Berlin v. Caplan

Collins, J., delivered the opinion of the Court. This is an appeal from a decree dismissing appellant’s bill of complaint, for specific performance of a contract. On March 3, 1954, Rosalie Berlin, as vendor, appellant, and Henry E. Caplan, as vendee, appellee, entered into a written contract by which appellant bargained and sold to the appellee, and the appellee purchased, properties numbered 1817, 1819, 1823, 1825, 1829, 1831, 1833, 1835, and 1837 Lorman Street, in Baltimore City, subject to annual ground rents of $48.00 on each property. The price was $16,000.00, of which sum $1,000.00 was paid prior to the signing of the contract, the balance of $15,000.00 to be paid in cash within sixty days from the date thereof, time to be the essence of the agreement.

Upon payment of the unpaid purchase money a deed was to be executed by the vendor to the vendee, conveying the properties “by a good and merchantable title”. The contract also provided, among other things, that it was the entire agreement and no statement or representation, not endorsed thereon, was to be binding upon the parties. The vendor warranted that no notices had been issued requiring repairs or renovations of the properties. The vendee assumed all responsibility for any such notices that might be issued in the future.

Prior to the date of settlement the appellee notified the appellant that the title to 1825 Lorman Street was defective. Settlement, not having been made within the sixty days spec ³³⁷ ified in the contract, the appellant, on August 25, 1954, filed a bill of complaint against the appellee asking that the agreement be specifically enforced; that the appellee be required to pay the unpaid purchase money; that appellee be enjoined and restrained from prosecuting a suit theretofore instituted by him against the appellant to recover the sum of $1,000.00 paid on account of the purchase price pending the determination of this cause; and for other and further relief. An answer was filed to that bill. A cross bill of complaint was filed by the appellee asking, among other things, that the appellant be ordered to pay to the appellee the sum of $1,000.00 paid on execution of the contract, plus $103.00 for title examination, and for other and further relief.

The chancellor filed an opinion in which he held, among other things, that the title to 1825 Lorman Street was not merchantable and, by decree, dismissed the original bill of complaint and ordered on the cross bill that the appellant pay the $1,103.00 demanded by the appellee, and the costs of the proceeding. From that decree appellant appeals. Testimony was taken in open court by the chancellor. Irving D. Alter, a member of the Maryland Bar, was employed by the appellee to examine the titles to these leasehold properties.

On April 12, 1954, he wrote a letter to the appellant in care of Benjamin F. Rody, a member of the Maryland Bar, in which he stated that the title to 1825 Lorman Street was vested in one Dobra H. Rosan by reason of an incorrect description in a deed recorded among the land records of Baltimore City in S. C. L. 4082, folio 235, which error had been perpetuated to the present time; that since Dobra Rosan was deceased and had died intestate, it would be necessary to take proceedings in the Orphans’ Court so that a confirmatory deed might be obtained from her heirs, assigns or personal representatives; that it would also be necessary to correct the inventory in the estate of Barney Lipsitz, who later entered the chain of title of these properties; that his client, the appellee, was ready to take the properties under the terms of the contract which expired on May 3, 1954; that inasmuch as time was of the essence, it would be necessary to have the defect in title corrected prior to the expiration of the contract; and ³³⁸ that, if the defect could not be corrected by May 3, 1954, the $1,000.00 deposit and the $103.00 for title expenses must be paid to his client. On April 26, 1954, Mr. Alter wrote another letter to the appellee in care of Mr. Rody stating that he had received no reply to his letter of April 12th. He again called attention to the fact that proceedings were necessary in the Orphans’ Court; that it would take at least six months for the necessary notice to creditors to expire; that it would seem impossible to correct the defect in title within the time limited by the contract; that his client was unwilling to extend the time limit; and he insisted that the $1,103.00 be paid to the appellee. On April 29, 1954, Wendell D. Allen, a member of the Maryland Bar, as attorney for Mrs. Berlin, wrote a letter to Mr. Alter in which he said that his letters of April 12th and April 26th had been referred to him; that proceedings were then in process to clear the title to 1825 Lorman Street, and that “This is to advise you that Mrs. Berlin is ready, able, willing and desirous of settling for the eight properties in accordance with the Contract of Sale dated March 3rd, 1954.

This is an instance in which the well known equitable doctrine of abatement applies. The proper abatement in this instance is l/9th of $16,000, under which you will receive a deed and good title to eight of the nine properties. In your letter of April 26th, 1954, to Mrs. Berlin you take the unreasonable view of demanding a return of the deposit of $1000, plus $103, for expenses. The sum of $1000, paid as a deposit, at the settlement, in accordance with the Contract, will be applied as a credit against 8/9th of the $16,000, which, under the abatement principle, will be the purchase price of the eight properties above mentioned.

