Case ID: miss_2/html/0341-01.html
Source: Caselaw Access Project
Author: {"author": "Mr. Chief Justice Shaekev", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Gibson v. Newman.
    Fraud cannot be set up by way of inducement, but must be directly charged. It is not necessary that the vendor should have a complete, unincumbered title at the time he contracts'; it will be sufficient if he can malee a good title at the time he agreed to convey.
    Where three notes were given to secure payment of the purchase money of land, and the first paid before conveyance, the covenants were held to be mutual and independent, and that suits could be sustained on the other notes before titles made.
    ERROR to the Warren circuit court.
    This suit was instituted on two writings obligatory given, with one other before paid, to secure payment of the purchase money of a lot in the town of Vicksburg.
    The defendant below pleaded two special pleas in bar. The pleas alleged, that the plaintiff below promised to make a good, unincumbered, indefeasible title, to said lot of ground. That the defendant had paid one of said notes, and had always been ready to pay the others, but that the plaintiff would not make titles. The plea concluded with averring a demand, and a refusal of conveyance.
    The pleas also allege, that the plaintiff represented in conversation, in relation to said land, that he had a good, indefeasible, unincumbered title, and that the defendant confiding in such representation, executed to plaintiff his notes, upon condition that the plaintiff would make him said title. There was also an averment, that the plaintiff knew, at the time of making the contract, that he was not possessed of a good title to said lot of ground. The plaintiff filed his demurrer to the pleas, which was sustained by the court.
    Coulter and Warren for plaintiff in error.
    The facts set forth in the first plea, admitted by the demurrer to be true amount to a fraud which renders the contract void. Courts of law have concurrent jurisdiction with courts of equity, in cases of fraud. A court of law effects its purpose by refusing to aid in enforcing a fraudulent contract. A court of equity sets it aside in ioto. Whenever a court of law can give relief, a resort to a court of equity is improper. 1 Wheaton, 179; 2 Cond. Rep. 520, note; Burr. 395. 474; 18 Johns. 427; 1 Term Rep. 464; Burr. 926-28; 3 Hay. 141. 202; 3 Peters, 214.
    A court of law ought never to give judgment, where it knows and has all the facts adverted to before it to show that a court of equity would and must enjoin it. A specific performance of payment of the moneys, or conveyance of the land, never will be decreed when the other party is unable to perform. Defendant admits by his demurrer that he is unable to make title to the lot. 9 Cond. Rep. 344; 6 Peters, S. C. 402-4. 328; 6 Wend. 76; Sug-den, 172; 2 Powel on Cont. 221.
    The first plea admitted shows an entire failure of consideration and fraud. 20 Johns. 133; 1 Tenn. Rep. 464. Contracts for land are always considered dependent, unless the contraiy intention clearly appears. The vendor cannot be compelled to convey his land without receiving the consideration money, nor the vendee to part with his money without an equivalent in return. 1 Peters, S. C. 464-5; 1 Hayw. Rep. 369; 16 Johns. 267; 26 Johns. 133-4; 10 Johns. 268; 3 Desaus, 541.
    It is well settled at law, that to entitle a vendor to,recover the purchase money he must aver in his declaration a performance on his part, or offer to perform, (that is to make, title,) which averment must be proved, unless performance’or tender is dispensed with. 1 Peters, 465. 675; 20 Johns. 130-1;' 2 Powel on Cont. 19.
    It is a good plea that the defendant was not authorised or had no right to convey. 2 Cond. Rep. 315. Whenever a vendor is unable or refuses to convey, the vendee may disaffirm the contract and recover back what he has paid. 5 Johns. Rep. 81, note; 12 Johns. Rep. 190.200; Ibid. 131; 3 Hayw. 141; 5 East, 198. 204.
    Whenever a party undertakes to make a good title it must be good in law and equity; and a court of law will take notice of equitable defence when it comes before them incidentally. Sug-den on Vend. 179.
    2d Plea. As to demand of title and refusal. If a vendor will not make a good title when demanded or called on, he loses his bargain. The vendee is not bound to wait until he can procure a title. 2 Phil. Ev. 64, note; 8 Johns. Rep. 257. 20. 27. 135. 67; 1 Peters, 464; 4 Peters, 328-9; 1 Tenn. Rep. 258.
    Where a deed is set aside in equity for fraud and imperfection, it would be equally set aside at law, upon pleading to it. In that case no estate passes. 6 Halsted, 118.
    If a vendor is to make a good title, he must be prepared to do so on the day when it is to be done, 2 Phil. Ev. 65, and must draw the conveyance. 7 Wend. 130; 3 Wend. 250. If a vendor will not make conveyance when reasonably demanded, he loses his bargain, and the purchaser is not bound to wait until he is able. 2 Phil. Ev. 64; 8 Johns. Rep. 257; 20 Johns. Rep. 27. 135 -6; 3 Wend. 250; 6 Cow. 1.
    The purchaser is not bound to part with his money unless the vendor is able to give him a title, according to the terms of the sale. If he is not, he may disaffirm the contract and recover back the deposit. 11 Johns. Rep. 527; 5 Johns. Rep. 8S.
    Fraud vitiates every thing. 3 Peters, 319-20; Walker, 73; 2 Kent. 453. 482. The basis of contract is good faith. 6 Johns. Rep. 110-11; 10 Johns. Rep. 463.
    Courts of law have concurrent jurisdiction with courts of equity in all cases of fraud. 11 Johns. Rep. 463; 6 Halsted, 392; 1 Wheat. 179; 1 Littell, 63; 2 Ves. 295. To prevent the necessity of resorting to equity, a court of law Avill notice equitable rights and do justice. 18 Johns. Rep. 505-6.
    Bodley and Templeton, contra.
    
