Court Opinion

ID: 3611693
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:55:41.390701+00
Date Added: 2024-06-11T07:45:34.482417
License: Public Domain

By the terms of the agreement upon which this action was brought, the defendant himself agreed to sell and convey unto the vendee, Elizabeth Brinckerhoff, the land in controversy. And notwithstanding the facts, that the defendant stated in his agreement, that the land was to be surveyed at the expense of the estate, for which he acted as trustee, and he added to his name, when he subscribed it to the agreement, the term "trustee, c.," he personally bound himself to the performance of the stipulations, which were contained in it. He, and not the beneficiary of the trust he held, undertook to perform the agreement by the conveyance of the land. It was his agreement, and not hers. And whatever the damages may be, which the plaintiffs are legally entitled to recover, on account of the failure to convey the land, they arose out of the breach of his contract, and consequently constitute a legal demand against him. As to this feature of the case, it is fairly within the ruling which was made in the case of Dewitt v. Walton (5 Seld., 571).
By the verdict and judgment in this action, the defendant was held to be liable in damages for the difference between the contract price of the land and its fair market value, at the time, when he failed to convey it. Whether such a legal liability was created by the circumstances proven in this action, is the important and more material point requiring consideration, in the disposition of the present appeal.
By the terms of the trust, which the defendant had been appointed to execute, he was authorized and empowered to sell all or any of the lands to which it related, with the assent of Mrs. Catherine Van Rensselaer, to be by her in writing from time to time expressed, if to her and said trustee it should seem to be discreet to make such sales. Soon after such appointment, she informed the defendant, that he need not consult her concerning the sale of any of the trust lands, but that he should confer with her husband on the subject; and whatever they agreed upon, she would give the required consent to. The defendant proceeded in that manner, and, *Page 69 
prior to making the agreement in controversy, sold and conveyed many pieces of land, in the deeds for which she united, making no objection, in any instance, to what the defendant and her husband had thought proper to be done. The agreement in suit was made with the concurrence of Mrs. Van Rensselaer's husband, and without any suspicion of any unwillingness on her part to give her assent to the conveyance provided for in the agreement. On the contrary, the defendant fully believed, that she would give her consent thereto, without delay or hesitation. He afterwards repeatedly requested her to join in the deed of the lands mentioned in the agreement to the vendee, which she always refused to do, declaring that she would not consent to any deed to her, on any terms or conditions whatever. Her reasons for not joining in the deed were of a personal nature, and her refusals were not instigated or caused by the defendant; nor was he accessory thereto. The defendant, finding it impossible to persuade her to consent to the deed he had agreed to give to the vendee named in his agreement, afterwards sold and conveyed the lands in question to another person, for a sum exceeding that which was to have been paid under the agreement with the plaintiff; and Mrs. Van Rensselaer united with him in making that conveyance of them.
From these facts, which were agreed upon at the trial, it distinctly appeared, that the defendant was aware of his inability to convey a title to this land, without the written consent of Mrs. Van Rensselaer, at the time when he entered into the agreement in question. The legal title seems to have been in the defendant as trustee, but his power to convey it depended upon her written assent to the conveyance. But from the assurance he had received from her upon this subject, and her repeated and uniform performance of that assurance, he appears to have become satisfied, at the time, when he made the contract with the plaintiff, inasmuch as it was made with the concurrence of her husband, that Mrs. Van Rensselaer would unquestionably enable him to fulfill his undertaking. This, the case shows, was fully believed and *Page 70 
expected by the defendant. And, as her reasons for withholding her assent were of a personal nature merely, without anything leading the defendant to suspect the existence of them, he had no grounds for any different belief or expectation. Under these circumstances, the defendant cannot be properly charged with such a want of care and caution in entering into the agreement with the plaintiff, as should lead to an impeachment of his good faith in the transaction. He had the express assurance of the beneficiary in the trust, that his contracts of sale should be performed by her, whenever they were made, with the assent and approbation of her husband. And that had always been previously faithfully observed and performed; which was sufficient to create the conviction, that it would be in all future similar cases. And the case shows, that such a conviction had been produced in the mind of the defendant. When he made the agreement with the plaintiff, he did so, not only believing, that it would be performed by the conveyance of the land, but having such reasons for his belief, as would ordinarily produce it in the minds of intelligent persons, acting prudently and cautiously,
The subsequent sale of the land for an advanced price, cannot have the effect of changing the defendant's relation to this transaction. For it was only made, after the defendant had found it impossible to persuade Mrs. Van Rensselaer to perform his agreement with the plaintiff. No bad faith or legal misconduct can be attributed to him, on account of what he did towards the conveyance of the legal title to the person, who finally acquired it He had no means of coercing Mrs. Van Rensselaer's written consent to a conveyance to the plaintiff, for she could only legally bind herself, under the terms of the trust, by writing, and that she absolutely refused to do. If she had so far concurred in the performance of the defendant's contract, as to have rendered the plaintiff entitled, as against her, to a specific performance of it in equity, then he would have been legally in fault for joining in a conveyance of the land to another person. But the case shows no *Page 71 
such concurrence on her part, as would have justified a resort to that proceeding.
