Zauderer v. Paterno Estates, Inc.

25 Misc. 2d 180, 204 N.Y.S.2d 202, 1960 N.Y. Misc. LEXIS 3313
CourtNew York Supreme Court
DecidedMarch 29, 1960
StatusPublished
Cited by1 cases

This text of 25 Misc. 2d 180 (Zauderer v. Paterno Estates, 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
Zauderer v. Paterno Estates, Inc., 25 Misc. 2d 180, 204 N.Y.S.2d 202, 1960 N.Y. Misc. LEXIS 3313 (N.Y. Super. Ct. 1960).

Opinion

Matthew M. Levy, J.

One Cecile T. Brinn, a stenographer in the office of the attorneys for the plaintiff, a realtor, entered into a written contract, dated January 15,1959, for the purchase from the defendant of a parcel of real property for $750,000. The down payment made by the purchaser on contract was $20,000. April 15,1959 was the adjourned date for title closing. The agreement contained a provision that it could not be changed or terminated orally. It is alleged in paragraph [181]*181Seventh of the complaint that, on April 10, 1959, the plaintiff entered into an agreement with the defendant, under which the defendant agreed to rescind the afore-mentioned contract of purchase and sale, and to terminate and cancel the obligation of Brinn thereunder, and also agreed to return to her the deposit, and the plaintiff agreed to cause Brinn to rescind the contract and to terminate and cancel the obligation of the defendant, the plaintiff also agreeing to indemnify the defendant for any sums the defendant may be obligated to pay for brokerage commissions. This subsequent agreement was entirely oral and no note or memorandum thereof was ever made. Later, on the same day that this claimed oral agreement was entered into, the plaintiff alleges that he notified the defendant that Brinn had agreed to a rescission of the contract, and at this time the plaintiff claimed to be acting as the agent of Brinn. There is no dispute that the plaintiff’s assertions that Brinn did rescind and cancel and that the defendant, too, did rescind and cancel, pursuant to the arrangement reached as alleged in paragraph Seventh of the complaint, relate to claimed rescissions which are oral. At least, there is no allegation that they were in writing and there is no written proof thereof, nor is there any statement or proof that the plaintiff’s authority to act on behalf of Brinn in such termination was in writing.

On May 14, 1959, the plaintiff took an assignment of the contract and of all rights that Brinn had under it and thereafter brought this action to recover the down payment of $20,000. The defendant moves for summary judgment dismissing the complaint, pursuant to rule 113 of the Buies of Civil Practice, or, in the alternative, for judgment on the pleadings pursuant to rule 112. The defendant contends that the oral agreement to rescind the written contract was invalid as being contrary to the express provisions of subdivision 2 of section 282 of the Beal Property Law and that the plaintiff was acting as Brinn’s agent without written authority as required by subdivision 5 of section 282. The defendant further contends that the plaintiff’s alleged agreement to pay the brokerage fees was also violative of the Statute of Frauds as expressed in Personal Property Law (§ 31, subd. 2), and that, because of the unenforcibility of the plaintiff’s promise to pay the brokerage fees, there was no consideration for the alleged oral rescission given by the defendant.

Subdivision 2 of section 282 of the Beal Property Law provides that: “ A written agreement or other written instrument which contains a provision to the effect that it cannot be terminated orally, cannot be discharged by an executory agreement [182]*182unless such executory agreement is in writing and signed by the party against whom enforcement of the discharge is sought, or by his agent, and cannot be terminated by mutual consent unless such termination is effected by an executed accord and satisfaction other than the substitution of one executory contract for another, or is evidenced by a writing signed by the party against whom it is sought to enforce the termination, or by his agent.”

The plaintiff argues that section 282 is not applicable, since the agreement pleaded in paragraph Seventh relates to an executed agreement and not to an executory one. In support thereof, the plaintiff urges that the agreement was one of mutual promises, and indeed it was. By it, the plaintiff agreed to secure a rescission by Brinn, and by it the defendant promised that it would rescind. And the plaintiff claims that it performed, and, therefore, that the agreement was executed. The decision in this case must hinge, so far as this point is concerned, upon whether or not there was such performance of the oral agreement as to remove it from the operation of section 282.

Subdivision 2 of section 282 is a comparatively recent addition to the Beal Property Law, and there appear to be no precedents discussing or deciding how much part performance is needed to remove an oral agreement of cancellation from the operation of the section. However, subdivision 1 of section 282 is concerned with the same problem, except that it involves parol modification (as distinguished from termination) of written contracts. I am of the opinion, therefore, that the cases which arose under subdivision 1 are applicable to the present-situation.

A part performance which would take a case out of the Statute of Frauds must be unequivocally related or directly referable to the oral agreement, so that the very performance which the promisee has completed tends to prove the agreement (2 Williston, Contracts [rev. ed.], § 494; see, also, Bright Radio Labs. v. Coastal Commercial Corp., 4 A D 2d 491, affd. 4N Y 2d 1021, construing Personal Property Law, § 33-c, the companion statute to Real Property Law, § 282; and Neverman v. Neverman, 254 N. Y. 496).

I would, of course, deem the cases cited by the plaintiff, which also arose under subdivision 1, applicable to subdivision 2, but it clearly appears in those cases that the oral modifications were actually acted upon or carried into effect. Thus, in Alcon v. Kinton Realty (2 A D 2d 454, motion for leave to appeal dismissed 2 N Y 2d 836) the landlord granted a lease [183]*183to a third party in reliance upon the oral modification. And in Keen v. Sinai (136 N. Y. S. 2d 427) the parol modification also had been acted upon. Analogy to a promissory estoppel is of some value in this context, and in either of these cases, the nonrecognition of the oral agreement would have resulted in a detriment to the party acting in reliance upon the change. In the instant case, on the other hand, neither party acted in reliance upon the oral agreement and neither party changed his position as a result of that engagement. What we have here, then, is an agreement which falls directly within the prohibition of subdivision 2 of section 282 of the the Real Property Law. And it is quite clear that if a third party who is a stranger to the contract seeks to rescind or modify the agreement by a collateral undertaking, the provisions of section 282 are still applicable (Bright Radio Labs. v. Coastal Commercial Corp., supra, pp. 493-494).

Assuming, however, that the agreement is not barred by section 282 because, as the plaintiff urges, it is not executory, then other questions remain.

By paragraph Seventh, the plaintiff has in effect set forth an alleged independent contract by which he undertook to cause Brinn to rescind, in consideration of the defendant’s promise to rescind, and in consideration, in turn, of the plaintiff’s promise to indemnify the defendant as to brokerage. The defendant contends that the plaintiff’s undertaking to indemnify the defendant is barred as not being in writing. In my view, that point is without merit, since the plaintiff’s agreement to indemnify ran not to the defendant’s creditor, but to the defendant, the debtor, and was part of the independent agreement set forth in paragraph Seventh of the complaint.

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Bluebook (online)
25 Misc. 2d 180, 204 N.Y.S.2d 202, 1960 N.Y. Misc. LEXIS 3313, Counsel Stack Legal Research, https://law.counselstack.com/opinion/zauderer-v-paterno-estates-inc-nysupct-1960.