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of a down payment and not for specific performance, should not be construed as manifestation of willingness to perform and to accept performance at the time of the trial, where, after the interposing of the answer, the government entered the World War and the resulting conditions were such as would render specific performance inequitable.

Page and Smith, JJ., dissenting.

Appeal from Special Term, New York County.

Action by Hermann M. Biggs and another against Steinway & Sons for the specific performance of a contract. From a judgment on the trial of the issues, dismissing the complaint, with costs, and requiring plaintiffs to pay to the defendant within 30 days the sum of $28,000, a down payment made by the defendant to the plaintiffs, and decreeing a sale of the premises for the payment thereof, in case payment was not made as therein required, plaintiffs appeal. Affirmed.

Argued before CLARKE, P. J., and LAUGHLIN, SMITH, PAGE, and MERRELL, JJ.

Ira A. Place, of New York City (Austen G. Fox and C. J. Beakes, both of New York City, on the brief), for appellants.

Solinger & Solinger, of New York City (Walter B. Solinger, of New York City, of counsel, and Fernando Solinger, of New York City, on the brief), for respondent.

LAUGHLIN, J. Mr. Justice Gavegan, before whom the issues were tried, wrote a well-considered opinion, properly disposing of the principal points; but, in view of the importance of the litigation and the novelty of the questions presented, we deem it necessary to add some further observations in support of the judgment.

[1] The contract between the plaintiffs and the defendant was made on the 29th of June, 1916, and thereby the plaintiffs agreed on the 1st day of August thereafter to convey to the defendant by deeds in the proper statutory short form containing the usual full covenants and warranties and free from all incumbrances, except as therein stated, the premises known as Nos. 109, 111, 113 West Fifty-Seventh street, in the borough of Manhattan, New York, in fee simple. It was expressly understood and agreed that simultaneously with the execution of the contract the defendant was entering into a contract for the purchase of the premises known as 114 West Fifty-Eighth street, and that the performance of the contract with the plaintiffs was dependent upon the simultaneous delivery of a deed to the defendant of said premises according to its contract with the owner thereof, and that if the title to any part of the premises agreed to be conveyed by the plaintiffs, or to the premises 114 West Fifty-Eighth street, should be found to be unmarketable, then the purchaser should not be obligated to take title, and the money paid on the execution of the contract should be returned to the defendant, and the contract canceled, and in the event of a defect in the plaintiffs' title, making it unmarketable, they agreed to pay to the defendant the reasonable expenses of the examination of the title, and they also agreed that the purchaser should have a lien on the premises for the repayment of the down payment. It was further provided that if, at the time for

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consummating the contract, the purchaser should not have obtained title to the premises, 114 West Fifty-Eighth street, a reasonable adjournment would be granted by the plaintiffs to enable him to obtain title to said premises. Provision was also made for a reasonable adjournment, if necessary, to enable the plaintiffs to remove tenants from any of the parcels and to satisfy mortgages thereon, it being expressly understood that possession was to be given free from occupancy at the time of the delivery of the deeds, and it was agreed that at the time of the delivery of the deeds the purchaser should execute to the plaintiffs a lease of the premises 113 West Fifty-Seventh street, then occupied as a home by one of the plaintiffs, for a term not exceeding two weeks, at a specific rental. At the time the contract was executed the plaintiffs were aware of the fact that the defendant was also negotiating for the purchase of the premises known as 112 West Fifty-Eighth street, owned by one Anderson, and that the defendant intended at once to demolish the buildings on the five parcels, and to erect thereon a single business building, 10 stories in height on FiftySeventh street and 6 stories in height on Fifty-Eighth street, and to use the building as its piano warerooms and lofts.

Upon the execution of the contract the defendant immediately employed architects to make plans for the new building, and the plans were completed and filed with the superintendent of buildings on the 3d day of August, 1916. In the meantime, and on the 25th of July, 1916, the board of estimate and apportionment, on the recommendation of a commission appointed by it on the 26th of June, 1916, adopted a building zone resolution, which took effect immediately, dividing the city into three classes of districts, viz.: (1) Resident districts; (2) business districts; (3) unrestricted districts. By that resolution the premises known as 112 and 114 West Fifty-Eighth street were embraced in a residence district, and their use for business purposes, as contemplated by the defendant, was prohibited. On the submission of the plans filed by the defendant, the superintendent of buildings, owing to the zoning resolution, refused to issue a building permit. When the parties met on August 1st, the time specified for consummating the contract, the plaintiffs tendered title, but the defendant interposed the adoption of the building zone resolution as an objection and declined to take title on that ground. At the request of the respondent, the closing was then postponed, by mutual consent, until the 31st of August. In the meantime the respondent endeavored, as already stated, to obtain authority to build on the premises as contemplated, and made further efforts to the same end, but to no avail, and on the 31st of August the respective parties maintained the same attitude as on August 1st, and negotiations terminated.

