Case Name: Joseph Morris vs. P. Petero
Court: Supreme Court of the State of Hawaii
Jurisdiction: Hawaii
Decision Date: 1878-01-04
Citations: 4 Haw. 23
Docket Number: 
Parties: Joseph Morris vs. P. Petero.
Judges: Judd and Me Cully, J.J.
Reporter: Hawaii Reports
Volume: 4
Pages: 23–29

Head Matter:
SUPREME COURT—IN BANCO,
OCTOBER TERM—1877.
Judd and Me Cully, J.J.
Joseph Morris vs. P. Petero.
ON QuESTIONS RESERVED..
X. M. was sued-in ejectment for a piece of land bought by-him of P. P. by a warranty deed, and gave notice to P. P. to defend,, which he refused, to do,- and J. M. consented to judgment. J. M. thereupon brought an action against P. P. on his covenant of warranty, to recover the purchase money paid and amount of damage suffered, by the judgment recovered in the action of ejectment;
Held, the judgment in. the former action was good though obtained by consent, the then defendant having given his grantor notice to defend, and he refusing so to do, and no-fraud, appearing.
Also, plaintiff entitled to recover the damages and costs and counsel fees paid by him in the former suit. The former judgment is conclusive evidence of the amount of damages.
Also, in such an action the defendant is not bound by the consideration recited in- the deed, but -may show the actual consideration paid.

Opinion:
Opinión of tbe Court by
MoCully, J.,
upon questions re served, as per the- following statement:.
"In, tliis cause tbe jury were directed by tbe Court to return, a verdict for tbe plaintiff — for $150, amount of tbe consideration expressed in tbe deed upon wbicb tbe action was brought; $168.75, amount of damages and costs paid by tbe plaintiff in tbe action of ejectment; and $50 counsel's fees- paid,in that action; total, $368.75 — subject to tbe opinion of tbe Court upon tbe following reserved points:
"First — Whether tbe judgment obtained against tbe plaintiff by consent is a good and- valid judgment against tbe now defendant; the plaintiff having given tbe defendant notice of tbe action and requiring tbe defendant to defend, and be refusing; to do so.
" Second — It being admitted that tbe defendant's grantor was entitled to a dower interest in tbe land, whether tbe plaintiff-is entitled to recover tbe whole or any of tbe purchase money?
" Third — Whether the defendant is entitled to have deducted* from tbe damages or interest tbe value of tbe stones, sold by him, taken from tbe land before tbe ejectment suit?
" Fourth — Whether in this action tbe defendant cannot show a different consideration from that expressed in tbe deed?
"The above points, with all tbe papers in tbe cause,, are hereby certified to tbe Supreme Court in Banco- at tbe present term."
By tbe said- papers it appears that this- is an action on a warranty covenant in a deed from -defendant to tbe plaintiff to recover tbe purchase money paid, and tbe amount of damages suffered by a judgment recovered in an action of ejectment at tbe April term.
Tbe first reserved- point raises the- question whether the judgment obtained against the- plaintiff is valid, and tbe Court is thereby referred to tbe record of proceedings in that case, by wbicb it appears that one N-aai, w., her husband, Kaaua, joining, brought action of ejectment against the present plaintiff. No answer was- filed, but on tbe 4th of April the following agreement was filed:
" Consent is hereby given that judgment for the plaintiff be entered herein as prayed for, and that damages to the amount of one hundred and fifty dollars for the detention of the land be awarded to the plaintiff.
" (Signed) Joseph Morris, by Cecil Brown, his Attorney.
"(Signed) E. Preston, plaintiff's Attorney."
Defendant's counsel now claims that this judgment is invalid, because made by consent of the attorney without authority in writing' from his client; that it is not within the power of an attorney-at-law to bind his client to a voluntary judgment. He cites Section 1069, of the Civil Code: "The practitioners so licensed, shall have control to judgment and execution'of all suits and defenses confided to them: provided, however, that no such, practitioner shall have power to compromise,. arbitrate and' settle such matters confided to him, unless upon such special authority in writing from his own client." But in the present case, Morris does not object to, but confirms the act of his attorney in this behalf. If the-judgment would have been valid, if Morris had previously given a written authority to do what has been done without it, and which he ratifies, it is difficult to see on what grounds a third party shall be permitted to claim that it is invalid.. The rights of the third party, this defendant, are those of the covenantor in a deed, to be notified of the pendency of the action against his grantee and to be called upon to defend. This was done in this case. If Petero. had come in he might have made the several points of defense, or in diminution of the amount of damages which he- proposes to make, if the-judgment shall be opened. It does not appear that there was fraud or collusion on the plaintiff's part, or on the part of. his attorney, in not proceeding- to trial and setting them, up.. Morris being sued in. ejectment, and it being shown that the claimants against him. had a good title, and that his own was insufficient, and so it being evident that he could not sustain a defense, he makes none, but, by his attorney assents to a judgment on terms wbicb do not appear unreasonable or fraudulent, and without incurring the additional costs of a jury trial. It is not claimed by Petero that another result must have been reached by trial and judgment on verdict. The paramount title ousted plaintiff, and must have done so, and Petero had refused to make any defenses against assessment of damages by reason of the dower interest or value of stones sold from the land.
