Case Name: Edward D. Edwards vs. Coleman M. Roberts
Court: High Court of Errors and Appeals of Mississippi
Jurisdiction: Mississippi
Decision Date: 1846-11
Citations: 7 S. & M. 544
Docket Number: 
Parties: Edward D. Edwards vs. Coleman M. Roberts.
Judges: 
Reporter: Mississippi Reports
Volume: 15
Pages: 544–556

Head Matter:
Edward D. Edwards vs. Coleman M. Roberts.
It is well established, that, if a party has a knowledge that he has been defrauded, and yet subsequently confirms the original contract by making new agreements and engagements respecting it, he thereby waives the fraud, and abandons his claim to equitable relief.
E. purchased of R. certain lands, and took a bond for title; and becoming apprehensive that R. would not be able to make a good title to all of the land embraced in the purchase, he instituted suit on the bond; pending the suit it was agreed by the parties to submit to arbitration the amount to be allowed E. in the premises; the arbitrators not being able to agree, E. and R. determined to divide the difference that subsisted between arbitrators, and an award was made accordingly; which was recorded as a part of the proceedings in the action on the title bond, and entered as the judgment of the court; and E. gave to R. a new note in accordance with the terms of the award : Held, that whatever might have been E.’s equitable right to relief on account of fraud practised upon him in the sale of the land, by consenting to abide the result of an arbitration upon the matters in dispute, and giving a new note in accordance with the terms of the award, he virtually reaffirmed the contract, and relinquished any right to relief he might have previously possessed.
Appeal from the vice-chancery court at Carrollton; Hon. Henry Dickinson, vice-chancellor.
On the 20th day of September, 1842, Edward D. Edwards filed a bill in the vice-chancery court at Carrollton, stating that on the 15th day of July, 1836, Coleman M. Roberts, designing to deceive and defraud him, proposed to sell him a tract of land containing about five hundred and twenty acres, described as follows, to wit: The south-east quarter and the east half of the south-west quarter of section No. 7, and the north-east quarter and the east half of the north-west quarter, and the northeast quarter of the south-west quarter of section No. 18, all in township twenty, north, of range nine east; that Roberts then represented that the west half of the north-east quarter of section eighteen belonged to Matthews T. White, but he could easily purchase it from White; that Roberts, after inducing him to believe that all of the land, except the small portion owned by White, belonged to him, went with complainant, and showed him a small portion of the land which was very fertile and valuable, and then represented that the whole tract was equally rich and valuable, the portion shown being but a fair sample of the whole tract; that about two hundred acres of the land, as was well known to Roberts at that time, were of a very inferior quality, and not worth one dollar and twenty-five cents per acre; that being so deceived and defrauded by Roberts, he then verbally contracted and agreed to give ten dollars per acre for the whole tract; that on the 6th day of October, 1836, he perfected the purchase at five thousand two hundred dollars, being ten dollars per acre, and paid one third of the purchase-money in cash, and gave two notes each for one-half of the residue, the one payable on the 1st day of January, 1838, and the other on the 1st day of January, 1839, and in consideration thereof Roberts executed a bond for title to the land, to be made perfect in fee simple on the 1st day of January, 1837, which bond was made exhibit A to the bill; that on the 15th day of July, and on the 6th day of October, 1836, the land was not worth more, and had he not been deceived and misled by the misrepresentations of Roberts he would not have agreed to give more than two dollars per acre. The bill charged that on the 15th day of July and the 6th day of October, 1836, the south-east quarter of the southwest quarter, and the south-west quarter of the south-east quarter of section 7, in township 20, was the property of William Lindsay; that the east half of the south-east quarter of section 7, and the north-east quarter of the south-west quarter, and the north-rvest quarter of the south-east quarter of section 7, were vacant and belonged to the government of the United States on the 15th day of July, 1836, and continued to be the property of the United States until the 15th day of August, 1836, when they were entered by the defendant; that the east half of the north-west quarter of section 18 was entered by the defendant in the name of the complainant on the 9th day of December, 1837; and the east half of the north-east quarter, and the north-east quarter of the south-west quarter, amounting to about one hundred and twenty acres, still belong to the United States. The bill further charged that when the defendant proposed to sell the land on the 15th day of July, 1S36, he represented that there was a fine spring of excellent water upon it, which representation was untrue; that complainant resided in Yazoo county, about one hundred and fifty miles from the land office in Columbus when the land was entered; that he knew nothing about the title and relied entirely upon the representations of the defendant; that becoming satisfied the defendant never would make him a good title to the one hundred and twenty acres still owned by the government, after he had paid in full the note that fell due