Business Associations, Pages 69–70

Hirsch v. Silberstein

Supreme Court of Pennsylvania, 1967

Facts:

Defendant Silberstein agreed to purchase plaintiffs' lot adjoining their home for $10,000, and it was conveyed by deed. Silberstein also executed an affidavit declaring that he had been acting as a straw party for black defendants Cross, making the transaction exempt from the real estate transfer tax. Plaintiffs sued for violation a clause in the agreement with states that the land should not be assigned or transferred by the buyer without the written consent of the seller.

Procedural History:

Trial court dismissed plaintiffs' complaint.

Issue:

Did defendants violate the purchase agreement or defraud plaintiffs?

Reasoning:

  • Defendants did not assign or transfer the agreement of sale. They just deeded the property itself in a separate transaction from themselves.

  • While plaintiffs investigated defendant Silberstein and his workplace and concluded that he would make a desirable neighbor but did not do the same for defendants Cross, they have not suffered any legally recognizable damages by this change. Defendant Silbersteins had no duty to reveal the existence of their principals, so their concealment does no constitute fraud.

Holding:

No, defendants did not violate the agreement nor defraud plaintiffs. Affirmed.


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