Grace v. Deepdale, Inc.

9 Misc. 2d 538, 169 N.Y.S.2d 287, 1957 N.Y. Misc. LEXIS 2205
CourtNew York Supreme Court
DecidedNovember 12, 1957
StatusPublished
Cited by1 cases

This text of 9 Misc. 2d 538 (Grace v. Deepdale, Inc.) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Grace v. Deepdale, Inc., 9 Misc. 2d 538, 169 N.Y.S.2d 287, 1957 N.Y. Misc. LEXIS 2205 (N.Y. Super. Ct. 1957).

Opinion

Marcus G. Christ, J.

These are two actions which each have their origin in the same contract for the sale of real property. As the result of an order of consolidation, they were tried together before the court without a jury. The real property which is the subject matter of these lawsuits is situated in the village of North Hills in the county of Nassau. There are two tracts involved. One of these is a parcel containing approxi[541]*541mately 140 acres, on which is situated a dwelling house together with various accessory building’s, commonly known and referred to in this litigation as “ Tullaroan ”. The other tract, comprising one parcel of approximately 53 acres and another of approximately 1 acre, is unimproved and is commonly known and referred to in this litigation as “ Arthur Farm ”. These properties formerly belonged to Joseph P. Grace and Janet Grace, his wife, both of whom are deceased.

THE PBOPEBTY

Tullaroan originally was a part of the corpus of an inter vivos trust created by the late Janet Grace for the benefit of her husband, Joseph P. Grace, Sr. Title to Tullaroan passed upon the death of Joseph P. Grace, Sr., pursuant to the exercise of a power of appointment, to the four children of Joseph P. Grace, Sr. and Janet Grace, his wife, who thereafter and at the time of the making of the contract of sale herein, held their title as tenants in common. These children are: Michael P. Grace, II (hereafter ‘ ‘ Michael Grace”), Joseph P. Grace, Jr. (hereafter “Peter Grace”), Charles MacDonald Grace (hereafter “Charles Grace”) and Janet Maureen Grace, an incompetent person (hereinafter sometimes referred to as the “ incompetent ”).

The tract known as Arthur Farm was one of the assets included in the corpus of a testamentary trust created by the late Janet Grace for the benefit of her four children, with the remainder over to their surviving issue. Pursuant to the provisions of such trust, fractional interests in this particular property, prior to the making of the contract in question, had been transferred to the three sons of the late Janet Grace. At the time the contract of sale was executed, title to Arthur Farm was vested in the three sons of Janet Grace, both in their individual capacities and as trustees of the testamentary trust established by their mother.

THE ACTIONS

Throughout the trial, as the record will show, these two actions were customarily referred to as “Action No. 1” and “ Action No. 2 ”, despite the fact that this designation of the two actions does not correctly indicate the chronological order in which the two actions were commenced.

Action No. 1 is the action entitled “ Michael P. Grace, 11, etc. against Deepdale, Inc., et al.” Action No. 2 is the action entitled “ Corinne E. Grace, etc. against Joseph P. Grace, Jr. et al.” Although the end result sought to be achieved in both actions is substantially the same, namely, rescission and can[542]*542ceUation of the contract of sale, the parties involved and the specific relief sought are not identical in form. It is therefore necessary at the outset to describe the nature of each of these two actions.

ACTION NO. 1-PARTIES AND THEIR CONTENTIONS

The plaintiff in Action No. 1 is Michael Grace suing both individually and in his capacity as a trustee of the testamentary trust created by his late mother, Janet Grace. In this suit Michael Grace, suing in the dual capacity just described, seeks to rescind the contract of sale upon the ground that he was induced to enter into the contract by fraud. As defendants he has joined the following parties:

1. Deepdale, Inc., a golf club which contemplates leasing the property from the contract purchaser, Real Property Owners, Inc.;
2. Real Property Owners, Inc. the real estate holding company for the golf club and the purchaser under the contract of sale;
3. Grace National Bank of New York which was dropped from this action upon its motion by an order dated December 11, 1956 upon the ground that the bank had no interest in the subject matter of this action.
4. Committee of Janet Maureen Grace, by Grace National Bank of New York and Michael P. Grace, II, its members. This defendant is one of the sellers under the contract of sale. Michael Grace has been removed as cocommittee by order dated May 3, 1957. John P. Boland, Esq. was appointed as guardian ad litem for the incompetent, Janet Maureen Grace, by an order dated December 19, 1956 when Grace National Bank of New York and Michael Grace were both members of the committee but in disagreement.
5. Grace Properties, Inc. in Liquidation. This corporate defendant was dropped from the action on its motion by order dated March 15, 1957 upon the ground that it had no interest in the subject matter of the action.
6. Charles Grace, individually and as trustee of the testamentary trust created by his late mother, Janet Grace. He is one of the sellers in the contract of sale.
7. Peter Grace, individually and as trustee of the testamentary trust created by his late mother, Janet Grace. He is one of the sellers in the contract of sale.
8. Albert Jorgensen. This defendant is the real estate broker involved in the transaction covered by the contract of sale. However, this defendant was never served in the action.

[543]*543From the foregoing it is seen that the only defendants among those originally named by the plaintiff who are subject to the jurisdiction of this court are: Deepdale, Inc., Beal Property Owners, Inc., the committee for the incompetent, the incompetent’s guardian ad litem, Charles Grace and Peter Grace.

The complaint in Action No. 1 alleges that the defendants fraudulently conspired to induce the plaintiff in both his individual and fiduciary capacities to sell the real property covered by the contract of sale at less than its value. The gravamen of the alleged fraud is set forth in allegations contained in paragraphs “11”, “12”, “13”, “14” and “15” of the complaint. It is therein alleged, in substance, that the acts of deception included withholding from the plaintiff information concerning other offers for the property so as to prevent negotiation with other prospective purchasers; concealment and withholding from the plaintiff of knowledge and information concerning the value of the property; concealment and withholding from the plaintiff information to the effect that Charles Grace was an applicant for membership in the golf club or was considered for membership therein or himself was contemplating membership in such club with an interest or proposed interest in Beal Property Owners, Inc., the real estate holding corporation; advising prospective purchasers that the property had been withdrawn from the market and thereby discouraging such prospective purchasers from attempting to buy the property. The plaintiff claims that by reason of these deceptions he was induced to sign the contract of sale in his several capacities and unlawfully hindered and prevented from exercising his judgment or discretion with respect to the sale of the property.

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Related

Grace v. Deepdale, Inc.
8 A.D.2d 965 (Appellate Division of the Supreme Court of New York, 1959)

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Bluebook (online)
9 Misc. 2d 538, 169 N.Y.S.2d 287, 1957 N.Y. Misc. LEXIS 2205, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grace-v-deepdale-inc-nysupct-1957.