By a complaint filed on February 17, 1987, [Note 1] the Plaintiff, James Cureton ("Cureton"), seeks a declaration that he is the owner of a certain two-family house located at 55 Bernard Street in the Dorchester District of Boston, Massachusetts ("Locus") and that a deed dated September 13, 1985, recorded at Book 11911, Page 18 in the Suffolk County Registry of Deeds [Note 2] (Exhibit No. 1) which purports to grant said premises to the Defendant, Alphonso Irving, Trustee of the N.B.Q.T. Trust, [Note 3] is null and void on the grounds of misrepresentation, fraud and deceit.
On May 27, 1987, the Defendant, David A. Hoicka ("Hoicka"), filed an answer and counterclaim in response to the Plaintiff's complaint. By said counterclaim, Hoicka seeks the following declarations: 1) that the deed to Alphonso Irving, Trustee of the N.B.Q.T. Trust, was duly executed and delivered and that title in said party be quieted against all claims of Cureton; 2) that said deed be reformed so as to state the sum of $21,500.00 as the actual consideration for such conveyance; and 3) that he, Hoicka, be awarded the sum of $100,000.00, as well as costs, attorney's fees and such other relief as this Court deems just and proper, for the alleged malicious prosecution by Cureton.
The matter proceeded to trial on February 23, 1989, at which time all testimony was recorded and later transcribed by a court appointed stenographer. James Cureton testified and ten exhibits, all of which are incorporated herein for purposes of any appeal, were admitted into evidence. At this time, the Court also granted the motion of the Defendant, Managing Consultants and Contractors, Inc., to dismiss Cureton's complaint as to it, due to Cureton's failure to perform service upon said corporation within the time prescribed in Mass. R. Civ. P. Rule 4(j).
In accordance with an extension of time granted by the Court during the first day of trial, Cureton filed an answer to Hoicka's counterclaim on February 27, 1989. Thereafter, on March 10, 1989, also in accordance with this permitted extension of time, an answer and counterclaim were filed in response to Cureton's complaint by one Julia Taylor, as Trustee of the N.B.Q.T. Trust. The three counts included in said counterclaim are identical to those set forth in the aforementioned answer and counterclaim of Hoicka.
A second and final day of trial was held on October 12, 1989, at which time a stenographer was again appointed to record and transcribe the testimony. Both Cureton and Hoicka offered testimony and seven additional exhibits were accepted into evidence. These additional exhibits are also incorporated herein for purposes of any appeal.
On all of the evidence before the Court, I make the following findings of fact:
1. At the time of the transaction at issue herein, Cureton was in his late fifties and was employed as a security guard. He possesses a third grade education and has some physical difficulty reading, particularly without the aid of reading glasses. Despite his limited formal education, however, Cureton possesses a general understanding of the questioned transaction. While he understood that the subject Purchase and Sale Agreements pertained to the sale of his property, he did not fully comprehend all of the terms and conditions contained therein.
2. At the time of the subject transaction, Hoicka was in his early thirties. He holds at least two undergraduate degrees, one in civil engineering and one in architecture, from the Massachusetts Institute of Technology, and a Master of Divinity degree from Boston University. In addition, Hoicka was awarded a juris doctorate degree from Suffolk University Law School in 1989. At the times most pertinent hereto, Hoicka was employed as President of Managing Consultants and Contractors, Inc., a corporation concentrating in the production of low-income housing, primarily in the Dorchester and Roxbury Districts of Boston. The record before the Court does not, however, disclose the extent of such activities by either Hoicka or the corporation. Further, Hoicka is and has been the beneficiary, officer or trustee of various trusts and/or corporations which hold title to certain parcels of real estate.
3. Cureton and his wife, Angela Cureton, acquired title to Locus by deed dated December 6, 1968, recorded at Book 8248, Page 188 (Exhibit No. 3).
4. At all times relevant hereto, the premises located at 55 Bernard Street were in a condition which may best be described as "a state of utter disrepair" (See Exhibit No. 2). As mentioned below, these premises were subsequently condemned by the Board of Health of the City of Boston.
5. In early April of 1985, Hoicka observed Locus and contemplated the possibility of purchasing and renovating it. Believing the premises to be unoccupied at this time, Hoicka left a business card bearing his name and the name of his firm, Managing Consultants and Contractors, Inc., in the front door. Shortly thereafter, he was contacted by Cureton, at which time the two parties discussed Hoicka's proposal.