The defendant was, therefore, not justly chargeable with any want of good faith, either in entering into the agreement with the plaintiff, or in afterwards joining in a conveyance of the land to another person. As to the latter act, when it was performed, he was not entirely a free agent. For, by the refusal of Mrs. Van Rensselaer to consent, in writing, to a conveyance to the plaintiff, and the inability of the defendant, as well as the plaintiff, to enforce a specific performance in equity of her verbal assurance, there was no mode in which the plaintiff could have acquired the title to the land. And, as he could not acquire it, the defendant was bound by the terms of the trust, whenever it appeared to be discreet to himself and his beneficiary, that a sale of it should be made, to execute the necessary conveyance for that purpose.
No good reason therefore exists for questioning the good faith of the defendant in either of these respects, but on the contrary, it was affirmatively made to appear, that his conduct was prudent and cautious, and governed by a well grounded belief, that the contract he made would be literally performed by Mrs. Van Rensselaer. And it was only after that had become impracticable, owing to no act or default on his own part, or over which he could exert any control whatsoever, that he, under the trust he had undertaken, conveyed the land to another person. He was no way in fault for making that conveyance, for even if he had positively declined to do so, it could not have secured the title to the plaintiff. In this respect, this case differs very essentially from those relied upon by the plaintiff's counsel, for in them, the vendor either voluntarily conveyed away his title, or refused to convey to the vendee, when he had the power to do so. (See Gerault v. Anderson, 2 Bibb, 540; Graham v.Hackwith, 1 A.K. Marshall, 429; Lewis v. Lee, 15 Indiana, 499; Fletcher v. Button, 6 Barb., 650; Dean v. Raseler, 1 Hilton, 420; Trull v. Granger, 4 Seld., 115.)
The only fault the defendant can be properly charged with, *Page 72 
if that can, in any legal sense, be characterized as such, is, that he too confidingly relied upon the word of the person, on whose act, his conveyance would be dependent for its validity. Upon this circumstance alone, the plaintiff's right to the damages arising out of the loss of her bargain, must therefore necessarily depend. For, in actions upon contracts for the sale and conveyance of real estate, it is well settled, that such damages can only be recovered, where the failure to convey the land contracted for, arises out of some fault or misconduct on the part of the vendor. It is not sufficient for that purpose, as it is, in contracts for the sale of personal property, that there should be a breach of the contract by a failure to convey the subject of it; but in addition to that, it is necessary, that the failure to perform shall have been produced by the misconduct or bad faith of the vendor. This rule is artificial, and peculiar in its character, and often productive of inconvenience and injustice, but it is too firmly established to admit of any question concerning its authority.
That there was no positive fault or misconduct on the part of the defendant, is clearly manifested by the circumstances under which he acted, when the contract was made. The only fault, that can be imputed to him, is that of a negative character, on account of his failure to ascertain, before he entered into the contract, whether any objection would exist concerning its performance. But it is clear, from the course of the business previously performed by him, that even a very prudent person would have hardly deemed that to be proper. For there was no apparent reason why the assurance, which the beneficiary had always previously performed, should not be equally observed in this instance. The defendant had no grounds for suspecting that it would not be; and it would have been an act evincing some degree at least of distrust, if he had endeavored to procure the special approbation of the beneficiary, when nothing indicating the impropriety of relying upon her general assurance had previously transpired. The defendant, as trustee, held the legal title of the land he contracted to convey, and was dependent upon *Page 73 
no one for his power to convey it, beyond the written assent of the beneficiary, which had been solemnly promised to him. In this respect, the case differs very materially from Hopkins v.Grazebrook (13 Eng. Com. Law, 100), where the defendant had neither possession nor title, and Robinson v. Harman (1 Exchequer, Welsby H. and G., 849), in which the defendant's title depended upon the terms of a will, that he appears never to have seen. It was suggested to him, before he entered into the contract to convey, that the will, under which he supposed he had derived title, might have vested the legal title, or the power to lease, in trustees. To which he replied, that there was nothing of the sort; that it was his property out and out, and he alone had the power of leasing it. A representation which, in itself, amounted to a fraud; as it turned out that the estate was devised to trustees, and the defendant's only interest was a right to a moiety of the rents for life. It does not, therefore, fall within the exception to the general rule, which was created by their authority.
