Case ID: scl_2/html/0380-01.html
Source: Caselaw Access Project
Author: {"author": "The Judges,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

George Whitefield against William M‘Leod.
    Charleston District,
    1802.
    'E'hat a sound ¡■rice warrants a sound ’•óod”6generai -.viiere a hay-ni'iiy"f'aluhe nreumstan-fair op]iortu-forming him-he'f shah^be hew'1 to "his bargain, tbo’ it turn out to be a losing Inadequacy of where there &e U°isfrinot "rouno^*OIfbr aUcontractSÍde
    
      deserves a sound commodity. of
    recovering back money which had been paid by mistake, MOTION for a new trial. This was a special action on the case, to recover back thirteen hundred pounds sterling, for a ship which was stated to be unsound and not seaworthy. There was a wr’tten agreement in this case, by which the defendant agreed to sell, and the plaintiff to purchase, the ship in question, at and for tne price of thirteen hundred pounds sterling, which sum was duly paid to the defendant agreea- hly to a bargain between them. Soon after the conclusion agreement, and the payment of the money, the plain- alleged that he had discovered that this was an old and ° unsound ship, not seaworthy, and that it would require more to repair her than she would be worth when repaired, Whereupon, he demanded a return of the money, and of- fered to rescind the agreement; but the defendant refused t0 §*ve UP contract5 and insisted upon holding the plain- t0 bargain. Upon which he brought the present action,
    upon the implied warranty in
    law, that a sound price Mr. Parker, for the plaintiff, contended, that this doctrine or where the consideration had failed, was so well established in our courts of justice at this day, that he would not dwell upon it, but would state it as a settled rule of law. He then offered to prove the payment of the money ; it was, however, admitted. He then produced sundry estimates made by ship-carpenters and masters of vessels, by which he said it would appear, that it would cost more to repair this old ship, and make her fit for sea, than she would be worth when all these expenditures were laid out upon her. That, therefore, upon every principle of justice, the defendant ought to refund him the money he had paid him, with interets for the use of it
    
      The Attorney-General, in reply,
    stated, that this ship was not sold to the plaintiff as a new ship, but as one which had run some years, and performed many voyages ; and consequently as a vessel which would stand in need of repairs. It was then proved, that the plaintiff was desired to go on board and examine her himself; that he did so, and took with him persons of skill and knowledge in naval affairs, particularly a captain Hunter, an experienced seaman and commander; and it was not till after a full examination of the state and condition of this ship that the bargain was closed. It was also proved by two merchants, Mr. Adam Tunno and Mr. William M-Whann, that if this ship had been new, she would have been worth two thousand five hundred guineas, more than double the sum she sold for.
    The presiding judge left this cause to the jury, as matter very proper for their consideration, under all the circum- , stances, and they found a verdict for the defendant.
    This was a motion for a new trial, on the ground that the verdict was against law, and the justice of the case.
    Mr. Parker, in support oí this motion,
    said, that as the doctrine he had contended for on the trial was now considered as the fixed and established law in this country, to wit, that a sound price deserves a sound commodity, he would go one step further, and lay it down as a principle equally sound, and as well deserving the support of this court, that a fair price raises an implied warranty of the adequacy of consideration ; and for that purpose cited Wooddeson, 415. Men, he said, paid their money in order to get an equivalent ; and if they were deceived, they ought at least to be restored to their former condition, even if no damages were allowed them, which was all that his client wished on the present occasion. And if the court would order a new trial, he had little doubt but that another jury would restore the money he had paid away, and place the parties where they originally stood before the bargain took place.
    