Some authorities, to show the effect of a judgment recovered on a covenant when the covenantor has notice, are: Littleton vs. Richardson, 84 N. H., Bell, J., thus states the law: " Where a person is responsible over to another, either by operation of law or by express contract, and he is duly notified of the pendency of the suit, and requested to take upon him the defense of it, he is no longer regarded as a stranger, because he has the right to' appear and defend the action, and has the same means and advantages of controverting the claim as if he was the real and nominal party upon the record. In every such case, if due notice is given to such person, the judgment, if obtained without fraud or collusion, will be conclusive against him whether he has appealed or not." In the City of Boston vs. Washington, 10 Gray 496, Metcalf, J., says of the foregoing: " So far the adjudications are conclusive. "
Hamilton vs. Cutts, 4 Mass., 348, is a case where the teiiant consented to ouster without action brought. The Court say of it, " There is no necessity for him to involve himself in a lawsuit to defend himself against a title which he is satisfied must ultimately prevail, but he consents at his own peril. If the title to which he has yielded be not good, he must abide the loss, and in suit against the warrantor the burden of proof will be on the plaintiff, although it will be otherwise in case of an eviction by force of judgment at law with notice of the suit to the warrantor. For in such case unless it be obtained by fraud, the judgment will be plenary evidence."
Petero, therefore, having- received notice and refusing to defend, there being no showing of fraud, and the assent to judgment being a lawful one as made, must be held concluded by the former judgment, and responsible for the second and third items above, viz: $168.75 and $50.
As to whether in this action the defendant may show a different consideration from that expressed in the deed, the prevailing American authorities are that the grantor is not estopped by the consideration expressed, for it is arbitrary and is frequently different from the real consideration. In like manner the acknowledgment of receipt of payment, although under seal, is liable to be impeached as a common receipt. Nor does the admission of parol evidence conflict with the statute of frauds, for it does not affect the contract for the sale of lands, but only the money arising out of that contract. When, therefore, a consideration is expressed in the deed it is mere prima facie evidence whieh may be rebutted or controlled by parol proofs as to the amount and fact of payment, not for the purpose of defeating the conveyance, but for the purpose of ascertaining damages to whieh a plaintiff may be entitled for breach of covenant. Such language is used in Wilkinson vs. Scott, 17 Mass., 249; Clapp vs. Tirrell, 20 Pick., 247; Morse vs. Shattuck, 4 N. H., 229.
In McCrea vs. Purmont, 16 Wend., 490, Cowen J. extensively discusses this point. Premising that there is certainly a greater conflict of authority than he had supposed, and expressing surprise that after much litigation it remained so far open (1886), he reviews the American decisions, those above cited among many others, with the result that, after some earlier decisions holding that such a clause is conclusive, the Courts now sustain the doctrine that the recital was not an estoppel to the admission of parol evidence (except only the Courts of the State of North Carolina), and the New York Court of Appeals held parol evidence to be admissible. The English decisions, however, were conflicting. Looking at Baker vs. Dewey, 1 Barn. & Cres., 705 (1823), Bayley J. says that a party who executes a deed in which it is expressly •stated that the consideration money has been paid is estopped in a Court of law from saying that the fact is not truly stated. Holroyd J. says "both parties are estopped by the deed from saying that the whole purchase money was not paid," and Best J. says that paixfl evidence of a fact wholly inconsistent with the statement of the deed ought not to have been received in evidence.
Greenleafs Ev. 1, Sec. 26, 13th edition, assembles the principal authorities, English and American, and states the result to be that in England the recital is regarded as conclusive evidence of payment binding parties by estoppel, but that the weight of American authorities is in favor of treating the recital as only prima facie evidence of the amount paid in an action of covenant by the grantor to recover back the consideration, or in an action of assumpsit by the grantor to recover the price which is yet unpaid — and the recital is not even prima facie evidence of payment when the deed is attacked as fraudulent by creditors of the grantor.
In this conflict of English and American authority, the -'00011; here must elect that of which the reason most commends itself.
Several considerations lead us to adopt the rule as established in the American Courts. Thus that the admission of proof as to the amount of the consideration stands upon the same footing with the admission of proof that the acknowledgment of payment is not true. " This always makes part of the premises and is seldom true; for in most cases credit for the whole or for a part is given. And if the grantor is bound by this expression, no remedy would be found for cases of error and mistake, which undoubtedly often occur." Wilkinson vs. Scott. In like manner the date of the deed.
If such matters can be shown in a proceeding in equity, and if not inconsistent with the essential principles of actions at law, then modem jurisprudence favors their admission in the latter, for the tendency of Courts and legislation is to simplicity and directness of practice. This Court has in many instances inclined to admit equitable principles into law actions, and on this ground alone might well admit proof in an action to recover the purchase money, to rebut the prima facie evidence of the statement in the deed.
E. Preston for plaintiff.
W. C. Jones for defendant.
Honolulu, January 4th, 1878.
We therefore hold for the defendant on the fourth reserved •question, and for the plaintiff on the other three.
Judgment on the verdict, in accordance with these principles, for $268.75 and costs.