I do not wish to appear arbitrary in this matter, but if you persist in your view, we can very easily file a bill in equity for specific performance, and I feel quite sure that the many adjudicated cases of the Court of Appeals of Maryland uphold this fair and equitable doctrine of abatement.” Dobra Rosan, who married Barney Lipsitz and thereby became Dobra Lipsitz, died intestate on September 8, 1940. Barney Lipsitz, the father of the appellant, died on July 10, ³³⁹ 1951, and by his will devised and bequeathed to the appellant all the leasehold properties which he owned at the time of his death. The appellant testified that she had known the properties in question ever since she could remember; that her father and mother were in possession of these properties for at least twenty-three or twenty-four years; that she helped them at times to collect the rents; and that she had paid taxes and ground rents on the properties since she acquired ownership under her father’s will. Benjamin F. Rody, Esquire, counsel for the appellant, was called as a witness by the appellee.

He stated that, after receiving the letters of April 12th and April 26th from Mr. Alter, he consulted with Mr. Allen, who answered appellee by his letter of April 29th; that he afterwards consulted with H. Harry Rosenberg, a member of the Maryland Bar, and determined that the titles of the properties agreed to be sold were good and merchantable and, therefore, it was unnecessary to continue or conclude the proceedings already started in the Orphans’ Court. Testifying in rebuttal, he said that during negotiations with Mr. Caplan, which culminated in the contract price of $16,000.00, those negotiations from the beginning were in even one hundred dollar amounts on a per house basis. Mr. Caplan, on cross-examination, had stated that Mr. Rody referred to the houses on that basis, but he insisted he was obliged to consider the negotiations on a group basis. It appears from the record that No. 1825 Lorman Street, acquired by Joseph Silverstein and Lena Silverstein, his wife, in 1919 by a deed from one Engel in which the properties were described by metes and bounds, the first lot described was actually No. 1841 and the seventh lot described was No. 1825.

After the seventh described lot appeared “Improvements being known as 1825-1829-1831-1833-1835-1837-1841 Lorman Street respectively. Subject to annual rent of $54.00 on the 1st lot and $48.00 on the remaining 6 lots.” Although the word “respectively” was used, the house numbers were given in inverse order. On August 13, 1923, the Silversteins executed a deed to Dobra Rosan, who later married Barney Lipsitz, in which the properties therein were described by house num ³⁴⁰ bers only. No. 1825 was one of the lots conveyed.

No. 1841 was not included. There was no metes and bounds description. This deed stated “subject to annual rent of $54.00 on 1825 Lorman Street and $48.00 on the remaining lots”. In fact, $54.00 is the ground rent on 1841.

The “being clause” refers to the deed from Engel to Silverstein for a more particular description. On the same day the Silversteins conveyed 1841 Lorman Street, a property not covered in the contract of sale before us, to someone else. Subsequently, apparently in contemplation of her later marriage, Dobra Rosan made various straw type conveyances. In one of these on September 28, 1923, she conveyed to Hinda D. Resnick properties which contained the following description: Beginning for the 6th on south side of Lorman Street at distance of 81' east from southeast corner of Lorman Street and Monroe Street and running thence east binding on south side of Lorman Street 13' 6" thence south parallel with Monroe Street 70' to an alley 4' wide thence west on north side of said alley 13' 6" and thence northerly by a straight line 70' to place of beginning and knozm as No. 1825 Lorman Street.

Subject to ground rent of $54.00. “The lots hereinbefore * * * 6thly * * * described being the same lots” as in deed August 13, 1923, S.C.L 4060-1 from Silverstein to Rosan. The description of the sixth lot, although referred to as 1825 Lorman Street, is in fact a description of 1841 Lorman Street, which Dobra Rosan never owned. Also, the ground rent is erroneously stated, as in the previous deed, to be $54.00, which is the correct ground rent for 1841. The ground rent for 1825 is $48.00.

On April 16, 1926, Hinda D. Resnick conveyed properties to Barney Lipsitz and Dobra Lipsitz, his wife, including number six aforesaid with the identical description, house number and ground rent as in the preceding deed to her from Dobra Rosan. The being clause stated that it was the same eleven lots of ground as in a deed from Rosan to Resniclc. In the answer to appellant’s bill of complaint, the appellee also claimed a defect in the title of lot 1819. He also claimed a defect in the title to 1837 by reason of a party wall agreement.

The appellee has apparently abandoned any defense ³⁴¹ based, on 1819 and 1837 and relies on the defect in the title of 1825 alone. The question before us, therefore, is whether the deed of September 28, 1923, from Rosan to Resnick, which described by metes, bounds, courses and distances, lot 1841, with the correct ground rent for that lot, and stated that it was known as 1825 Lorman Street, conveyed a merchantable title to 1825. If not, the title is still in the heirs and assigns of Dobra Rosan. If the deed from Rosan to Resnick did not convey 1825, then for the same reasons the deed from Resnick to the Lipsitzs did not convey it.

Appellant relies on the fact that the deed from Rosan to Resnick contained a “being clause” which ultimately referred back to the deed from Engel to Silverstein. That deed, however,