on the 1st day of January, 1838, he instituted suit in the circuit court of Choctaw county to the September term, 1841, on the title bond; that pending the suit the defendant proposed to him that they should submit to arbitrators, to be chosen by themselves, the question of how much should be allowed him on account of the failure of title to the one hundred and twenty acres, and at the earnest solicitation of the defendant he acceded to the proposition, and the question was referred to-arbitration; that the arbitrators were not able to agree on the sum to be allowed complainant, and the defendant proposed to him and urgently pressed him to agree to divide the difference between the arbitrators ; that not knowing what was the difference between the arbitrators, and supposing the defendant to be equally ignorant on that point, as he at the time assured him he was, complainant agreed to divide the difference between the arbitrators, and that their award should be made accordingly, which agreement was made known to the arbitrators, and they made an award allowing complainant six hundred dollars to be deducted from the purchase-money of the land ; that the award was given to the clerk of the circuit court of Choctaw county, and by him entered on the minutes of the court as a part of the proceedings in the action on the bond; that in pursuance of the award, the defendant allowed him a credit of six hundred dollars, and he, on the 29th day of September, 1841, executed a new note for the sum of thirteen hundred and fifty dollars, in favor of the defendant, and took up the old note which was still unpaid. The bill charges that it was distinctly understood and agreed between the parties that neither should select an arbitrator whose opinion on the question to be submitted was known to him; that .in violation of their agreement the defendant selected an arbitrator whose opinion was well known to him at the time; and the complainant has since ascertained that when the defendant proposed to divide the difference between the arbitrators he understood perfectly well the grounds of their difference and all about it; and that the defendant acted fraudulently and unfairly, in procuring the award to be made more unfavorably to the complainant than in justice and equity it ought to have been. The bill further charged, that notwithstanding the fraudulent conduct of the defendant, in the procurement of the award, he was wholly unwilling to surrender up the note for thirteen hundred and fifty dollars; that he commenced suit on it and would proceed to collect it unless enjoined by the court; that the defendant was insolvent, &c. The prayer was that the award be set aside; the suit instituted by the defendant be enjoined ; the note for $1350, cancelled ; that the contract for the sale of the land be rescinded or declared void ; and the defendant be compelled to return the money paid him by the complainant; and that the land be sold for the payment thereof. An injunction was granted on this bill by the Hon. J. M. Howrey. The defendant answered, denying that he made any false representations, or in any manner imposed on the complainant, either in regard to the quality or title to the land; a fair opportunity was given to the complainant to examine the quality of the land for himself, and he bought on his own judgment. Respondent stated that when he sold the land he thought the spring referred to was on it; he had been so informed by Lindsay, from whom he purchased that portion of the land near the spring, and he expressed that opinion to the complainant at the time of the sale; he had since ascertained, however, that the spring was very near the line, but not on the tract sold to complainant; that when he sold he believed he had entered the 120 acres, which still belong to the government; that in the summer of 1836, he intended to enter it, and when he sold he thought he had done so, but by mistake, range 8 was inserted in the certificate of entry instead of range 9, the land being correctly described in all other respects; that when the sale was made, neither he nor the complainant was aware of the mistake; they both then believed the certificate embraced the land intended to be sold, and a transfer was made of the certificate at the time to the complainant. Respondent admitted the sale was verbally agreed upon on the 15th day of July, and completed and writings executed on the 6th day of October, 1836; he admitted he had not, when the first agreement was made, a title to all the land, and that was the reason why a bond for title to be made at a future time was given; that a portion of the land was entered by Lindsay, and a portion was owned by White, of which facts he informed complainant, but he told complainant he could easily purchase it from them; he stated that he did make the purchases from Lindsay and White as-it was agreed between the complainant and himself he should do; that after his purchase the complainant discovered some defect in the title obtained from Lindsay, and with the knowledge and consent of the complainant, he on the 9th day of December, 1837, entered that part to which the title was defective, in the name of the complainant, and the complainant then said he was perfectly satisfied. Respondent further stated that the title to all the land he sold the complainant, except to the 120 acres above mentioned, was then perfect, and he could and would have had the mistake in regard to the 120 acres corrected, and thereby rendered the title to the whole tract perfect, had not the complainant commenced suit on the title bond