Yeskel v. Gross

Citation144 A. 312
Decision Date16 January 1929
Docket NumberNo. 79.,79.
PartiesYESKEL et al. v. GROSS et al.
CourtUnited States State Supreme Court (New Jersey)

Syllabus by the Court.

Appeal from Circuit Court, Essex County.

Action by William Yeskel and another, partners trading as Yeskel Supply Company, against Samuel Gross and other. Judgment for plaintiffs, and defendants appeal. Affirmed.

Argued May term, 1928, before GUMMERE, C. J., and PARKER and KATZENBACH, JJ.

Grosman & Grosman, of Newark, for appellants.

Philip J. Schotland, of Newark, for respondents.

KATZENBACH, J. This is an appeal from a judgment of the Essex county circuit court. The judgment is for $3,041.22, and represents the amount of a vendee's deposit and search fees in a real estate transaction. The case was submitted to the trial court on the pleadings and an agreed state of facts. The trial court directed that a judgment be entered in favor of the plaintiffs. From this judgment the defendants below have appealed.

On October 22, 1924, Samuel Gross and Passie Gross entered into an agreement with William Yeskel and Samuel Yeskel, partners trading as Yeskel Supply Company, to sell a property to them located in the city of Newark and known as the "Trefz Brewery" for the sum of $85,000. The purchasers paid down $2,500. When the time came for the delivery of the deed the sellers inserted in the deed a covenant which was to run with the land that the premises were not to be used as a brewery or for the manufacture of wines, beers, spirituous liquor, or malt beverages known as near beer. The purchasers rejected the deed because the agreement of sale did not provide that such a covenant should be inserted in the deed. The vendors then filed a bill in the Court of Chancery praying for the reformation of the agreement and the specific performance thereof. The Court of Chancery dismissed this bill. 98 N. J. Eq. 64,130 A. 546. The decree of dismissal was affirmed by the Court of Errors and Appeals. 100 N. J. Eq. 293, 134 A. 737. The Grosses then refused to pay the Yeskels the deposit money and the expenses incurred by them for searches and a survey. The present action was instituted to recover the deposit, search fees, and cost of survey.

The only ground of appeal specifically stated in the notice of appeal is the direction of a verdict in favor of the plaintiffs and the refusal to direct a verdict in favor of the defendants. Passing the question as to whether under this ground of appeal the defendants-appellants can argue the points advanced in the circuit court for the direction of a verdict in their favor, we will consider these points as if they had been stated in the notice of appeal as grounds upon which the appellants rely. The first is that the present action is based on a contract declared nonexistent by the Court of Errors and Appeals, and consequently the suit, if maintainable at all, should have been for money had and received. Assuming that the Court of Errors and Appeals declared the contract nonexistent, this does not bar the recovery of money paid under the contract. The suit is not one for a breach of the contract, but one arising because of the action of the appellants in refusing to return the money paid under the contract and to pay expenses arising from the respondents' efforts to carry out the contract. It is in effect a suit for money had and received. Such an action has been approved in Kurtz v. Busch, 128 A. 552, 3 N. J. Misc. R. 389 (not officially reported).

The second contention of the appellants is that the respondents are barred from maintaining the present action at law because they should have filed a counterclaim in the chancery action for the return of the deposit and the cost of searches and survey. This contention we deem without merit. The statute of set-offs (vol. 4, C. S. 1910, p. 4836) applies only to cases of mutual indebtedness and does not apply to a suit in equity for the reformation of a contract. The respondents' claim was at the time of the filing of the bill in chancery in part (search fees and...

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