Court Opinion

ID: 3594609
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:42:23.064185+00
Date Added: 2024-06-11T13:39:37.553887
License: Public Domain

In this case the defendant was in possession of an instrument under the seal of the corporation of the city of New York, by which there purported to be created in him an estate for the term of one hundred years, in a house and lot of land in the city of New York. The plaintiff was at the time in possession of the house and lot, claiming to be and being seized thereof in fee, unless the lease held by the defendant created a valid term for years in him. The defendant as matter of fact believed, the lease did give him the term which it purported to convey. The plaintiff also so believed, and thereupon a bargain was entered into between them in pursuance of which the plaintiff paid the defendant $1800, and received in consideration thereof an assignment of the term. The plaintiff now seeks to recover back this money upon the general ground, that the defendant, notwithstanding his apparent interest in the premises, had no estate in them whatever, the lease from the corporation being invalid, and that he purchased the lease and paid the money under an entire misapprehension and mistake as to the facts upon which depended the validity or invalidity of the defendant's lease.
This is not the case of money paid by a party under a mistaken idea of the existence of a legal obligation binding him to pay it; nor that of a party seeking to resist the performance of an executory contract to pay money, entered into under such circumstances of mistake. Of this latter sort was Bell v.Gardiner, (4 Man.  Gr. 11,) in which the action was upon a promissory note given by the defendant for the amount of a bill of exchange on which defendant was endorser, but which had been altered after endorsement, whereby he ceased to be liable. The jury found that the defendant when he gave the note had no knowledge of the alteration, but the judge refused to submit to them the question whether the defendant had the means of knowledge. All the judges held that, this being only a promise to pay, the defendant's position was much stronger *Page 334 
than if he had been plaintiff in an action to recover back the money; but as the case had been argued on its analogy to a claim to recover back money paid, they considered it in that light also, and approved of Kelly v. Solari, (9 M.  W. 54,) in which they held it to have been determined, that in an action to recover back money paid under a mistake of facts, it was not necessary to negative means of knowledge as well as knowledge of the true state of the facts.
Kelly v. Solari, belonged to the former class. It was an action to recover back the amount paid by an insurance company upon a life policy, which the insured had by mistake permitted to expire. The fact that it had lapsed was known to the officers of the company, who afterwards having forgotten the fact paid the loss. The court held that this fact of forgetting was no answer to the action. It is not necessary to pursue this line of cases, for they do not touch any ground upon which this plaintiff can succeed. He has entered into a contract which has been executed, and his position is that of one seeking to rescind the contract and get back the consideration paid. No case of fraud is pretended, McCormick and the plaintiff both believed that the lease was valid, and one bought and the other sold under that belief.
The parties did not deal with each other upon the footing of the compromise of a doubtful or doubted claim, but upon the ground of a conceded right in the defendant. He was assumed by both of them to have become the owner of a term for one hundred years in the premises in question, and the parties dealt with each other upon that basis for the sale and purchase of that interest.
Then as to the subject matter upon which the sale was to operate, the plaintiff having actually redeemed the premises before the execution of the lease to the defendant, the authority to convey which the corporation had acquired was defeated, and their lease was wholly inoperative to confer upon the defendant any right whatever, and *Page 335 
had no more significance or efficacy in law than if it had remained unexecuted. It follows, that the assignment executed by McCormick to Martin did not convey to him any right. The subject matter to which it related had no existence. The plaintiff in my judgment occupies the same position which any other person would have occupied who had dealt with the defendant for the term of one hundred years, and become the purchaser of it.
Now the term which was the subject of the contract, contrary to the supposition of both parties had no existence, and in all that class of cases where there is mutual error as to the existence of the subject matter of the contract, a rescission may be had; (1Story Eq. § 141, 142, 143.) The case of Hitchcock v.Giddings, (4 Price 135,) was a bill by a vendee of a remainder in fee expectant upon an estate tail. A recovery had been suffered at the time of the contract, though both parties were ignorant of the fact, and there had been no fraud from knowledge or concealment of the fact, and it was decreed that a bond given for the purchase money should be delivered up, and the interest which had been paid upon it should be refunded.
I do not see how the principle of this case can be distinguished from that at bar; for surely it can be no ground of difference in result, that in the one case an estate which had once existed had at the time of the contract come to an end, while in the other the estate which was the subject of the contract had no existence at any time. (Allen v. Hammond, (11Pet. 71.)
The judgment below should be reversed, and the sale be declared rescinded, c.
RUGGLES, Ch. J., and GARDINER, JEWETT, TAGGART, MORSE and WILLARD, JJ., concurred.
MASON, J., was in favor of modifying the judgment of the superior court, so as to dismiss the complaint without *Page 336 
prejudice to an action for specific relief, by avoiding the contract for the purchase of the lease.
Judgment reversed, c.