Court Opinion

ID: 6948399
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:28:20.912187+00
Date Added: 2024-06-11T16:07:59.833246
License: Public Domain

,'Scates, J. Myers filed this bill for the" rescission of a contract, by written assignment of Edmunds, of his patent to a ¡horological cradle in certain counties in this State, and a re-■■■conveyance of a tract of land paid therefor, and the re-payment ..of ifive hundred dollars, paid him in goods and chattels. The .grounds set up for this equity are, the misrepresentation and fraud .of Edmunds, in this, that he represented' and sold to .them a patent for the principle, machinery and mode of operation by which the cradle was put and kept in motion, whereas -he had no patent for these, but only for the design, configuration and ornaments of such a cradle. The fraud and misrepresentation are fully denied in the answer, which insists upon a want of equity in the bill, upon the further grounds, that no offer is made to re-assign the patent or re-convey it to plaintiff; that defendants made sales of patent rights for large sums, and that they do not offer to account for the values received on these sales; and that, on account of these sales, they cannot restore the patent fully to plaintiff. The court decreed a rescission of the contract, a re-conveyance of the land, and the payment of four hundred dollars by plaintiff, and that defendants re-convey or assign the patent. The decree is erroneous in two points of view. Suppose the evidence sustained the allegations of the bill as to the fraud and misrepresentation, while the rescission of the contract .might therefore be equitable and just to the defendants, yet it is clearly shown by the evidence that defendants have sold the patent for part of the territory included in their purchase, and received large sums of money or property therefor. Now that portion of the decree that orders a return of the consideration by plaintiff,—the land and the money,—restores the defendants to all their rights,-—to the condition they were in before the purchase. But the plaintiff is not restored to his, by a decree simply, for a re-conveyance or re-assignment of the patent. This re-assignment cannot affect the rights of purchasers from defendants, nor does the decree require defendants to account for the receipts and profits on these sales. One of the boasted advantages and cherished objects of a court of equity is to administer complete relief, and do ample justice to both parties. I know tliat where a transaction is tainted with fraud, for which a court of equity is simply asked to annul the contract and avoid the writings, the parties may be left to assert their remedies at law for mutual restoration of their rights, and compensation in damages. But where, as here, the party seeks the further specific relief to have the property restored, and to be put in statu quo, he must come, not only with clean hands, but ready and willing to do whatever may be necessary on his part to render equal justice to the other party, by restoring to him the property he may have received, or its value, if put beyond his control, if damages, instead of the specific property, would be equitable. I am speaking of executed agreements. Executory contracts would require nothing more than a delivery up and cancellation of the writings. Courts will rescind and cancel such contracts upon less proofs than will be required to disturb agreements which have been carried into effect by delivery and exchange of their mutual rights, interests and possessions. The want of consideration might induce a court to withhold its aid in enforcing a contract, but could not afford a ground for rescission of an executed agreement. So upon this ground proceeded the case of Taylor v. Hare, 4 Bos. and Pull. R. 260, which was an action to recover back moneys paid for the use of a patent, brought after the discovery that the patent was void, the patentee not being the inventor. Heath, J., puts the case very strong: that “ there never has been a case, and there never will be, in which the plaintiff, having received benefit from a thing which has afterwards been recovered from him, has been allowed to maintain an action for the consideration originally paid. We cannot take an account here of the profits. It might as well be said, if a man lease land, and the lessee pays rent and afterwards be evicted, that he shall afterwards recover back the rent, though he has taken the fruits of the land.” And this is abundantly confirmed by the English decisions. Norman on Patents, 149 to 151, (52 Law Lib. 118). But for a fraud, the court will rescind and return what has been paid; yet I presume it will hold the complainant to account for what he had in exchange, and for the profits he has derived from its use or sale. Waters v. Lemmon, 4 Ohio R. 229 ; Camplin v. Burton, 2 J. J. Marshall R. 216 ; Yoder v. Swearingen, 6 J. J. Marshall R. 518. See also 8 B. Monr. R. 129; 6 Monr. R. 102 ; 4 Litt. R. 12 ; 6 Gill. and John. R. 424 ; 1 Freem. Ch. R. 35. Courts have the power to impose terms, (1 Story Eq. Juris., Sec. 439; 2 ibid. 696-7, 707), and he that asks must do equity. Contracts will not bo rescinded and complainant left to perform his part of the decree by acts to be afterwards done, but the doing equity is a precedent condition of his right to a decree for the relief he seeks. 4 Ohio, 229; 2 J. J. Marsh. 