deed to the escrow agent, which agent then filed the same for record; avers that she was without any knowledge of the terms of the deed until it was returned to her subsequent to its recording; and denies that she accepted the deed as a merger or a variation of the terms of said purchase agreement "as a waiver of the terms of said agreement specifically warranting against assessments."
The pleadings in this case present all issues conceivably necessary to resolve the dispute between the parties in this action. Since there is no bill of exceptions, the evidence with respect to these issues is not before us. The presumption of law is that a judgment entered by a trial court properly resolved the issues in the pleadings according to the evidence and the law.
Upon a careful consideration of the record before us, we determine that no error prejudicial to the substantial rights of the defendants is shown even should it be that the petition fails to state a good cause of action.
In Yocum, Admr., v. Allen, 58 Ohio St. 280, 50 N.E. 909, the Supreme Court stated in the first paragraph of the syllabus:
"Where, in a cause pending in the Court of Common Pleas a demurrer to a petition has been overruled, and upon issues made by answer and reply, the case has been tried to a jury and a verdict and judgment for plaintiff rendered, this court will not reverse the judgment, even though satisfied that the demurrer ought to have been sustained, provided it also appears, upon a consideration of the whole record, that the overruling of the demurrer was an error which was not prejudicial to the adverse party."
Judgment affirmed.
HURD, P. J., concurs.