Victor M. Metsch is a Senior Litigation/ADR Counsel at Smith, Gambrell & Russell, LLP. He can be reached at email@example.com. He maintains a website at www.LegalVictor.net and can be found on Twitter @LegalVictor1.
The equitable remedy of reformation to correct a “scrivener’s error” in a contract, agreement or understanding appears to be as old as the common law itself. General principles of New York law in this area of the law were formulated in the mid to late nineteenth century (Part I); nuanced and applied to more complicated transactions in the twentieth (Part II); and continue to be followed and applied in the current millennium (Part III).
CRP/Extell v. Cuomo
In CRP/Extell Parcel I, L.P. v. Cuomo, 101 A.D.3d 473, 957 N.Y.S.2d 293 (1st Dept. 2012), the Appellate Division recently, unanimously and summarily affirmed the order and judgment of Supreme Court, 34 Misc. 3d, 1214A, 946 N.Y.S. 2d 66 (Sup. Ct. New York Co. 2012), which had “denied the petition to annul the determinations of respondent Attorney General, directed the release and return of down payments made by respondent purchasers in connection with purchase agreements for condominium units, and dismissed [the] hybrid CPLR article 78 proceeding/reformation action [.]” (underscoring added)
The First Department affirmed the decision of the Court below, based upon CPLR 7803, because “[t]he Attorney General’s determinations were not affected by an error of law or arbitrary and capricious[.]” And the Appellate Division affirmed dismissal of the claim for reformation “as the court [below] properly dismissed the claim on the ground of collateral estoppel. Indeed collateral estoppel bars petitioner from litigating the claim, as it was fully litigated before and decided by the Attorney General.” (citations omitted)
The terse and dismissive decision by the First Department reveals nothing about the substance of the underlying dispute- whether or not the sponsor of a residential condominium conversion plan was required to return $16 million in down payments, and accept the cancellation of forty apartment contracts of sale with aggregate purchase prices of more than $110 million, because of what the petitioner-sponsor claimed to be a “scrivener’s error”.
Supreme Court described the facts:
CRP/Extell submitted its proposed plan to the Attorney General’s Office on November 29, 2005. Thereafter, the Attorney General issued deficiency comments to the sponsor’s outside counsel which is also the escrow agent in this matter, the law firm of Stroock & Stroock & Lavan LLP (hereinafter “Stroock”). The ongoing review process began, sets of revisions were submitted by petitioner’s attorneys and the Attorney General reviewed and commented on such revisions.
On August 11, 2006, petitioner’s plan was accepted for filing by the Attorney General’s Office. CRP/Extell then began offering condominium units for sale.
Between 2006 and 2008, the forty individuals named as co-respondents in this proceeding entered into purchase agreements with petitioner. The purchase agreements incorporated by reference CRP/Extell’s offering plan. The offering plan identified the commencement date for the first year of operations in the building. The projected first closing date was September 1, 2008.
In their respective agreements, each purchaser agreed to purchase a unit for a stated price. Purchasers agreed to provide an “Initial Deposit” and an “Additional Deposit” as down payments for their payment obligations under the purchase agreements. Each purchaser agreed to pay the balance of the purchase price upon delivery of the deed for the property it had purchased. Each purchaser agreed further that CRP/Extell would retain the purchaser’s down payment if the purchaser failed to close on its unit as required by the purchase agreement.
In accordance with the agreements, purchasers tendered down payments to CRP/Extell. The down payments were all placed in escrow subjected to 13 NYCRR section 20.3(o) in accordance with the offering plan.
The aggregate amount of the down payments paid by the purchasers is $16 million dollars. The properties are valued collectively at over $110 million dollars.
Section 20.3(o)(12) of the regulations required CRP/Extell to offer purchasers a right to rescind if the first closing in the building was delayed twelve (12) months beyond the anticipated commencement of the first year of operations. CRP/Extell was required, therefore, to offer purchasers a right to rescind if the first closing did not occur by September 1, 2009.