216 ; 6 ibid. 518. Defendants should have promptly notified plaintiff when they discovered the supposed fraud, and of what use they intended to make of it; whether to rescind the contract or insist on damages, (Boyce, Executor, v. Grundy, 3 Pet. R. 214; Walk. Mich. Ch. R. 186, 373 ; Earring. Ch.R. 102, 301, 427), and, if they chose to rescind, should have tendered a return of the consideration received by them; or, at least, made an offer to return. 3 B. Monr. R. 159; 4 Litt. R. 12. This has not been shown, neither in the bill nor the evidence, while it is in evidence that they had sold the patent for a part of the territory, and could not recover that part, nor had any account for the proceeds of these sales been either offered by the bill or ordered by the decree. Plaintiff, under this decree, will be left to bring his action at law, or file a bill to recover back the interests he had in the patent, and so but partial justice will be done in this case. 10 Yerg. R. 59. For anything apparent in the pleadings or proofs, defendants may have made the sales after their discovery of the alleged fraud, first trying what speculation they could make, and failing in that, they file this bill to rescind. If this is not so, it should be negatived by averments. They have concealed the fact, or failed to show it in the bill, that they had made any sales, but it comes out in the answer and proofs. Having enjoyed and used the patent under the purchase, they have derived advantages and profits from it; and upon this principle the case of Chanter v. Dewhurst, 12 Mees, and Wels. R. 823, was ruled, and many others referred to, in Norman on Patents, 150, (52 Law Lib. 119.) I have thus shown that the decree is erroneous, upon the supposition that the proofs sustained the suggestion of fraud, which is the ground upon which relief is sought. But the defendants wholly failed in their evidence. No witness testifies to any representation whatever being made to them. No negotiation between the parties is shown; and no other contract but the pláintiff’s deed of assignment of the patent. There is much testimony as to plaintiff’s general conversations about his patent, and as to what he claimed under the patent, and as to the general reputation and impressions of the neighborhood as to the extent of what he claimed under it. This, if not wholly irrelevant, though taken without objection, is very unsatisfactory, had defendants even succeeded in this manner to make out a fraudulent representation and sale. But so far from it, the proof shows that plaintiff, when speaking particularly of the claim, under his patent, always confined it to the particulars patented; and only used general language, when speaking of the patent generally, without reference to the claim. Had all these conversations formed part of the particular negotiation with defendants, we should have no hesitation in dismissing this bill. Besides, the patent, specifications and drawings, are shown to have been kept in plaintiff’s shop, where these cradles were being made as models, at his house, and other places ; and that defendants were in and out, like others. They might have seen them, as others did, and we cannot resist the conclusion that they did see and examine them, either before they purchased, or before they sold under it; for between those periods, plaintiff had them a model made, and they were in and out, and giving directions while it was constructing. The only evidence therefore offered is, that contained in the patent itself, which is for a “ Design for a cradle,” the specifications, which are for an “ ornamental design in the shape or configuration of horological cradles, and of ornamental designs to be worked thereon,” and the deed of sale, which has a caption, “ Alexander Edmunds’ Patent Horological Cradle,” and which recites that he had obtained a patent from the United States for an “ Horological Cradle.” Neither the phraseology of the one or the other imports that there was machinery about it, and of course cannot imply that that “ principle, machinery or mode of operation ” was the subject of the patent. Every one should be presumed to know that a “ Baby Cradle” would not be patentable, by that description, so far as the application of its use is concerned; for we may indulge the presumption that it was as well known to Adam as to Edmunds. And so too, of numberless forms, from the natural rind of a tree, or hollow gum, to the more elegant conceptions of mechanical invention. What particular change is to be inferred, or instrument is imported by the word “ Horological,” is rather a question of fact, than of law. The law will as readily intend a “ Grain ” as a “ Baby ” cradle ; so far as either is suggestive of, or adapted to, the art of measuring time. This may be done by a “principle” “or mode of operation,” adopted in the hourglass and the dial, as well as by machinery; and in the latter, whether by weights or pulleys, or by springs. If we attempt to make its import a question of law, instead of fact, as to the meaning of the party, we are at once involved in the necessity of determining that the deed secured the right to use some one or all these modes of measuring time with a cradle. On the contrary, it is very evident, that an arbitrary selection of a name was made, for the thing patented; and to the patent and its specifications and drawings, a prudent man would have had recourse, unless prevented by fraudulent representations, which are not shown here. Decree reversed, and bill dismissed. Decree reversed.