Court Opinion

ID: 6966070
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:54:07.581285+00
Date Added: 2024-06-11T16:08:37.360424
License: Public Domain

Phillips, J.: The jurisdiction of a court of chancery to so correct mistakes in contracts and agreements as to make them express the actual intent of the parties is one of the ancient and well-established heads of the jurisdiction of that court. Where, through mistake or oversight in the execution of an agreement, a seal necessary to its validity is omitted therefrom, but the instrument purports, on its face, to be a sealed instrument, it will, ordinarily, itself furnish the evidence showing the oversight or mistake, and a court of chancery will correct it. (Town of Colchester v. Culver et al. 29 Vt. 111; Wadeworth v. Wendell et al. 5 Johns. Ch. 224; Probate Court et al. v. May et al. 52 Vt. 182; Michael et al. v. Tinsley, 69 Mo. 442; Allen v. Elder & Son, 76 Ga. 674; Bernard Township v. Stebbins, 109 U. S. 341; Love v. Sierra Nevada Lake Water and Mining Co. 32 Cal. 639.) By the great weight of authority this jurisdiction. of courts of equity may be invoked for the correction of omissions, by oversight and mistake, in official bonds, and where the evidence is clear of a mistake or omission whereby the instrument fails to conform to the intention of the parties, it will be reformed, even as against sureties. This principle has been sustained in a long line of cases with a very great degree of uniformity. It arose as early as 1815, in Wiser v. Blanchly et al. 1 Johns. Ch. 437, where a guardian’s bond was taken in the name of the People instead of in the name of the infant, and it was held by Hew York’s great chancellor: “Whether the surety is to be holden though the bond was taken in the name of the People instead of in the name of the infant, I have no difficulty in saying that it is within the ordinary jurisdiction of this court to correct such a mistake by holding the party according to his original intention, and to consider the bond as taken to the infant. Where the intention is manifest this court will always relieve against mistakes. * * * The court will do it in the case of a surety.” Inhabitants of the Town of Montville v. Haughton et al. 7 Conn. 543, was a case where Haughton was appointed collector of taxes, and the selectmen required of him a bond, with surety, that he would faithfully collect and pay over, etc. Haughton, as principal, with one Thompson as surety, executed a bond in the sum of $2000, with a condition, etc. The bond was signed but no seal attached, but was attested as “signed, sealed and delivered in the presence of." The court held: “It is found by the court that the seal was omitted in this case by mere mistake and accident. If the plaintiffs might sue on this agreement at law, it does not follow that they may not have relief in a court of equity. The plaintiffs are entitled to a bond, the consideration of which can not be inquired into at law,” and held that the correction should be made. In Olmsted v. Olmsted, 38 Conn. 309, a joint bond, had been executed and the surety had died, whereby his estate was discharged at law. A correction was sought to make the bond several, and it was held : “Where the contract does not express the agreement or intention of the parties, to the injury of the obligee, and that is clearly made to appear, equity will reform the instrument, as well against sureties as principals.” In United States v. Cushman, 2 Sumn. 434, Judge Story held: “This is not a case where the plaintiff seeks to have a bond, or other contract joint in its form, reformed, so as to make it joint and several against a surety, living or dead. In such a case a court of equity will not interfere unless there is the most plenary evidence to establish the fact that it was the intention of all the parties that it should be several as well as joint. But if such an intention is clearly established, courts of equity will enforce that intention when there has been an omission to express it, by accident or mistake or fraud, as well against sureties as against the principal debtor. Under such circumstances there is no distinction between the case of sureties and that of principals, for it is a mere specific performance of the original contract as understood by all the parties.” In Bernard Township v. Stebbins, supra, bonds of a township were issued, signed by commissioners and sold for value, but by mistake the seals were omitted therefrom, and reformation was had. In Probate Court et al. v. May et al. supra, a bill was filed to correct an administrator’s bond by affixing seals omitted through accident or mistake, and the correction was ordered. In Town of Rutland v. Paige et al. 24 Vt. 181, seals were omitted from a constable’s bond by the sureties. They admitted it was intended at the time that seals should be attached, but insisted they should be indemnified, and a correction was ordered. The principle that courts of equity may reform instruments against sureties as well as principals has been declared in Prior v. Williams, 3 Abb. Dec. 624; Huson v. Pittman, 2 Hayw. 504; Clute v. Kneis, 102 N. Y. 377; Armistead v. Bogman, 1 Ired. Eq. 117; Neininger et al. v. State, 50 Ohio St. 394; Smith v. Allen, 1 N. J. Eq. 55; Butler v. Durham, 3 Ired. 589; Sikes v. Truitt, 4 Jones’ Eq. 361; State v. Franks, 51 Mo. 98. The principle as to the reformation of an instrument against a surety, so as to make it express the intention of the parties, is declared in this State in Edwards v. Schoeneman, 104 Ill. 278, where a married woman executed a mortgage, with her husband, on her own separate estate, which mortgage was to secure a debt of the husband, and, the description being uncertain, it was held that it might be corrected and the mortgage foreclosed. This case last cited is in irreconcilable conflict, in principle, with what is held in Trustees of Schools v. Otis et al. 85 Ill. 179. In principle we can see no difference in the reformation of an instrument to make it express the intention of the parties, whether a surety is a party to it or not. The consideration that extends to the principal also extends to the surety. The rights of the obligee are the same as to each, and each owes him the sanie duty. The bond in this case, with the evidence in the record, clearly shows it was intended to be sealed and made a sufficient bond. Its recitals carry conviction that such was the intent. Neither ignorance of fact nor of law could be relied on to show the contrary, and to declare an intent not to seal the same would be a declaration of an intended fraud. In such condition of the record the court should have decreed a reformation of the instrument. The principle announced in Edwards v. Schoeneman, supra, is more in accord with the weight of authority than is Trustees of Schools v. Otis et al., and based on the better reasoning, and the latter case, so far as it is inconsistent with what is here stated, must be considered overruled. On other questions raised, as to the right to damages under the bond if corrected, we will express no opinion. The complainants have a right to have a bond as indemnity, such as is provided by law, and although they may sue on the contract as one of indemnity, that is no answer to their right to have the bond, with its advantages, as provided by the statute. The Superior Court erred in dismissing the bill, and the Appellate Court erred in affirming the decree. The judgment of the Appellate Court for the First District and the decree of the Superior Court of Cook county are reversed, and the cause is remanded. Reversed and remanded.