6. In mid-April of 1985, Hoicka and a companion met with Cureton at Locus. During this meeting, which took place in Cureton's automobile parked outside of Locus, the parties agreed on a purchase price of $21,500.00. It is not clear whether this amount was to be the gross or net price.
7. On May 8, 1985, Cureton and Hoicka met for a second time, again in Cureton's automobile parked outside of Locus. At this time, the parties executed a Greater Boston Real Estate Board "Standard Form Purchase and Sale Agreement" ("Standard Form") showing as the purchase price for Locus the amount of $21,500.00 (Exhibit No. 12). Cureton and Hoicka initialed the first three pages of this agreement and signed the signature page thereof, as well as a "Rider" page appended thereto. Neither Angela Cureton's initials nor her signature appear anywhere on this document. This agreement provided for a closing date of May 31, 1985. Under this form of agreeent the stated price is a "gross" price subject to certain adjustments. As a deposit for the sale of the premises, Hoicka gave Cureton a check in the amount of $100.00 (See Exhibit No. 18).
8. Shortly thereafter, Cureton and Hoicka entered into a second agreement relative to Locus, which agreement was also on the Standard Form (Exhibit No. 13). This agreement differs from the first in that it recites a purchase price of $5,000.00 (less the $100.00 previously given to Cureton) and is subject to the same adjustments. Cureton testified that this revision in price was made at his request to conceal the actual purchase amount from his wife, with whom he had been having marital difficulties. Hoicka testified, however, that he had learned of certain liens on the property, although not the amounts thereof, and that $5,000.00 was to be a guaranteed minimum amount which Cureton would receive from the sale of Locus, regardless of the amount of liens and/or encumbrances on the property. While I find the Plaintiff's motivation to be less than commendable, I also find Hoicka's position to be inconsistent with that of a well-educated adult, familiar with real estate transactions, inasmuch as, were his intentions as stated, he could have easily drafted an agreement to reflect such an understanding. Rather, Hoicka used the "Standard Form" agreement, which requires "a good and clear record and marketable title, free from encumbrances", and further provides that the grantor "may, at the time of delivery of the deed, use the purchase money or any portion thereof to clear the title of any or all encumbrances or liens...." Moreover, Hoicka's "minimum price" reasoning appears to be inconsistent with other of his testimony.
This second agreement was initialed and signed by Cureton and Hoicka in the same manner as the first agreement. The closing date, however, was advanced from May 31, 1985 to June 7, 1985. Further, this agreement provided that the balance of $4,900.00 was to be paid to Cureton at the time of the delivery of the deed in cash, or by certified cashier's, treasurer's or bank check. As with the first agreement, neither Angela Cureton's name, signature or initials appear thereon, although by his own testimony, Hoicka was aware of Mrs. Cureton's interest in the premises at the time the second agreement was executed.
9. Following the execution of the second Purchase and Sale Agreement, Hoicka made a cursory inspection of the premises at 55 Bernard Street and a limited, albeit unsuccessful, attempt to ascertain the extent of existing liens and encumbrances on the property.
10. In August of 1985, well after both Purchase and Sale Agreements had expired, Cureton informed Hoicka that Locus had been condemned by the Board of Health and that he had an opportunity to obtain emergency housing from the Boston Housing Authority. In view thereof, Cureton expressed an eagerness to sell Locus.
11. In early September of 1985, Hoicka furnished Cureton with an unsigned deed to the premises naming as grantee, Alphonso Irving, Trustee of the N.B.Q.T. Trust and showing a consideration of $5,000.00. Hoicka requested that Cureton sign the deed, have his wife sign the deed and have both signatures notarized. In reply to Cureton's question as to when he would receive the money, Hoicka informed him that he would be paid once the deed was recorded at the Registry.
I do not find that what appeared to Cureton to be an unconditional promise to pay was, in fact, such. Rather, it was intended, although not communicated, as a promise to pay an undetermined amount subject to the existence of limited, and at that time unascertained, title defects.
12. On September 13 , 1985 , Cureton signed the deed and procured what purports to be the signature of his wife, Angela, thereupon. The deed was also notarized.
