Baltimore Permanent Building & Land Society v. Smith

Bartol, C. J.,

delivered the opinion of the Court.

This is an action instituted hy the appellee, for the-breach of a contract made with him hy the appellant, for the sale of a parcel of land. The contract is dated February 16th, 1877. The property which is the subject-matter of the contract, is therein described as “all that property situate and lying in Calvert County, Md., containing about sixty-five acres, being a part of the property known as ‘Solomon’s Island,’ and which was purchased by said Land Society from Philip M. Snowden,, trustee, under a decree passed by the Circuit Court for Calvert County, in equity, in the case of the Baltimore Permament Building and Land Society against Isaac Solomon and Wife, except eight or nine small lots, since-sold by it, which lots were mentioned in leases made by said Solomon, after the mortgage given by him to said Society.”

The consideration or price to be paid by the appelleewas $12,000, “to wit, $500 in cash, $4500 on or before the 14th day of April 1877, and the balance, to wit„ $7000, to be paid in two years, from the date hereof, to be secured by mortgage on the property hereby agreed to be-sold, with interest payable semi-annually.” The cash payment of $500 was made.

By the covenants of the parties a deed was to be made by the vendor on payment of $4500, as stipulated, and a. mortgage executed by the purchaser to secure $7000, the balance of the purchase money.

It was “ agreed that the title to the property was good and clear of all incumbrances.”

The contract was signed by the appellee at the office of his attorney in Philadelphia. He had never seen the property and asked Wilton Snowden, (secretary) who represented the appellant, for a plat. When the secretary *197 returned to Baltimore, “he wrote to the agent of the ■company for a plat made hy Mr. Grover, in 1872. The agent replied, he would have the plat in a few days;” on the 6th of March, the secretary received a letter and the plat; on seeing it, he discovered a considerable discrepancy between the number of acres mentioned in the contract, and that shown on the map. He soon after notified Mr. Beman in Baltimore, (who had a written agreement with the appellee, dated February 13th, for one-half interest in the purchase,) showed him the plat and requested him to inform the appellee of the discrepancy, which Beman did hy letter, the same day. Beman’s letter was dated March 13th, and received by appellee the following day, when, as he testifies, he first heard that there were less than sixty-five acres of land.

On the 17th of March, appellee went to Baltimore, ■started thence, on the night of the 18th, to visit the island, in company with Beman and Wilton Snowden; returned to Baltimore on the evening of the 19th, and went to Philadelphia the same night. Saw nothing more of the company till the 14th day of April, when he tendered $4500, and demanded a conveyance of sixty-five ■acres. The answer was that “ they had not got it, could not do it,” or words to that effect, “that they had not the land.” Snowden testifies that “ appellee demanded sixty-five acres, declined to accept the deed and execute the mortgage, because there was not sixty-five acres of land, he wished a proposition, the company offered to abate $2000 for the deficiency, which was declined, invited a proposition from him, which he declined to make. Then the company said they were willing to pay hack the $500, and cancel the agreement. About two months afterwards the $500 was tendered to him in Philadelphia which he declined to accept.”

It appears, that on the 21st day of March preceding, an abstract of title was sent to the appellee, hy the secre *198 tary, which with the plat was placed hy him in the hands of Mr. Rohinson, his attorney, who under his instructions, went to Calvert County on the 7th day of April, and made a careful and thorough examination of the title, which proved satisfactory. Mr. Rohinson states that the only objection was the deficiency of land. He states that “ he was not sent down to examine the title, till after the appellee knew, and he knew that the quantity of acres was deficient.”

On the 10th day of August 1877, the following letter was sent to the appellee, and received the following day

“Baltimore, 10 Aug. 1877.

“Levi E. Smith, Esq.

“Dear sir: I write to announce to you, that by a. survey of Solomon’s Island, made hy order of the hoard of directors of this Society, and completed a few days ago,, there were found 48.08 acres in the entire island. After deducting lots sold and leased previous to the agreement with you, there were found thirty-six acres.

“ Yours truly,

“ Wilton Snowden.

“ Secretary.”

The suit was instituted on the 27th day of November 1877.

The declaration contained two counts, to the first the defendant demurred, and the demurrer was sustained. On this ruling no question has been raised. The case was tried below, on the issue joined upon the plea to the second count. This count sets out substantially the contract, and alleges a breach by the appellant in failing and refusing to execute and- deliver a deed conveying about-sixty-five acres of land; claims damages for this breach, and also special damage, for expense and trouble incurred hy the plaintiff, and for moneys expended by him for *199 legal advice and counsel in the investigation of the title, &c.