      The Attorney-General. The plaintiff cannot possibly recover on any special warranty in this case; if he recovers at all, it must be on the implied warranty. He admitted that a sound price required a sound commodity, but denied that a sound price had been paid in the present case, in the sense in which the counsel for the plaintiff wished to place it. Only thirteen hundred pounds had been paid for this ship, and it was proved that if she had been new and sound, she would, from her size, capaciousness and construction, have been worth double the sum, which shews she was sold as a half-worn ship, and, consequently, only half the price of a new, sound ship was paid for her. That the doctrine urged on behalf of the plaintiff, that.a fair price raises an implied warranty of the adequacy of consideration, was a novel doctrine, unknown to the common law, and had never been broached in any of our courts of justice before. Such a doctrine, he said, if once admitted in the formation of contracts, would leave no room for the exercise of judgment or discretion, but would destroy all free agency; every transaction between man and man must be weighed in the balance like the precious metals, and if found wanting in this adequacy, must be made good to the uttermost farthing ; it never was, nor never could be, of practical use in society. The thing might at first sight appear to be plausible, but when, brought to the test of experience, it would be found to go too far, to prove too much, and at last to destroy itself by the extravagance of its theory. The true rule respecting contracts he took to be this, that whenever a man paid a sound price to the seller for a commodity which turned out to be unsound afterwards, without the seller’s knowledge of the unsoundness at the time oí sale ; or where there was a knowledge of the unsoundness, and a concealment on the part of the seller; in all these, and similar cases, a sound price raises an implied warranty to repay the money paid, and in all cases of fraud, the party was liable to smart money by way of damages besides. - But in all other cases, where there is. an equal knowledge of all the circumstances, and where each party has an opportunity of informing nimself, and the means of procuring information, and a man makes a contract or bargain with all such advantages before him, and with his eyes open, he ought to be bound by it; otherwise, good faith and mutual confidence would be atan end. In the present case, the ship sold to the defendant was sold as a half-worn ship. The plaintiff was desired to go on board and examine the vessel; he did so, and took trusty and confidential men with him for that purpose, and after all this examination made his bargain. Was there any thing like concealment of circumstances here ; any knowledge of facts on one side, which was not freely communicated to the other ? None. Was there any latent defects which the seller knew of, and the purchaser was not informed of ? None. Every thing was open to him within the knowledge of the defendant, and he ultimately made the purchase upon the strength of his own judgment, and that of his friends; and not upon the recommendation or representation of the defendant. To suffer such a man to get rid of such a contract, under all these circumstances, would establish a principle which would undermine and blow up every contract, which could be made by any man, who wished to get rid of it afterwards. But the real truth of the case, he said,. was this: The plaintiff had found out, that the bargain he had made was not likely to turn out to be an advantageous one, as freights which had been high, had fallen considerably ; and therefore it was he wished to get rid of his bargain. He did not wish to be at the expense of repairing this ship, and putting her in a condition for sea, but thought it more advantageous, as things had turned out, to get back his money by rescinding this Contract.
   The Judges,

after hearing the arguments, were all of opinion, there were no grounds for a new trial. The doctrine of a sound price deserving a sound commodity, they observed, though a very wise and salutary one, had been bandied about in our courts more than any other. It had vibrated from the extreme of rigour on one hand, to the extreme of laxity on the other ; and juries had in too many instances in the exercise of these powers, rendered contracts too precarious In this case, however, it appears, that the Judge who tried the cause, had left it to the sound discretion of the jury, who on their part again appear to have exercised it in a very proper manner, by holding the parties to their bargain. Many decisions have been made on this subject in our courts, and all on the same uniform principles ol law and justice, though often misapplied. The general tenor of them all, when well understood, had been to guard against fraud and circumvention, and those latent defects which neither party knew of. But none of them ever meant, or were designed to aid men in getting rid of contracts fairly made, under a full knowledge of all the circumstances, relating to the subject matter of such contract on both sides. Every man was free to make a contract, and free to refuse it, but when once made, he was bound by it, where there was no fraud, concealment or latent defect. It was the sound policy of the law to support and uphold contracts, and not to destroy or render them uncertain. Inadequacy of consideration, is not alone any ground for setting aside a contract solemnly entered into. The adequacy or inadequacy of consideration, in every contract, depends so much upon the different ideas of men, in relation to the objects of their contracts, and the views and purposes with which they are entered into, that there is no fixing any general standard or rule by which it can be settled ; for what one man might think a full and adequate consideration, another might think very inadequate, so that really it is so indefinite and uncertain in itself, that such a doctrine never could be reduced to practical use ; as every contract might be impeached, where any advantage is gained on one side or the other, which had not equally been acquired by the opposite party.

Rule for new trial discharged.

All the Judges present.