13. While the recording of a deed with notarized signatures usually does raise certain presumptions of regularity, there is ample evidence in the record to raise questions with this Court as to Mrs. Cureton's intent and understanding when and if she signed the deed, and further questions which I decline to enumerate herein. Under these circumstances, Mrs. Cureton would appear to be a necessary party and/or the Court would strongly consider appointing a guardian ad litem to protect her interests. I do not, however, find such action to be necessary based on the result I reach below.
14. In mid-September of 1985, Hoicka sent an agent to 55 Bernard Street to pick up the deed, as executed, from Cureton. Cureton delivered the deed, relying on the representation that he would be paid when the deed was recorded. Thereafter, on September 20, 1985, without the knowledge of Cureton, Hoicka had his secretary record the deed at the Suffolk County Registry of Deeds. This deed is recorded at Book 11911, Page 18 (Exhibit No. 1). At the time of the deed's recording, Hoicka had not yet performed a title examination on the property nor had he paid Cureton any sum other than the $100.00 deposit.
15. During October of 1985, Cureton telephoned Hoicka several times regarding payment of the purchase price. In the course of these conversations, Cureton informed Hoicka that for various reasons he wished to be paid in cash. Hoicka refused to consent to this method of payment, insisting that he would pay only by check made out to Angela and James Cureton. At no time thereafter, however, did Hoicka tender, or even draw, a check in any amount to Cureton and/or Mrs.Cureton, nor do I find sufficient evidence from which to determine whether or not Hoicka had funds available for such purpose. Moreover, the record indicates that Hoicka and Cureton are in disagreement as to the amount due the Curetons in the event the sale is upheld. While Cureton contends that he was to receive the sum of $21,500.00 for Locus, there is insufficient evidence in the record from which to ascertain an amount certain which Hoicka expected or expects to pay for it. Hoicka's counterclaim, however, does allege a purchase price of $21,500.00, less certain adjustments undetermined on the record before the Court as to amount.
Following his conversations with Cureton in October of 1985, Hoicka made no attempt, by negotiation or legal means (ie. declaratory judgment or specific performance), to resolve the issue of payment. Thus, as of the date of this litigation, the only amount ever received by Cureton from Hoicka for the sale of Locus was $100.00.
16. Hoicka relies upon the provisions of the expired Purchase and Sale Agreements to justify his offering Cureton payment by check. As noted, however, both agreements had long expired, leaving the parties to whatever arrangement they could mutually agree upon. Of course, there are circumstances under which tendering a check would not only be reasonable, but would be enforceable as well. Indeed, under the instant circumstances as known to the parties, it is understandable that Hoicka desired some assurance that Mrs. Cureton would at least see the proceeds of the sale. However, once the Purchase and Sale Agreements had lapsed, and in consideration of all pertinent circumstances, Cureton was free to impose whatever conditions he wished on the transaction, including the condition that payment be made in cash. Hoicka may have well questioned whether or not Cureton was acting in his wife's interest at this time, however, I note that despite Cureton's admissions as to his marital difficulties, Hoicka still relied upon Cureton to obtain Mrs. Cureton's signature on the deed which was subsequently recorded. I find that after recording the deed it was somewhat late to question Cureton's possible fiscal intentions towards his wife. If Hoicka were indeed concerned about Mrs. Cureton's interest, the deed should have been held in escrow until such concerns were resolved.
The lapsed Purchase and Sale Agreements cast further, and even greater, doubt on the parties' understandings as to the amount to be paid for the conveyance of Locus. As stated above, the two agreements set forth different amounts, both being, by their very terms, subject to various adjustments, the amounts of which are undeterminable from the record before the Court. Accordingly, I find that a final net price was never agreed upon by the parties.
17. Despite Hoicka's alleged belief that, as of September 20, 1985, he was the lawful, record owner of Locus, he instituted no action thereafter to evict Cureton from the premises, nor to otherwise recover possession thereof.
In consideration of the foregoing, I find, that under the attendant circumstances, for the reasons hereinafter stated, the deed purporting to convey Locus from the Curetons to Hoicka is null and void on the ground of failure of consideration and on the basis of mutual mistake.