No good ground exists for impeaching the bona fides of the defendant in this transaction. For, as long as he had the title to the land, and the right to convey it, subject only to the written assent of the person who had promised to join with him in the conveyance, under the precise state of circumstances apparently existing in this case, he cannot be charged with bad faith in entering into the contract he made for the sale. This is evident from the circumstances themselves; and it is well settled by the authorities applicable to them.
In the case of Jones v. Dyke, cited by Judge DENIO in his opinion in Conger v. Weaver (20 N.Y., 143), the defendant, as an auctioneer, had sold certain real estate under the belief that the owner had authorized him to sell it, but which turned out not to be the fact. And yet it was held that he was not liable for the damages, c., occasioned by the loss of the bargain. The same principle in substance entered into and controlled the decision of Bush v. Cole (28 N.Y., 261). For the theory of that case was, that the defendant had sold the land for less than he had been directed to sell it by the owner, *Page 74 
and he had therefore knowingly violated his instructions in agreeing to make the sale of it which he did. In the case ofWalker v. Moore (21 Eng. Com. Law, 100), it was held, that a person, who professed to sell that which he bona fide believed he could sell, though in fact he had no title, was liable only for the expenses of investigating the defective title; and this rule was applied and approved in the decision of the case ofPounsett v. Fuller (84 Eng. Com. Law, 660). There the defendant erroneously believed he had the power to convey the right he contracted to sell, though the contrary was indicated by the evidence of his title, which was held by himself. And yet, as he acted in good faith, he was exonerated from the claim made against him for the damages arising out of the loss of a valuable bargain. The court held, that "As a layman, he had a fair right to believe he had the power to sell which he professed to have, and therefore his case comes within the qualification of the rule," as expressed in Walker v. Moore (supra). The same rule was declared in Thompson v. Guthries, adm'r (9 Leigh, 101, 107). It was there held, that in all executory contracts for the conveyance of land at a future time, the established measure of damages is the purchase money. On a covenant to make a good title, where there is no fraud on the part of the vendor, and he sells believing his title to be a good one, or that it can be made so, the rule must be the same. Wilson v. Spencer (11 Leigh, 261); Allen v. Anderson (2 Bibb., 415, 16);McDonnell v. Dunlop (Hardin, 41); Bitner v. Brough
(11 Pa., 127, 129); McNair v. Compton (35 id., 23, 28); Baldwin
v. Munn (2 Wend., 400); Peters v. McKeon (4 Denio, 546), and Conger v. Weaver (supra), are, in substance, to the same effect.
In the case of Sikes v. Wild (1 Ellis, Best and Smith, 587), the precise point arose that is now under consideration, under circumstances somewhat more favorable to the claim of the plaintiff than those presented on the present occasion. After examining all the previously decided cases affecting the question, the Court of Queen's Bench held that the damages arising out of the loss of the bargain could not be recovered. *Page 75 
And the case of Sweem v. Steele (5 Clarke Iowa R., 352), is substantially, in principle, of the same import. The present case is within the sense and spirit of this principle. For it appeared, that the defendant acted in entire good faith in what he did, having the title to the land he agreed to convey, and was only prevented from conveying it by an obstacle, not only unforeseen but unsuspected, without having any reason to expect he would encounter it, and over which he had no control. If the case disclosed any ground, upon which the beneficiary or her estate could be rendered liable over to the defendant for these damages, a different disposition could be made of it, from that which is required by the authorities bearing upon it. But it does not, for her contract with him, and on the faith of which he acted, was for the sale of an interest in lands, and consequently void within the statute of frauds, because it was not reduced to writing and subscribed by her. And no such partial performance of it had taken place as, under the settled rules of courts of equity, would justify a decree for the specific performance of it. Neither does it appear, that the terms of the trust would permit the defendant to reimburse himself for the payment of such damages as are claimed in this case, if the plaintiffs were allowed to recover them.
The judgment should therefore be reversed and a new trial ordered, with costs to abide the event, unless the plaintiffs shall, within twenty days after notice of this decision, stipulate to reduce the verdict to the sum of $318.25, the amount actually paid the defendant on the contract, together with interest thereon from the thirteenth day of June, 1849. And in that event, the judgment as so modified, should be affirmed without costs of the appeal to either party.
HUNT., Ch. J. and LOTT, J., concurred with DANIELS, J., for reversal.
Judgment affirmed. *Page 76