    The pleas are, that plaintiff and defendant had a conversation about the sale of a certain lot in Vicksburg, and that plaintiff represented to defendant, that he had a good title, and was autho-rised to sell; and that if defendant would execute his .notes to him, he would sell him said lot and make him title, &c.; and avers that in consideration that the said plaintiff promised to make him a title, he then and there executed his notes. 3. Plea, stating one of them to have been paid, concluded by stating that plaintiff had not a good title. 2d plea adds a demand of title from plaintiff to the said statements of facts.
    Both these pleas are bad.
    1. Because they are uncertain. They do not set out any distinct cause of defence; are confused and uncertain in their sta'e-ments. It cannot be determined from their language whether defendant sets up as a bar to the action, fraud, failure of consideration, want of title at the time of sale, or a refusal on the part of the plaintiff to comply with his promise.
    2. The pleas are for the same reason double; allege as the. •consideration of the notes first,- the sale of the lots, and then, a promise to convey. But placing the defence on either of these grounds, the pleas are bad.
    3. Because, if the sale be the consideration and the failure to convey be the failure of consideration, and the grounds of defence, under such a state of facts, the defendant must set up with 1. Fraud. 2. Eviction by a title paramount to the plaintiff’s; or, 3. Facts amounting to an entire disaffirmance of the contract, from the disability of the plaintiff to put defendant in possession, or in a situation to derive some benefit from the subject of purchase. The pleas set up neither fraud nor eviction, and do not show that the defendant is not in possession or has not enjoyed the property; and the truth is his alienee now enjoys this property. In support •of this .position see all the authorities referred to below.
    4. If the pleas allege the promise of the plaintiff to convey a title to be the consideration of the notes, the promise and the execution of the notes, being stated as contemporary, the pleas are no, bar to the action. Showing themselves a sufficient consideration, is a promise for a promise. Chitty on Con. 16; 1 Caines, 583; 12 Johns. Rep. 397; 2 Kent’s Com. 475.
    '. 5. The contract set out b.y the pleas, if any, is sufficiently set out, shows the covenants or promise of the parties to have been independent, and in such a case, the breach of the covenants on the part of the vendor, is no defence to an action on the notes. 9 Johns. Rep. 126; 20 Johns. Rep. 15; 5 Cowen, 509; 4 Littell, 253. And a party who has paid money on such a contract cannot recover it back in an action for money had and received. 6 Cowen, 13. -
    6. It is a rule of interpretation, that the party who is to do the first act must show his intention to rely on his remedy on the covenants, and not to make performance on the other side a condition precedent. 4 Littell, 353. The defendant shows in his plea, that he was to do the first act, because he avers, that he has paid one note given for the same consideration, which must have been presumed to have been in conformity with his contract. This fact also shows, that the conveyance was to have taken place when the money was paid, and brings the case completely within the scope of the authorities above cited.
    ■ 7. The pleas are bad, because they do not aver that the defendant prepared and tendered a deed at the time he demanded a title. Sugden on Vendors, 183 and 369, Phila. Edit.; 30 Johns. Rep. 15; 6 Cowen, 17.
    8. The pleas show that the title was to be made at the time the money was paid; because the conveyance must have been stipulated to have taken place, either before or after the notes were executed. The defendant states an execution of his notes-without conveyance, and the presumption is in pursuance of the contract. It was, therefore, to take place subsequently; and as no particular time subsequently is set out, and as the defendant states he has paid one instalment, the conclusion is unavoidable that it was to take place when all the instalments were paid; and if such is not the construction, the pleas are bad for uncertainty.
   Mr. Chief Justice Shaekev

delivered the opinion of the court.

