Court Opinion

ID: 6686344
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:33:02.474641+00
Date Added: 2024-06-11T16:00:57.879901
License: Public Domain

Corson, J.
(dissenting). I am unable to concur with the majority of the court in its opinion in this case, and will briefly state my reasons for dissenting therefrom.
The defendants, in their answer, as one defense, allege that the plaintiff made certain material representations in regard to the boundaries and ownership of the mining ground described in the contract, and that they relied upon said representations, and, but for the same, would not have entered into the contract for the purchase of the property, and that said *420representations were untrue, and that they therefore rescinded the contract. These allegations were proven by uncontradicted evidence. The majority of the court, in its opinion, takes the view that as there was a stipulation in the contract, providing that, in case the title of the plaintiff to any of the mining ground described in the contract should fail, there might be a reduction of $450 per acre, for so much of the ground as might be lost, the defendants must rely entirely upon the contract, and were not entitled to rescind. This seems -to me an erroneous view. If there were material misrepresentations as to the boundaries and ownership of the mining property, by which the defendants were induced to enter into the contract, they were, in my judgment, entitled to rescind the same, notwithstanding the stipulations referred to, as they were entitled to the mining ground substantially as represented by the plaintiff, whether the misrepresentations on his part were fraudulently made or made by mistake. Section 1283 of the Revised Civil Code of 1903 provides: ‘‘A party to a contract may rescind the same in the following cases: (1) If the consent of the party rescinding or any party jointly connected with him was given by mistake or obtained through duress, menace, fraud. * * * (4) If such consideration, before it is rendered to him, fails in any material respect from any cause.” And section 1284 provides: “A stipulation that errors of description shall not avoid a contract, or shall be the subject of compensation, or both, does not take away the right of recision for fraud nor for mistake, where such a mistake is in a matter essential to the inducement of the contract, and is not capable of exact and entire compensation. ” It will thus be seen that a party to a contract may rescind the same when his consent thereto was given *421by mistake or obtained by fraud, or if the consideration, before it is rendered to him, fails in a material respect. And it will be further observed that errors of description will avoid a con-' tract, notwithstanding the stipulation contained therein, where there is fraud or mistake, -and such mistake is in a matter essential to the inducement of the contract, and is not capable of exact and entire compensation.
It appears from the undisputed evidence that the northerly boundary of three of the claims in which the plaintiff had a one half interest, which were represented by the plaintiff as being bounded by a barbed-wire fence, was from four to six hundred feet southerly therefrom, and that these claims overlapped two other claims, on one of which the defendants erected their hoisting works and sunk their shaft, and which were represented by the plaintiff as being his sole property, and were free from all adverse claims. Clearly, the fraud or mistake as to several acres of mining ground, including a one-half interest in the ground upon which the defendants had erected their hoisting machinery, constituted material representations, and such as were not capable of exact and entire compensation. It may be laid down as a general rule that, when parties to a contract for the purchase of real property make representations as to the boundaries of the same, which are material and constitute the-inducement for the making of the contract, the buyer is entitled to rescind if the boundaries are not as represented. In Bigham v. Madison, 103 Tenn. 358; 52 S. W. 1074, 47 L. R. A. 267, the Supreme Court of Tennessee held: “Where, on a sale of land, the boundaries are pointed out, and the parties are mutually and honestly mistaken as to their location, and such mistake is material, and the vendee fails to get the land he in*422tended to buy, and which the vendor thought he was selling and had a right to sell, the vendee will be entitled to a recision. ’ ’ When, therefore, the defendants discovered the falsity of the representations of the plaintiff as to the boundaries and ownership of these claims, they were clearly entitled to rescind the contract, notwithstanding the stipulations therein.
It is further stated in the majority opinion that the defendants were not entitled to rescind for the reason that there was too long a delay in asserting their rights, but, in my judgment, the delay was not unreasonable, in view of the circumstances disclosed by the evidence, and the court would have been justified in so ruling as a matter of law.
The position is further taken in the majority opinion that the defendants could not restore to the plaintiff everything of value which they had received from him, by reason of the depreciation in the value, of the property. If, however, the property was restored, the fact that it had depreciated in value could not affect that right. In the quite recent case of Snow v. Alley, 144 Mass. 546, 11 N. E. 764, 59 Am. Rep. 119, the Supreme Court of Massachusetts, in discussing this subject, says: “The right to rescind or avoid a contract proceeds upon the ground that a party has been fraudulently betrayed into making it, and, having thus been induced to part with his own property, may resume possession of it on returning that which he has himself received, and thus placing the other party in the same position that he was before the contract was made. If that which he returns is diminished in value by natural causes, or in the ordinary or proper use of it, he may still return it, as in such case, the contract being rescinded, such diminution is the loss of the original owner. ” And in Goodrich v. Lathrop, *42394 Cal. 56, 29 Pac. 329, 28 Am. St. Rep. 91, the Supreme Court of California says: “Section 3407- of the Civil Code provides: ‘Rescisión cannot be adjudged for mere mistake,-unless the party against whom it is adjudged can be restored to substantially the same position as if the contract had not been made. ’ The words ‘same position, ’ found in the section, are used with reference to the subject-matter of the contract, and the fact that the market value of the property may have depreciated while out of the possession of the vendor does not defeat the vendee’s right of rescisión. If the property can be returned by the vendee in substantially the same condition as when he received it, then the requirements of this section of the Code are fully satisfied.”
If I am correct in the opinion that the defendants had the right to rescind the contract, then they were entitled to remove all the machinery and improvements made by them upon the property capable of removal, and the tools and implements belonging to them, notwithstanding the stipulations in the contract, for when the contract was rescinded all the stipulations therein were necessarily rescinded, also. As we have seen, by reason of the falsity of the representations made by the plaintiff, by which they were induced to enter into the contract, they were not only deprived of a very large portion of the mining ground described in the contract, but also of a one-half interest in the hoisting works erected by them, and in the shaft and drifts excavated by them. Certainly, under these circumstances, it would be manifestly unjust to give the improvements made by the defendants to .the plaintiff, who had made the misrepresentations.
Holding these views, I am clearly of the opinion that a new trial should be granted. • ■ ' ’