Case ID: mass_4/html/0425-01.html
Source: Caselaw Access Project
Author: {"author": "Parsons, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

* Moses Bliss and George Bliss versus Matthew Thompson.
    One is a competent witness for a plaintiff, although he has a similar action pend ing against the same defendant, arising out of the same transaction.
    An implied promise to pay money received by the defendant, for a release to A, by the plaintiff, of a warranty of lands, is not a contract concerning lands within ' the statute of frauds.
    The maxim that a party shall not be received to aver against his own deed, does not apply to the case of a deed obtained by fraud.
    The common law requires good faith in all contracts; and where one overreaches another by false allegations, or fraudulent concealments, the law will compel him to pay over the money, obtained by such means, to the party to whom, in equity and good conscience, it belongs.
    This was an action of indebitatus assumpsit for money had and received.
    Upon the general issue being pleaded, the cause was tried at an adjourned session of the Court in December last, before Sedgwick 
      J., and a verdict found for the plaintiffs, subject to the opinion of the Court on the evidence filed in the case, and reported by the judge, from which the following facts appear: —
    The plaintiffs, the defendant, William Ely, and certain other persons, were tenants in common in fee, in different proportions, of a large tract of land in the state of Kentucky, purchased, by the agency of the said Ely, of William Alexander. The purchase was secured by the assignment of the warranty of Richard Gernon. It was afterwards known that there were prior claims to a part of the land, and that the remaining part was of an inferior quality, there being no timber on it; and the principal reliance of the purchasers, to relieve themselves against a bad bargain, was on the warranty of Gernon. The defendant, having purchased the shares of most of the proprietors, had himself, with the agency of William Austin, agreed with Gernon to procure for him from the partners a release of his warranty for 8000 dollars, of which Austin was to have 2000 dollars. The defendant, concealing his transaction with Gernon, applied to the plaintiffs to purchase their share, under the pretence that nothing could be obtained from the original purchase, but by immediately proceeding to Kentucky. and saving some part of the purchase money by selling the land for the most it would bring; that Gernon’s warranty was worth nothing, as he was unable to pay any thing, and that he was intending to proceed to the south of France, whence he had emigrated. The plaintiffs were then lg-, norant of Austin’s connection with the defendant, and of [ * 489 ] his concern in the contract * with Gernon. The information given by the defendant, and written by his agent, Austin, was wholly false, and by them known to be so, and was communicated by them with the intention of deceiving the plaintiffs, who, giving credit to the representations and information given them by the defendant, sold to him their interest in the purchase, secured by Gernon’s warranty, for a sum of money much less than their proportion of the money paid by Gernon, to procure a release of his warranty. The said Ely was treated in the same manner by the defendant; and under the same impression, and with the same confidence that the defendant had given the plaintiffs, being present during the negotiation, he likewise sold his share to the defendant for the same price, and the plaintiffs and Ely conveyed their shares to the defendant by the same indenture. These facts were principally proved by the deposition of Mr. Ely, the admission of which was objected to at the trial by the defendant, and because that objection was overruled, the defendant moved for a new trial.
    In support of this motion, it was argued that Mr. Ely, holding under the same deed with the plaintiffs, and having a similar action pending against the defendant on the same grounds, was too closely united in interest with the plaintiffs to be received as a competent witness. It was true their estates in the land were several, but the receipt of the money from the defendant was joint, as was the release to Gernon. If they had joined in the action, as it was insisted they might and ought to have done, they could not thus have been witnesses for each other.
    It was further contended that this action was not maintainable upon the evidence in the case, for that Gemon’s warranty was a covenant real running with the land, and the plaintiffs’ demand is thus within the statute of frauds, as being on a contract concerning lands, and so ought to be supported' by some written memorandum signed by the party to be charged therewith.
    It was also said that the plaintiffs, having by their deed acknowledged full satisfaction for their release, were estopped to say that no sufficient consideration was paid, or that fraud was used in the transaction.
    *But it was more strongly insisted that the facts dis- [*490] closed no moral or even legal fraud. If the defendant was better informed of the quality of the land, and of the goodness of the title to it, and of Gernon’s ability, than the plaintiffs were, he had a right to avail himself of such superior knowledge. He received the money from Gernon to procure a release to him from the several claimants under his covenant of warranty, and he had a right to make the best bargain he could with each of them. He was bound by no rule of honesty or fairness to give to the plaintiffs information which would enhance their demand, and which they were equally able and obliged to procure for themselves. A circumstance in the case absolutely protects the defendant against the imputation of fraud; he offered to sell his claim to the plaintiffs for the same sum which he offered them for theirs.
    Before the plaintiffs’ counsel made any observations on the motion, a suggestion dropped from the Court that they need not labor to show that a gross fraud had been committed, but how far the plaintiffs could be relieved in this action.
    
