The sheriff's sale of 1893 was voidable because of the erroneous statement of the incumbrances upon the property sold. Pearson v. Gooch,69 N.H. 208; Bickford v. Poor, 68 N.H. 443. Supposing that it was a valid sale, and not being in fault for so understanding, the plaintiffs made the settlement of 1895, whereby, for a small sum, they unintentionally parted with what proves to be a valuable interest. They did not intend to sell, nor Currier to buy, the interest conveyed, for all supposed it was already owned by Currier. Upon the discovery of the facts they brought this bill, asking to be restored to the rights which they assigned because of the mutual mistake of all parties concerned. The settlement, having been made upon an honest mistake of material facts, should be set aside, unless there is an estoppel. Wiswall v. Harriman, 62 N.H. 671, 672.
The defence is set up that the answer of Samuel W. Thompson to the original bill in equity brought by Currier and Pease, in which Thompson alleged that the title to the property was in his wife under the Wentworth claim, created an estoppel against the setting up by him, or his privies, of title under the Bellows claim. No decree was ever made in that case, the bill having been dismissed by agreement as to all parties interested as plaintiffs in the present proceeding. Conceding that this answer might be treated as a technical disclaimer, it would not estop the party pleading it until final judgment. Wells v. Iron Co., 50 N.H. 85.
At the time of the settlement, there were, or had been, two claims of title, — one under the plaintiffs' mother as mortgagee, and the other under their father as the owner of the equity. Currier had attempted to levy upon the latter interest, and both he and the plaintiffs believed that he had done so. All that the plaintiffs then had to rely upon was the mother's mortgage title; and if this failed, they had no claim upon the property. In this state *Page 266 of the facts, and while the plaintiffs were claiming by their pleadings that the mother's title was valid, the settlement was made. From this it is argued that the plaintiffs are estopped to deny the truth of their allegation, because the defendants acted upon it and bought the claim. It is a familiar rule of law that one who has induced another to act, by means of representations of facts which he knew, or ought to have known, were untrue, cannot deny those facts to the other party's disadvantage. But it is not found that Currier's action in making the settlement was based upon the truth of the representations, nor even that he believed them to be true. A representation of fact not acted upon and not believed is not a foundation for an estoppel in pais. Moore v. Bowman, 47 N.H. 494, 499; Stevens v. Dennett, 51 N.H. 324, 334; Pittsburg v. Danforth, 56 N.H. 272,278; Howes v. Fiske, 67 N.H. 289. Not only is it not found that Currier believed in Eliza's claim, but the inference is the other way. If that claim was well founded, she had a perfect title to the property, and Currier had no claim enforceable against it, except, perhaps, some mortgages. All his claims against the estate of Samuel were then worthless; for that estate consisted almost entirely of Samuel's claim to the grant. Currier's claims against Thompson Ricker were in about the same situation. The mother was living; and, unless William inherited something from his father, there was nothing from which to collect the Thompson Ricker notes. In exchange for Eliza's claim of title, Currier gave $500 in money and these comparatively worthless notes. If that claim was well founded, he bought property worth more than $12,000 for substantially $500. It is manifest that he did not rely upon the truth of the assertion that Eliza's title was valid. On the other hand, when the situation of the parties is considered from the plaintiffs' standpoint, it is clear that, as found by the referee, they relied upon Currier's representations as to his title (i.e., his pleadings), and acted to their injury. While both parties believed that Currier owned Samuel's interest, Currier knew the facts which, as a matter of law, established a lack of ownership. His ignorance was of the law, while theirs was of the facts. Whatever equities there are in the situation seem clearly to be with the plaintiffs.
It is further argued that the plaintiffs are estopped because of the proceedings against the estate of Samuel after the settlement of 1895. To sustain this position, it is shown that executions against him, held by Currier and duly presented to the commissioner appointed by the probate court, were neither allowed nor disallowed, and that the time for appealing from the acceptance of his report has expired. It is not necessary to consider the effect of these proceedings, for the plaintiffs agree that these claims may be considered valid. *Page 267
The report of the referee is that the compromise should be set aside unless the facts reported show an estoppel. As those facts fall short of this, and no error of law appears in the general finding, the plaintiffs are entitled to relief. There has been a common mistake as to an essential fact forming an inducement to a contract. Not only do the circumstances justify the inference that the agreement would not have been made if the truth had been known, but the referee has so found as a fact, and the contract is voidable. Wiswall v. Harriman, 62 N.H. 671, 672.
The plaintiffs are entitled to have the compromise of 1895 set aside, and the sheriff's sale of 1893 decreed invalid, upon making full restoration to the defendants. They must pay all the claims which the defendants, or either of them, could have established against the estate of Samuel at the date of the settlement, and all such sums as were paid in carrying out the compromise, with interest, and must surrender the releases, etc., received in pursuance of the compromise. They must also pay the Thompson Ricker notes. At the time of the settlement, suits were pending for the collection of them, and whatever rights Currier or Pease had by attachment or otherwise may have been lost. It appears that such is the fact as to William F. Thompson's interest in the grant. The burden of now attempting to enforce payment of these notes by a levy upon his interest in the property, and an overthrow of his intervening conveyance thereof, ought not to be imposed upon the defendant. "A court of equity is always reluctant to rescind, unless the parties can be put back in statu quo. If this cannot be done, it will give such relief only where the clearest and strongest equity imperatively demands it." Grymes v. Sanders, 93 U.S. 55. It may be that the full payment of these notes will give the defendants more than they could have obtained as the facts were when the settlement was made, but it cannot be said that anything less will be certain to do them full justice. As he who seeks equity must do equity, the plaintiffs must restore the defendants to their former situation before receiving the equitable relief asked for.
Upon a compliance with these conditions, within such reasonable time as the court at the trial term shall order, there will be a decree the plaintiffs, otherwise the bill will be dismissed.
Case discharged.
All concurred. *Page 268