The first exception • to he considered, is that taken to the parol evidence offered by the plaintiff, of the representations by Snowden as to the number of acres, made before and at the time the contract was signed. This is found in the testimony of Smith, (the plaintiff,) Robinson and Snowden, which was admitted subject to exception, and the appellant, by its fourth prayer, asked to be excluded as inadmissible, because it tended to contradict, alter, or explain the terms of the written contract.

This testimony is as follows:

Smith, (the appellee,) stated “ that he informed Snow-den that. Beman had represented that the company had seventy acres of land on the island. Mr. Snowden then proceeded to write the contract as it now appears, and then read it to witness, when witness heard him read ‘about sixty-five acres’ he said to Mr. Snowden seventy acres is what the property was represented to me to contain.’ ” Mr. Snowden replied “that there was more than sixty-five acres, but that as he was a little uncertain about the amount of land contained in the eight or nine small lots, which are excepted from the sale, he had written the area down at sixty-five acres, so as to be sure that the company could deliver at least that number; he assured witness that there were at least sixty-five acres, and rather more than less than that number. On the 16th day of February, Mr. "Wilton Snowden came to the office of witness in Philadelphia having the contract with him ; Mr. Robinson, witness’s counsel was present and he read the paper over; when he came to the words c about sixty five acres’ he asked Mr. Snowden what was meant by c about,’ and Mr. Snowden assured Mr. Robinson that there were more than sixty-five acres, but that they put it sixty-five, so as to be sure they could deliver it; after this explanation, witness under the advice of Mr. Robinson *200 signed the contract, and paid the §500, which Mr. Snow-den wrote the receipt for, &c.”

The testimony of Robinson is to the same effect. Snow-den testifies, “ At the time of signing the agreement in Philadelphia, Smith made some reference to the number of acres, and witness told him at that time, that it was the impression of the directors that there were about sixty-seven or sixty-eight acres of land ; the original deeds all through, and the mortgage to the company called for eighty acres of land, from which there were leased, as we supposed, twelve or thirteen acres, and witness stated to him that he thought sixty-five acres was a proper figure to put it at; and he thinks he gave Mr. Robinson the same response.”

There is no rule of law better settled or more inflexible, than that which excludes parol evidence which is offered to vary or contradict the terms of a written contract. The rule on this subject is distinctly stated in Rice vs. Forsyth, 41 Md., 402 , as follows: “ It is a cardinal rule that parol or extrinsic evidence is inadmissible to add to, contradict or vary the terms of a written contract. It may be admitted to ascertain and make certain the parties and subject-matter of an agreement, to apply the contract to its subject, to prove any collateral independent fact about which the written agreement is silent, and to remove latent ambiguities. In such case it is used not to contradict or vary the written instrument, but to uphold and enforce it as it stands.” It is sometimes a matter of some nicety to determine whether in a particular case, the parol evidence offered falls within the general rule, and few subjects have given rise to more difficult and • perplexing questions for decision. In cases of latent ambiguity, parol extrinsic evidence is always admissible to remove such ambiguity, so that the contract may be applied to the subject-matter. Oases of this kind have no application here, and need not be cited. Sometimes the parol evidence is *201 offered to prove some collateral, independent fact, or agreement between tbe parties about which the written contract is silent; in such case it is admissible.

' Examples of the application of this rule are found in McCreary vs. McCreary, 5 G. & J., 141 ; Creamer vs. Stephenson, 15 Md., 221 ; Basshor vs. Forbes, 36 Md., 154 . Many other cases might be cited; among them may be classed Erskine vs. Adeane, L. R., 8 Chy. Appeals, 756, 765, 766, cited by appellee, who contends that the present case falls within the same class. A brief recurrence to the terms of the written contract, and the parol evidence clearly shows that this contention cannot be supported.

