Blanchard v. Stone

The opinion of the court was delivered by

The orators seek to recover back a sum of money, paid to defendant, and also to have him enjoined from prosecuting a suit for the recovery of a further sum, and that he shall be decreed to give up certain securities which he holds against the orators. The ground upon which this is sought, is that of alleged fraud in obtaining the money and securities in question.

It appears that that the defendant, having obtained a written obligation from George D. Douseman, to convey to him certain land, upon payment, to be subsequently made, of certain sums of money, sold and assigned his interest therein, to the orators, upon the payment, by them, of the money, and execution of the securities in question, among which securities was a bond by which they obligated themselves to complete the payments to Douseman, necessary to perfect his obligation to convey.

In the assignment of the contract from the defendant to the orators, there is nothing said about any title in Douseman, and no covenant or agreement in relation to the title to the land in any way. The orators paid the several instalments to Douseman, as they became due, except the last, which they paid six months in advance. At this time the orators had ascertained that George D. Douseman had no title to the land, but that the title was in one Talbot C. Douseman, as they supposed, and this subject to a heavy mortgage.

The question here arises, what ought the orators to have done ? Should they have proceeded to pay up what was behind, after learning that George D. Douseman had no title ? It is said, that unless they did, they would have had no claim upon him for what was paid, as there was a stipulation in the contract, “that if said payments should not be made by the time specified, in said contract, said Stone should forfeit all right, legal or equitable, to .a conveyance of said premises.” But, in that case, it was not necessary to make the last payment before the time. After they had learned these facts, *277ought they not to have notified the defendant, and given him the offer of directing what should be done, in case they intended to have recourse to him ? — for it is a maxim in chancery, that “ he that seeks equity should do equity.” These are all questions worthy of consideration, when looking after the equitable relations of the parties. But the orators, it may be, in the spirit of speculation so prevalent at that time, were not admonished to hesitate by the discovery of defective title, but consented to take a deed from Talbot C. Douseman, and gave up their contract and covenant for a good title, from George D. Douseman. Having done this, they had taken an entirely new security — such as the defendant had never relied upon, and such as would, under no circumstances, be available to him. In doing this, the orators took a step which they cannot retrace. When they found the title to be defective, and before giving up the contract, if they had chosen to have rescinded their contract with defendant, they could have placed him in statu quo. They could have put back into his hands, the covenants of George D. Douseman, which would have been good security for the defendant, — or they might have insisted upon a satisfactory deed from Douseman, and, in case he did not furnish it, with that paper they could have called upon him for their recompense. But when they bargained away the covenants and agreements of George D. Douseman, for those of Talbot C. Douseman, it became a matter of their own, and they have induced a state of things in which the defendant did not participate, and for which, if he is made accountable, he is left without a remedy. The transaction between the orators and defendant, must be regarded as a negotiation for the contract. It was not a purchase of the land, for the defendant had no title to it, and did not pretend to have any, but merely held the obligation of Douseman to give him a title.

This view of the case enables us to pass over many of the points raised in it, for, this point being settled, it is of little importance how is the law', or how are the facts in other respects. For, even if in point of fact, the defendant made false representations in relation to Douseman’s title to the land, that would not justify the orators, after having discovered the defect in the title, still to go on and experiment upon the title, and if they, in the chapter of accidents and *278chances, could make something, to keep it, and if not, after having thrown away all security for themselves or the defendant, then to come back upon him for relief.

That the defendant made some representations about the title of Douseman, that were not true, is very probable — but that he knew them to be false, we have no very conclusive evidence.

The decree of the chancellor is affirmed.