Court Opinion

ID: 6234564
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:29:30.11091+00
Date Added: 2024-06-11T08:58:00.124031
License: Public Domain

The opinion of the court was delivered, May 17th 1873, by
Williams, J.
The only question worthy of consideration in this case is presented by the 14th assignment. The action was brought to recover the price paid for certain oil-stocks which the plaintiffs alleged that they had been induced to purchase upon the fraudulent representations of the defendants as to the cost of the land; and a recovery was sought to be had on the footing of the plaintiffs’ rescission of the contract and a tender of the stocks to the defendants before bringing the action. The evidence shows that the plaintiffs bought the stocks in April 1864; that they were informed by the defendants, in October or November 1865, of the price paid for the lands; and that, on the 2d of March 1866, they tendered the stocks to the defendants and demanded back the money they had paid for them. Between the discovery of the alleged fraud and the tender of the stocks the assets of the company had been exhausted in boring unsuccessfully for oil, and the *176stocks had consequently depreciated in price. The court charged the jury that if they found that the plaintiffs were informed of the price of the lands by Mr. Wise in October, or early in November 1865; that the plaintiffs did not offer to return to the defendants the stocks in question for one or more months after such information was given; (the date is given, the evidence is March 2d 1866;) that the price of the stocks had fallen between the time of the receipt of the information and the time of the tender, or that any other unfavorable circumstances appearing from the evidence occurred in the interval, so that the defendants would be in a worse condition by taking back the stocks at the time of the tender, than they would have been if the stocks had been previously tendered at the time the information was given, then their verdict must be for the defendants. The objection made to the charge is, that mere delay in making the tender, after discovery of the fraud, is not in itself a defence to the action ; and whether it is such, as to amount to a confirmation of the sale, or a loss of the right to rescind it, is a question of fact for the jury.
If the defendants were guilty of the alleged fraud, the plaintiffs, on discovering it, had the undoubted right to rescind the contract, and, upon a tender of the stocks, to demand back the price paid for them. But it was their duty to do it within a reasonable time. They were not at liberty to await the result of the experiments the companies were making to obtain oil, and to rescind the contract after their efforts had proved to be fruitless. If they intended to rescind the contract it was their duty to act promptly and to return or tender the stocks at the earliest convenient moment after discovering the fraud. If they unduly delayed to return them and demand back the price they affirmed the validity of the contract: Pearsoll v. Chapin, 8 Wright 9 ; Negley v. Lindsay, 17 P. F. Smith 217. What is reasonable time or undue delay, when the facts are not disputed, is, as is well settled, a question of law to be determined by the court. Quam longum esse debet non definitur in jure sed pendet ex discretions justiciariorum: 1 Tho. Co. Litt. 644, (52 b.)
Here the delay was for four months, and no evidence was given to explain or excuse it. Under the circumstances we have no hesitation in saying that it was unreasonable. The inference is pregnant that if, in the meantime, oil had been found in large quantities, there would have been no rescission of the contract, or offer to return the stocks. The plaintiffs could not take the chance of the speculation, and at the same time repudiate the contract if it turned out to be a losing bargain. Besides, the instruction complained of was not predicated of the mere fact of the plaintiffs’ delay in offering to return the stocks, but of the delay coupled with the fact that the price of the stocks had fallen in the interval between the discovery of the alleged fraud and the date of the *177tender. The verdict of the jury establishes both of these facts, and we are clearly of the opinion that they are sufficient to bar the plaintiffs’ right to rescind the contract. There was then no error in the instructions of the court, and they were as favorable to the plaintiffs as they had any right to ask or expect.
There is nothing in the other assignments requiring special notice. The evidence complained of had more or less bearing upon the question in issue, and there was no error in its admission that calls for a reversal of the judgment.
Judgment affirmed.