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Dissenting opinion of COMSTOCK, C. J.

distinguish it from the present. The conveyance there was made to the creditor, in full satisfaction of the mortgage-debt, and, of course, the securities ought to have been delivered up at the same time. The transaction was with the mortgagee personally, and no inquiry was made of him for the securities, nor did he make any representation or suggestion intended or calculated to mislead. Such being the facts, this court affirmed the decision of the court below, where the question had been determined against the mortgagor; the question was one of fact, as it is in the present case. The decision is clearly not an authority requiring us to hold, as matter of *law, [ * 253. that the plaintiff was chargeable with notice when he made the payments in question. The judgment should.

be affirmed.

DENIO and BACON, JJ., also dissented.

Judgment reversed, and new trial awarded.

Statement of the Case.

CLEMENT v. CASH.

Covenant to Assign.-Liquidated Damages.

A covenant to assign a bond and mortgage, is sufficiently performed, by the execution of a proper instrument, though the original mortgage be lost, if duly recorded.

A covenant to assign a purchase-money mortgage, described as executed by the mortgagors and their wives, is satisfied, by an assignment of such mortgage, though the wives did not join therein.

A sum named as liquidated damages, will not be construed as a penalty, though it appears too large for a breach of some of the conditions of the contract, and too small for others, if all of them are to be simultaneously performed.

APPEAL from the general term of the Supreme Court, where judgment was entered upon a verdict in favor of the plaintiff, subject to the opinion of the court at general

term.

This was an action to recover a sum of $2099, as liquidited damages for the non-performance of a contract to convey land. The defence was, that the plaintiff had failed to assign certain mortgages specified in the contract, the assignment whereof was a condition precedent to performance by the defendant, and also that the sum of $2000 was to be construed as a penalty, and not as * 254 ] liquidate l dunges. *The judge before whom the case was trie 1 directed a verdict for the plaintiff for $2000, and interest, subject to the opinion of the court at general term; and judgment having been there rendered upon the verdict, the defendant took this appeal.

Bangs, for the appellant.

Bissell and Ballard, for the respondent.

Opinion of the Court, per WRIGHT, J.

WRIGHT, J.-The questions in the case are-1st. Was there a sufficient offer to perform on the part of the plaintiff, at the time and place designated in the contract?and 24. Were the damages for non-performance liquidated and fixed by the contract?

I. The execution and delivery of the deed of the defendant's land and the payment therefor by the plaintiff, were to be simultaneous acts; such payment was to be made in cash, cash securities, and real estate. On the day appointed for the performance of the contract, the plaintiff tendered $4000 in cash; the assignments of the bonds and mortgages mentioned in the contract; two indorsed promissory notes of $500 each; and a deed of a house and lot in Byron. The contract provided that the defendant should take, in part payment for his land, an assignment of a mortgage upon land known as the Stewart farm, executed in May 1854, by Joel Rouse and Lewis Merwin and wives, for the sum of $3137 and interest; and also, an assignment of a mortgage on land in the town of Pembroke, executed on 5th July 1854, by Charles L. Branch to Clement, for $1000 and interest. The original mortgage of Branch was not attached to the assignment; for the reason that it had been left for record in the clerk's office of the county, *and could not afterwards be found; the mortgage was, however, re[* 255 corded, and the assignment tendered referred in terms to the record. The other assignment tendered was of a bond and mortgage, alike in all respects to that referred to in the contract, except that the mortgage was not signed by the wives of Rouse and Merwin. It is not insisted, that there was any failure in the offer to perform on the part of the plaintiff, unless in respect to these assignments. Nor do I think there was any here; he of fered substantially to do and perform all that the contract required of him, and sufficient to put the defendant in default.

With respect to the Branch mortgage, all that the

Opinion of the Court, per WRIGHT, J.

plaintiff covenanted to do was to transfer it, by assignnent, to the defendant; he tendered a proper assignment, with the bond attached. The original mortgage, it is ue, was not present with the assignment, it having been eat to the clerk's office to be recorded, and was lost. It was recorded on the 21st September 1854. An assignment of the bond and mortgage, the bond being attached and the mortgage recorded, was as effectual for all purposes as if accompanied with the mortgage.

The mortgage assigned on the Stewart farm was undoubtedly the one referred to and described in the contract, though not purporting to be signed by the wives of Rouse and Merwin. On the day of the tender, the defendant made no objection to this assignment; showing that he considered the tender, so far as this mortgage is in question, a compliance with the intention of the contract. It was a purchase-money mortgage, and so expressed in the instrument; it was upon the identical farm mentioned in the contract, of the same date, and executed to secure the exact sum ($3137) therein named. If the parties to this action were reversed, and the same facts proved, there could be no recovery against the plaintiff, on the ground that there was a breach of the contract, in failing to assign a mortgage on the Stewart farm, executed not only by Rouse and Merwin, but by their respective wives. The offer to perform, in this respect, was according to the intent of the contract.

* 256 ] *Upon the whole, therefore, there was nothing in the conduct or acts of the plaintiff to justify or excuse the refusal of the defendant to perform his part of the contract, to grant and convey, by a good and sufficient deed, the premises and real estate described therein. The pretext set up in the answer, that the defendant was induced to execute the contract upon the fraudulent representations of the plaintiff in respect to the validity and nature of the liens of the mortgages agreed to be assigned and taken in payment, was entirely unproved;

Opinion of the Court, per WRIGHT, J.

in short, the evidence showed a total failure to perform on his part, without any legal excuse or justification.

II. The important, and, in fact, the only question of any real difficulty in the case, arises in respect to the damages. The concluding clause of the agreement is as follows:-"In case either of the said parties shall fail to keep, perform and fulfil the covenants and agreements herein contained, on his part to be kept, performed and fulfilled, the party so failing to perform shall pay to the other party the sum of two thousand dollars, which said sum is hereby mutually agreed by and between said parties to be the ascertained and liquidated damages for such non-performance."

It is competent for the parties to a contract for the purchase or sale of real estate, to liquidate and settle, by agreement between themselves, the amount of damages to be paid upon a breach of the contract, instead of leaving such amount to be ascertained by a court or jury. When, says RUGGLES, J., in Cotheal v. Talmage (9 N. Y. 551), the damages resulting from the breach are uncertain in amount, as they are all in cases other than where the contract is to pay money, the parties have the right. to say how much shall be paid by way of compensation to the party injured; and when they have settled that compensation, neither a court of law nor a court of equity will diminish its amount, unless it be so grossly disproportionate to the actual injury that a man would start at the bare mention of it. (Astley v. Weldon, 2 Bos. & Pul. 351.) So, also, I think, where the language employed in that part of the instrument ascertaining the amount of the damages is clear and plainly indicative of an intention to fix a definite sum to be paid by [* 257 the party failing to perform, and negatives all inferences of an intent to name the sum as a penalty, the courts are not authorized, by construction, to make a new contract for the parties, or unmake the one made by them, and hold, from the nature

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