Opinion
July 8, 1908.
James W. Osborne, for the appellant.
R. Burnham Moffat, for the respondent.
The plaintiff, as assignee of one Thomas C. Doremus, sues for damages for the non-fulfillment by defendant of what is alleged to be a contract by him to purchase a tract of land in Tennessee. The alleged contract is in writing, and bears date October 30, 1902. It reads as follows:
"This memorandum of an agreement this day entered into between Thomas C. Doremus and William A. Milliken, witnesseth: The said Thomas C. Doremus agrees to sell and convey, by deed in fee with general warranty to William A. Milliken seventy thousand (70,000) acres of land situate, lying and being in the Counties of Cumberland, Roane, Rhea and Bledsoe in the State of Tennessee for the sum of seven hundred thousand ($700,000) dollars, to be paid as follows: Three hundred and fifty thousand ($350,000) to be paid within thirty days from this date, and three hundred and fifty thousand ($350,000) within sixty days from this date. The said Milliken is to satisfy himself as to the title of said property by such examination as he may desire within the next thirty days."
This paper was signed and sealed by both Doremus and the defendant. At the time it was signed Doremus had no title to the property referred to, and never acquired such title, nor ever, so far as appears by any competent proof, had any contract or agreement with the owners thereof which assured his ability to carry out the above agreement on his part, although there are throughout the case references, more or less vague, to some papers in a bank or other depository which, as it seems to have been assumed, conferred some right upon him to acquire title to the lands upon some undisclosed condition or consideration. It also appears quite clearly that neither Doremus not defendant understood or expected that defendant would himself become the actual purchaser of the lands. The evidence hope and expectation was that the land could be sold to one Dotson and a firm in Washington, and both Doremus and defendant at once proceeded to endeavor to impress Dotson with the desirability of the land. Dotson, however, refused to purchase, and thereupon defendant, within thirty days after the paper had been signed, notified Doremus that he could not go on with the purchase. Thereafter Doremus and the defendant worked together for about two years in the attempt to sell the land, Doremus from time to time borrowing, or attempting to borrow, small sums of money from defendant, apparently without a suggestion of any claim that the latter was in any way indebted to said Doremus. Early in 1904 a possible purchaser appears to have been discovered, and on February first of that year Doremus gave defendant a written promise that if he should succeed in selling the property to parties with whom defendant might bring him in contact, he would pay to defendant ten per cent of the gross amount received and accepted on such sale. In March, 1904, Doremus and defendant quarrelled because defendant would not indorse a note for Doremus, and on May 16, 1906, Doremus assigned to plaintiff's intestate the claim which this action is brought to enforce, and upon which judgment has been recovered. There are several very substantial reasons why this judgment cannot stand. First. The defendant did not agree to purchase the land or to pay to Doremus any sum whatever. The so-called contract is purely unilateral, the only agreement in it being Doremus' covenant to sell upon being paid a given sum at stated times. There is no promise or agreement on defendant's part to purchase or to pay the specified price. No action can, therefore, be maintained against him for his failure to do that which he never agreed to do. ( Dorsey v. Packwood, 12 How. [U.S.] 126; L'Amoreux v. Gould, 7 N.Y. 349; Quick v. Wheeler, 78 id. 300; Barrow Steamship Co. v. Mexican Cent. R. Co., 134 id. 15; Chicago G.E.R. Co. v. Dane, 43 id. 240; Rafolovitz v. American Tobacco Co., 73 Hun, 87; Commercial Wood Cement Co. v. Northampton Portland Cement Co., 115 App. Div. 388.) The document will be searched in vain for any assumption by the defendant of the obligation to take the land or pay the price. It amounts to nothing more than an offer or option on the part of Doremus to sell the land to defendant if the latter will pay $350,000 in thirty days and a like sum in sixty days. By its terms it imposes no obligation of acceptance upon the promisee, and the fact that the defendant also signed it and took and kept a duplicate copy does not justify an implication of a promise on his part to accept the option. ( Churchward v. The Queen, L.R. 1 Q.B. 173; Justice v. Lang, 52 N.Y. 323, 329.) This objection is sufficiently raised by the denials and qualified admissions in the answer.
Second. The document, if it is to be treated and considered as a contract for the sale and purchase of land, is void both in this State, where it was made, and in Tennessee, where the land lay, because it does not specifically or with sufficient certainty describe and identify the land proposed to be conveyed. ( Johnson v. Kellogg, 7 Heisk. [Tenn.] 262; Dobson v. Litton, 5 Coldw. 616; Cooley v. Loddell, 153 N.Y. 596; Ward v. Hasbrouck, 169 id. 407.) All that is provided for is the sale of 70,000 acres of land in certain counties in Tennessee. The land is not identified in any way, not even by a declaration as to its present ownership, or by reference to an earlier deed, or by the enumeration (sought to be supplied by the complaint) of the particular grants of which the tract is composed. No court could make a decree of specific performance against Doremus, and his promise to convey would be sufficiently complied with by the conveyance of any tract or tracts of land in the counties named, comprising 70,000 acres. The blue print read in evidence, even if admissible to help out the option, of which I have great doubt ( Wright v. Weeks, 25 N.Y. 153), adds little or nothing to its definiteness. It contains neither courses, boundaries nor distances.