■ The written contract in terms stipulates for the sale of a parcel of land, described as part of Solomon’s Island, containing about sixty-five acres. The purpose of the parol testimony is to prove a sale of sixty-five acres of land, without qualifying words, and also to prove representations made by the agent of the vendor, that the number of acres contained in the parcel sold, was at least sixty-five, and that such representations induced the appellee to sign the contract. How this testimony cannot be said to relate to an independent collateral fact; on the contrary, it refers to the very subject-matter embraced in the writing, to wit: the quantity or number of acres; and its effect is to bind the appellant absolutely to convey at least sixty-five acres; whereas in the writing such a stipulation is not found, unless indeed such is the true meaning and construction of the writing, in which case the parol testimony has no significance ; but of this we shall speak hereafter. It is difficult to understand why the effect of the parol testimony, if it have any effect, is not to add to or vary the terms of the written contract. If the latter had contained nothing about quantity, or, the number of acres had been mentioned with the strongest words of qualification, such as “be the same more or less” *202 the objection to the admissibility of the parol evidence would he perhaps more obvious, hut certainly would rest upon. no other principle or reason than that which exists in the present case. The legal question would he the same.

■ In dealing with this proposition, it is important to hear in mind the nature of this proceeding, and the pleadings in the case. Here the suit is on the written contract. In another form of proceeding, if for instance, the suit were by the vendor to enforce the contract, and the purchaser were defending upon the ground of fraud, or mistake or misrepresentation as to quantity, whereby he was induced to enter into the contract, the parol evidence would he clearly admissible. But suchps not the nature of the case ; the appellee does not impeach the validity of the written contract, hut has declared upon it as binding, and seeks to recover damages for its breach by the appellant. No fraud or misrepresentation is alleged, nor could it he, in the form of. action selected. In such case the appellee must stand or fall upon the terms of the written paper, and it is not competent for him to set up by parol another and different contract from that .on which he has declared. Watchman & Bratt vs. Crook, 5 G. & J., 239 ; Kribbs vs. Jones, 44 Md., 397 . And this objection applies with special force in a case like the present where the contract is within the Statute of Frauds and required to he in writing. Taney vs. Bachtell, 9 Gill, 205 .

For these reasons we are of opinion the parol evidence referred to was inadmissible, and there was error in refusing the appellant’s fourth prayer, which asked that it he excluded, and for the same reasons the first prayer of the appellee was erroneously granted, which referred to the parol evidence, and made it a part of the hypothesis of the prayer.

The next question arises upon the construction of the written contract, upon which alone depends the appellee’s right to maintain the suit.

*203 By the first prayer of the appellant the Court was asked to instruct the jury, “ that by the true construction of the agreement, the quantity of land did not enter into the essence of the agreement, and the plaintiff took upon himself the risk of the number of acres contained in the parcel mentioned in the agreement, and was therefore bound to complete the contract, by the acceptance of a deed for as much land as the part of the island mentioned actually contained, subject to the exceptions therein referred to. * * * And after his refusal to do so, the plaintiff was entitled to treat the contract as rescinded, and the plaintiff can only recover the sum of $500, paid by him, with interest at the discretion of the jury.”

The proof shows that the part of the island embraced in the contract of sale comprised in fact only from thirty to thirty-six acres, for the evidence differs as to this. The largest number as stated in the survey made at the instance of the appellant is thirty-six acres. The question therefore is whether a contract to convey “about sixty-five acres” can be performed by conveying thirty-six acres, and this turns upon the meaning or construction of the word “ about” as it appears in the writing.

The general rule as stated in Marbury vs. Stonestreet, 1 Md., 147, is, where land is sold and the number of acres is stated, that quantity, is of the essence of the contract, or forms a material consideration with the purchaser, whether the sale be for a gross sum or by the acre, unless there is something in the terms of the contract to show the contrary.

Where the sale is for a gross sum, and there are qualifying words used suchas “ more or less,” or equivalent expressions, they have been held to import that quantity does not enter into the essence of the contract. Stebbins vs. Eddy, 4 Mason, 419 ; Jones vs. Plater, 2 Gill, 128 ; Stull vs. Hurtt, 9 Gill, 446 ; Hall vs. Mayhew, 15 Md., 551 ; Slothower vs. Gordon, 23 Md., 9 ; Tyson vs. Hardesty, 29 *204 Md., 305 . But what is the force and effect of the qualifying words “about sixty-five acres” in this contract? Does it import that quantity was not a material part of the contract ? and can the Court so declare as a conclusion of law ?

We think not. The force of the qualifying word, we think, is simply that while the parties do not hind themselves to the precise quantity of sixty-five acres, it imports that the actual quantity is a near approximation to that mentioned, that is to say, within a fraction of an acre, or perhaps it might cover a discrepancy of one or two acres.