The offering plan contains a provision stating as follows:
It is anticipated that the First Closing will occur by the commencement date for the First Year of Condominium Operation as set forth in schedule B which is September 1, 2008. If the First Closing does not occur by September 1, 2008, as such date may be extended by duly filed amendment to the Plan, Sponsor will amend the Plan to update the budget and to offer Purchasers the right to rescind their Agreements within fifteen (15) days after the presentation of the amendment disclosing the updated budget, and any Purchaser electing rescission will have their Deposits and any interest earned thereon returned.
It is undisputed that the offering plan was drafted by CRP/Extell’s counsel. Petitioner contends that the attorney who drafted the offering plan erroneously typed an “8” (September 1, 2008) instead of a “9” (September 1, 2009) in the above provision.
The purchase agreements contain the following integration clause:
This Agreement together with the Plan constitutes the entire agreement between the parties and supersedes any and all understandings and agreements between the parties with respect to the subject matter hereof.
The first closing occurred on February 12, 2009, after the September 1, 2008 rescission date set forth in the plan. Petitioner did not offer purchasers rescission as a result of the non-occurrence of the first closing by September 1, 2008.
Id. at 3.
A purchaser “filed an application with the Attorney General for a determination on the disposition of the down payments, seeking to rescind its purchase agreement on the ground that the first closing had not taken place by the projected date of September 1, 2008 [and the sponsor] cross-applied for release of the down payments [.]” The Attorney General found in favor of the purchasers, against the sponsor and directed the escrow agent to release the down payments. Extell filed an Article 78 Proceeding in which “[t]he first cause of action [sought] reformation of the offering plan and purchase agreements.”
Supreme Court summarized Extell’s argument:
Petitioner argues that, where scrivener’s error is alleged, the law requires the fact-finder to collect and consider all of the relevant evidence of the parties’ intent. Petitioner contends that where, as here, a party is seeking reformation of an agreement, a party may rely on extrinsic evidence even if the agreement is not ambiguous. Such extrinsic evidence in the instant matter includes: 1) the admission of a scrivener’s error by Stroock; 2) provisions in the agreement that are inconsistent with a September 1, 2008 date; 3) advertising materials; and 4) the pre-dispute course of dealings.
A scrivener’s error constitutes a mistake in the reduction of an agreement to writing” (Rosalie Estates, Inc., v. Colonia Insurance Co., 227 AD2d 335, 337, 643 N.Y.S.2d 59 [1st Dep’t 1996]). A written agreement may be reformed for mutual mistake where the parties have reached an oral agreement and, unknown to either, the signed writing does not express that agreement” (Ebasco Constructors, Inc. v. Aetna Insurance Co., 260 AD2d 287, 290, 692 N.Y.S.2d 295 [1st Dep’t 1999] (internal quotation marks and citation omitted)).
Id. at 6.
And Supreme Court found the argument unavailing:
Petitioner asserts that there was a mutual mistake, yet there is no contrary agreement that would demonstrate the existence of such a mistake. The parties did not come to the understanding of a September 1, 2009 date. In short, there is no evidence that the September 1, 2008 date was a mistake.
Likewise, the doctrine of unilateral mistake is not available as an excuse for the Court to re-write the unambiguous agreement. Petitioner has neither alleged nor shown any fraudulent conduct whatsoever by respondents.
Petitioner contends that CRP/Extell is permitted to assert a reformation claim against the purchasers in the instant Article 78 proceeding.
The evidence necessary to warrant reformation of a written instrument has been summarized as follows:
There is a heavy presumption that a deliberately prepared and executed written instrument accurately reflects the true intention of the parties. To overcome this presumption and warrant a trial on a claim for reformation, the plaintiff must come forth with a high level of proof, free of contradiction or equivocation, that the instrument is not written as intended by both parties. The party seeking reformation bears the burden of proving by clear and convincing evidence that the instrument is not correct due to an error in the reduction of the agreement to writing, or that it was executed under mutual mistake or unilateral mistake coupled with fraud. This means that the plaintiff must show, in no uncertain terms, not only that mistake or fraud exists, but also exactly what the parties agreed upon, particularly if the negotiations were conducted by sophisticated, counseled people.
