Morrison v. Eaton

The plaintiff, Morrison, on the 26th day of March 1814, sold to the defendant certain real estate in Morristown, on which he had for some time kept a public house, and for which the defendant paid one thousand dollars, and covenanted to pay. another one thousand dollars by instalments. According to the terms of the contract, the defendant, on the 1st of April 1814, took possession of the property, and continues in possession, receiving the rents and profits of it. This action is brought to recover the first instalment of the money, for which a credit was given *207—and the defendant pleads, in bar of the action, that the article of agreement was obtained by fraud, and is fore, void in law — and the question now is, whether the evidence offered by the defendant, is relevant to support the issue on his part.

There is no doubt, but that the defendant ought to have stated in his plea, the fraudulent misrepresentations on which he relies to avoid the contract; the question might then have been decided on demurrer. By pleading in this general form, he does not preclude the plaintiff from bringing the matter before the court, by objecting to the evidence ; and I consider the question as the same in effect, although it comes up in a different shape from what it should have done.

In 2d Chitty 464, a precedent is given of a plea in bar to debt, on a sealed instrument; and in a note to that precedent, it is said that “Fraud is a defence at law.” The authors cited, are 2d T. R. 765, and 3d T. R. 438. The case in 2d T. R. is an action of assumpsit, on a promissory note, and does not support the position, that fraud is a defence at law, to an action brought on a specialty. The fraudulent sale of a pretended patent right, was received as a defence to an action of covenant, for which it was the only consideration, in 3 T. R. 438. This case seems an exception made, on the ground of public policy, to the general rule, and not the rule itself; it does not support the assertion of Ohitty, in the broad and general terms which he uses, that “ fraud is a defence at law.” The general rule is, that a covenant, under seal, may be voidable in equity, for fraud or want of consideration. But a contract, under seal, is not void at law,

Johns 3/7*7

unless the consideration of it is illegal. It would be sufficient, then, to exclude this evidence, that it does not warrant any such conclusion from it, as that the article of agreement was void at law. But on the reason of the thing merely, I can see no objection against a man’s avoiding his deed at law, by pleading that it was obtained by fraud, and was without consideration, on the same ground that in an action of assumpsit for the price of a chattel sold and delivered, it is competent for the defendant to avoid his promise, by proving that the sale was fraudulent and without consideration. But this kind of defence could not be received, unless the chattel had been restored; for a man will not be permitted to keep and use property which he has purchased, and avoid paying for it hy shewing a deceit in the sale. If it'should be admitted, then, that the same defence may be made in an action on a specialty, as on a simple contract, it would seem that the defendant has not put himself in a situation to take advantage of it, *208and what is offered to be proven, does not go in bar of the action in this case; for, as to the 1st point, the promise not to keep a public house in Morristown; it might have been an inducement to the defendant to make the purchase, to enter into this covenant; but the breach of such promise, would not make the covenant either void or voidable — it is an agreement altogether collateral to the contract on which this suit is brought. The breach of such agreement cannot, therefore, bar this action. As to the 2d and 3d points, it may be observed, that the defendant went into possession of the property, under this contract, more than three years ago, and has ever since held and enjoyed it. You cannot take the benefit of a contract, and avoid the obligations of it. If you would rescind on the ground of fraud, you must rescind in t-oto. If you will have your land and buildings, you must pay for them; as if you buy an horse, you cannot keep and use him, and avoid paying the price agreed for him, by proving a deceit in the sale. Place the opposite party in statu quo, before you refuse to fulfil a contract on the ground of fraud, is a dictate of common honesty as well as of law.

The plaintiff has contracted to convey to the defendant, át a future day, certain real estate, he represented it to be his own, or concealed the fact that a part of the property was not his own; and is it a necessary inference from this, that he will not be able to fulfil his con tract ? He may have, the fee in himself, or he may purchase it. An obligation to convey land, under such circumstances, is not void in law; so that, in whatever way the case presents itself to my mind, it seems that the evidence offered, does not go to support the plea in bar, for it does not warrant the inference that this contract is void in law. Evidence rejected. Verdict and judgment for plaintiff.