Third. Neither the complaint nor the proofs showed that Doremus was ever in a position to sue for damages. It is conceded that he never had a title to the land so that he could make a tender of performance, or that he did in fact make such a tender. The complaint is framed upon the theory that by refusing to go on with the purchase before the day fixed for the payment of the first installment of the price, the defendant committed what is termed an anticipatory breach of the contract, which entitled Doremus to sue at once, and that the right of action was transferred by assignment to plaintiff's intestate. The doctrine of anticipatory breach as a basis for an immediate action for damages against him who repudiates or refuses to go on with a continuous executory contract is one which, when applied at all, is applied with great caution and only in a very limited class of cases. ( Kelly v. Security Mutual Life Ins. Co., 186 N.Y. 16.) It has never, so far as we can ascertain, been applied in a case like the present. It may be that defendant's declaration that he could not or would not go on with the purchase would have justified Doremus in rescinding or withdrawing his offer to sell, but it afforded no ground for an immediate action for damages for non-performance. We are referred by the respondent to a number of cases of undoubted authority to show that the agreement to pay $350,000 in thirty days, assuming that there was such an agreement, was an independent agreement, and that Doremus might have sued at once for the first installment without tendering performance or showing his readiness to perform. The difficulty is that this is not such an action. It is not an action for the first installment of the purchase price, but an action for damages for complete non-performance on defendant's part, and it was not begun until long after the date for full performance had passed. Having waited until after the date fixed for full performance, payment and conveyance have become concurrent obligations, and to maintain an action against the vendee for non-performance the plaintiff must allege and show tender of performance on his part, or a waiver of performance on the part of the vendee, or some act by the vendee that excused non-performance by the vendor. ( Eddy v. Davis, 116 N.Y. 247; Bigler v. Morgan, 77 id. 312; Stern v. McKee, 70 App. Div. 142.) Defendant's refusal to go on with the purchase doubtless rendered it unnecessary for Doremus to make an actual tender, but it did not obviate the necessity to allege and prove his readiness to perform, or to allege and prove that by reason of some act of defendant he was unable to perform, which but for that act he would have been able to do. He has not brought himself, in any sense, within the rule. It is conceded that he could not perform or tender performance because he had no title. It is suggested, though neither allege nor proven, that he could have obtained title and thus qualified himself to perform if defendant had completed his contract. But mere suggestion is not enough. The law requires both allegation and proof. As was said in Stern v. McKee ( supra): "It is suggested that the recovery can be upheld upon the theory that Shainwald was excused from full performance by reason of the defendant's refusal to proceed. This cannot be done for the reason that there are no appropriate allegations in the complaint which would permit a recovery upon that ground. The plaintiff having predicated his right to recover on the breach of the agreement, was bound to allege and prove performance on the part of his assignor, or an excuse for non-performance, and if an excuse were relied upon, then he was bound to allege facts constituting such excuse, and in addition thereto that he was at that time ready and had the ability to perform and would have done so except for the acts of the other parties to the contract."
Fourth. The court adopted and applied the wrong measure of damages in permitting plaintiff to prove the market value of the land, and in basing the damages on the difference between the market value and the contract price. This is the proper and usual rule where the vendor actually owns the land, but it is wholly inapplicable where he has to purchase it himself in order to fulfill his contract. In such case his loss cannot exceed the difference between what it would cost him to acquire the land, and what the defendant promised to pay. It may be that, if his contract with the owner was at a price far below the market price, he could not recover the whole difference, but he certainly cannot recover more. If his contract with the owner was at a price below the market price, he would not be damaged to the extent of the difference between those prices by the defendant's refusal to complete the purchase, because that difference would be represented by the land which he presumably could sell at the market price. The true measure of damage in a case like the present, assuming an obligation on the part of defendant to purchase and ability on the part of plaintiff to put himself in a position to convey, would be the value of his bargain, and that would be the difference between what it would cost plaintiff to acquire the property and the contract price, not exceeding, however, the difference between the fair market value and the contract price. For the foregoing reasons the judgment and order denying the motion for a new trial must be reversed, and since the document relied upon imposed no obligation upon the defendant, the complaint must be dismissed, with costs in this court and in the court below.
INGRAHAM, McLAUGHLIN, CLARKE and HOUGHTON, JJ., concurred.
Judgment and order reversed and complaint dismissed, with costs in this court and in the court below.