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MacKenzie v. McLean

Decided: July 25, 1952.

DOROTHY B. MACKENZIE, PLAINTIFF-RESPONDENT,
v.
JOHN R. MCLEAN AND ANGELINE MCLEAN, DEFENDANTS-APPELLANTS



McGeehan, Jayne and Goldmann. The opinion of the court was delivered by Goldmann, J.A.D.

Goldmann

[20 NJSuper Page 518] Plaintiff and defendants entered into an agreement on October 16, 1950 whereby plaintiff agreed to purchase and defendants to sell certain real estate in Pennsauken Township, New Jersey, together with the restaurant and tavern business conducted thereon, for the sum of

$28,000. The agreement required a money deposit of $3,000 and contained the following clause:

"The title to be delivered shall be a marketable title and one that will be insurable by a recognized title company.

In the event that such title cannot be made as above set forth and the Buyer is unwilling to accept such title as the Sellers can make, then at the Buyer's option, the payments made on account shall be returned to the Buyer, together with the reasonable expenses of examining the title."

The parties met at the offices of Lawyers' Title Insurance Corporation, Camden, New Jersey, on November 16, 1950, in accordance with the terms of the agreement, for the purpose of settlement. At that time plaintiff refused to accept the tendered deed for the real property and the transfer of title to the other business assets because the title company, admittedly a "recognized title company," refused to insure the title without reserving the exception about to be mentioned.

Defendants had through their attorney also tried to obtain an insured title with the Market Street Title Abstract Company, another recognized title company, but it would only insure against actual loss by virtue of the restrictions being violated; it would not insure the title outright without reference to the restrictions.

The property in question was made up of four tracts, the first and fourth of which were conveyed in 1924 and 1925 by deeds subsequently recorded and containing, among other restrictions, the following:

"That no part of said premises nor any construction thereon shall be used, occupied, employed, erected or maintained (1) for the storage, manufacture or sale of intoxicating liquors, * * *."

Defendants became the owners of the property in 1950. A tavern had been operated on the premises since 1933, Pennsauken Township having annually issued a plenary retail distribution license for the business.

By reason of defendants' failure to deliver a marketable title and one that was insured by a recognized title company, plaintiff demanded the return of her deposit money of $3,000. She subsequently instituted this action for the recovery of the deposit, with interest and costs. At the conclusion of the trial the trial judge, sitting without a jury, awarded judgment in favor of the plaintiff. Defendants appeal.

The sole question here is whether plaintiff is entitled to recover her deposit money, defendants having failed to comply with their agreement to deliver "a marketable title and one that will be insurable by a recognized title company." The validity of such a stipulation is beyond dispute, and where the parties have so agreed they are bound, in the absence of fraud. Brinn v. The Mennen Co. , 4 N.J. 610, 615 (1950), affirming 5 N.J. Super. 582 (Ch. Div. ...


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