Droutman v. E. M. & L. Garage, Inc.

• Decision Date: 20 May 1941
• Docket Number: No. 222.,222.
• Citation: 20 A.2d 75,129 N.J.Eq. 545
• Parties: DROUTMAN v. E. M. & L. GARAGE, Inc. et al.
• Court: New Jersey Supreme Court

20 A.2d 75

129 N.J.Eq. 545

DROUTMAN

v. E. M. & L. GARAGE, Inc. et al.

No. 222.

Court of Errors and Appeals of New Jersey.

May 20, 1941.

Syllabus by the Court.

1. It may be considered a settled rule in this State that the exceptional circumstances, in which parol engagements may be effective to compel the owner of real estate to forego the benefits of his legal title, are embraced in three situations: (1) A parol contract for the sale of real estate which has been part performed by delivery of possession. (2) Actual, positive fraud, as distinguished from moral wrong. (3) Where the parol promise is admitted in the answer and the benefit of the statute is not at the same time claimed.

2. No case within any of the above situations being exhibited either by the bill of complaint in this case or by supporting affidavit for a preliminary injunction, injunctive restraint was properly denied and the bill properly dismissed.

HEHER, Justice, dissenting.

Appeal from Court of Chancery; Kays, Vice Chancellor.

Suit by Joseph Droutman against the E. M. & L. Garage, Incorporated, and others, for a decree enjoining the erection of a gasoline station on defendants' land. From an order dissolving an ad interim restraint, granting a motion to strike the bill, and dismissing the bill, 129 N.J.Eq. 1, 19 A.2d 25, the complainant appeals.

Decree affirmed.

Archie Elkins, of Jersey City, for appellant.

Milton Rosenkranz, of Jersey City, for respondents.

PARKER, Justice.

Upon the filing of the bill, there was an order for ad interim restraint, and to show cause why such restraint should not be continued. Defendants gave notice of motion to strike the bill of complaint, which under present practice is substituted for a demurrer to the bill. Both matters were heard together, and the court ordered the restraint dissolved, motion to strike the bill granted, and the bill dismissed. The complainant appeals.

The important questions in the case are whether the statute of frauds was applicable to the situation, and if so, whether it was available to respondents on the record.

The facts are adequately stated in the opinion filed by the learned Vice Chancellor, ubi supra. That the agreement relied on by complainant was not in writing, is clear and is not denied. That it would restrict an ordinarily legitimate use of real property, if enforced, is equally clear. Appellant relies on decisions in Connecticut and New York as supporting the proposition that "agreements restricting the use of land, although made by parol, are enforceable and do not come within the statute of frauds," but no such rule obtains in this State. Our law on this subject was clearly expounded in the Chancery case of Radey v. Parr, 108 N.J.Eq. 27, 153 A. 628, decided by Vice Chancellor Learning, one of our ablest Vice Chancellors. In that case the question was whether an oral agreement by the owner of a tract of land with purchasers of a part thereof that the tract was to be developed and maintained as exclusively residential, would be enforced for the purpose of preventing the erection or operation of a factory on any part of the tract.

On the filing of the bill, there was an order to show cause for restraint, and the argument was on the return of that order to show cause. In that posture of the case an injunction pendente lite was denied. (108 N.J.Eq. at page 33, 153 A. 628, at page 630). The opinion states three situations, and three only, "in which parol evidence may be...