N.E.D. Holding Co. v. McKinley

• Decision Date: 20 July 1927
• Citation: 246 N.Y. 40,157 N.E. 923
• Parties: N. E. D. HOLDING CO., Inc., v. McKINLEY et al.
• Court: New York Court of Appeals Court of Appeals

246 N.Y. 40

157 N.E. 923

N. E. D. HOLDING CO., Inc.,

v.McKINLEY et al.

Court of Appeals of New York.

July 20, 1927.

Action by the N. E. D. Holding Company, Inc., against Eugene F. McKinley and others for specific performance. From a judgment of the Appellate Division of the Supreme Court (219 App. Div. 738, 219 N. Y. S. 870), reversing an order of the Special Term denying the motion of certain defendants for judgment on the pleadings, and dismissing the complaint, plaintiff appeals.

Reversed, and order of the Trial Term affirmed.

Appeal from Supreme Court, Appellate Division, Second department.

George G. Ernst, Edward S. Greenbaum, Henry Gale, and Jonas J. Shapiro, all of New York City, for appellant.

David Tepp, of White Plains, for respondents.

CARDOZO, C. J.

By contract, dated April 4, 1925, the Young Men's Christian Association of White Plains agreed to sell certain real estate to the defendant Eugene F. McKinley for $145,800, of which $20,000 was to be paid in cash on the signing of the contract, and the residue, $125,800, in cash two years later, April 4, 1927, on the delivery of the deed. During the intervening period the seller was to retain possession, paying interest to the buyer on the amount of the deposit.

On November 21, 1925, McKinley, who held the contract not only for himself, but also for certain coadventurers, the defendants Day and others, signed a note or memorandum of resale to the plaintiff. The memorandum reads as follows:

‘Received of N. E. D. Holding Company, of White Plains, the sum of $100 as binder on the following transaction:

‘Sale by me Eugene F. McKinley, of White Plains, of a plot owned by me and briefly described as follows:

‘The Y. M. C. A. corner on Mamaroneck avenue to Martine avenue, being about 55x225.

‘Terms as follows: Price $165,000. Paid in cash herewith $100. To be paid in cash on Monday, November 23, 1925, as binder $2,500. To be paid in cash at time of signing contract $22,400. To be paid in cash on delivery of deed, by purchaser executing a mortgage to seller in the amount of $_____, to run for a term of _____ years at 6 per cent.

‘Binder to be signed Monday, 10 a. m., November 23. Contract to be signed on or before December 17, 1925, at the office of E. F. McKinley, White Plains, N. Y., at 11 a. m. Deed to be delivered on or before _____ at the office of

[Signed] Eugene F. McKinley.

‘In presence of William Barrett.

‘Purchaser to pay for drawing bond and mortgage, mortgage tax, revenue stamps on bond, and recording fee. The broker is _____, who is entitled to regular commissions.’

At the foot of this document there was signed two days later the supplemental memorandum following:

‘The within closing is hereby adjourned to November 28, 1925, or before by mutual consent.

‘November 23, 1925.

E. F. McKinley.'

The complaint alleges that the plaintiff demanded of McKinley that he enter into a formal contract in accordancewith the preliminary agreement, and that he refused to do so and gave notice he would not perform. It alleges that the defendants Day and others claim an interest in the first contract, the one between the association and McKinley. It prays for judgment that the association specifically perform its contract with McKinley, that McKinley and the other defendants specifically perform the contract with the plaintiff, and for other relief. A motion by some of the defendants for judgment on the pleadings, denied at Special Term, was granted by the Appellate Division on the ground that some of the terms of a complete agreement were absent from the writing.

[1] We cannot say as an inference of law from the mere inspection of the writing that anything of substance was left open to be agreed upon thereafter. The parties evidently thought they were bound, for they described the writing as a binder. Cf. Ellis v. Miller, 164 N. Y. 434, 438,58 N. E. 516. We are not to strain for a construction that will defeat their expectation. The price is stated in terms of money ($165,000). The presumption is that money was to be the medium of payment, and that the final payment was to be made at the delivery of the deed. The plaintiff tenders money as part of its complaint. Much is made by the defendants of the fact that the memorandum is written upon a stereotyped form which leaves a blank for the amount of a purchase-money mortgage. Since the blank was not filled, it may be rejected as surplusage if the parties so intended. Grady v. Fazzolari, 134 App. Div. 589, 119 N. Y. S. 300. Cf. Williston, Contracts, §§ 1141, 1909. Rejection becomes the easier in the light of the attendant circumstances. The entire payment was to be cash under the contract between McKinley and his own vendor, the owner of the land. The inference is natural that a cash payment was to be made under the contract of resale. The blank may be corroboration, in connection with other evidence, that some other form of payment was considered or expected. It is no evidence of itself, and surely none that is conclusive.

[2][3] The memorandum does not fail of its effect...