
    Richard B. Disbrow, Resp’t, v. Samuel E. Harris, App’lt.
    
    
      (Court of Appeals, Second Division,
    
    
      Filed October 21, 1890.)
    
    1. Deed—Merger—Contract or bade.
    Plaintiff contracted to sell a house for $35,000, in good condition and put in three new grates. Defendant paid all the purchase money except $350, and the following memorandum was signed by both parties: “ On closing contract * * * there has been allowed tó Mr. Harris $50 for grates (not ini, and Mr. Harris has retained $300 to secure completion of sidewalks and iron gate on stoop, and when done said Disbrow is to receive the $300.” Held, that-it maybe assumed that, with the exception of the performance of the certain things specified, the contract should in all other respects he treated as satisfied by the conveyance made.
    3. Same—Evidence—Fraud—How pleaded.
    Defendant alleged in his answer that plaintiff did not deliver the house' in good condition; that he promised to make changes and repairs, ‘‘and at, the time of closing contract of sale he stated that the said work had been done, when in fact it had not been done, as he well knew. But supposing that the plai itiff’s statements were true, * * * the deed was taken and the money paid as aforesaid.” Meld, that these allegations in the complaint were sufficient to authorize the admission of evidence to overcome the apparent effect of the agreement so far as it by the alleged fraud was made an obstacle to the operation of the stipulation of the original contract, and to prove the breach of that stipulation and the damages sustained by its non-performance.
    (Folleto, Oh. J., and Brown, J., dissent.)
    Appeal from judgment of the general term of the superior-court of the city of New York, affirming judgment entered upon a verdict in favor of the plaintiff.
    
      Jacob F. Miller, for app’lt; Frederick W. Hinrichs, for resp’t.
    
      
       Reversing 14 N. Y. State Rep., 723,
    
   Bradley, J.

— The action was brought to recover the-balance alleged to be clue upon a contract made between the parties, hy which the plaintiff agreed to sell to the defendant certain real property, consisting of a house and lot in the city of Hew York, for $25,000, and on a day mentioned on payment of the purchase money to convey the property to him with covenants-of warranty. The contract contained the provision that -the plaintiff should deliver the house in good condition and put in three new grates. The defendant afterwards paid all the purchase money payable to the plaintiff, except $350, which sum was retained by the defendant pursuant to an agreement made by the parties as follows: “ On closing contract between Richard B. Disbrow and .Samuel E. Harris there has been allowed to Mr. Harris fifty dollars for grates (not in), and Mr. Harris has retained $300 to secure completion of sidewalks and iron gate on stoop, and when done said Disbrow is to receive the $300.” 'This last mentioned agreement was in writing subscribed by the parties, and is the subject of allegation in the complaint. The defendant, by way of counterclaim, alleged that the house was not delivered to him in good condition, and specifically alleged defects, not including any failure of the plaintiff to perform the last mentioned agreement. The question arises upon exceptions taken by the defendant to the exclusion of evidence offered by him to prove such defective condition. When a deed of conveyance is made and accepted pursuant to an executory contract to sell and convey land containing stipulations of. which the conveyance is not necessarily a performance, the question whether such stipulations are surrendered is treated as one of intention; and in the absence of evidence upon the subject there is no presumption of intention to give up those benefits or that they are satisfied by the conveyance. Morris v. Whitcher, 20 N. Y., 41; Witbeck v. Waine, 16 id., 532; Murdock v. Gilchrist, 52 id., 242.

The provision before referred to in the contract for the sale of the premises came within this rule, and the benefit of it to the defendant may have survived the conveyance if nothing had intervened to have defeated it. But when, to complete the performance of the contract and as preliminarily to the conveyance, the parties came together and made the agreement to the effect that the payment of the small amount retained of the purchase money was made dependent only upon the performance of the certain things therein specifically mentioned, it may be assumed that they intended that, with that exception, the provisions of the contract should, in all other respects, be treated as satisfied by the conveyance thereupon made, and such was its effect unless the defendant may, in some manner, be relieved from it. Fraud on the part of the plaintiff would vitiate it and enable the defendant to avail himself of the non-performance of the stipulation upon which he relies in the original contract. But this was matter of affirmative defense or counterclaim on the part of the defendant, and fraud must be alleged to enable him to introduce evidence in its support. His counsel here contends that this was done. Whether he did this sufficiently to render the excluded evidence competent is the main question for consideration. The defendant alleged in his answer that the plaintiff did not deliver the house in good •condition, and specified the defects of which he complained, and added that when those defects were discovered attention was called to them and the plaintiff promised to make the requisite changes and repairs, and at the time of closing the contract of sale he stated that the said work had been done, when, in fact, it had not been done, as he well knew. But supposing that the plaintiff’s statements were true that he had done the work, the •deed was taken and the money paid as aforesaid.” After stating some other matters, he alleged, damages for which he demanded judgment. If the defendant intended to found his claim upon fraud he did not very well allege it, and although they might not bo; effectual as against a demurrer, his allegations, somewhat inartificially made, did contain the elements of fraud on the part of the plaintiff. And for the purpose of a trial the same strictness is not. applicable as in the disposition of the specific objection taken by demurrer. Koop v. Handy, 41 Barb., 454; Whittlesey v. Delaney, 73 N. Y., 571. That the representations were untrue to the knowledge of the plaintiff and material, and that the defendant was induced by them to enter into the new agreement to pay the residue of the purchase money upon the terms there mentioned,, were facts which would tend to support the charge of fraud, and those were the facts substantially alleged by him. The defendant upon that ground should have been permitted to give evidence to overcome the apparent effect of that agreement so far as it, by the alleged fraud, was made an obstacle to the operation of the stipulation before mentioned, of the original contract. And in that, view the rejected evidence to that extent, and to prove the breach of that stipulation, and the damages sustained by reason of its. non-perfprmance was competent. This was a proper subject of counterclaim. Code, § 501.

These views lead to the conclusion that the judgment should be reversed and a new trial granted, costs to abide the'event.

All concur, except Follett, Oh. J., and Brown, J., who dissent, and Haight, J., absent.  