Gluck v. Rynda Dev. Co.

• Decision Date: 22 July 1926
• Citation: 134 A. 363
• Parties: GLUCK et al. v. RYNDA DEVELOPMENT CO. et al.
• Court: New Jersey Court of Chancery

134 A. 363

GLUCK et al.

v. RYNDA DEVELOPMENT CO. et al.

Court of Chancery of New Jersey.

July 22, 1926.

Bill for specific performance by Amelia R. Gluck and husband against the Ryuda Development Company and others. Defendant Arlington Realty Company filed a counterclaim and petition for mandatory injunction. Decree for defendants in accordance with opinion. Complainants' motion to strike out petition of defendant Arlington Realty Company denied.

See, also, 97 N. J. Eq. 72, 127 A. 335; 130 A. 809; 134 A. 370.

Michael J. Tansey, of Newark, for complainants.

Jacob Hauptman, of Newark, for Rynda Development Co., Abraham Hauptman, Jacob Hauptman, and J. Lewis Fiacre.

Samuel D. Williams, of Newark, for Dime Savings Bank.

Thomas E. Fitzsimmons, of Newark, for Arlington Realty Co.

Frank Hancock Hennessy, of New York City, for Franklin Society for Home Building & Savings, and pro se.

BERRY, Vice Chancellor (orally). I will dispose of this matter now. I have allowed the fullest latitude in the trial of this cause, because I thought it best to have a complete record of the whole transaction, so that there will be no question hereafter as to the basis of this decision.

This bill seeks the specific performance of a contract for the sale of land, entered into between the defendant Rynda Development Company as vendor and Chemtec Company as vendee. The complainant Amelia R. Gluck is the assignee of the Chemtec Company. The complainant Maurice B. Gluck is her husband, and, I believe, the real party in interest. The agreement was dated May 1, 1922, and provided for the sale and purchase of a lot of land 60 feet in front by 140 feet in depth, located at South Orange, N. J., known and designated as lot 31. on map of Rynda Development Company. The purchase price of the lot was $2,340, of which $100 in cash was paid on the date of the agreement, and the contract provided for the payment of $780 in cash on the day of settlement and the balance of $1,400 by the execution and delivery to the Rynda Development Company of a mortgage, payable one-third in one year and the balance at the end of the second year, together with interest at 6 per cent., and which mortgage was to be subject to a proposed first mortgage in an amount not exceeding 80 per cent. of the cost of a house to be erected on the lot. It was stipulated in the agreement that the purchaser was to be let into possession for the purpose of constructing a dwelling. The date fixed for final settlement under the contract was August 1, 1922, but the date of settlement was continued from time to time until some time in December, 1922. The exact date to which it was continued is a little uncertain, as neither party agrees to the particular date on which settlement was to be finally had, but, as I look at this case, it does not make such difference whether it was December 21st or December 26th. The complainant Maurice B. Gluck was the president of the Chemtec Company, the vendee under the agreement of sale. The Chemtec Company entered into possession and began the construction of a building, but became financially involved; mechanic's lien suits were instituted and prosecuted to final judgment, and the defendant Arlington Realty Company became the purchaser of the property at sheriff's sale held under an execution issued on the mechanic's lien judgment, and received a deed from the sheriff of Essex county. The complainants allege tender of performance by them and refusal of the defendant Rynda Development Company to perform. Complainants also allege the delivery of a deed by the defendant Rynda Development Company to them, redelivery by the complainants to this defendant and unlawful retention of that deed by this defendant. Some phases of this controversy have already been before this court in at least two suits in which three opinions were filed by Vice Chancellor Baekes. Arlington Realty Co. v. Gluck, 97 N. J. Eq. 72, 127 A. 335; Id., 130 A.809; Rynda Development Co. v. Gluck, 134 A. 370. The files in these cases have been produced here in court to-day, and are respectively docket 54, p. 565, and docket 56, p. 535. and some phase of this matter has also been before the Essex county circuit court in various mechanics' lien suits, and in particular one brought by the complainant Maurice B. Gluck against the complainant Amelia R. Gluck, the defendant Rynda Development Company and others, and which suit was dismissed by Judge Dungan for failure to prosecute within the year. This judgment was affirmed by the Court of Errors and Appeals on Judge Dungan's opinion in May of last year, and the report of that case will be found in 129 A. 130.