This action was commenced on the 13th of September, 1916, by service of the summons and complaint. On the 13th day of July, 1916, the defendant contracted for the purchase of the Anderson parcel, and before the time for consummating that contract arrived the zoning resolution had been adopted, and the defendant likewise refused to take title to that parcel, whereupon Anderson brought an action for specific performance. The defendant answered, setting forth the ma

terial facts, to which reference has been made, and the purposes for which the premises were to be purchased, and the adoption of the zoning resolution before the time for the consummation of the contract, and counterclaimed for the down payment. The plaintiff demurred to the defense and counterclaim, and moved for judgment on the pleadings, and the motion was granted at Special Term, but on appeal this court reversed (178 App. Div. 507, 165 N. Y. Supp. 608), and held that the defendant was not obliged to take the title, and that its obligation in that regard did not depend upon the validity of the zoning resolution, for it was not obliged to take the risk of the validity thereof, and our decision was affirmed by the Court of Appeals (221 N. Y. 639, 117 N. E. 575). That decision is applicable and controlling here, and it necessarily follows that the defendant was not obliged to take the title tendered, either on the 1st or the 31st of August, 1916.

There is no basis, in my opinion, for attempting to distinguish the Anderson Case on the theory that this court and the Court of Appeals failed to appreciate the fact that the contract, as in the case at bar, did not specify the purpose for which the purchaser intended to use the premises, and that this court, in reversing the Special Term, and the Court of Appeals, in affirming our order, erroneously supposed that the act of the Legislature conferring authority on the board of estimate and apportionment to adopt the building zoning resolution, was enacted after the contract was made. The contract, in that case, was made on the 13th of July and the zoning resolution was adopted on the 25th of the same month. Of course, this court and the Court of Appeals realized and understood that the Legislature was not in session at that time and did not confer the power to adopt the zoning resolution after the contract was made. The failure of this court and of the Court of Appeals to allude to the fact that the authority to adopt the zoning resolution had been conferred by the Legislature before the contract was made does not warrant the inference that such fact was overlooked, particularly since it appeared by the record that the defense in the Anderson Case, to which the demurrer was interposed, expressly pleaded the statute conferring authority upon the board of estimate and apportionment to adept the zoning resolution and the date of the enactment thereof, and the point was made and fully argued that, the authority to adopt the zoning resolution having been conferred before the contract was made, the parties were chargeable with notice that it might be exercised. The point, therefore, could not have been overlooked by either court. Moreover, in the Anderson Case, the facts with respect to which the defendant intended to use the premises were pleaded precisely as they were pleaded and proved here, not that the use to which the premises were to be put by the purchaser was expressly stipulated in the contract, but merely that both parties so understood. In such circumstances, to refuse to accord full authority to the decision in the Anderson Case as a controlling precedent here would, in my judgment, be a serious departure from our method of administering justice and render precedents of but little value. The present appeal, however, is after a trial, and

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other points not fully considered in the decision in the Anderson Case, are presented.

