Trachtenburg v. Sibarco Stations, Inc.

384 A.2d 1209, 477 Pa. 517, 1978 Pa. LEXIS 934
CourtSupreme Court of Pennsylvania
DecidedApril 28, 1978
Docket113, 114 and 115
StatusPublished
Cited by22 cases

This text of 384 A.2d 1209 (Trachtenburg v. Sibarco Stations, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Trachtenburg v. Sibarco Stations, Inc., 384 A.2d 1209, 477 Pa. 517, 1978 Pa. LEXIS 934 (Pa. 1978).

Opinion

OPINION

MANDERINO, Justice.

Appellant, Sibarco Stations, Inc., entered into agreements with appellees to purchase contiguous parcels of real estate in Homestead, Pennsylvania, for the purpose of constructing a service station. The purchase of each parcel was contingent, inter alia ; upon the consummation of all the purchas *520 es; upon the premises being free and clear of all leases; and upon appellant’s receipt of the necessary permits for construction. Nearly six months after accepting appellees’ offer, but before a closing date was agreed upon, appellant informed appellees it was cancelling the agreement because it was unable to obtain the permits necessary to construct a gasoline service station.

Each of the appellees filed a complaint in equity asking for specific performance of the contracts of sale. Some of the appellees also sought money damages for loss of rental income, maintenance costs, and certain demolition costs. Appellant filed preliminary objections to each of the complaints on the ground that equity jurisdiction should not obtain because appellees sought money damages only and had a complete and adequate remedy at law.

The three cases were eventually consolidated for trial, and on January 21, 1975, Judge Louik, sitting as Chancellor, issued a decree ordering specific performance of the contracts. In addition, those appellees who had sought damages were awarded damages plus interest. The Superior Court affirmed per curiam. 238 Pa.Super. 727, 356 A.2d 819 (1976). We granted appellant’s petition for allowance of appeal and this appeal followed. (All three cases were consolidated for oral argument and are before us on this appeal).

Appellant raises five assignments of error in this appeal. Appellant first renews its jurisdictional challenge, arguing that appellees have an adequate remedy at law and hence the case should have been certified to the law side of the Court. Appellant’s second claim is that the Chancellor improperly interpreted the sales contract. Appellant contends that it was entitled to cancel the sales agreement because the agreement required only that appellant apply for a building permit, which was denied. Third, appellant argues that because the Trachtenburgs’ property was encumbered by a lease, and the contract required appellees to convey title free of any leases, appellees were not “ready, willing, and able” to tender performance which is a prerequisite to *521 specific performance of the agreement. Fourth, appellant claims that the Chancellor erred in refusing to admit evidence relevant to the existence of the lease. Lastly, appellant argues that the damages for demolition costs awarded to certain of the appellees were neither contemplated nor foreseeable and hence not recoverable.

We need only address appellant’s first argument, for we agree this was not a proper case for the exercise of the court’s equity powers. We therefore reverse the Chancellor’s order and remand the case to the law side of the trial court, making it unnecessary to consider appellant’s other assignments of error at this time.

Appellant’s jurisdictional argument is that appellees have an adequate remedy at law and hence the equitable remedy of specific performance was improperly granted. Appellant characterizes appellees’ suit as one to obtain the purchase price under the agreements, argues that such relief is no more than a suit for money damages alone, and contends that these should therefore have been certified to the law side of the trial court. To support its conclusion that equity did not have jurisdiction in this case, appellant relies principally on Kauffman’s Appeal, 55 Pa. 383 (1867), where one hundred eleven years ago, this Court held that a seller of real estate cannot get specific performance of a contract to convey land if the seller only seeks the payment of the purchase price. See also Heights Land Co. v. Swengel’s Estate, 319 Pa. 298, 179 A. 431, 432 (1935) (dictum) (citing Kauffman for the proposition that when a buyer breaches a contract to purchase real estate, a seller’s suit in equity, the object of which is simply to enforce payment of the purchase price, will not be entertained).

Appellees concede the general statement of Pennsylvania law that a seller who seeks only the purchase price has an adequate remedy at law. They contend, however, that this principle is not applicable in the present case because appellees seek more than money damages; they seek to force appellant to accept appellees’ deeds; they also seek authorization for the escrow agent to dispose of funds deposited *522 with it and “all other relief necessary to effect the settlement.” Appellees thus argue their remedy at law is not adequate, and that the Chancellor’s invocation of equity powers was a sound exercise of judicial discretion that should not now be disturbed.

We agree with appellant that under the facts of this case, appellees have an adequate remedy at law, and that the trial court erred in invoking its equity jurisdiction. The basic relief sought by appellees is payment of the purchase price, and a review of the remedies available in this Commonwealth to a seller of land when the buyer repudiates the contract makes it clear that these proceedings should have been certified to the law side of the court.

In Pennsylvania, a seller of real estate has three remedies available when a buyer repudiates the contract. One, the seller can sue at law for damages, the measure of damages being the full contract price minus the market value of the land on the date of breach, less any payments received. See McConaghy v. Pemberton, 168 Pa. 121, 31 A. 996 (1895); Harris v. Harris, 70 Pa. 170 (1871); 5 Corbin on Contracts § 1098A (1951). See generally 32 P.L.E. Sales of Realty § 171 (1960), and cases cited therein.

Two, in limited situations, specific performance might be available to a seller who could show that the legal remedies were not sufficient to put the seller in the same position as if the buyer had not breached the contract. Although at least one early case intimated that specific enforcement was available to a seller as a matter of course so long as good title could be conveyed, Moss v. Hanson, 17 Pa. 379, 382 (1851), Kauffman’s Appeal, supra, 55 Pa. 383 (1867), established the rule that where the action for specific performance is simply to recover the purchase price, and nothing in the circumstances of the case require the aid of chancery to give effect to the contract, equity will not entertain it. See also Heights Land Co. v. Swengel’s Estate, supra, 319 Pa. 298, 179 A. 431 (1935); Dorff v. Schmunk, 197 Pa. 298, 47 A. 113 (1900); Deck’s Appeal, 57 Pa. 467 (1868). The outstanding example of a situation where a seller would *523 be entitled to specific performance is Finley v. Aiken, 1 Grant, Cas. 83 (Pa.1855). In Finley, the vendee was contractually bound, as part of the transaction, to deliver bonds and a mortgage in order to secure deferred payments.

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Bluebook (online)
384 A.2d 1209, 477 Pa. 517, 1978 Pa. LEXIS 934, Counsel Stack Legal Research, https://law.counselstack.com/opinion/trachtenburg-v-sibarco-stations-inc-pa-1978.