without giving notice to respondent, or allowing him time to have the mistake corrected. Respondent admitted that during the pendency of the suit, he made a proposition to submit the question in controversy between them to arbitrators, but he denied positively that he knew the opinion of the arbitrator selected by himself, or wa-s guilty of any fraud, or practised any unfairness in the procurement of the award ; he insisted that the award was fairly made in pursuance of an agreement between the complainant and respondent voluntarily entered into, without any misrepresentation, or undue influence made or attempted to be used by respondent. He denied all the charges of fraud and misrepresentation contained in the bill. Several letters and written documents were filed with the answer as exhibits, which corroborated the statements of the respondent. The evidence was very voluminous, but we only notice that portion of it which bears upon the point on which the opinion of the court turned. Only three witnesses were examined upon the subject of the award, and all on behalf of the complainant. The first examined was Thomas I. Lindsay, who stated that he heard Roberts say, after the arbitration, that he could have had the mistake in the certificate of entry, intended to embrace the one hundred and twenty acres, the title to which was not perfect, corrected, and the complainant ought to pay the balance of the money, meaning the six hundred dollars allowed complainant by the arbitrators; and he appeared to be dissatisfied with the award. James Wellons testified that he was one of the arbitrators, and the question submitted to them, was the amount that ought to be allowed the complainant, on account of the failure of title to the one hundred and twenty acres of land still owned by the government; that after an investigation of the case, he believed it was in the power of the defendant to perfect the title, and it being admitted by both parties that the failure of title occurred by mistake, he, witness, was not willing to allow any deduction from the note of complainant, nor to release the defendant from the obligation of his bond ; that the defendant asked him a great many questions both before and after the arbitration; but witness could not say with certainty, whether the defendant asked his opinion on either the legal or equitable principles involved in the case ; he might have asked it, but witness could not say whether he did or not; that both parties agreed to abide the decision of the arbitrators, but after the new note had been executed, he heard the complainant express dissatisfaction with the result of the award; that the arbitrators did not act under oath, the parties having consented that they need not be qualified. ■ Witness further testified, that the arbitrators not being able to agree, William Co-thran, the other arbitrator, being of the opinion that the complainant should be allowed twelve hundred dollars, T. S. Ayres was called on to act as a third arbitrator, but becoming dissatisfied he retired, and refused to act further; the parties then agreed that witness and Cothran should split the difference between them, and the award was made in that way. William .Cothran proved that he was one of the arbitrators; that they did not act under oath, nor were the witnesses who were examined by them sworn ; there was no written agreement or obligation entered into by the parties to abide by the award, though they verbally agreed to do so; he did not know whether the award was made in conformity to the rule of the court submitting the case to arbitration, or not, as he had no recollection of ever seeing the rule of the court; that the arbitrators could not agree, James Wellons being unwilling to allow the complainant any damages, and witness in favor of allowing him twelve hundred dollars; and the parties learning there was no possibility of an agreement between the arbitrators, came to the arbitrators, and informed them they had agreed that the arbitrators should divide the difference between them, and make that the award, — and the award was made in that way; that he never, either at or before the time of announcing the award, communicated to Edwards any fact connected with it; that at the time the award was announced, Edwards expressed no dissatisfaction with it, but subsequently he did express dissatisfaction on account of the small amount of damages allowed him. On cross-examination, he stated that, at the time of the arbitration it was stated by the defendant and admitted by the complainant, that the defendant had intended to enter the one hundred and twenty acres of land sold to the complainant, but by mistake had entered different land, and no fraud was charged against the defendant on that account, the only fraud then complained of was in relation to the quality of the land. In this condition the case was submitted to the vice-chancellor, who rendered a final decree at the June term, 1845, deciding that the parties having agreed to submit the matters in controversy between them to arbitration, the award of the arbitrators being entered as a judgment of the circuit court of Choctaw county, was valid and binding upon the parties, and that if any'fraud had ever existed, it was waived by the arbitration ; that the injunction should therefore be dissolved and the bill dismissed at complainant’s costs. From which decree the complainant appealed to this court.
Acee, for appellant.
The defendant’s counsel objects to the relief sought on three grounds:
L That complainant has waived the fraud, by long and tame acquiescence.
