Wilson v. Jordan

Saffold, J.

Jordan instituted an action of debt, in Greene Circuit court, against Wilson, as maker of a promissory note, payable to Jordan, for three hundred dollars. The pleas were, the general issue ; want of consideration, and failure of consideration. The plaintiff below obtained a verdict and judgment. F-rom a bill of exceptions, taken on the trial, by the defendant below, it appears that one John F, Martin sold a house and lot to Jordan, and executed to him a deed. That Jordan, in Gctocer, 1826, being in possession, sold the houso and lot to the defendant,, Wilson; executed 'r> him a 'deed, and gave him possession of the prornisos, for which the aforesaid noto was given. That about a year after this sale, Wilson sold the samo, to one Cooper, and gave him possession, which he retains. It further appears that said defendant, Wilson, offered to prove that no deed convoying the lot to Jordan, had been' recorded in Greene county; also, to prove by the sheriff, and the production of the execution, that the house and lot had been sold to Daniel"Greene, by the sheriff, to satisfy an execution against Martin, the first granter as aforesaid, in September, 1829. The note, it will be observed, was executed in October, 1826 : the suit comipenced in August, 1829, and the trial was had at'March term, 1530.

The court, on motion of the plaintiff, below, rejected the evidence offered, to prove the failure of consideration, as aforesaid.

The rejection of this evidence is the cause assigned for error.

The appellant, Wilson, contends that it was competent for him to introduce evidence, going to establish a failure of title of the vendor, as a defence to the action on the note: and that though there had been no eviction in fact, the circumstances operate as an eviction in law, and constitute a legal defence.

The adverse party controverts these positions; and contends, that the sheriff’s title may be invalid, or never prosecuted* or, should it ever be prosecuted to eviction, it does not appear what were the covenants in the deed, or whether there were any; also, that an eviction, by a title, to which the covenants do' not extend, imposes no responsibility on the vendor, either in law or equity. He further Contends, that where a purchaser has taken a defective title, and can not recover against his immediate vendor, his only recourse is to the covenants of the earlier vendors, many of which may ran with, the land; also, that Wilson and. his vendee, having had possession near three years before the sale, and received the mesne profits, the failure of consideration, if any, is but partial, which is not available at lam.

It is to be observed, no question has been raised respecting- the sufficiency of the proof, that the several conveyances were duly executed as stated. It is not shewn what covenants, or whether any, were expressed in them. Nor is the precise date of the judgment shewn, but, from the record and argument, we assume the fact that it was not until recently before the sale, and about, the time the suit was commenced on the note. •

The effect of the statute,’-creating constructive covenants, relied on by the appellant, is not unworthy of consideration. It provides, that in all deeds, “ whereby any estate of inheritance, in fee simple, shall hereafter be limited to the grantor, or his heirs, ' the words grant, bargain, sell, shall be adjudged an express covenant to the grantee, his heirs and assigns, to wit: that the grantor was seized of an indefeasible estate, in fee simple; freed from incumbran-ces, done or suffered from the grantor, (except the rents and services that may be reserved,) as also, for quiet enjoyment against the grantor, his heirs and assigns; unless limited in express words contained in such deed; and the grantee, his heirs, &c.- and assigns, may, in any action, assign breaches, as if such covenants were expressly inserted.”a

There appears some difficulty in the construction of this statute; whether the section quoted was intended to be applied to absolute conveyances, in fee simple, or to conveyances of limited estates, leaving a reversionary interest, either certain or contingent, in the grantor 'and bis heirs. The least intelligible part of the section, are the words, “ whereby any estate of inheritance, in fee simple shall ^hereafter be limited to the grantor or his heirs." If, according to the true construction of this statute, it refers to conveyances in fee simple, and creates, by its own operation, (as is contended,) a goaeyal warranty of title' and covenant, for quiet enjoyment, by the grantee, his heirs and assignees, it excludes from this state, the source from which have arisen many of "the most intricate and important questions relative to the tenure of real estate, and the responsibility of vendors.

If, on the contrary, the statute can only, apply to conveyances of estates, on condition, or limited in duration ; or, if it creates warranties and covenants, only against subsequent alienations, or incumbrances by the grantors, and their heirs, then it can have no influence on cases like the present: and in this view of the 'subject, unless we should infer, as the contrary is not shewn, that the deed did contain Tull covenants, or warranties, the positions assumed by. the counsel for the appellee, would be unanswerable— that, in as.much as the conveyances have been executed by the necessary parties, if the purchaser has been, or should be, evicted by a title to which the covenants do not extend, he can not withhold the — Pechase money, either in law or equity ; unless it be on an allegation of fraud distinctly made, and suffi- ° . . J J ciently sustained.a

But as the effect of this statute w;v. not fully discussed in the argument-as wo aro ¡u-t satisfied respecting the construction, and as other questions involved are, fully decisive of this case, we decline, on this occasion, declaring any construction of the section alluded to.