Where the mistake lies in the basis of the agreement itself rather than in its reduction to writing, it is incumbent upon the proponent of reformation to show that the mistake is mutual; that is, that both parties intended the same agreement, which is different than what is reflected in the written instrument. It is not necessary, however, to prove a mutual mistake where the alleged error occurred in the reduction of the agreement to writing. To succeed on a reformation claim on unilateral mistake, the plaintiff bears the burden of proving both its own mistake and fraudulent concealment by the other party.
16 NY Jur.2d Cancellation of Instruments section 92.
In the determinations, the Attorney General found that CRP/Extell had not met its heavy burden to show that the alleged “scrivener’s error” was contrary to the intention of the parties and had not provided evidence that the parties intended a September 1, 2009 date. In addition, the Attorney General found that the law of mistake did not support CRP/Extell’s position that the September 1, 2008 rescission date stated in the offering plan was an “obvious typographical error” requiring reformation of the contract under the law of mutual and/or unilateral mistake. Furthermore, the Attorney General found that the integration clause in the purchase agreement might preclude consideration of parol evidence even where a claim of scrivener’s error is asserted, and that the offering plan unambiguously identifies September 1, 2008, as the rescission date.
Id. at 7.
The $16 million down payment /$110+ million in contracts involved in the CRP/Extell litigation may soon be addressed by the Court of Appeals – and, as such, invites a review of both the historical antecedents, on the one hand, and the development and current state of the law, on the other, with respect to claims for reformation of contract based upon an alleged “scrivener’s error”.
The Historical Antecedents
Scrivener’s error appears to have been recognized as an arguable ground for reformation of contract under New York since the mid- nineteenth century.
In Nevius v. Dunlap, 33 N.Y. 676, 678-83 (1865), the Court of Appeals addressed an action to reform a bond and described the conflicting contentions:
The plaintiffs demand judgment for $3,000, with the interest from the commencement of the action, and, if necessary, that the bond to their testatrix be reformed so as to provide for the payment of interest to her thereon from the time of its date, deducting therefrom her just share of the actual costs of the support furnished the father and mother. The defendants answered, denying, amongst other things, that there was any agreement in regard to the payment of the interest, other or different from that expressed in the conditions of the bond, and denying that there was any error or mistake in its form or structure.
Id. at 678.
After a non-jury trial, Special Term entered a judgment “that the bond be reformed according to the prayer of the complainant[.]” The Court of Appeals outlined the issue:
This brings us to consider whether the plaintiffs made such a case upon the proofs as entitled them to the relief demanded in the complaint. To entitle a party to the decree of a court of equity, reforming a written instrument, he must show, first, a plain mistake, clearly made out by satisfactory proofs. Whenever the evidence is loose, equivocal or contradictory, or is in its texture open to doubt or opposing presumptions, the relief will not be granted (Story’s Eq. Jur., 157.) This proposition is obvious, because the written instrument, carefully and deliberately prepared and executed, is evidence of the highest character, and will be presumed to express the highest character, and will be presumed to express the intention of the parties to it, until the contrary appears by clear, positive and unequivocal evidence. In the second place, he must show that the material stipulation which he claims should be omitted or inserted in the instrument, was omitted or inserted contrary to the intention of both parties, and under a mutual mistake. (Id., 155.) It is not enough to show that he made a mistake himself; that, through inadvertence and error on his part, he executed an instrument, the stipulations of which do not express what he intended. He must also show that the other contracting party labored under a similar delusion.