2. That the award made by the arbitrators precludes the complainant from seeking redress.
3. That by submitting to said award, and acting under it, the complainant has confirmed the original contract, and by that means has rendered it valid and binding.
The first position is neither sustained by the facts of the case, nor the law. For the bill charges and the answer admits, that there were two representations made, one as to the quality of the land and the other as to the title. And the bill charges and the answer admits, that so soon as complainant discovered that no title could be made to the one hundred and twenty acres of ¡and, owned by the general goverment, that he sued on the bond given by defendant, for title.
So many misrepresentations were made by Roberts, as to the boundary, quality and titles to the land sold, that some two or three years elapsed before they were all discovered to be false. So soon as complainant ascertained, that the Hile was defective,; he sought relief in the proper court.
In the case of Grundy v. Boyces’ executors, 3 Peters, 210, Grundy rested more than three years before he took any steps to have the contract rescinded ; and even then he did not act until he had permitted a judgment to be recovered against him on the notes given for the purchase-money, without making any de-' fence in the court which, having taken cognizance of the case, had the right to grant the relief.
The case.in Smedes &. Marshall, relied on by defendant’s counsel, is not a case in point. In that case the question of delay or long neglect did not arise.
As to the 2d objection, I will barely add, that the bill, answer and depositions, all prove that there was no award. The arbitrators could not agree; and the parties decided the matter between themselves by agreeing that they (Edwards and Roberts,) would divide the difference.
But even admitting that an award was made; how was it made, and under what circumstances'? The deposition of Wel-lons, the arbitrator on the part of Roberts, proves clearly that Roberts had ascertained his legal opinion upon the very question involved in the dispute, before he selected him. The fact that Wellons was willing to allow complainant nothing, and at the same time release Roberts from making a title to one hundred and twenty acres of land, according to the tenor of his bond, when the same had cost complainant $1200, is so striking an instance of misjudgment or gross partiality, as to avoid the award, even if good in other respects.
“ If the misjudgment of the arbitrator amounts either to partiality or corruption, the award will be set aside.” Ewing's Adm’r v. Beauchamp, 2 Bibb, 456; Am. Dig. 178, sec. 9.
“So, if the assessment of damages be so erroneous as to induce the belief that the arbitrators must have been grossly partial, their award will be set aside.” Van Coi'tlandt v. Under-hill, 17 Johns. 405.
“ An award obtained by false statements, may be set aside in chancery, although the party complaining of such an award, assented to the admission of such statements.” Buckly v. Starr, 2 Day’s R. 553; Am. Dig. sec. 3, 177.
“ Where a submission to arbitration, was by rule of court, the conduct of the arbitrators, and the parties to the submission may be examined, and if, on examination, it appeared that the arbitrators had been partial and unjust, or had mistaken the law, the court will not enforce a performance of the award. 1 Saund. R. 327; 1 Salk. 71; Forster v. Brunett, 1 Mod. 21; Darby shire v. Cannon, 2 Bur. 701.
But the award itself is bad, because it is not responsive to the submission. The matter submitted to the arbitrators was, “ what deduction should be allowed on the notes given by complainant to defendant, for complainant to release defendant from his obligation to make titles to the one hundred and twenty acres mentioned and specified in the bond?” And the award requires complainant to release the defendant from his obligation to make titles to one hundred and twenty acres “not included or mentioned in the bond.”
“An award is bad, if made of matters not within the submission.” Fisher v. Pembly, 11 East R. 188; 1 Saund R. 32, a.
“ And such an award is void.” 2 Story’s Eq. 682, 713.
“An arbitrator can be made a witness respecting everything that occurred.” Story on Eq. PI.-235, 323, 519, 825; Reeve v. Farmer, 4 Term R. 146; Shepherd v. Merrill & Tucker, 2 Johns. Oh. R. 276.
As to the 3d objection,' that the complainant has confirmed the original contract, and thereby rendered it valid, by acting under the award; it will only be necessary to say that the contract being in part for the sale of public lands, or lands belonging to the United States, was illegal, being against public policy, and therefore incapable of confirmation. When the contract was made in July, 1836, two-thirds of these lands were vacant public lands; when the bond for titles were executed at least two hundred acres were in the same condition, and when the pretended award was made, at least one hundred and twenty acres still belonged to the general government; all the notes were tainted with the illegal contract, and were therefore void.