It cannot he construed to mean that the parties were contracting without regard to the area, or that the appellee took the risk with regard to the quantity. He was not acquainted.with the property, had never seen it. Its character and position, the mode in which it was occupied, and the purposes for which it was contemplated to he used, as shown hy the evidence, preclude the idea that it was a purchase in gross without -regard to quantity, and that the contract could he performed hy conveying about half the number of acres mentioned in the contract. Thirty or thirty-six acres cannot he construed to he about sixty-five acres. In Bourne vs. Seymour, 16 C. B., 336, (31 E. C. L.,) a contract for the sale of “ about five hundred tons nitrate of soda’ ’ was construed to he a contract for the sale of five hundred tons, with such exception hy the word “about” as the variance usually found to exist in such cases, arising from some little difference in the mode of weighing, and that it was not performed hy delivering four hundred tons.

So in this case we construe the contract to he an agreement to sell and convey land containing sixty-five acres, with no other qualifications than such slight variation as might he found in its actual measuremeant. The appellee was not hound to accept a conveyance of thirty or thirty-six acres. The first prayer of the appellant was properly refused.

*205 The next question to be considered is the measure of damages, and in deciding this question we shall dispose of that raised by the appellant’s exception to the evidence with reference to the contract of sale by the appellee to E. D. Wilson referred to i.n the sixth prayer of the appellant.

By granting the second prayer of the appellee the jury were instructed that “the measure of damages is the amount they may find the plaintiff paid to the defendant under the contract, with interest as the jury may allow, and the personal expenses they may find the plaintiff reasonably incurred in and about the performance by him of the contract, including such fees to his professional adviser in the premises, for services rendered after the execution of the contract, as the jury may believe to have been reasonable. And also the difference between the price agreed to be paid for the land by the plaintiff, and the actual market value thereof on the 14th day of April, 1877; and in ascertaining the market value of the land at that date, the jury are entitled to consider any circumstances existing at the time, established to their satisfaction, which tended to affect the market price of the property on that day.”

• The general rule in case of a breach of contract of sale by a vendor, is to award such damages to the purchaser as will place him so far as money can do it, in the same position he would have occupied, if the contract had been fulfilled. Engle vs. Fitch, L. R., 3 Q. B., 330. “When contracts for the sale of chattels are broken by the vendor ' failing to deliver the property according to the terms of the bargain, it seems to be well settled as a general rule both in England and the United States, that the measure of damages, is the difference between the contract price and the market value of the article at the time when it should be delivered.” ****** Sedgwick on the Measure of Damages, 313, (6th Ed.) On page 315, the *206 author remarks, “it will he observed, that in laying down this rule, the analogies of real estate are departed from, and the price paid or the consideration money is not considered conclusive, but that the actual value is inquired into.” In the case of a breach of a contract to convey land, a different rule was established in England at a very early day. In Flurean vs. Thornhill, 2 Wm. Bl., 1078, the purchaser was denied all profit for the loss of his bargain.

The law is thus stated by Sugden: “ If the purchaser declare on the common money counts, he of course cannot obtain any damages for the loss of his bargain; and even if he affirm the agreement by bringing an action for the non-performance of it, he will obtain nominal damages only for the loss of his bargain; because a purchaser is not entitled to any compensation for the fancied goodness of his bargain, which he may suppose he has lost, where the vendor is without fraud, incapable of making a title.” Vendors and Purchasers, 358, (14th Eng. Ed.)

The learned author cites Flurean vs. Thornhill, and a number of other decisions. Although that case has been sometimes criticised, and perhaps departed from in some degree by Hopkins vs. Grazebrook, 6 B. & Cres., 31, which in the opinion of Sugden cannot be reconciled with it, yet he says “it is much too late to impeach the authority of that case, which, moreover, was properly decided.” It has been followed in a great number of cases; among them may be cited, Hadley vs. Roxendale, 9 Exch., 341; Walker vs. Moore, 10 B. & C., 416, 422; Worthington vs. Warrington, 8 C. B., 134; Pounsett vs. Fuller, 17 C. B., 660; Sikes vs. Wilde, 1 B. & S., 687, and 4 B. & S., 421; Bain vs. Fothergill, L. R., (6 Exch.,) 59; Engel vs. Fitch, L. R., (3 Q. B.,) 314.

