Clark v. People's Bank

Thomas, J., delivered the opinion of the Court. This appeal is from a decree of the Circuit Court of Baltimore City dismissing the bill of complaint of the appellant for the specific performance of an alleged contract for the sale of certain property in Baltimore City. ²⁶⁴ In June, 1918, a certain Charles E. Brownell and George A. Cox, alleged to be the agent of the appellee, the People’s Bank of Somerset County, Maryland, executed the following agreement or lease: “This Agreement, Made this........day of......, 1918, between The People’s Bank of Somerset County, George A. Cox, Agent, Landlord, and C. E. Brownell, Tenant: “Witnesseth, That the said Landlord hereby rents to the said Tenant the premises No. 4903 Eerndale Avenue, Howard Park, for the term of one year, beginning on the first day of July, 1918, and ending on the first day of July, 1919, at Six Hundred Dollars a year, payable in monthly installments of fifty dollars each in advance. “And the said Tenant hereby covenants with the said Landlord to pay the.rent as aforesaid, keep the premises in good order, and to surrender the peaceful and quiet possession of the same at the end of the said term, in as good condition as when received (the natural wear and decay of the property and unavoidable accidents excepted), and further, that the said Tenant will not do, suffer or permit anything to be done, in or about the premises which will contravene the policy of insurance against loss by fire; nor use, nor permit their use, for the purposes other than those of a family dwelling house, and will not at any time assign this agreement, or sublet the property thus let or any portion thereof, without the consent in writing of the said Landlord, or his representatives; and further, that whatever alterations or repairs the said Tenant shall be permitted to make shall be done at his own expense. “It is further agreed, that if the rent shall be thirty days in arrears, the Landlord shall have the right to distrain for the same, and to re-enter and take possession; and if the Tenant shall violate any of the aforegoing covenants on his part herein made, the Landlord shall have the right, without formal notice, to re ²⁶⁵ enter and take possession, and if the property shall be destroyed or rendered untenantable by fire or unavoidable accident, the tenancy hereby created shall be thereby terminated, and all liability for rent herein shall cease upon payment proportionately to the day of fire or unavoidable accident. “And it is also further agreed, That this agreement, with all its provisions and covenants, shall continue in force from term to term after the expiration of the term above mentioned; provided, however, that the parties hereto, or either of them, can terminate the same at the end° of the term above mentioned, or of any term thereafter, by giving at least thirty-seven days’ previous notice thereof in writing. “And it is further agreed, that the said Landlord will put in an adequate furnace so as to heat said premises, and the said Tenant shall have the right to build a garage on said premises at a place selected by the Landlord, or his agent, at the Tenant’s cost and expense. “It is further agreed, that the Tenant shall have the right and option to purchase the aforesaid premises for the sum of Seven Thousand Dollars ($7,000.00) at any time during the term of this lease. At the expiration of this lease, if said tenant desires, he may have the right to rent the premises, if not sold. “In testimony whereof, the said parties have hereunto subscribed their names and affixed their seals the day and year first above written. “O. E. Brownell. (Seal) “Test: O. E. Hyde. “The People’s Bank of Somerset County, (Seal) “Per Geo.

