In Cagger v. Lansing (supra) it was held that a delivery in escrow did not bind the purchaser although he verbally promised to perform the condition.Summary of this case from Farago v. Burke
Argued October 27, 1870
Decided February 7, 1871
Lyman Tremain and Anson Bingham, for the appellant
Samuel Hand, for the respondent.
The contract between the plaintiff's intestate, and the defendant was for the sale, by the former to the latter, of an interest in land, and was by parol, and consequently void by section 8, volume 2 of the Revised Statutes, 135. Payment by the defendant to the intestate of a part of the purchase-money, did not take the contract out of the statute so as to enable the intestate, or his representatives, to maintain an action thereon for the recovery of the balance of the purchase-money agreed to be paid for the land. ( Van Alstyne v. Wimple, 5 Cowen, 162; Baldwin v. Palmer, 10 N.Y., 232.) Payment of this purchase-money by the defendant to the intestate did not make this a valid contract against the former. The other ground, upon which it is claimed by the counsel for the respondent that the contract is valid, is the fact that a deed purporting to convey the interest of the intestate in the land to the defendant was executed by the former, and, by agreement of the parties, was at the time placed in the hands of, or delivered to, a third person, to be by the latter delivered to the defendant, upon payment by him, within a few days, of the sum of $1,000, the balance of the purchase-money, which payment the defendant promised to make. This clearly was a delivery of the deed to the third person, to be delivered to the defendant as the deed of the intestate upon performance by the defendant subsequently of the condition, that is, of paying the money according to the agreement. This was a delivery by the intestate as an escrow, only, had it been made pursuant to a valid contract for the sale of the land. ( Jackson v. Catlin, 2 Johns., 247.) Until performance by the defendant of the condition, no title passed from the intestate to him by virtue of the deed. ( Jackson v. Catlin, supra; Thurman v. Booth, 21 Wend., 267; Smith v. South Royalton Bank, 32 Vermont, 341.) This furnishes a perfect answer to the position of the respondent's counsel, that the recovery in this case may be sustained upon the ground that it was for lands sold and conveyed by the intestate to the defendant, as no lands nor any interest therein have been sold and conveyed by the latter to the former. The law, as insisted by the counsel for respondent, that the purchase-money agreed by parol to be paid for lands conveyed may be recovered by action, is shown by an unbroken current of authority in this State, from Shepherd v. Little (14 Johns., 210), to Hamilton v. Gridley, decided by this Court at the present term. But the facts fail to bring this case within the rule, there having been no conveyance to the defendant. The counsel for the respondent insists that the deed executed by the intestate and delivered in escrow is a contract for the sale of the land executed by the intestate. This position cannot be sustained. The deed purports to be a conveyance of all the intestate's interest in the premises for a consideration therein expressed of $1,000, but is wholly silent as to the terms of the contract pursuant to which it was made. If delivered to and accepted by the defendant, it would have operated as a conveyance, but it would be resorted to in vain to find evidence of the contract pursuant to which it had been delivered, as it contains no recitals of any agreement or other reference thereto. No one will contend that a contract for the sale of land, executed by the vendor, is binding upon the purchaser unless the contract is delivered to and accepted by the purchaser as a valid subsisting contract. A delivery in escrow cannot bind the purchaser, although he verbally promises to perform the condition. Until performance and acceptance by the purchaser, he is at liberty to abandon the contract. It is said that this must be regarded as an executed contract by the intestate for the reason that he had done all required on his part, and that all that remained to consummate it, as such, was performance by the defendant. The answer to this is, that what the intestate did, did not constitute a transfer of his title to the defendant; and whether it would result in such transfer depended entirely upon the performance of the condition by him. This never having been performed, and the defendant refusing to perform it, all the acts of the intestate became nugatory. The deed became wholly inoperative, and the rights of the parties the same as though nothing had been done. It was said by the Supreme Court, that it was the defendant's own wrong that the money was not paid; but this may be said in every case where a party fails to perform a contract void by the statute of frauds. The position of the defendant is: true I have not paid the money, but the title has not been conveyed to me, nor has there been any legal contract within the statute for such conveyance. Again it is said by the Court that the defendant may be regarded as estopped from setting up the invalidity of the contract. I can see nothing in the case sustaining this position. He received nothing whatever under it. True, there was some slight evidence that he received possession of the farm in consequence of it, but it is manifest that this view had no consideration upon the trial, the defendant offered to prove that he was, at the time, and for years before had been, in possession of the farm, and this evidence was rejected as immaterial. Besides, the taking possession would not have estopped him in a court of law from availing himself of the statute, as a defence. This, if true, together with other acts of part performance, might have been held sufficient for a court of equity to enforce specific performance. The court erred in denying the defendant's motion for a nonsuit, upon the ground that the contract being by parol, was void by the statute of frauds. It is unnecessary to examine the other exceptions insisted upon by the appellant's counsel. The judgment appealed from must be reversed, and a new trial ordered, costs to abide event.
CHURCH, Ch. J., and GROVER, PECKHAM and RAPALLO, JJ., concur; ALLEN and FOLGER, JJ., did not vote; ANDREWS, J., absent.