The rule in England as deduced from the decided cases is thus stated in 2 Addison on Contracts, sec. 529: “If *207 the vendor had reasonable ground for believing that he was the owner of the property, and had the right to sell at the time he agreed to sell, but is prevented by an unexpected defect of title from completing his engagements, and is ready to do all that he possibly can to fulfil the contract, the purchaser will only be entitled to recover nominal damages, together with his deposit (if a deposit was paid) with interest, and the expenses he has incurred in investigating the title and searching for judgments.”

In Hammond vs. Hannin, 21 Mich., 374 , the cases in the United States are collected and reviewed by Judge Cooley in an able opinion, and the following conclusions are stated, as the rule of damages: “ If the vendor acts in had faith,—as if having title he refuses to convey, or disables himself from conveying,—the proper measure of damages is the value of the land at the time of the breach; the rule in such case being the same in relation to real as to personal property. But on the other hand, if the contract of sale was made in good faith, and the vendor for any reason is unable to perform it, and is guilty of no fraud, the clear weight of authority is that the vendee is limited in his recovery to the consideration money (paid) and interest, with perhaps in addition, the costs of investigating the title.”

Many cases are cited by the learned Judge in support of these propositions, some of which are referred to in the appellant’s brief.

Mr. Sedgwick also states this as the rule generally followed in this country as well as in England. And the same rule applies where the inability to perform the contract proceeds from a deficiency in the quantity of land, unknown to the vendor without his fault, as where it proceeds from a defect in the title.

This question does not appear to have arisen, or been decided in this State.

*208 Cannell vs. M’Clean, 6 H. & J., 297 , was an action on a bond, conditioned for the conveyance of land; the purchase money was paid, and the condition of the bond being broken, the Court of Appeals held, reversing the judgment of the County Court, “ that the value of the land at the time of the breach of the contract was the measure of damages.”

In that case, so far as appears in the report, the question of good faith on the part of the vendor was not raised. There was no evidence of his inability to convey, or excuse or explanation for his failure to perform his contract.

So far as appears the breach of the bond was a wilful act on his part, and the Court laid down the same rule of damages, as applicable to contracts respecting personal property. We do not question the correctness of that decision or mean to depart from it; in our judgment, the rule there adopted has no application to a case like the present.

In Dyer vs. Dorsey, 1 G. & J., 440 , there was a contract by the vendor, that a deed should be executed to the purchaser by third persons, who held an outstanding title; the contract being broken, a suit was brought thereon by the purchaser, and the Court decided that “ the sum of money which it might be necessary to- pay for obtaining the outstanding title was the true measure of damages.”

In Marshall vs. Haney, 9 Gill, 251 , the Court held that the time at which the breach occurred was the period at which the value of the lands should be estimated in assessing damages, (p. 260.) This was said with reference to the second breach, which charged that the defendant, after making the contract, had conveyed a part of the lands to another person.

In Rawlings vs. Adams, 7 Md., 26 , (51,) it was held that the rule adopted in Cannell vs. M’Clean in regard to the measure of damages could not be applied to the case then under consideration.

*209 We need not refer particularly to the facts of that case, or to those-of Clagett vs. Easterday, 42 Md., 617, as they furnish no analogy to the present. In the case last cited, the general rule was stated as in Cannell vs. M’Clean, hut under the circumstances of the case, it was held that the rental value of the land was the proper measure of damages.

In none of these cases was the particular question decided, which is here presented.

That is to say, what is the true measure of damages, where the vendor has acted in good faith, and without fault, and is unable to convey the land, from causes beyond his control, and which he could not with reasonable diligence foresee. That is the case presented by the second prayer of the appellant; which in our judgment states the rule of damages correctly, and ought to have been granted; ■ except for the last part of it, which denies to the appellee the right to recover for money paid counsel, for investigating the title, if such expenses were incurred by him after he was notified of the deficiency in the quantity. This part of the prayer we think was erroneous, and there was no error in refusing it. The appellee was not bound to be governed by such notice, but was entitled to go on and ascertain the facts for himself, both as to the state of the title and the number of acres contained in the island. It appears, moreover, that it was not till the 10th day of August, 1877, that specific notice was given to him of the actual area of the island, which was long after he had incurred the expense of investigating the title.

It follows from what has been said, that there was error in the ruling of the Court below in the first and second hills of exception, and in granting the first and second prayers of the appellee, and refusing the fourth and sixth prayers of the appellant.

*210 (Decided 30th June, 1880.)

The appellant’s third prayer was correctly refused for the reason stated by the Judge of the Superior Court.

Judgment reversed, and new trial ordered.