Court Opinion

ID: 8046736
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:00:12.314138+00
Date Added: 2024-06-11T16:37:31.705403
License: Public Domain

Sargent, J.
It is well settled that whenever one party to a contract refuses to execute any substantial part of his agreement, he thereby gives to the other, party the option to rescind the entire contract, by offering to restore what he has received, and so replacing the parties in their original situation, provided the offer to do this is made in a reasonable time, and the situation of the parties remains so far unchanged that they can be restored to their former position.
But the party who would take this ground must do so distinctly and unequivocally. He can not treat the contract as binding and as rescinded at the same time. Where a party who maybe entitled to repudiate a contract, either because it has not been performed in reasonable time, or because the other party refuses to execute any essential or substantial part of his agreement, does any act which amounts to an admission of the existence of the contract, or a ratification of it, after a full knowledge of all the facts and circumstances connected with it, he can not afterward elect to treat it as void and rescind it. Pierce v. Duncan, 22 N. H. 18; Webb v. Stone, 24 N. H. 288, and cases cited; Brinley v. Tibbets, 7 Greenl. 70; Allen v. Webb, 24 N. H. 278; Fuller v. Little, 7 N. H. 535; Jenkins v. *321Thompson, 20 N. H. 259; Masson v. Bovet, 1 Denio 74; Kingsley v. Nallis, 2 Shep. 57; Cook v. Gilman, 34 N. H. 556; Brown v. Mahurin, 39 N. H. 156; Drew v. Claggett, 39 N. H. 431.
It appears, in this case, that the defendant had been trusteed before the bargain was made between him and the plaintiff for the transfer of the notes, and that the plaintiff knew of this fact. It does not appear here, nor is it material, upon what particular ground the trustee was charged in the former suit. But it seems that, after the defendant had consulted counsel, and concluded not to give up these four notes to the plaintiff, as requested, the plaintiff elected to treat the contract as binding, and claimed to have it enforced, notwithstanding the pendency of the trustee suit, and actually appeared in court as claimant of those notes, and contested the title to them, persisting in claiming them under said contract for several terms, until the court decided that his claim could not be sustained, and held the defendant chargeable, as the trustee of said Moore, for the four notes then in question.
Had the plaintiff, as soon as he found that the defendant had decided not to give up these notes to him under the contract, elected at once to rescind the contract, and had he then tendered the defendant the three hundred dollar note and mortgage, unconditionally, and demanded back his money which he had paid, and, if not returned to him, commenced his suit for it, he could, no doubt, have sustained it; and had these proceedings all appeared in the disclosure of 'he trustee, as they necessarily would have done, the court undoubtedly would have held that the contract was void, and that the defendant should be charged for all the five notes, and a receiver appointed to collect the same, and apply the proceeds, first to pay the defendant the amount due him, and the balance in payment of the claim against said Moore in that suit. Bev. Stat., ch. 208, sec. 16; Fling v. Goodall, 40 N. H. 208. In *322that ease, the defendant would have had the five notes to rely upon, out of which he must be paid, if the mortgage was not sufficient security for his debt, and if there was any thing more, Moore’s creditors would have had the benefit of it.
This would haVe been the situation of affairs, had the plaintiff elected to rescind the contract, when the defendant refused to perform it on his part. That would seem to have been the proper time for him to make his election, and, we think, he must be held to have then made his election, and have chosen to ratify the contract and risk the consequences. His conduct, in appearing as claimant of the notes in court, and so long contesting his claim, and the length of time that elapsed before he said any thing about rescinding the contract, are only consistent with that hypothesis.
But suppose the plaintiff had made no election before the time when he claims to have rescinded his contract, could he then, after that lapse of time, have put all parties, or even the defendant, in his former position, by rescinding’ the contract and restoring what he had received? It is clear that he could not. ~We have seen the position the defendant would have been placed in had the contract been rescinded. But now, instead of holding the mortgage of the farm and the four other notes, to secure his $300, the four notes have been taken from his hands, in payment of Moore’s debts, while this plaintiff was claiming a ratification of his contract. Now, if the contract is rescinded, he will have nothing but his mortgage as security; and if that is insufficient to secure his debt, then his other security is gone, and he suffers loss. So that, on two grounds, we think, the plaintiff can not now rescind this contract. First, he can not now, by rescinding it and restoring all he has received, place the defendant in his former position, or one as favorable to himself as he was in before; and, second, because, hav*323ing once and at the proper time, made his election to ratify the contract, he can not, at this late day, undo all he has done, and he allowed to rescind it.
This view of the case renders it unnecessary to consider whether there was any evidence competent to he submitted to the jury, tending to show that the plaintiff had done and said enough to amount to a rescisión in any case. This verdict, being taken by consent, would be sustained, if there was any competent evidence on which it could have been found ; while a verdict, ordered by the court, will be set aside, if there was any evidence upon which the jury might have found the other way. In order to rescind a contract, the party proposing to rescind must deliver up or tender the property he has received, without condition or reserve; and then, before he can recover, he must demand the money he has paid, or the articles he has delivered to the other party, before suit brought. It is possible that, from the different statements made by the plaintiff, in regard to what passed between him and the defendant, July 20, 1860, it might have been proper to have left it to the jury to say what was said, and what the parties intended and understood by it, and if so, the verdict on that point would be sustained. But, however that may have been, in the view we take of the case, the plaintiff, upon other grounds, can not maintain his suit, and there must be

Judgment for the defendant.