A. Cox, Agent.” The lease was assigned to the appellant on the 4th of January, 1919, by the following endorsement thereon: ²⁶⁶ “Baltimore, Md., Jan. 4th, 1919. “For value received, I hereby assign and transfer all my right, title and interest in the within lease to Linwood L. Clark. “Witness my hand and seal this 4th day of Jan. “C. E. Brownell.” On the same day George A. Cox wrote on the lease the following consent to the assignment: "Assignment to Linwood L. Clark, approved Jan. 4. 1919. "Geo. A. Cox." The appellant, wlm went into possession of the property under the above assignment, testified that about the last of February or the first of March he made several offers to Mr. Cox to buy the property; that Mr. Cox told him that he had attempted to sell the property for $6,500.00, but that the bank had refused to accept the offer and that he thought the bank had made a mistake in not accepting it; that he, the appellant, was trying to get the property for less than $6,500, which was, in his opinion, its maximum value, but that he finally told Mr. Cox some time in May to submit to the bank an offer from him of $6,500.00 and that Mr. Cox said he would take it up with the bank; that on the 31st of May Mr. Cox served on him a notice to vacate the property on the 1st of July; that on or about the 1st of June he notified Mr. Cox that he would exercise the option in the lease on or before the 1st of July, and asked him for a reference to the title, which Mr. Cox gave him; that about the middle of June he prepared a contract for the sale of the property to him for $7,000.00 and took it to Mr. Cox for execution, and that instead of Mr. Cox signing it as agent for the bank as he expected him to do, Mr., Cox told him he would submit it to the bank; that Mr. Cox’s actions on that occasion made him suspicious, and as he did not hear from Mr. Cox, he had his attorney, Mr. Wattenscheidt, write to the bank as follows: ²⁶⁷ “Baltimore, Md., June 20, 3919. “People’s Bank of Somerset Oo., “Princess Anne, Md. “Gentlemen: “Please advise me at once, as counsel for Linwood L. Clark, who is purchasing from you under option No. 4903 Ferndale Avc., Howard Park, in fee at $7,-000.00, when it will be convenient for you to execute deed of said property to him. He has already taken up this matter with you through your Baltimore agent, Mr. George A. Cox, but does not seem to get much satisfaction from him.

The option under which Mr. Clark is purchasing expires on the first day of July, 3919; and the transfer must be made before that time unless you care to extend the time. Mr. Cox has informed Mr. Clark that you have redeemed the ground rent and are in a position at any time to execute the fee simple deed. I am going to start work on the title today and will be ready any time after the 25th to make title. “Please advise me at once when and where you will execute said deed. “Yours very truly, “P. S. — My client advises me that he submitted contract of sale to your local agent, Mr. Cox, more than a week ago, but according to my information it has not been forwarded to you for execution.” The plaintiff also testified that there1 was no reply to that letter, and he alleges in his bill that it developed upon examination of the title to the property about the 27th of June that it was subject- to a redeemable ground rent of $120.00 a year, and that the defendant-was not, therefore, “in a. position to execute an absolute deed,” and that he telegraphed the bank as follows: “Am your tenant Ferndale Avenue property, Baltimore. Lease gives option buy Seven Thousand Dollars in fee before July 1st.

Submitted contract salo to Mr. Cox two weeks ago. Heard nothing since. Don’t understand. Ready settle with your Bank the minute you will execute to me a fee simple deed.” ²⁶⁸ Having received no reply to the letter of Mr. Wattenscheidt or to the telegram, the plaintiff wrote Colonel Henry L. Waters, the president of the bank, as follows: «June 30, 1919. “Col.

Henry L. Waters, “President People’s Bank of Somerset Co., “Princess Anne, Md. “My Dear Colonel: “In June, 1918, your agent, George A. Cox, leased to one O. E. Brownell property 4903 Eerndale Avenue, Baltimore City, for a term of one year, beginning July 1st, 1918, and ending July 1st, 1919. This lease contained the usual provisions as to assignment, renewal and default. It also contained an option to the tenant to buy said property at any time during said term, in fee, at the sum of seven thousand dollars. “On the 4th day of January, 1919, this lease was assigned to me by C. E. Brownell, which assignment on the same day was approved in writing on the face of said lease by your agent, George A. Cox. “I notified Mr. Cox on or about the first day of June, 1919, that I was going to exercise my option. A few days subsequent thereto I presented to him a contract of sale in duplicate from your Bank to myself, thereby indicating my intention to exercise my option.

Said contract provided for the purchase price to be paid fully on or before the first day of July. He said he would forward same to you at once. “About the same time I heard that Mr. Cox was endeavoring to sell the property, and in fact had agreed to sell said property to another party. This of course must have been subject to the option of the tenant to buy as aforesaid. “I have heard nothing from Mr. Cox since. “About a week or ten days ago, I had Mr. Wattenseheidt to write you a letter, again indicating my purpose to exercise said option. Later, I think he talked with you over the ’phone.

