This case involves an attempt to set aside a transaction entered into between Salvatore Zingale (an alleged mental incompetent) and Rubin Podvin and Gussie Podvin, involving the purchase by the said Salvatore Zingale of a parcel of realty situate in Atlantic City, New Jersey. The action seeks to restore the incompetent to the financial position he enjoyed prior thereto, and hence the realtor who consummated the sale and the mortgagee who advanced funds to complete the sale are also made defendants, so that complete relief may be obtained.
The facts in connection herewith are as follows:
On March 17, 1945, one Salvatore Zingale was committed to Stamford Hall, a Connecticut institution for the treatment of mental disorders. He had schizophrenia of a paranoid type. He lacked, as the doctors testified, insight. He had grandiose ideas. His mental condition was such that at times, at least, a layman would not, by mere observation, be warned thereof. At this hospital he received electric shock treatments and after six weeks was released in the custody of his wife. Although then manageable, he was not completely recovered and was still without normal judgment.
During all of this time he was engaged in the jewelry business in Brooklyn, New York.
On February 2, 1948, being then in Atlantic City, New Jersey, he entered into an agreement to purchase the Hotel Davenport, located in said city. The total consideration was $54,000, of which sum he made a down payment of $4,000. On February 6, 1948, having returned to Brooklyn, he was, because of his agitation and unruliness, treated by a physician, who committed him to a mental institution at Astoria, Long Island, New York, on February 7, 1948. On February 20, 1948, Morgan and Lockwood, lawyers of New York City, mailed a letter, a copy of which follows, to Morris Saslaff, agent of the Podvins:
"We have been consulted by the wife and a son of Salvatore Zingale with respect to a deposit which Mr. Zingale made with you on account of a purported purchase of the Hotel Davenport, 116 South Carolina Avenue, Atlantic City, New Jersey. They have furnished us with medical evidence that Mr. Zingale is incompetent and has been so for some time. They did not have a copy of any contract or other memorandum signed by Mr. Zingale, who is presently under care in a mental institution. Any agreement which Mr. Zingale may have signed appears to be wholly improvident and without binding legal effect.
In view of these facts, please arrange to have returned the $4,000 deposit which Mr. Zingale made for the purported purchase of the Hotel Davenport, and for which you issued your receipt on February 2, 1948.
Please let us know if any expenses have been incurred in behalf of Mr. Zingale so that we may give the matter of their payment consideration."
The Podvins admitted having received notice thereof.
On February 27, 1948, the same New York law firm wrote a letter to the Boardwalk National Bank of Atlantic City, which reads as follows:
"We have been consulted by the wife and son of Salvatore Zingale with respect to a purported contract for the purchase of Hotel Davenport, 116 South Carolina Avenue, Atlantic City, N.J., and an application for a ...