“ A promissory note, given in consideration of the purchase of an improvement upon vacant public land, is for an illegal consideration, and an action cannot be sustained thereon.” Merrill v. Legrand, 2 How. 150.
“All agreements, bonds, or securities given for, or in viola tion of a public law, &c., are deemed incapable of confirmation or enforcement.” 1 Story’s Eq. 294.
“And the general rule is, that whenever any contract or conveyance is void, either by a positive law, or upon principles of public policy, it is deemed incapable of confirmation.” 1 Story’s Eq. 303.
“If the original contract be illegal or usurious, no subsequent agreement or confirmation of the party, can give it validity.” 1 Story’s Eq. 338, 339. See Note 2 — 338, 339.
Surely if the sale of an improvement on vacant public land, is an illegal act according to the decision in Merrill v. Legrand, because it contained a trespass, a sale of the land itself is also illegal, and the contract absolutely void and incapable of confirmation.
William G. Tho?npson, for appellee.
In September, 1841, the parties submitted the matters of difference between them to arbitration, and had the award entered of record as the judgment of the court. The point in dispute, as Edwards states in his bill, was in regard to one hundred and twenty acres of the land, the title to which was in the government. The award was, that Edwards should be allowed a credit of $600 on account of this defect of title. He submitted to, and confirmed the award, by substituting a new note, deducting $600, for the note last falling due, given at the time when the contract was made. There is no proof that Roberts acted in anything fraudulently or unfairly in procuring the award; there is no proof that by the award the new note was to be for a less sum than it was given for. We deem it unnecessary to argue the question, whether the award be in itself, legally valid and binding. The whole proceeding constituted an agreement between the parties, valid and binding, by which Edwards was to waive all objection to the contract, on the ground of failure to make title to the one hundred and twenty acres, in consideration that Roberts would allow him a credit of $600 more than he had paid on the purchase-money. This agreement was fully executed on Edwards’ giving the substituted note. And as there is no pretence in the bill that Edwards had not at this time a perfect title to the rest of the land, we contend that by giving the substituted note under the agreement in relation to the award, he thereby waived all objections of whatever sort to the contract ; and that he is bound by his executed agreement, and will be held to it. There is no ground for rescission set forth in the bill, which did not exist, if at all, at the time the contract was made.
William Thompson, on the same side.

Opinion:
Mr. Justice Thacher
delivered the opinion of the court.
This is an appeal from a decree of the vice-chancellor of the northern district.
The bill is based upon allegations of fraud in a contract for the purchase of land, consisting in misrepresentations by the vendor both as to the quality and title. The bill likewise charges fraud in obtaining an award under arbitration upon matters connected with the original contract.
It is a well established position, that if a party has a knowledge that he has been defrauded, and yet subsequently confirms the original contract by making new agreements and engagements respecting it, he thereby waives the fraud and abandons his claim to equitable relief. 2 Ves. Sr. 126; 9 Ves. 364; Fonbl. Eq. 129, note r.
Roberts having given Edwards a bond to make a title to the lands embraced in the purchase, and Edwards conceiving he had just fears that Roberts would be unable to make him a title to the whole of the land embraced in the purchase, to wit, one hundred and twenty acres of land, the title to which was still in the government of the United States, instituted an action upon the title bond. Pending this action, the parties mutually agreed to submit to arbitration what amount of deduction of the original purchase-money should be allowed to Edwards in consideration of the premises. While this arbitration was proceeding, it was ascertained that the arbitrators were unable to agree upon a decision, and the parties then further agreed to divide the difference that subsisted between the arbitrators. In accordance with this latter agreement an award was made allowing Edwards a deduction of $600 upon the original amount of his purchase-money. This award was duly recorded as a part of the action upon the title bond. It was however, insisted by Edwards that Roberts took undue means to procure the result of the arbitration by engaging the -Services of an arbitrator whose opinion he had ascertained was already favorable to his interests; but this is strenuously denied by Roberts in his answer, and is not substantiated by the evidence in the cause.
Whatever, therefore, may be the merits of the original position assumed by Edwards, respecting the charge of fraud having been practised upon him in the purchase, the fact of his having consented to abide by the result of an arbitration upon the matters in dispute, and above all the circumstance that he acted upon the award, however unwillingly, and gave a new note to Roberts in accordance with the terms of that award, constitute such a re-affirmance of the contract as was a virtual relinquishment of any right to relief which he might up to that time have possessed.
Decree affirmed.