On all of the evidence before the Court, I find that no sum of money beyond the $100.00 deposit was ever paid, or even tendered, to Cureton for the sale of Locus. Although it is Hoicka's contention that he was, at all times pertinent hereto, willing to pay Cureton whatever the purchase price therefor may have been, this contention pertains only to his making such payment by check. Cureton, however, believed he would receive some amount upon the recording of the deed, although as stated, no specific amount was ever agreed upon. I find such facts to be demonstrative of a clear lack of intent on the part of Hoicka, at the time he received and recorded the deed, to unconditionally pay Cureton a specific amount as consideration, and that his representation to Cureton that he would be paid shortly after the deed was recorded was, in fact, a conditional promise, subject to the actual status of title - unknown at that time. Unlike the usual real estate transaction, there was no closing, nor any determination of anything even resembling closing adjustments. Cureton relied on what he reasonably believed to be an unconditional promise to his detriment, insofar as the deed was in fact recorded, but no monies beyond the $100.00 deposit were ever tendered to him thereafter.
As a general rule, a deed, like a contract, may be rescinded where, on a given set of facts, there was no "meeting of the minds" between the grantor and the grantee on some essential term thereof. See Air Technology Corp. v. General Electric Company, 347 Mass. 613 (1964). In the instant matter, I find that a mistake as to a material fact, specifically the actual purchase price owed to Cureton for the sale of Locus, existed between the parties. The record before the Court reveals that, at the time Hoicka delivered the deed to Cureton and instructed him to have the deed signed and the signatures notarized, the previously executed Purchase and Sale Agreements had expired, thus providing no guidance as to the issue of purchase price. Cureton, however, believed that, shortly after the deed's recording, he would receive the sum of $21,500.00 less some undetermined amounts, an assumption contributing greatly to his desire to sell the Locus. See Golding v. 108 Longwood Avenue, 325 Mass. 465 , 468 (1950); Levy v. Bendetson, 6 Mass. App. Ct. 558 , 563, 564-565 (1978). Cureton's belief runs contrary to Hoicka's alleged understanding that $5,000.00 was the minimum purchase price of the conveyance, although there is nothing in the record to indicate the extent of encumbrances on the property or that Hoicka possessed knowledge of the same. Accordingly, as a mutual mistake as to a basic assumption upon which the conveyance was made, namely the price to be paid for the subject property, existed, I find that there was never a "meeting of the minds" between Hoicka and Cureton on this material issue, and that, accordingly, the deed must be declared null and void. See White v. White, 346 Mass. 76 , 80 (1963); Dover Pool & Racquet Club, Inc. v. Brooking, 366 Mass. 629 , 632-634 (1975); Covich v. Chambers, 8 Mass. App. Ct. 740 , 749-750 (1979).
Moreover, I find that Hoicka's lack of a present intention to unconditionally pay Cureton a specific amount for the sale of Locus at the time he received the deed, coupled with Hoicka's representations of his readiness and willingness to pay for Locus only on terms unacceptable to Cureton (See Finding No. 16), constitute a failure of consideration sufficient to warrant rescission of the deed. See Lang v. Giraudo, 311 Mass. 132 (1942); Bellefeuille v. Medeiros, 335 Mass. 262 (1957).
Having ruled that the deed which purports to convey Locus to Hoicka is null and void and must be rescinded, Cureton is hereby ordered to return the $100.00 deposit to Hoicka within forty-five (45) days from the entry of a final judgment herein, after all appeals have been resolved.
Inasmuch as I have found there to be a failure of consideration and a mutual mistake sufficient for rescission of the deed, and inasmuch as such allegations were not pleaded herein, the Plaintiff may amend his complaint within forty-five (45) days hereof should he feel it necessary to do so.
The Plaintiff Cureton has filed certain requests for findings of fact and rulings of law, which I have considered. Certain of these requests are incorporated herein. I have taken no action with respect to the remainder, as I have made my own findings and rulings as to those facts and rules of law which I deem most pertinent hereto.
[Note 1] The Plaintiff first commenced this action by complaint dated August 11, 1986, however, certain amendments to this complaint were subsequently allowed by the Court on March 6, 1987.
[Note 2] All recorded documents referred to herein are at this Registry.
[Note 3] The Defendant, Alphonso Irving, Trustee of the N.B.Q.T. Trust, was designated as the nominee of the Defendant, David A. Hoicka. Insofar as Hoicka is a beneficiary under this Trust, he purportedly holds a beneficial interest in the premises at issue herein.