If the alleged defect of title had not been, sufficiently ascertained, and could not be legally tested, in this action, the consequence must be, ijiat the defence insisted on, ought not to have been sustained.-

The case of Frisby vs. Hoffragle,a is much relied on, in support of the defence offered against this note. That action was brought to recover the amount of notes, given to secure the purchase money of a tract of land, conveyed by a deed with warranty. There, before "'the conveyance was executed, a judgment, had been obtained against the plaintiff, and after the notes were given by the defendant, the land was taken, by virtue of an execution on that judgment and sold, and conveyed by the sheriff.The plaintiff proved that the defendant had not been evicted or disturbed in his possession of the land, by the purchase at the sheriff’s sale. The Judge being of opinion, that the consideration bad failed, directed the .plaintiff to be non-suited, with leave to move to set aside the non-suit. The supreme court held, that the consideration had entirely failed: for, although the defendant had not then been evicted, he was liable to be so, and would be responsible for .the mesne profits; and, that it was competent for the court to do justice, at once, and avoid circuity of actions. It is true, however, as contended, by the ap-pellee, that this case sustained the doctrine of relief, by way of defence, to a greater extent than it had been usually carried in that State; and its authority has been subsequently questioned-nor do the authorities;a cited by the court, in support of this de~ cision, well sustain it. But that case, according to the view taken of it, by that court, was materially different from this, in as much as the failure of co~i-sideration there, was entire, and, in this, it was not; The decisions of this court, however, have gone far, to abolisb. the distinction, with us, between the effect of a partial and total failure of consideration.-See M'Million vs. Pigg & Marr,b -Peden vs. Moore.c These cases, like those cited, in support-ol the case of Fris7iy vs. Ho~nagle, related to the sale of personal property; but, we are of opinion, the principles of relief should, in this respect, be the same in refe~ ierence to the sale of .either kind of property-provided the circumstances, constituting the failure of consideration, be equally conclusive, and susceptible of proof at law: Nor do we feel the least dissatisfaction with our former decisions, so far as they tend to place partial, and total failure of consideration, on the same footing, instead of driving parties to the circuity of actions.

There is, yet a more essential difference between the case of Frisby vs. Hoffnagle, and this; than the one mentioned. In the former, the judgment, creating the lien on the land, existed previous to the execution of the conveyance; consequently the title was incumbered, so as to be-rendered invalid, from its inception; and that, in a manner which must be presumed to have been known to the vendor, when he executed the conveyance. These circumstances implied fraud, which might authorise a rescission of the contract; and though the presumption of fraud, was not expressed, as the ground of ihe decision, it must be so considered, to reconcile the case with the current of decisions, in'the seme court. It is a settled rule of law, that if a failure of consideration, in the sale of land, as well as personal estate, be the result of a fraudulent intention, in the vendor, especially, if it relate to the quantity or quality of the thing sold, such failure may constitute a legal de-fence to an action, brought to recover the purchase money. . Generally, however, ihe injury must have been sustained, before the remedy can be sought— either by using it as matter of defence, to an action, for the purchase money, or as the ground of an independent action. If a failure of consideration arise from the conveyance.of a land title, which is defective, by reason of a paramount title in another, or other incumbrance, the invalidity of the title must be ascertained by an eviction, or something tantamount thereto, before the relief can be sought. Yet, we think the right of redress may, on principle and authority, be extended so much farther, in either of the forma mentioned, .as to afford a remedy, in case of fraud, respecting the quantity or quality of lands conveyed ; and that it may be sought as soon as the ■facts are sufficiently ascertained. In such case, neither the necessity of disturbance in the enjoyment, nor the doctrine of eviction, can apply.

The case, cited, of Adams va.Wiley et ux a carries the principle farther, and affords such relief, withiout evidence of fraud. There, the action- was brought, on bonds, given /to secure the purchase money, for lands sold by the plaintiff to the defendant. The defence was, that the quantity of land had been misrepresented, by the plaintiff; also, the quality.— Cokock, J., in delivering the opinion of the court, remarked, that it was apparent, there was no fraud in the case; that there may have been misrepresentation, which, though not intentional, might entitle the defendant to a discount. . He further said, a deficiency, in quantity, or defect in quality, where there has been a representation, is a legitimate ground for a deduction of price, or rescission of the contract, as the case may be;, but, that case, on the part of the defendants, was to be considered as an action of breach of covenant: for, it had been proved, and admitted, that the true quantity of land, was less than that stated in the deed.