Newman instituted this suit on two writings obligatory for the sum of 600 dollars, to which Gibson pleaded two special pleas in bar. First, that the writings obligatory were given to secure purchase money agreed to be giyen for a lot in the town of Vicksburg, to which the plaintiff below represented, ■ that he had a good, unincumbered, indefeasible title, and agreed and promised, that if defendant would execute his notes for 18.00 dollars, payable in three annual instalments, he would make to him a good and complete title to the lot, free from all incumbrances. That the defendant confided in his promises, and executed the writings obligatory in the declaration mentioned with one other, and concludes by averring, that at the date of the contract, the plaintiff had not a good, indefeasible and unincumbered title to the lot, and was not authorised to sell.

The second plea was, that the notes were given for the lot, and that Newman at the time of making, represented that he was seised by good and indefeasible title, free from all incumbrances; and that if Gibson would execute to him the notes, he agreed and promised to make him a good title, and concludes by averring the execution of the notes by Gibson as the performance on his part; and also, that he has paid one of the notes, and has at all times been ready and willing to pay the others, if Newman would make him a title; and avers, that he demanded title, which was refused.

To these pleas there was a demurrer, and several causes assigned, which was sustained, and we are to determine whether it was properly or improperly sustained.

For the plaintiff in error, it is insisted that the facts pleaded and-admitted by the demurrer, amount to fraud, and that the contract was therefore void. In making an application of this position to the first plea, it is untenable, both in reference to the form of the plea and the matter pleaded. The representations of Newman in regard to the goodness of his title, are only set out in the plea, by way of inducement, and fraud cannot be set up in that manner, but must be directly charged. Nor does it in point of fact amount necessarily to fraud, that Newman had not, at the time of sale, a good, indefeasible, and unincumbered title.” It is not pretended that it was part of the contract that titles should pass on the day of sale, and it was, therefore, immaterial whether Newman had, at that time, an unincumbered title or not. If he was prepared to make such a title as he contracted for at the time he undertook to convey, it is all that the defendant had a right to require. Numerous authorities might be cited to show, that it is not necessary that the vendor should have a complete unincum-bered title at the time he contracts; if he is able to convey at the time he has designed to do so, it is sufficient. Two of the authorities, cited by the counsel for defendant in error, fully sustain the position. 5 Cowen, 510; 9 Johns. Rep. 126. The first plea was, therefore, manifestly bad, and the demurrer was properly sustained to it.

The second plea presents the subject in a diiferent light, but it is not entirely free from objections on the ground of uncertainty. The representations of the plaintiff in regard to his title, as set out in the plea, are subject to the same objections which have been applied to the first plea. It is stated that the plaintiff below proposed that in consideration that Gibson would execute his notes for 1800 dollars, that he (Newman) promised to make him a good title to the lot. Gibson avers that he executed the notes, and performance on his part, which were accepted as such. To construe this part of the plea alone, it might lead to the conclusion that the promise to make title was the consideration of the notes. The plea does not state when the title was to be made, and there is no reasonable inference that it was to have been made when the notes were executed; else why did the defendant pay one of them before he got a title, or why would he execute the notes without getting a title? No other conclusion is left than that the promises, as they are set up in this part of the plea, were independent; if so, it was not the performance of the promises to make title, but the promise itself which was the consideration of the notes. The case of Saunders v. Beal's Adm’r, 4 Bibb, 342, is directly in point, and that mutual promises amount to sufficient consideration, the one for the other, is shown by numerous authorities. 2 Kent’s Com. 365; 12 Johns. Rep. 397; 4 Bibb, 342.

We are to take, however, the substance of the whole of the plea, and see whether it is a bar to the action. It is averred that the notes sued on, together with one other, were given to secure the price of a lot in Vicksburg, sold by the defendant in error to the plaintiff. That the defendant promised to make a good and indefeasible title to the lot free from all incumbrances. That the plaintiff has paid one of the notes and has at all times been ready to pay the other, but that the vendor would not make him a title, and concludes by averring a demand of title and refusal.

