In our opinion, tbe judgment of bis Honor is not supported by tbe adjudications of this Court. Tbe jury found tbat Bud Tart was insane at tbe time be attempted to contract with tbe plaintiff, and bis insanity was known to tbe plaintiff. Upon a verdict establishing the same facts, this Court, in Creekmore v. Baxter, 121 N. C., 31, said: “Tbe first two issues found facts which constitute fraud in law. No other kind of fraud was charged in tbe pleadings; and tbe third issue, referring to actual fraud in fact, is neither necessary nor contradictory. It cannot be doubted tbat any one dealing with an insane person, knowing bis insanity, deals with bim at bis own peril.” “The ground upon which courts of equity interfere to set aside tbe contracts and other acts, however solemn, of persons who are idiots, lunatics or otherwise non compos mentis, is fraud. Such persons being incapable, in point of capacity, to enter into any valid contract or to do any valid act, every person dealing with them, knowing their inca *675 pacity, is deemed to perpetrate a meditated fraud upon them and their rights.” Story Eq. Jur., sec. 227; Adams Eq., 183; Odom v. Riddick, 104 N. C., 515. In Sprinkle v. Wellborn, 140 N. C., 163, Mr. Justice Walker, speaking for this Court, said: “If, therefore, one person induces another, who lacks this capacity or this freedom, to enter into an apparent contract, equity will not recognize the transaction, however, as one author says, it inay be fenced by formal observances, but, deeming it fraudulent, will in proper cases afford relief against it at the suit of the party imposed upon. Fetter on Equity, 143. On this ground, the contracts of idiots, lunatics and other persons non compos mentis are generally regarded in a certain sense as invalid. It has been said by many courts that the contracts of a lunatic, made after the fact of insanity has been judicially ascertained, are absolutely void, and that he can have no power to contract at all until there is reversal of the finding and he is permitted to resume control of his property. Fetter Eq., 143; Odom v. Riddick, 104 N. C., 515.” Beeson v. Smith, 149 N. C., 142.

• The plaintiff’s evidence established the fact that 'the insanity of Bud Tart had been judicially ascertained, for it appeared that he had previously been committed to the State’s Hospital for the care of the insane, and the verdict establishes the fact of his insanity at the time of the alleged contract, to the knowledge of the plaintiff. In Creekmore v. Baxter, supra, this Court said: “Courts of equity always protect innocent purchasers as far as possible, and ordinarily place the parties back in statu quo, when it can be done without injury to either; but if any one contracts with a lunatic, knowing his insanity, he must bear alone whatever loss arises from the transaction.”

The evidence of the plaintiff himself shows, however, that a reversal of the judgment can work no loss or inequity to him; he has now had possession of the property for nearly eight years, at a rental1 of $100 per year, and the improvements put by him on the lot cost him, by his own evidence, $475. From this statement it clearly appears that the plaintiff will sustain no loss by the improvements placed by him upon the property. In no event is he entitled to betterments.

It is our opinion that his Honor should have signed the judgment tendered by the defendant, and that he was in error in signing the judgment tendered by plaintiff. "W"e, therefore, reverse the judgment of his. Honor and direct judgment to be entered in accordance with this opinion, without liability to the plaintiff to further account for the rents and profits by him received to 17 June, 1910, and without charge to the defendant *676 for tlie taxes which may have been assessed against said property, and which are to be a charge against the plaintiff. The plaintiff will pay the costs of this action.

Reversed.