The Court of Appeals, in reversing and ordering a new trial because the evidence presented failed “to overthrow the express words of a written instrument and substitute other words in their place[,]” admonished that:
It is worthy of observation that there is not one particle of proof showing or tending to show that David Dunlap, the obligor, entertained or expressed a different intention from that expressed in the bond. Concede it to be true that it does express the intention of be true that it does not express the intention of his father, and what then? The mistake must have been mutual, and until it be shown that both parties were mistaken, there can be no relief in the form of reformation.
Id. at 682-83.
In Story v. Conger, 36 N.Y. 673, 674-76 (1867), the Court of Appeals outlined the facts:
On the 14th day of December, 1849, the defendant and his wife conveyed to the plaintiff certain real estate in the city of New York, and, by the deed, the plaintiff covenanted that the premises were free and clear of taxes and assessments. At the time of the conveyance, there was a tax for the year 1849 of $189.31, which was a lien and incumbrance on the premises, and which the defendant was then liable to pay. The defendant failed to pay the tax, and the plaintiff paid the same on the 14th day of February, 1850. And, for the recovery of the sum so paid, with interest, this action was brought.
and the defense:
[I]n conversation and negotiations between the defendant and the plaintiff in reference to the sale of the premises, it was understood that the plaintiff was to take the same without the personal warranty or obligation of the defendant, and that the defendant was not to take any responsibility in respect to the title. A written agreement was entered into between the parties, by which the defendant agreed to sell the premises to the plaintiff, and convey and release the same to him by a good and sufficient deed; that the plaintiff was then a tenant in possession; that the defendant tendered to the attorneys of the plaintiff, in his presence, a deed of the premises without covenants or warranty, but they objected to the deed, alleging that a deed without the usual full covenants might throw suspicion on the title and be an impediment in the way of disposing of the property, and urged the execution of a full covenant deed; and to induce the defendant to execute and deliver such a deed, they represented to him that they had investigated the title to the premises, and that the same was perfect and free from all liens and incumbrance (except the mortgages referred to in the written agreement), and that the defendant would incur no liability by giving the deed. The defendant, induced by, and relying on such representations as true, executed and delivered the deed in the complaint mentioned; but such representations were untrue, and he was deceived thereby.
Id. at 674.
A Circuit Court jury rendered a verdict in favor of the plaintiff for $311.87. The verdict was affirmed by General Term. And the Court of Appeals framed the issues as follows:
Two questions are presented by the present demand for a new trial. First. Was the defendant, by the preliminary agreement of sale, which was in writing, of the date of November 30, 1849, bound to pay the tax in question? Second. If he was not, has he stated facts enough in his answer to entitle him to the relief he desires?
Id. at 675.
The Court of Appeals found, as to the first question, that the defendant was bound by the contract of sale to pay the taxes. As to the second question, the court held that:
These views [as to the first question] render unnecessary a discussion of the second question. It is quite possible, from the allegations of the answer, that there was some misconception of the effect of the defendant’s contract, and that there was some misunderstanding as to the fact of the existence of the tax in question. No fraud, however, is suggested, nor is it alleged that a mutual mistake existed on the point in question. One of these allegations is indispensable in a complaint asking for a reformation of the contract. (citation omitted)
Id. at 676.
In Welles v. Yates, 44 N.Y. 525, 528 (1871), the Court of Appeals addressed the following questions: “[C]an there be a judgment to reform a contract, there not being a mutual mistake, but error on one part and fraud on the other?”
As to the facts:
The complaint, in substance, alleged that on the 28th of May, 1846, the plaintiff was the owner of 110 acres of land, being lot No. 4; that on that day he sold the same by executory contract, with the timber thereon, to T. & T. Trevor, for $17 per acre.
That on the 7th day of December, 1846, he was the owner of lot No. 5, containing 141 acres, and then entered into an agreement with the same parties, by which they undertook to cut the timber standing thereon, manufacture the same into boards and planks, and to give the plaintiff one half of the lumber thus manufactured. Certain other details were provided, which it is not necessary to specify. At the same time, the plaintiff entered into an executor contract with the same persons, for the sale of the 141 acres, at four dollars per acre.