• The principles of law as applicable'to covenants and promises, which are verbal covenants, are well settled, but great difficulty frequently arises in ascertaining and fixing the character of the agreement. Covenants are of three kinds: 1. Those which are conditions precedent and dependent, where the performance of one depends on the prior performance of another. 2. Mutual conditions or concurrent covenants, which are to be performed at the same time; and 3. Mutual and independent covenants, when the default or non performance of the plaintiff is no excuse for the defendant. The particular division to which the case before us properly belongs is to be ascertained from the meaning and intention of the parties as gathered from the contract as pleaded, and it is to be regretted that it was not set out with greater certainty. The facts pleaded cannot amount to a bar unless the promises were mutual and dependent, or both to be performed at the same time by the one making title and the other paying the money. The party who wishes to excuse himself for a breach of his obligation, on the ground that the plaintiff had failed to perform his mutual undertaking, must plead the plaintiff’s agreement with sufficient certainty to show that he was bound to perform, and that his failure to do so discharged the defendant. It appears by the plea that Newman promised to make a good title, but the time at which it was to be made is not stated. By a fair construction of the plea it might with some plausibility be urged that the title should have passed when the notes were made, and yet such a construction would not strengthen the defence. There is an averment that in consideration that Gibson would execute his notes, Newman promised to make him a title. Gibson agreed to pay in three instalments; and at the maturity of which one of them was the title to have been made? Perhaps the fairest inference would arise in favor of the time of the last instalment, but I apprehend that matter should have been specially pleaded as an estoppel, and not be left to depend upon mere inference of fact.

It is necessary to aid the plea by construction, as that is the only means by which any time can be fixed at which Newman agreed to make a title; and suppose we assume that he was to have done so when the last payment fell due, the question then arises, were the arguments mutual and dependent, or independent? We find many adjudicated cases where it has been held that an agreement to pay by instalments, or at different times, would make the covenants mutual -and independent, as by doing so the party had manifested a willingness to rely on the covenant or promise of the other contracting party for title or performance, by parting with at least part of his money before he could with propriety call for performance on the other side. This rule of construction is adhered to both in England and in the United States, as will be seen from the following authorities, some of which hold that the payment of part is still more conclusive as to the character of the agreement. Pordage v. Cole, 1 Saunders, 319, note 4; Terry v. Duntze, 2 H. Bla. 389; Robb v. Montgomery, 20 Johns. Rep. 15; Champain v. White, 5 Cowen, 509; Mason v. Chambers, 4 Littell, 253; Saunders v. Beal, 4 Bibb, 342; Gardiner v. Corson, 15 Mass. Rep. 471. In the note to the case in Saunders this strong language is used: “ If a day be appointed for the payment of money, or part of it, or for doing any other act, and the-day is to happen, or may happen, before the thing, which is the-consideration of the money or other act is to be performed, an action may be brought for the money, or for not doing such other act before performance; for it appears that the party relied upon his remedy, and did not intend to make the performance a condition precedent: and so it is when no time is fixed for the performance of that which is the consideration of the money or other act.” The language of Mr. Justice Buller in Terry v. Duntze is equally conclusive, and so is the language of Judge Jackson, in Gardiner v. Corson; and the reporter of the case has added a copious note, and cited many authorities in support of the position.

I do not think the decision in the case of the Bank of Columbia v. Hagner, 1 Peters’s Rep. 455, cited by counsel for the plaintiff in error, can be said to sanction a different rule, when critically examined. The court decided that in contracts for land, the covenant should be considered mutual and dependent, unless a contrary intention appeared, and it was thought the contract before them did not show a different intention. The contract, if it existed at all, was predicated on the written proposition of Hagner, in which he proposed to pay in six quarterly instalments, for which he would give his notes, if the plaintiff would give him a deed. If the bank should prefer it, however, he proposed to pay by in-stalments, and take a bond for title when the payments were completed. There was some doubt in point of fact, whether the bank had accepted the proposition; but if the act did amount to an acceptance, the bank was, of course, bound to perform the correlative part of the proposition, by either making a title, or giving bond for title. It must have been on this ground that the covenants or agreements were held to be dependent, although he had agreed to pay by instalments. If it were not, it is difficult to reconcile this decision with the authorities cited. In the case before us, the parties have shown their intention by their acts. Gibson gave his notes to pay the money at particular times, by which he manifested an intention to pay at all events, without regarding the performance of Newman as a condition. He has given for evidence of his intention by actually paying a part of the money, and has thus shown a willingness to part with it without getting a title, thus proving by his subsequent act what the law presumes he intended by his first.

The judgment of the court below must be affirmed.