He told me that he had heard nothing of my determination to buy. This all ²⁶⁹ seemed strange to me, and a couple of days later I sent you a telegram. “Absolutely no response has been made to any effort on my part to get an acknowledgment from you of any kind. “My attorney has reported to me that this property is subject to a ground rent of one hundred and twenty dollars. It is, therefore, impossible for you to execute a fee simple deed at this time, and of course I am not called upon to make a tender of the seven thousand dollars for a title, subject to a two thousand dollar prior lien. The law does not require me to take action, which would be of no avail, or to make a tender of the seven thousand dollars under these circumstances.

I have the seven thousand dollars on hand, ready to pay you in full as soon as you can deliver up to me a fee simple deed. I will tender it to you immediately upon knowledge of your ability to execute such deed. “I wish you would please redeem the outstanding reserved rent on said property, at the earliest possible moment, notifying me when this is accomplished. “When the transaction is finally consummated, the adjustment will be made as of July 1st, 1919. “Will you please be kind enough to acknowledge receipt of this letter. I have done all I can do in furtherance of this transaction, and await your pleasure. “Yours very truly, “Linwood L. Clark.” “Diet, but not reviewed.” Not hearing from Colonel Wafers the plaintiff states that he wrote him the following letter and received the following reply from counsel for the bank: “Baltimore, Md., July 1, 1939. “Col. Henry L. Waters, “People’s Bank of Somerset Co., “Princess Anne, Md. “Dear Sir: “We have sent three communications to you, two letters and a telegram, and have received no aeknowl ²⁷⁰ edgment of either.

Do you not think that we are at least entitled to the courtesy of an answer ? “If your reason for not answering us and fixing a date and place for the 4903 Ferndale Avenue transaction to be completed is that you have not yet redeemed the ground rent, and are not in a position therefore to give an absolute deed, this can be overcome. I am perfectly willing to put the transaction through on the seven thousand dollar basis, deducting therefrom in the settlement the two thousand dollars ground rent outstanding, plus the accrued ground rent to July 1st. .. “Please do me the kindness to answer this letter, ¡and. let me know just where you stand and what the difficulty is. ■. ■ “I do not care to deal any longer with George A. Cox in this matter unless you insist on it. I have not found ,his representations to me to be correct. “Yours very truly,” “Princess Anne, Md., July 9th, 1919. “Linwood L. Clark, Esq., ■“Attorney-at-Law, “Baltimore, Md. “Dear Sir: “In response to the communications from you to Col. Henry J. Waters, President of the People’s Bank of Somerset County, which were handed by him to me, that'I, as counsel to the bank, might reply to the same, can say that the bank has no knowledge of the sale of the Ferndale Avenue property to you, either di.reetly or indirectly. “Very truly yours, “L. Crestón Beauchamp.” Before the receipt of the letter from counsel for the bank, the plaintiff, on July 8th, filed his bill of complaint in this case for specific performance of the alleged contract and for an injunction restraining the defendant from instituting ejectment proceedings, which, it is alleged, Mr. Cox threat ²⁷¹ ened to institute against him.

The Court passed an order “that the defendant be and is hereby enjoined from instituting proceedings for the ejectment of” the plaintiff, unless cause to the contrary be shown on or before July 23rd, 1919, and on July 16th an answer was filed to the bill through Rufus W. Applegarth, Esq., attorney, and on the same day a motion was entered through said attorney to dissolve the injunction. ■ On the 22nd of July Mr. Applegarth, by leave of Court, filed an amended answer, and on the 18th of August, 1919, the defendant, through Mullikin & Marchant, attorneys, filed an amended answer to the bill in the place of the answers previously filed. In this answer the defendant admitted that the property was- leased to C. E. Brownell for' the term of one year by George A. Cox, who was authorized by the defendant to lease the property; that the lease was assigned to the plaintiff, and that the defendant had accepted the rent from the plaintiff, but it alleged that the bank had no knowledge of the contents of the lease, and