That these two pieces of land were of the same value; that the timber growing on the latter piece was of the value of $5,000, and that such timber, in the understanding of the parties, was reserved to the plaintiff by the manufacturing contract mentioned, and that the price of four dollars per acre was for the land simply, the timber being reserved to the plaintiff. That, after proceeding for some time in the manufacture of the lumber, the purchasers became embarrassed, and the defendant took their place in the contract, and without new or further negotiations, a calculation was made of their payments, the balance found due paid by the defendant, and an absolute deed of the two pieces of land without reservation of the timber, made by the plaintiff to the defendant. That the defendant well knew all of the facts in the complaint recited. The plaintiff then avers “that through and by mistake he failed to insert in the said last-mentioned deed (of the 141 acres) any reservation of the timber mentioned and embraced in the contract secondly above mentioned;” and also avers demand and refusal to amend. The prayer is that the deed may be corrected, so as to be made to contain a reservation of the timber, and that the plaintiff may have an accounting as to the timber taken and removed by the defendant.
Id. at 527-28.
The Court of Appeals affirmed the trial court’s finding that, and reformation of the contract based thereon because, ” there was an error and mistake on the part of the plaintiff, as averred by him [and] that there was no mistake on the part of the defendant, but that he well understood the plaintiff’s error.”
In Pitcher v. Hennessey, 48 N.Y. 415, 418-23 (1872):
The plaintiff purchased 3,000 bushels of wheat in Oswego, and he could get no one, neither the defendant nor any one else, to freight it for him. For the purpose, therefore, of securing the transportation of his wheat, he made an agreement with the defendant to purchase his boat for the sum of $1,800, and the defendant agreed to load the wheat on the boat and run the boat and transport the wheat to Martinsburgh. The sale of the boat and the contract to load and run her were all one entire agreement, the consideration of which, on the part of the plaintiff, was the $1,800 to be paid by him.
The plaintiff, evidently, would not have bought the boat unless the defendant had agreed to run her and carry the wheat; and the defendant would not have agreed to carry the wheat unless the plaintiff had bought the boat. This agreement was reduced to writing in two separate instruments, drawn and executed at the same time and place, one of which was a mere bill of sale signed by the defendant, transferring the boat and her appurtenances, and the other was signed by both parties and was as follows:
“Michael Hennessey is to run boat T. Matthews, this day sold to Edwin Pitcher, of Martinsburgh, Lewis county, to the warehouse of said Pitcher on the Black River, in Martinsburgh loaded, at his, said Hennessey’s expense, except the tolls and insurance which said Pitcher is to pay. Said boat to run there with ordinary dispatch and to start immediately. Risk of navigation assumed by said Pitcher.
Id. at 418-19.
Pitcher was prevented from delivering the cargo “because the boat was too large to pass the locks on the Black River canal with her cargo[.]” General Term of Supreme Court affirmed a verdict in favor of Pitcher that Hennessey had breached the contract to transport freight– based upon the finding that Hennessey had assumed the “risk of navigation.
The Court of Appeals reversed finding that: “Taking the relation and situation of the parties into view, I think that it is clear that the defendant meant only to assume all the risks occasioned by the negligence and misconduct of himself and his servants and that the plaintiff meant to assume all of the risks, attending upon the navigation through the canal, which were beyond the control of the defendant.”
