Opinion
05-17-1895
ROMMEL v. MASS et al.
E. Q. Keasbey, for the motion. E. B. Williamson, opposed.
Bill by August Rommel against Adolphus H. Mass and others for reformation of a deed. Application by plaintiff for injunction to restrain proceedings at law pending suit. Denied.
E. Q. Keasbey, for the motion.
E. B. Williamson, opposed.
EMERY, V. C. I must deny the application for injunction. Treating the bill as a bill to reform a deed executed and delivered by the parties, it seems to me that the bill of complaint and the complainant's affidavits present a case where, upon the facts shown by these papers alone, the court would have no right to reform the deed as prayed for. The bill prays that the deed may be reformed by excepting the land between high and low water mark from the covenant of warranty, for breach of which the suit is brought. Such reformation of a deed can only be made on the presentation of a case which shows that both parties intended and agreed that the covenant should be so limited, and that there was a mutual mistake, in that the deed was not drawn as the parties intended it should be drawn. Mistake on one side is sometimes sufficient ground to rescind a contract, but an executed contract cannot be rectified, so as to be changed by a court to another contract than that which the parties have signed, on the ground of mistake, unless it is shown to be a mistake of both parties. Mortimer v. Shortall, 2 Drury & W. 363 (Lord Sugden, 1842); Hearne v. Insurance Co., 20 Wall. 488 (Swayne, J., pages 490, 491); Henderson v. Stokes, 42 N. J. Eq. 586, 8 Atl. 718 (Vice Chancellor Bird, 1887), and cases cited.
As is clearly disclosed in this case by the complainant's bill and affidavits, the mistake of complainant in this case was not that he did not intend to execute and deliver the deed as actually drawn, but that in doing so he acted under the mistake of supposing that he had title to all the lands purporting to be conveyed by the deed. Evidently a mistake of this kind on his part, without proof of circumstances which would cast an equitable obligation on the grantees, cannot entitle the grantor to a decree rectifying the deed, as against them. With this view,—that the complainant's case, on his own bill and affidavits, fails to show a basis for relief on this ground,—I have no right, pending final decree on this bill, treated as a bill to reform, to stay an action at law on the covenants in the deed. The defendants' affidavits deny any mistake on their part, or on the part of complainant, as to including the lands in question, and show, in addition, that the deed, in the particular now complained of, substantially carries out the complainant's previous written agreement or memorandum as to the lands to be conveyed and the warranty to be made.
If, in the second place, the bill can be treated as a bill against the Fidelity Title Company, to prevent their recovery in the action at law of a demand which they would be required to repay the complainant, the fatal objections to granting the injunction at this stage of the suit are these: First. The complainant does not, either in the suit at law or by his bill, admit his liability on the covenant sued on, but shows that he has, in the suit at law, denied this liability, and that this question is one depending in the court of law, and there to be decided. This is purely a legal question, and unless this liability on the covenant is admitted here, or established by the court of law, the complainant has no basis whatever of any claim of damages against the Fidelity Company for negligence in drawing the deed so as to include this covenant sued on. Second. Supposing the complainant to be liable on the covenant, the question whether the Fidelity Company is liable to him for negligence in drawing the deed, as drawn, is a question of legal liability, as to which a court of law should first determine the right. This court cannot in the first instance, and in this suit, settle this question of the liability of the Fidelity Company for negligence in drawing the deed. The contention that the controversy as to this point may now be drawn to this court, under the jurisdiction as to equitable set-offs, and that for the purpose of effecting such set-off the pending action at law may be stayed, and both legal claims be decided here, cannot, I think, be sustained, under the decisions of this court. In Jackson v. Bell, 31 N. J. Eq. 554, Vice Chancellor Van Fleet stated the principles on which this jurisdiction as to set-off was founded, and refused to enjoin the enforcement of a judgment pending the determination at law of a legal counterclaim. His decision was affirmed by the court of errors and appeals for the reasons stated by him. 32 N. J. Eq. 411. In this case the vice chancellor declared (page 557) that, until the counterclaim there set up was established by judgment at law, the court of equity could exercise no control over it, and that the enforcement of a judgment would not, as a general rule, be stayed in order to allow the defendant at law to recover on his counterclaim. On the present application, and when no suit has been brought at law to test the validity of the complainant's claim, the court is asked to stay the plaintiff's action at law, and to adjudicate, not only upon the plaintiff's claim in that action, but also upon the legal counterclaim of the defendant at law, in order to ultimately set off one against the other. Such jurisdiction has never, I think, been exercised by courts of equity,— certainly not by preliminary injunction.
I think it should also be noticed that the claim of the grantee against the grantor for breach of covenant of warranty, and the claim by the grantor against his own agent for negligence in drawing the deed so as to include the warranty, do not seem to be claims which have a common origin, nor does one claim seem to be the natural outgrowth of the other. The Fidelity Company's connection with the covenant of warranty sued on arose, not by any contract with the complainant, but by reason of an independent contract with the complainant's grantee, with which the complainant had noconnection. The fact that the deed—or rather the form of the deed—is the origin of both claims does not form any kind of union between them for the purpose of enjoining the present suit at law, or of assuming equitable jurisdiction to decide both claims. Trotter v. Heckscher (Err. & App.; 1885) 40 N. J. Eq. 612, 4 Atl. 83 (opinion of Mr. Justice Dixon, pages 057, 658, 40 N. J. Eq., and page 83, 4 Atl.) governs the case on this point. The rule to show cause should be discharged, with costs.