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(182 N.Y.S.)

than the market value of their property at the time the contract was made. The contract price was $280,000. One expert called by the plaintiffs testified that the market value at that time was only $200,000, and another testified that it was $208,000 or $210,000. An expert called by the defendant testified that the market value when the contract was made was $325,033.22, and that its value at the time of the trial was less. On this evidence the plaintiffs claim that the favorable contract they entered into with the defendant was worth upwards of $80,000 more than the market value of the premises they agreed to convey.

On the other hand, the defendant showed that it was not purchasing for investment or speculative purposes, but solely for the purpose of erecting said building and conducting its business therein; that after making the contracts for the purchase of the parcels, and before it was to take title, it entered into a contract with the Farmers' Loan & Trust Company for a loan of $350,000 to be secured by a mortgage on the five parcels and to run for five years, with interest at 5 per cent. during the course of the construction of the building, and thereafter with interest at 412 per cent., and that the loan was accepted subject to the approval of the Farmers' Loan & Trust Company of the plans; that in the meantime, and before the trial, building enterprises were seriously restricted by lawful regulations incident to the war, and the cost of building construction had greatly increased, and that the average increase thereof was approximately 60 per cent. above the cost at the time the defendant was to take title, and that it could no longer obtain the loan from the Farmers' Loan & Trust Company, and that the additional cost of obtaining such a loan at the time of the trial would have been approximately $20,000.

[3-5] No claim was made on the trial that this evidence presented by the defendant in answer to the evidence offered by plaintiffs under the supplemental reply was not admissible, because not pleaded. If, therefore, it should have been pleaded, it is too late now to raise the point. A reply is the last pleading contemplated by the Code of Civil Procedure (section 514), and any new matter therein is necessarily deemed denied, and subject to any available defense on the part of the defendant. Of course, if the plaintiff, instead of serving a supplemental reply, had obtained leave and filed a supplemental complaint, showing that pending the action the premises had been excepted from the zoning resolution, then it would have been necessary for the defendant, if it wished to claim that circumstances had so changed that it would be inequitable to require it to take title, to plead the material facts by an amended answer; but since the plaintiffs saw fit to present this issue with respect to their ability to perform, arising by virtue of the rescission of the zoning resolution in so far as it affected the premises in question, by a supplemental reply only, the facts proved by the defendant showing that it would have been inequitable to require it to take title at the time of the trial, were clearly admissib.c. In fact, the record shows that the plaintiffs stipulated that they interposed no objection to this evidence on the ground that it was not admissible under the pleadings.

[6, 7] I am of the opinion that this evidence neither required, nor would it warrant, a decree for specific performance. The defendant having been justified in rejecting title at the time title was tendered, the question is whether the court could or should make it take title upwards of two years thereafter, when the restriction had been removed. The learned counsel for the appellant relies on the general rule that, if the title is good at the time of the trial, compensation may be made to the purchaser for any injury resulting to him from the delay and specific performance may be decreed. Clute v. Robison, 2 Johns. 595, 614; Jenkins v. Fahey, 73 N. Y. 355; Haberman v. Baker, 128 N. Y. 253, 28 N. E. 370, 13 L. R. A. 611; Haffey v. Lynch, 143 N. Y. 241, 38 N. E. 298. But that general rule is subject to an exception recognized in Haffey v. Lynch, supra, and in Schmidt v. Reed, 132 N. Y. 109, 30 N. E. 373, and by Chief Justice Marshall in Garnett v. Macon et al., 2 Brock. 185, Fed. Cas. No. 5,245, that it does not apply where there has been a material change in the condition of the parties or of the premises, and it would be inequitable to grant the decree. If the action had been brought to trial prior to the removal of the restriction, the plaintiff would not have been entitled to the decree, and when the restriction had been removed the circumstances had materially changed, both with respect to the availability of money and the cost of material and construction in consequence of our having entered into the World War. This is not like a case of a defect in title which it is within the power of the owner to remove upon attention being drawn thereto, and which may be removed in a comparatively short time. See Higgins v. Eagleton, 155 N. Y. 466, 50 N. E. 287. Here it was not within the power of the owners to remove the obstacle. They had no cause of action for specific performance when the action was begun, and I think they acquired none by the amendment of the zoning resolution nearly two years thereafter.