The Court of Appeals found that “the answer was sufficient to authorize a reformation of the contract” because the defendant alleged that:
[T]hat by the verbal agreement between the said plaintiff and defendant, in relation to the delivery of said boat and cargo, at Martinsburgh, aforesaid, which preceded the execution of said written contract, and in pursuance of, and in conformity with which said verbal agreement, the said written contract was, as this defendant believes and avers, by both of said parties intended to be, and understood to have been drawn, this defendant was not to assume or take any risk in respect to the size of the said canal boat, as compared with the size and capacity of the locks on the Black River canal through which the said boat would be obliged to pass on the route to Martinsburgh aforesaid, or in respect to the practicability of passing the said boat through said locks, but, on the contrary, such risk, it was understood by both of said parties, should be, and was understood by them to have been, assumed by the said plaintiff, in and by the terms of the said written contract for the delivery of said boat at Martinsburgh aforesaid,” and prays that the written contract “be corrected and reformed by inserting therein a clause or provision that the risk of the impracticability of passing the said boat cargo through the locks of the Black River canal be assumed by the plaintiff, should such correction become necessary to attain justice between the parties.
Id. at 422.
The Court of Appeals found that the facts alleged were sufficient to support reformation:
1. That the parties made a parol agreement, by which the defendant was not, and the plaintiff was, to assume the risk in question. 2. That both parties intended this agreement should be embodied in the written contract. 3. That they both understood it was so embodied. 4. That the contract was so drawn that the plaintiff assumed only the risk of navigation, and this the court below held did not include this risk.
Id. at 423.
and held that:
We have then a case, as made by the answer, where a mutual mistake was made in reducing the parol agreement to writing and in signing the written contract. In such a case equity will conform the written instrument to the parol agreement which it was intended to embody.
And the Court of Appeals concluded:
“Where an instrument is drawn and executed, which professes or is intended to carry into execution an agreement previously entered into, but which, by mistake of the draftsman, either as to fact or to law, does not fulfill that intention, or violates it, equity will correct the mistake, so as to produce a conformity to the instrument.”
Id. at 423.
In Albany City Savings Institution v. Burdick, 87 N.Y. 40, 44-47 (1881), an action to foreclose a mortgage:
[Burdick] alleged that she never assumed or agreed to pay the mortgage; that she intrusted Martin to procure the deed to be drawn, and that he, without her knowledge or consent, fraudulently procured a clause to be inserted in the deed binding her to pay the mortgage; that she accepted the deed, believing that he had drawn it according to the prior agreement, and that she did not know that the deed contained the clause until about the time of the commencement of this action, and she demanded, beside other relief, that the complaint be dismissed as to her, and that the deed be reformed by striking out the clause thus fraudulently inserted.
Id. at 44.
Trial Term ruled against Burdick without permitting her to prosecute her claim for reformation; and General Term affirmed “upon the ground that her failure to examine the deed and know its contents was such negligence on her part as deprived her of the right to assert the alleged fraud or to have any relief on account thereof[.]”
The Court of Appeals reversed and granted a new trial:
It has certainly never been announced as the law in this State that the mere omission to read or know the contents of a written instrument should bar any relief by way of a reformation of the instrument on account of mistake or fraud. It is the general rule that where a written instrument fails to conform to the agreement between the parties in consequence of the mutual mistake of the parties however induced, or the mistake of one party and fraud of the other, a court will reform the instrument so as to make it conform to the actual agreement between the parties.
Id. at 46.
Mrs. Burdick intrusted Martin to draw the deed, and he was bound to have it drawn so as to express the agreement between the parties; and when he brought and delivered the deed to her, it was in effect a representation to her that the deed had been so drawn. She was not bound to assume that he might be practicing a fraud upon her, or representing a falsehood, and she cannot be charged with negligence in believing confidently that he was acting in good faith and telling the truth[.]
Id. at 48.
In Born v. Schrenkelsen, 110 N.Y. 55, 57-59 (1888), plaintiff assigned a patent for a folding chair to defendants and, at the same time, defendants agreed to pay plaintiff a royalty of seventy-five cents for each chair manufactured under the patent. Plaintiff sued to enforce the following agreement:
We agree to number the chairs in rotation, pay royalty every month, if desired, and show our sales books for the confirmation of the numbers sold. We further agree to pay royalty on not less than six hundred chairs a year, and should we fail in this the agreement shall be null and void.
Signed by M. & H. SCHRENKEISEN,
By M. Schreinkeisen
Id. at 57.
