Kurzawski v. Schneider

Principal and agent — Vendor and vendee — Rescission of contract. An agent who receives money paid on a contract for the purchase of real estate made by his principal cannot be held liable in an action by the purchaser to recover the money back on proof of facts which would entitle the purchaser to rescind the contract. M. agreed to sell her land to plaintiff, and defendant was employed to reduce the contract to writing. It was then arranged that plaintiff should pay the purchase money in instalments to defendant for M., and that the defendant was to see to the proper transfer of the title when the whole of the price should have been paid. Plaintiff subsequently claimed to rescind the contract, and defendant offered to return the purchase money if M. would agree. Held, that the plaintiff had no right of action against the defendant.

Appeal, No. 127, Oct. T., 1896, by defendant, from judgment of O. P. No. 2, Allegheny Co., July Term, 1895, No. 124, on verdict for plaintiff. Assumpsit to recover back purchase money of real estate. Before White, J. At the trial it appeared that plaintiff on May 4,1893, entered into a contract of writing with Mrs. Modzynski to buy the-latter’s land in Germany. Defendant, a real estate agent, drew the contract, and it was agreed that he should receive the purchase money which was to be paid in instalments, and pay it over to Mrs. Modzynski, and that after all the purchase mone3r was paid he should see to the proper transfer of title to plaintiff. Plaintiff paid to defendant $1,020, when owing to delays he claimed to rescind the contract. The court charged in part as follows : [This is an action by the plaintiff, Kurzawski, against Mr. Schneider, to recover $1,020, which were paid to him at different times, on a verbal contract between the plaintiff and Mrs. Modzynski for the purchase of a piece of land in Prussia.] [2] It seems, from the testimony of Mr. Schneider, that these parties met at his office, in May, 1893, and entered into a verbal contract, by which Mrs. Modzynski agreed to sell to the plaintiff, Kurzawski, the land for two thousand three hundred thalers. There was a mortgage on the property to the . amount of five hundred thalers, and he was to pay one thousand eight hundred thalers and take the property subject to the mortgage of five hundred thalers. He paid, I think, some $200 at that time, and at different times paid money, until he had paid to the defendant, Schneider, $1,020. [It seems that there was a great deal of trouble in trying to make a title to the property. Mrs. Modzynski was the party selling the property, and yet she had not a title to the property.] [3] It turned out, finally, that the property had been conveyed to her and her husband, and he was dead; also, that there were minor children, and perhaps some children of age. Mr. Schneider sent on some papers to Germany — some powers of attorney that he speaks about — and he explains that the conveyance had to be made in court there; that the parties must appear in court, either personally or by attorney. There were also delays in consequence of not having a guardian for the minor children. The thing ran on for two years, when the plaintiff here became dissatisfied with the delay, gave notice that he rescinded the contract, and called upon Mr. Schneider to refund to him the money he had paid. [Now the contract being parol, not in writing, and n.ot signed by the parties, was not obligatory upon them.] We have a law in this state — and it is an old law brought over from England, to guard against frauds and perjuries — by which all contracts for the sale of real estate must be in writing and signed by the parties. We cannot enforce a parol contract for the purchase of real estate. Sometimes there may be an action for damages, under peculiar circumstances ; or if a party purchaser has gone into possession and made valuable improvements, he may, in a case of that kind, hold the vendor to the parol contract; but until something of that kind takes place, either party may refuse to carry out that parol contract, and, until it is consummated, either party may withdraw from it by giving notice to the other side. That was done by the plaintiff here, who gave a personal notice to Mr. Schneider and brought an action, on April 18, 1895, to recover back the money that he had paid him. After that, Mr. Schneider went on, by his proceedings in the courts of Germany, as he says, and, by a paper which he presents here, he says, the title was conveyed September, 7,1895. I cannot understand that paper. You have heard it read. I do not think it shows any conveyance of property by the Modzynski heirs to the plaintiff. I cannot understand it at all as a copy of any record of court, or of any proceedings that would indicate an actual conveyance or transfer of the property by the Modzynski to the plaintiff. But even if it was, it came too late. The plaintiff having given notice to rescind that contract in May last, the other party, if he went on, went on at his own expense. The defendant received this money as a kind of agent between the two parties, and he would not be bound to pay interest on it until this suit was brought, when the demand was made for the return of the money. According to his testimony, the plaintiff was to pay only 1,800 thalers, and according to the value of thaler coins in this country, a thaler is worth about seventy cents, being three marks — worth more in Germany, a mark generally passing there for nearly a quarter of a dollar in our money; but the quotation in this country is that a Prussian thaler is worth seventy cents. If on that basis Mr. Schneider received |1,020, it would be equal to a little more than 1,800 thalers, the whole amount of purchase money to be paid by the plaintiff. By Mr. Miller: $1,260 that would be, if the court please. By the Court: Well, that would be about $240 more, then, than he received; but it seems that they never tendered the deed to the plaintiff. [But one radical defect here is that Mrs. Modzynski had no title that she could convey, and all this expense and delay was-because she had no title to convey — hunting up heirs and appointing guardians and protracting the thing over two years, until the plaintiff got weary and demanded his money; and nearly three years expired before -there was anything like a tender of conveyance.] [5] Under all of these circumstances, gentlemen, I think the plaintiff is entitled to recover back the money he paid to Mr. Schneider, and Mr. Schneider is protected, because he says the Modzynski heirs are here in court assisting him in trying this case. [I instruct you, therefore, to find for the plaintiff in the sum of $1,020, with interest from the time the suit was brought.] [6] Mr. Schneider had the use of the money, or a good portion of it, for a couple of years before suit was brought, but I do not think the plaintiff can recover interest on that. The interest for that time would be, I think, an ample compensation for the expense he has had. Verdict and judgment for plaintiff for $1,081.20. Defendant appealed. Errors assigned were (2-6) above instructions, quoting them.