Levine v. Lafayette Bldg. Corp.
| Decision Date | 03 February 1930 |
| Docket Number | No. 117.,117. |
| Citation | 148 A. 772 |
| Parties | LEVINE v. LAFAYETTE BLDG. CORPORATION. |
| Court | New Jersey Supreme Court |
(Syllabus by the Court.)
Appeal from Court of Chancery.
Suit by David L. Levine against the Lafayette Building Corporation. From an adverse decree (142 A. 441), defendant appeals. Reversed and remanded, with directions.
William J. Morrison, Jr., of Hackensack, for appellant.
Merritt Lane, of Newark, for respondent.
As we read the so-called "agreement of sale," which is set out substantially in full in the opinion of the Vice Chancellor, 142 A. 441, ubi supra, it is on its face incomplete, and on its face it contemplates a "formal contract," which naturally would settle certain terms not stipulated in the existing paper; noticeably, the details of the first mortgage, subject to which the conveyance is to be made (except the term of five years which is stated in the paper) and also of the second mortgage. Assuming that the offer of cash in lieu of the latter would obviate the difficulty in that regard, the first mortgage remains unsettled.
There was no first mortgage in existence when this paper was signed, as the Lafayette Corporation had no title, but only a contract of sale. They did have title when the decree under review was made, and had executed a purchase-money mortgage for $70,000, payable in installments, and had actually paid off some $15,000 of the principal thereon.
The Court of Chancery, starting with what we consider a false premise (i. e., that the paper could be regarded as a complete contract, even though preliminary and contemplating a formal contract), proceeded, on the theory of the line of cases typified by Luczak v. Mariove, 92 N. J. Eq. 377, 112 A. 494, affirmed 93 N. J. Eq. 501, 116 A. 925, to provide for the change of the installment mortgage into a straight mortgage at 6 per cent. to run five years from the date of passing title, and an additional mortgage to cover the $15,000 paid off, but without any provision as to due date of interest, or rights to call principal for default in the interest, taxes, and the like, usual in such cases.
Holding, as we do, that the paper is on its face incomplete, and contemplates later completion by treaty and the execution of a contract containing the essential omitted terms, the whole structure of the decree falls. Venino v. Maegele, 99 N. J. Eq. 183, 131 A. 895, affirmed 100 N. J. Eq. 357, 134 A. 920.
With respect to the leading case of Wharton v....
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Panco v. Rogers
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...36, 115 A. 69, and adopted in Levine v. Lafayette Building Corp., 103 N.J.Eq. 121, 137, 142 A. 441, reversed on other grounds, 105 N.J.Eq. 532, 148 A. 772. Swedish-American Nat. Bank v. Merz, Sup., 179 N.Y.S. 600; Morris v. Ballard, 56 App.D.C. 383, 16 F.2d 175, 49 A.L.R. 1461. I am not inc......
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