The pivotal point, as it seems to me, is: Would the defendant have made the contract at the time the restriction was removed or at the time of the trial? If conditions had remained the same, the court might, perhaps, properly say that there is no good reason why it should. not have made it at the time the title became marketable, as well as before; but the changed conditions so materially affected the defendant's plans and purpose that it cannot, or at least should not, be held that it should have been compelled to take title at the time of the trial. The contract did not expressly declare that time was of its essence, and the plaintiffs objected to having it so provided therein; but they agreed to convey a marketable title on August 1, 1916, and that, if they should be unable so to do, the contract should be canceled, and that they would, in that event, repay to the defendant the down payment made by it. It might be within the province of the court to enforce specific performance of the contract, if the restriction had been removed within a reasonable time after August 1st, and before conditions had materially changed to the prejudice of the purchaser; but here the provisions of the contract with respect to delivery of possession free from occupancy show that time was substantially of the

(182 N.Y.S.)

essence of the contract, and I think it would be most inequitable to hold the defendant indefinitely bound by the contract, which expressly provided for its cancellation in the event that a marketable title was not tendered at a specified time more than two years before the trial. See Wells y. Smith, 7 Paige, 22, 31 Am. Dec. 274; West v. Guaranty Trust Co., 162 App. Div. 301, 147 N. Y. Supp. 421; Toole v. Toole, 112 N. Y. 333, 19 N. E. 682, 2 L. R. A. 465, 8 Am. St. Rep. 750; Lloyd v. Collett, 4 Brown's Ch. R. 469; Gale v. Archer, 42 Barb. 320; Rice v. Barrett, 99 N. Y. 404, 2 N. É. 43; Goldsmith v. Guild, 10 Allen (Mass.) 239; Schmidt v. Reed, 132 N. Y. 109, 30 N. E. 373; Jackson v. Edwards, 22 Wend. 498; Willard v. Tayloe, 8 Wall. 557, 19 L. Ed. 501.

[8] There is no force in the contention that the provisions of the defendant's answer and amended answer, by which it then manifested readiness and willingness to perform the contract, but only asked for the return of the down payment, and not for specific performance, should be construed as a manifestation of willingness to perform and to accept performance at the time of the trial. When it interposed its answer and amended answer, we had not entered the war, and the conditions existing at the time the contract was made had not materially changed; but it proved that they had so changed long before the trial. The fact that the purpose for which the defendant desired the parcels was not recited in the contract is no answer to these views, for it sufficiently appeared by the contract that the purchaser had a particular plan and purpose in mind, for which it desired more land than the plaintiffs had to sell, and did not desire the plaintiffs' land unless it could obtain the other land, and, moreover, the plaintiffs were fully aware of the purpose for which the defendant was acquiring the property. Consequently a change in circumstances affecting such purpose was even more material to the purchaser than a material depreciation in the market value of the premises in the meantime, which was recognized in Garnett v. Macon, supra, as a sufficient answer to a demand for specific performance.

The case is one of great hardship to both parties, but I fail to see any principle upon which the defendant should be compelled to make good the plaintiffs' loss.

It follows that the judgment should be affirmed, with costs.

CLARKE, P. J., and MERRELL, J., concur.

PAGE, J. (dissenting). Mr. Justice LAUGHLIN states that the decision in the case of Anderson v. Steinway & Sons, 178 App. Div. 507, 165 N. Y. Supp. 608, affirmed 221 N. Y. 639, 117 N. E. 575, is controlling in the present case, and that "it necessarily follows that the defendant was not obliged to take the title tendered either on the 1st or the 31st day of August." I do not concur in this conclusion. The Anderson Case came before this court on an appeal from an order granting plaintiffs' motion for judgment on the pleadings, consisting of the complaint, answer containing a defense and counterclaim, and demurrers to the latter for insufficiency. The present case is an ap

peal from a final judgment after the trial of the issues raised by the complaint and answer containing substantially the same defense and counterclaim, the allegations of which were controverted by replies. In the Anderson Case the facts alleged in the defense and counterclaim were admitted. Here they are controverted, and the evidence tending to support or disprove the facts is before us. The authority of the Anderson Case was closely limited by the Court of Appeals to one proposition, for the opinion of that court states:

"It appears from the contract in controversy and the pleadings that it was understood by the contracting parties to be wholly dependent upon the defendant obtaining title to plaintiffs' and other real property, mentioned in the contract, the title to all of which was to be taken solely for a purpose which has either been prevented by the ordinance in question or can only be carried out after successfully maintaining in the courts that such ordinance is unconstitutional, and it would be inequitable in this case to decree specific performance. The opinion of Justice Scott of the Appellate Division, so far as it discusses the question upon which we place our decision, is approved."