      Ashmun, for the plaintiffs,
    observed that it had lately been much the practice to extend the benefit of this action to every case where one held money, which in equity and good conscience he was bound to pay over to another. In this case, the plaintiffs were deprived of their money by a gross fraud. Not only was there a false affirmation, but Austin’s letter was in nature of a false token. They respected facts which were peculiarly within the defendant’s knowledge, and which, on every principle of good faith, he was bound to disclose.
    
      But, even agreeing there was no fraud in this case, yet it is contended that this money was received by the defendant for the use of the plaintiffs, whenever they should by their act and deed confirm the release to Gernon, or enable the defendant to do it for them, which their deed to the latter certainly did.
   The opinion of the Court was afterwards delivered by

Parsons, C. J.

[After stating the facts from the evidence reported.] It appears that Ely, though objected to, was admitted as a witness, and that, agreeably to the direction of the judge, a verdict was found for the plaintiffs for the difference be-[*491] tween the money paid them by the defendant *for the release, and the money received by him of Gernon, to extinguish his warranty on the shares belonging to the plaintiffs.

The admission of Ely is now objected to as a sufficient cause for setting aside the verdict. Ely’s testimony was certainly very ma terial for the plaintiffs; and if it was improperly admitted, the verdict ought to be set aside. The objection to him is founded on his connection with the plaintiffs in the same transaction; that, for the same supposed fraud, he has commenced his action; and if he can be a witness for the plaintiffs, they will be witnesses for him.

An objection of this nature may very properly be made to a jury, to the credit of a witness, who will decide what weight is due to his testimony; but no objection, on account of interest, can exclude a witness, unless he be interested in the event of the suit. In this action, Ely had no such interest; and the verdict cannot be given in evidence for or against him, in any action in which he may be a party. And although his demand may arise out of the same transaction, this case cannot be stronger than that of an action against one underwriter on a policy of insurance, in which another underwriter on the same policy may be a witness for the defendant. We therefore think that Ely was a competent witness, and that the judge did right in permitting his testimony to be laid before the jury.

Several objections have been made to the verdict. It has been urged that the assignment of Gernon’s warranty, which ran with the land, must be considered as an assignment of land, and, therefore, that the plaintiffs’ demand is within the statute of frauds, and so could not be supported by paroi evidence, but only on a written memorandum made by the defendant.

Without controverting the position that a contract to release a covenant of warranty annexed to land, is a contract concerning some interest in land, yet, in this case, the objection cannot prevail. For the action is not brought on any agreement made by the defendant with the plaintiffs, concerning the sale of any interest in land, but for money he had in equity received from Gernon for their use, by reason of their having extinguished the interest they had in Gernon’s warranty.

* Another objection is, that the release to the defend- [ * 492 ] ant oy the plaintiffs being by deed, they cannot aver that it was obtained by fraud against their own deed, which expresses a sufficient and fair consideration.

It is generally true that a man shall not be received to aver against his own deed. But the case of fraud is always excepted, which vitiates every transaction; and a deed obtained by fraud is to be considered as a void contract as to the fraudulent party.

But the great objection, and the one most relied on, is, that the transaction, considered in all its parts, is not in law fraudulent; that the defendant had a legal right to make his bargain for his own benefit with Gernon, to procure a release of his warranty, and that he might lawfully conceal it from his partners in interest.

. Not only good morals, but the common law, requires good faith, and that every man in his contracts should act with common honesty, without overreaching his neighbor by false allegations, or fraud ulent concealments.

Let us now look at this transaction. From the evidence reported, it was competent for the jury to infer that the defendant was a partner in interest, with the plaintiffs and others, in Gernon’s warranty ; that, as a partner, he proposed terms to Gernon to discharge his warranty; that he was to receive 8000 dollars on procuring the discharge; that he concealed this negotiation, and falsely affirmed that the warranty was worth nothing, and fraudulently produced Austin’s letter, written for this purpose, to give credit to his affirmation ; and that the plaintiffs, imposed on in this manner, executed this release, by which the defendant was enabled to fulfil his contract with Gernon, by extinguishing the plaintiffs’ interest in the warranty.

As the jury might make these inferences from the evidence, we must presume that they did make them, as they have found a verdict for the plaintiffs.

On this view of the case, we are satisfied that the transaction be tween the parties is vitiated by fraud on the part of the defendant, and will not protect him in holding the money he received from Gernon, in consideration of the plaintiffs’ having released their interest in the warranty. Here is not * only the [ * 493 ] suppression of the truth, but also an allegation of falsehood, to deprive the plaintiffs of their interest in the warranty.

It appears that the jury deducted, from the plaintiffs’ proportion of the money paid by Gernon to the defendant, the, sum he had paid the plaintiffs for their release. This deduction, we think, was right, as the effect is to give to the plaintiffs so much of the money received from Gernon by the defendant, as he, against equity and good conscience, detained from the plaintiffs. Upon the whole, we do not find any good reason to set aside the verdict; and judgment must be entered upon it for the plaintiffs.

Hooker and J. Dwight for the defendant.