The purchase price stipulated in the agreement was never paid by the vendee or its assignee. The only payments on account of the purchase price shown to have been made are the payment of $160 on the execution of the contract, and the payment of $400 by the Chemtec Company by virtue of an assignment of certain other contracts by that company to the defendant Rynda Development Company, and for which this defendant gave the Chemtec Company a credit of that amount. Complainant Gluck contends that the $1,400 mortgage referred to was executed and tendered with the purchase price of $780 in cash, and that that tender was made to the Rynda Development Company on or about November 25th. This is denied by the Rynda Development Company's officers. I find as a fact that no such tender was ever made. The reasons for my finding against Mr. Gluck on this point will appear later. Some time in November, 1922, the complainants had arranged for a loan from the defendant Franklin Society for Home Building & Savings, with the proceeds of which it was intended to complete the purchase of the lot in question and also to complete the buildings. In order to facilitate the consummation of this loan and the settlement, the defendant Rynda Development Company delivered to the defendant Hennessy, in escrow, a deed for the lot in question, duly executed by the Rynda Development Company, which was to have been delivered to the complainant Amelia R. Gluck only upon completion of the whole transaction and the payment of the balance of the purchase price according to the terms of the agreement. By subterfuge, the complainant Maurice B. Gluck obtained possession of this deed from a representative of the defendant Rynda Development Company, to whom it was intrusted for delivery to Mr. Hennessy, had a photostatic copy thereof made, and then returned the deed to this representative or induced the representative to have a copy made himself; but in the view I take of the matter, it does not make any difference, in the legal effect, which of these statements is true. Some time thereafter the complainants executed to one Frieda Horn, a sister of Mr. Gluck, a mortgage on the premises in question for $850, and attached this photostatic copy of the deed to the mortgage and recorded the mortgage with the copy of the deed attached in the office of the Essex county register of deeds. And prior to this, Mr. Gluck had attempted to have the photostatic copy recorded as a deed, but this was refused by the register of deeds, and Gluck left the register's office vowing that he would get the copy of the deed on record in spite of such refusal. The arrangement with the defendant Franklin Company whereby the complainant Amelia R. Gluck was to obtain a loan from that company was never consummated, and the deed which had been delivered to Mr. Hennessy in escrow was returned to the Rynda Development Company and destroyed. The mechanic's lien suit and sheriff's sale at which the defendant Arlington Realty Company became the purchaser followed. The Arlington Realty Company entered into possession of the premises over the protest of Mrs. Gluck, completed the building, and thereafter executed a mortgage for $S,000 to the defendant Dime Savings Institution. The Arlington Company then filed its bill to quiet title to the land. This bill was dismissed when it appeared at the trial that the complainant was not in peaceable possession, its possession being disputed by Mrs. Gluck, and actual peaceable possession being the jurisdictional requirement of the statute. It was held in that suit, however, that the deed, photostatic copy of which was made and recorded by the complainant Maurice B. Gluck, was never delivered, and that the copy was a fraud. The bill was dismissed without prejudice, with leave to the complainants to present a properly drawn bill charging that the Glucks claimed title under the deed the photostatic copy of which was on record, and that that record constituted a cloud on the title, and praying that the original and photostatic copy of the deed be declared null and void, and indicating that under such circumstances relief would be granted. Subsequently the Arlington Realty Company did file such a bill, but it also was dismissed because in that suit it was shown from the record of the mechanic's lien suit that the issuing of the summons was not indorsed on the lien claim as the statute requires, and consequently the lien was discharged, and, as the judgment was, therefore, a nullity, no title passed by the sheriff's deed. In that suit Vice Chancellor Backes, in reciting the facts found by him, said (130 A. 809):

"In the meanwhile the Chemtec Company transferred its contract to Amelia R. Gluck, and the Rynda Development Company arranged to convey the land to her. Mrs. Gluck negotiated with a New York concern for a mortgage; the time was fixed for the passing of title at the office of the lender's* attorney in New York, and the deed was left with the attorney to be delivered on payment of the balance of the purchase money. The mortgage loan was not effected, the purchase price was not paid, and the deed was surrendered by the attorney to the Rynda Company. Before delivering the deed to the New York attorney Maurice B. Gluck, Mrs. Gluck's husband, a New York lawyer, who represented...