From the admitted facts in that case it appeared that it was understood that the property was taken solely for use for business purposes, which had been prevented by the building zone restriction, if valid, or, if not valid, it would require action in the courts to relieve the property from the inhibition, and that the defendant should not be compelled to take property that he could not use for the sole purpose for which it was purchased, or to buy a lawsuit. Mr. Justice Scott in his opinion stated:

"Neither party to the contract could, when it was made, have reasonably anticipated that, before the time came for closing the title, the law-making power would step in and impose such restrictions upon the use of the property as would render it useless * * for the only purpose for which it sought to acquire it." 178 App. Div. 515, 165 N. Y. Supp. 613.

And again:

"After the contract was made the law-making power steps in, and takes action which makes it impossible for the plaintiff to convey what she had intended and expected to convey, and for defendant to acquire what it had intended and expected to acquire." 178 App. Div. 514, 165 N. Y. Supp. 612.

If the facts upon which the decision in the Anderson Case was predicated were not established by the proof in the present case, then the two cases are clearly distinguishable, and the Anderson Case would have no controlling effect on the decision in this case.

First. Was it an essential element of the contract that it and the other property could be devoted to a business use? There is no claim made that the contract does not contain the entire engagements of the parties, or that anything was omitted therefrom by mutual mistake or by fraud. It is the usual contract for the sale of real estate. The only unusual feature is the reference to a contract simultaneously made with another party for the purchase of her real estate and making the performance of this contract dependent, not alone on the marketability of the property therein described, but also on the marketability of the other property. The contract is expressed in clear and unambiguous terms. There is therefore no room for construc

(182 N.Y.S.)

tion or resort to prior negotiations to ascertain the intention of the parties. It is well settled that it is not in the province of the court to change the terms of a contract which has been entered into, even though it be a harsh and unreasonable one. Nor will the dictates of equity be followed, if by so doing the terms of the contract are ignored, for the folly or unwisdom of a contract is not for the court to pass upon. Its terms, however onerous they may be, must be enforced according to the clear meaning of the language used, and the intention of the parties using the language must be determined by its contents alone. The contract in suit was prepared with care and deliberation; several proposed contracts were prepared and rejected. This contract was adopted by the parties as expressive of their deliberate intention. The court cannot make a new contract for the parties, nor read into this one terms and conditions that the parties have not expressed. If, as claimed by the defendant, the sole object of buying this property was to erect upon it a business building, and if, unless it could be used for that purpose, it was not to be required to take title, a provision to that effect should have been incorporated in the contract. In the absence of such a provision, I can find no justification in law or equity for refusing specific performance on the ground that such was the unexpressed understanding of one party.

In this case there was no change in the law between the time of the signing of the contract and the closing of title, nor was there any restriction put upon the use of the property that could not have been reasonably apprehended. The Legislature in 1914 conferred the power on the board of estimate and apportionment of the city of New York to divide the city into districts and regulate and restrict the location of buildings designed for specific uses within such districts. Laws 1914, c. 470, adding sections 242a and 242b to the Greater New York Charter. In 1916 this act was amended. Laws 1916, c. 497. The amendment to section 242b, which is applicable herein, merely delegated the further power to the board, from time to time, to amend, supplement, or change the regulations or districts. The statute provided for the appointment of a commission to recommend the boundaries of districts and appropriate regulations and restrictions to be imposed therein; that the commission shall make a tentative report and hold public hearings thereon before submitting its final report to the board; that the board shall not determine the boundaries of any district, nor impose any regulation until after the final report of the commission; that after such final report the board shall afford persons interested an opportunity to be heard, at a time and place to be specified in a notice of hearing to be published for 10 consecutive days in the City Record. The board of estimate and apportionment appointed the commission on June 26, 1914, and the commission made reports to the board on March 10, 1916, and June 2, 1916. Therefore, although the building zone resolution was not finally adopted until after the signing of the contract for the sale of the property in suit, there was no change in the law, nor sudden or unexpected action by the public authorities, restricting the use of the Fifty-Eighth street property. It is to be presumed that the board and the commission proceeded

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