The parties to this action entered into a written contract whereby the plaintiff agreed to sell and the defendant agreed to buy four several parcels of land with the houses thereon for the sum of $23,000, to be paid partly in cash and partly by taking title subject to certain mortgages upon the property. When she executed this contract, the defendant knew that the plaintiff was not then the owner of the premises which he agreed to sell to her but that he expected and intended to acquire title thereto by purchasing the same at a foreclosure sale. Before this foreclosure sale took place the defendant stated to the plaintiff that she would not perform the contract on her part but intended to buy the premises for her own account without in any way recognizing the said contract as binding upon her, and this she did, buying the four parcels for $5,595 each. The plaintiff attended the foreclosure sale, able, ready and willing to purchase the premises, and he bid for the same, but in every instance of a bid *Page 99 made by him the defendant bid a higher sum. The result was that she acquired each lot for $155 less than she had obligated herself to pay the plaintiff therefor under the contract or $620 less in all.
In the foreclosure sale was included a fifth house, which the defendant also purchased. This was not mentioned in the written contract between the parties, but according to the complaint there was a prior parol agreement which provided that the plaintiff should buy all five houses at the foreclosure sale and should convey only four of them to the defendant, retaining the fifth house for himself.
Upon these facts the plaintiff brought the present action demanding judgment that the defendant convey to him the fifth house and declaring that he has a lien upon the premises purchased by her at the foreclosure sale and that she holds the same in trust for the plaintiff subject to the contract. The complaint also prays that the plaintiff be awarded the sum of $620 damages, being the difference between the price which the defendant paid at the foreclosure sale for the four houses mentioned in the contract and the price which she would have had to pay the plaintiff thereunder.
The learned judge who tried the case at Special Term rendered judgment in favor of the defendant, holding that under the contract of sale there was no relation of confidence between the vendor and vendee. "In the present case," he said, "each party was free to act for his own interest, restricted only by the stipulations of the contract." He was, therefore, of the opinion that "the defendant had a right to buy in at the auction and that she is entitled to hold exactly as though she had been a stranger and that the plaintiff is not entitled to recover the difference between the price paid at the auction and the contract price."
I am inclined to agree with the trial court that no relation of trust can be spelled out of the transactions between the parties. There is no finding of any parol agreement *Page 100 in respect to the fifth house which has been mentioned, and even if there had been such an agreement resting merely in parol, I do not see that it would have been enforceable. As to the four parcels which constituted the subject-matter of the written contract, the defendant avowed her intention to ignore that contract before bidding for them, and cannot be regarded as having gone into possession under the plaintiff as vendor, but did so rather in defiance of any right of his; hence, there is no likeness to the cases of Galloway v. Finley (12 Peters, [U.S.] 264) and Bush v. Marshall (6 How. [U.S.], 284) relied upon by the appellant. In those cases, it is true, vendees who had bought up better titles than those of their vendors were treated as trustees for the latter; but the contracts of sale had been carried out and the vendees were in full possession of the lands before they acquired the superior outstanding title; and both decisions were expressly placed on the ground that under such circumstances the vendor and vendee stand in the relation of landlord and tenant and the vendee cannot disavow the vendor's title.
There is no need of judicially declaring any trust in the defendant, however, to secure to the plaintiff the profit which he would have made if the defendant had not intervened as purchaser at the foreclosure sale and had fulfilled the written contract on her part. This is represented by his claim for $620 damages. That amount, under the facts as found, I think the plaintiff was entitled to recover. He has demanded it in his complaint and he should not be thrown out of court because he has also prayed for too much equitable relief.
In the case of every contract there is an implied undertaking on the part of each party that he will not intentionally and purposely do anything to prevent the other party from carrying out the agreement on his part.
This proposition necessarily follows from the general rule that a party who causes or sanctions the breach of *Page 101 an agreement is thereby precluded from recovering damages for its non-performance or from interposing it as a defense to an action upon the contract. (Young v. Hunter, 6 N.Y. 203; Barton v.Gray, 57 Mich. 622, and cases there cited.)
"Where a party stipulates that another shall do a certain thing, he thereby impliedly promises that he will himself do nothing which may hinder or obstruct that other in doing that thing." (Gay v. Blanchard, 32 La. Ann. 497.)
By entering into the contract to purchase from the plaintiff property which she knew he would have to buy at the foreclosure sale in order to convey it to her, the defendant impliedly agreed that she would do nothing to prevent him from acquiring the property at such sale. The defendant violated the agreement thus implied on her part by bidding for and buying the premises herself. Although the plaintiff bid therefor she uniformly outbid him. Presumably if she had not interfered he could have bought the property for the same price which she paid for it. He would then have been able to sell it to her for the price specified in the contract (assuming that she fufilled the contract), which was $620 more. This sum, therefore, represents the loss which he has suffered. It is the measure of the plaintiff's damages for the defendant's breach of contract.
I see no escape from this conclusion. It is true that the contract contemplated that the four houses should go to the defendant and they have gone to her; but that is not all. The contract contemplated that they should go to the plaintiff first. In that event the plaintiff would have received $620 which he has not got. This would have had to be paid by the defendant if she had fulfilled her contract; and she should be required to pay it now unless she can present some better defense than is presented in this record. This will place both parties in the position contemplated by the contract. The defendant *Page 102 will have paid no more than the contract obligated her to pay; the plaintiff will have received all to which the contract entitled him. I leave the fifth house out of consideration because as to that it seems to me there was no enforceable agreement.
For these reasons the judgments of the Appellate Division and the Special Term should be reversed and a new trial granted, with costs to abide the event.