It is alleged in the complaint that the plaintiffs and the owner of the premises 114 West Fifty-Eighth street had good and marketable titles and duly tendered deeds in accordance with their contracts on the 1st day of August, 1916, and demanded payment of the balance of the purchase price, and renewed the tenders and demands on the adjourned day, and that the plaintiffs had been put to great expense, in vacating possession of the premises, in satisfying mortgages thereon before their due date, and in obtaining another place of residence, to enable them to perform the contract, and cannot be restored to their former position, and specific performance of the contract was demanded. The defendant interposed an answer on the 27th of September, 1916, putting in issue some of the material allegations of the complaint and alleging for a defense and counterclaim that it was desirous of purchasing the said five parcels for the purpose of demolishing the buildings on the premises and erecting on the entire plot a factory building as already stated, which facts were known to the plaintiffs, and alleging the other material facts with respect to the adoption of the zoning resolution forbidding the erection of the structure contemplated on two of the parcels, and that the then owner of the premises 114 West Fifty-Eighth street, with whom defendant contracted for the purchase thereof was unable to perform the contract on account of the zoning resolution, and that the defendant was ready. on August 1st, and was still ready when the answer was interposed, to perform the contract on its part, and it prayed for judgment dismissing the complaint, and for a sale of the property under its lien for the down payment, and for the repayment thereof. On the 27th of September, 1916, the defendant served an amended answer, in substance to the same general effect, but alleging the facts more fully. The plaintiffs, by a reply and an amended reply, put in issue the material facts alleged in the defense and counterclaim, and alleged that the zone resolution was void, and, if specific performance was not decreed, they demanded judgment for their damages. The issues were not brought on for trial until the 24th of October, 1918.

[2] The learned counsel for the appellants contends that, even though the Anderson Case precludes a judgment in favor of his clients for specific performance, the defendant should, in any event, be compelled to reimburse his clients for their loss sustained in preparing to perform the contract, consisting of bonuses paid to tenants for moving, bonuses paid to mortgagees for accepting payment before the debts secured thereby were due, and the liability incurred by one of the plaintiffs in renting a house to occupy on removing from one of the parcels. Although no facts analogous to these were presented for adjudication in the Anderson Case, that decision necessarily precludes a recovery by the plaintiffs of any of these items. If, as held in the Anderson Case, the title tendered was not marketable, and the defendant was not obliged to accept it, I know of no legal or equitable rule or principle under which the defendant should be obliged to reimburse the plaintiffs for any loss they sustained by the prepa

rations they made to perform the contract which they finally were unable to perform. It appears, however, that on the 12th day of July, 1918, and before the trial, the zoning resolution was so amended as to exclude there from the parcels on Fifty-Eighth street, so that thereafter there was no prohibition against the erection on the five parcels of a building such as the defendant contemplated erecting thereon at the time the contract was made, and intended to erect thereon immediately after taking title. The plaintiff also proved the adoption of a prior resolution by the board of estimate and apportionment on the 23d of March, 1917, amending the zoning resolution as follows:

"(c) Permit the extension of an existing or proposed building into a more restricted district under such conditions as will safeguard the character of the more restricted district."

On the 12th day of September, 1918, the plaintiffs served a supplemental reply, in which they pleaded the amendment of the zoning resolution adopted on the 23d of March, 1917, partly removing the restriction, and the amendment of July 12, 1918, wholly removing it. It was, however, neither pleaded nor proved that, after the adoption or either of these resolutions amending the zoning resolution, the plaintiffs made a further tender of performance of their contract based thereon, and there is no evidence that either amendment was drawn to the attention of the defendant until the service of the supplemental reply. The first amendment of the zoning resolution, adopted on the 23d of March, 1917, did not, I think, materially change the status of the parties, for it did not follow therefrom that the building the defendant contemplated erecting would have been permitted thereunder, and conditions might have been exacted for safeguarding the character of the restricted district which would have materially affected the defendant's plans and purposes. The real point presented by the supplemental reply and the evidence received thereunder is as to whether, in view of the fact that the restriction had been wholly removed at the time of the trial, which occurred over two years after the time defendant was to receive title, the court should have awarded specific performance, or should have required that the defendant, as a condition of not having a decree of specific performance rendered against it, reimburse the plaintiffs for the losses they incurred in the particulars specified.

The plaintiffs showed that, acting pursuant to the contract, which required them to deliver the premises unoccupied, they expended prior to the 1st of August, 1916, the day on which the contract was to be consummated, $7,533.32 in securing the surrender of leases and in moving and storing the goods of one of the plaintiffs, and that one of the plaintiffs rented a house known as 39 West Fifty-Sixth street, for his residence for the term of five years at an annual rental of $7,000, and that they were obligated to pay the sum of $1,005.42 to obtain discharges of mortgages, in addition to the payment of the principal and interest, and that they became obligated to pay as broker's commissions on the sale the sum of $2,800, and on account of these items the plaintiffs claimed a loss of $18,338.64. The plaintiffs also claim that the defendant agreed to pay them considerably more

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