Plaintiff argued that “defendants were absolutely obligated to pay royalties on not less than 600 chairs per year, whether they manufactured them or not [;]” and alleged in their answer “the mistake in reducing the agreement of the parties to writing.”
The trial court found for the defendant after a non-jury trial; General Term affirmed the judgment; and the Court of Appeals modified and reformed the agreement:
We think the defendants’ answer sufficiently alleged the mistake in reducing the agreement of the parties to writing. It was not necessary for them to allege a mutual mistake in the reduction of the agreement to writing, there being no mistake as to, the agreement. In such a case, if, by the mistake of the scrivener or by any other inadvertence, the writing does not express the agreement actually made it may be reformed by the court. It is only where the action is to reform the agreement itself that it is required that it should be alleged in the pleading and proved on the trial that the mistake was mutual. Where there is no mistake about the agreement and the only mistake alleged is in the reduction of that agreement to writing, such mistake of the scrivener, or of either party, no matter how it occurred, may be corrected.
We think there was sufficient evidence to show that the agreement as drawn did not express the true agreement previously made between the parties, because by that agreement the defendants were absolutely obligated to pay royalties on not less than 600 chairs per year, whether they manufactured them or not; and it was at the sole option of the plaintiff, in case the defendants were in default in paying royalties upon so many chairs, to declare the agreement null and void.
Id. at 59.
And in The Christopher and Tenth Street Railroad Company v. The Twenty-third Street Railroad Company, 149 N.Y. 51, 55-58 (1896):
The essential purpose of this action, as alleged in the complaint, was to reform a contract or lease made by and between the Twenty-third street Railway Company, The Bleecker Street and Fulton Ferry Railroad Company, and The Christopher and Tenth Street Railroad Company, dated the twentieth day of May, 1884. The plaintiffs sought to have the lease reformed by adding to the reservation therein after the words “Fourteenth Street,” the words “Between Ninth and Eleventh avenues.” The reservation contained in the lease reads as follows: “It being understood and agreed that the party of the first part (the Twenty-third Street Company) shall also have the right to run and operate its cars upon and through the above-mentioned railroad and route, in and along Fourteenth street.” The route in Fourteenth street to which this provision refers is described in the lease as follows: “Commencing at the intersection of Fourteenth street and Fourth avenue; thence through and along Fourteenth street with double tracks to Eleventh avenue.”
Id. at 55.
The trial court dismissed the claim on the merits; and General Term affirmed the judgment. The Court of Appeals affirmed and, in the process, summarized the law as the nineteenth century drew to an end:
To enable the plaintiffs to maintain this action, it was incumbent upon them to show that there was a mistake, that it was mutual and one made by all the parties to the agreement, so that the intention of neither was expressed. If it was such a contract as one of the parties intended to make and the one it understood the others also intended to make, the court had no power to reform it…as under such circumstances it would be making a new contract for the parties, and unjust to the ones who made no mistake. (Nevius v. Dunlap, 33 N.Y. 676; Story v. Conger, 36 N.Y. 673; Lyman v. The United Insurance Co., 17 Johns. 373.) In an action for the reformation of a written instrument upon the ground of mistake, the party seeing the reformation must prove that there was a mistake by evidence that is clear, positive and convincing. It is to be presumed that the written instrument was carefully and deliberately prepared and executed, and, therefore, is evidence of the highest character and will be regarded as expressing the intention of the parties to it until the contrary appears in the most satisfactory manner. The grade and degree of proof required to entitle a plaintiff to relief of this character has been many times considered by the courts of England, the Federal and the various state courts of the United States, and their decisions as to the nature of the proof required, show that it must be of the most substantial and convincing character.
Id. at 58.
Victor M. Metsch is a Senior Litigation/ADR Counsel at Smith, Gambrell & Russell, LLP. He can be reached at firstname.lastname@example.org. He maintains a website at www.LegalVictor.net and can be found on Twitter @LegalVictor1.