Conford, Freund and Haneman. The opinion of the court was delivered by Freund, J.A.D.
This is an action for specific performance of a written and duly recorded agreement for the sale of realty brought by the vendees in possession of the premises against the successor in title of the vendor. From a judgment of the Chancery Division, Union County, on the opinion of former Judge Scherer, 56 N.J. Super. 109 (1959), in favor of the plaintiffs, the defendant Olaf Realty Corp. (hereinafter "Olaf") appeals.
Although undisputed, the facts are complex, and this proceeding is the culmination of considerable litigation. Briefly, on September 30, 1954 the plaintiffs entered into a contract, duly recorded in the Union County Register's office on October 13, 1954, with Jardine Estates, Inc., the
former owner of the realty, whereby Jardine agreed to complete the construction of a certain dwelling then in course of construction, in accordance with specifications; to deliver possession to plaintiffs not later than December 1, 1954; and to convey title to the lands and building by warranty deed in consideration of the sum of $38,000 to be paid by plaintiffs. Upon execution of the contract, plaintiffs paid $1,500 and they agreed to pay $300 per month commencing December 1, 1954, to be applied toward payment of taxes, fire insurance premiums, interest at 5 per cent on the unpaid balance of the purchase price, and the remainder in reduction of the purchase price. It was also agreed that the plaintiffs might at any time make additional payments on account of the principal.
The contract did not specify a particular date for the delivery of the deed but rather provided a formula for the determination thereof, and we regard this as an essential factor in the resolution of this cause. This time was to be when the accumulated payments made by the plaintiffs -- the deposit, monthly payments applied to reduction of the purchase price, and any additional payments -- totaled $8,000. The pertinent language of the agreement reads:
"When the unpaid balance of the purchase price has been reduced to $30,000.00, the seller shall execute and deliver to the purchasers the conveyance of the real estate hereby sold in accordance with the terms hereof and the purchasers shall either obtain their own financing and pay to the seller the unpaid balance of $30,000.00 due on the purchase price * * * or the purchasers shall execute and deliver to the seller a purchase money bond and mortgage thereon for $30,000.00 payable in monthly installments of Two Hundred Dollars ($200.00) * * *"
"the said deed of warranty shall be delivered and received * * * when the unpaid balance of the purchase price has been reduced to $30,000 * * *."
A supplemental contract was entered into on December 30, 1954 but not recorded. It amended the earlier agreement by increasing the monthly payments under the bond and
mortgage from $200 to $300 per month; the seller undertook certain obligations concerning completion of the house; and it was further provided that the seller might, at any time until delivery of the deed, encumber the premises by mortgage or otherwise, "not in excess of $30,000" or use the contract as collateral security for a loan up to that amount. Otherwise there were no basic changes.
Thereafter plaintiffs took possession of the premises under the contract.
In December 1955 Jardine instituted suit in the Union County Court, Law Division, against the plaintiffs for possession of the premises, alleging a default by the plaintiffs. They counterclaimed for damages resulting from Jardine's failure to complete work required of it under the contract and for improper performance of work that had been done. In November 1956 a jury rendered a verdict of no cause of action on Jardine's complaint and awarded plaintiffs $10,000 on their counterclaim. On Jardine's appeal, the Supreme Court affirmed the dismissal of its complaint but directed a retrial of the counterclaim. Jardine Estates, Inc. v. Koppel , 24 N.J. 536 (1957). Upon the retrial, plaintiffs recovered a judgment against ...