In the case of Mackey vs. Executors of Collins,a it was decided, that where the defendant had, by deed, granted, bargained,, sold, and released, to the plaintiff, a tract of laud, to hold, in fee; and, thereby bound himself, his heirs, executors, &c., to war-, .rant, and forever defend the premises, to the plaintiff, his heirs, cue. against all persons, whomsoever, lawfully, claiming, or to claim the-same, or any part thereof;' the plaintiff might maintain an action, for the breach of such covenants, before eviction, by shewing a paramount title, in a third person.

Butin both these South Carolina.cases, the court rested the decisions mainly on rules of practice, which, they said, had long prevailed in that State, and which they admitted,' to have been a slight departure from the strict common law doctrine.

'A similar practice is found to prevail ih Pennsylvania.b But, in reference to these cases, it is sufficient to'remark, that as that State recognises no separate Chancery jurisdiction, the decisions, there, cannot be regarded as satisfactory authority, on questions, involving the distinction between common law, and Chancery jurisdiction, or the precise boundary of the former.

In most of the other States of the Union, as well as in England, the principles of decision are understood to be different. The rule adopted in Kentucky, is, that the defence of a failure of consideration of a note, given for a tract of land, cannot be sustained, unless the consideration has utterly failed.Nor is it there allowed, if th'fe contract has been consummated, on the part of the vendor, by executing the deed of conveyance, with either a general warranty of title or a special warranty, against himself. The reason expressed, by the court of Appeals, was, that in cases of a geiieral warranty, a liability was thereby imposed on the vendor, w hich would not be destroyed by the plea, and which was, itself, a valid consideration; and, iii case of such special warran~y, if the land was lost by a title deriv~d from the vendor, he would be subject to an action o,n the warranty, for the loss. And, it was further remarked, in the same case, that a deed of conveyance without warranty, would operate, as an assignment of the preceding warranties, which run with the land.a

`juier ann iaier aecisions, in i~ew xor~, tnan-tne one referred to, (Frisby vs. Hoffnagle,) maintthn principles less favorable to the defence here insisted on, than is the doctrine of that case. The case of Bumpus vs. Platner,b waSa controversy respecting a failure' of the consideration of a bond and mortgage, given to secure the payment of part of the purchase money, for a tract of land 1which had been conveyed by deed, with covenants of warranty.

The Chancellor, in assigning - his reasons, for refusing relief, observes, “ It is said to be very difficult, to extract from the books, what the rule of equity is, upon this point of failure of consideration, the agreement is executed ;a but, I apprehend, it may be safely said, that ther,e is no case of relief^ on this ground, where possession has passed and continued, without any eviction at law, under a paramount title.” It is true, that under a conveyance, which the complainants in that case, charged to be defective, on account of a prior conflicting conveyance, from the same original grantor, they had held quiet possession, for near twenty years; and, the Chancellor remarked, that the legal presumption was fast ripening against the opposing title, from the lapse of time, since it accrued : that it might be the better title, but it could not be tried upon that bill&it was impossible for- him to'know, what legal, or what valid defence might be set up against it.-Perhaps, there might be none; but the application was clearly premature; and, it would be without precedent, and dangerous, in principle, to arrest and bar the recovery of a debt, -while the purchaser is still in possession, under the purchase deed, and there had been no eviction at law.” : '

The. case of Miller vs. Watson,b is an authority, direct OppoSition to the defence here insisted on. There was an admitted failure of title, conveyed by deed, with warranty, and a verbal promise, by the vendor, to account for the purchase money. The court ~aeld, that, as therehad b~en no eviction, there was no~ consideration to support the promise: and, that where a debt is secured by an instrument of a higher nature, as by deed or record, the promise to pay it, is void. — That, admitting there was a cloud upon the title,- or that it had entirely failed, the hostile claim may have been quieted, or purchased in, by the vendee, for a'very small portion of the consideration money; or the vendor may himself have quieted the title.

. Without determing how far we would be disposed to adopt the principles of this latter decision, we have no hesitation in deciding, that, in this case, for the reasons that no fraud is alleged — the contract had been executed, long before the incumbrance accrued —Wilson and his vendee enjoyed the possession for near' three years, and continued to do so — and that there had been no judicial test of the validity of the-title conveyed, for the want of which, the effect of the incumbrance was uncertain — the defence at law was unsustainable.

The judgment must, therefore, be affirmed^

a Toul. Dig. 238

a Sug on V. 348, § 3; -Bos. & Pul. 170; 5John. Ch. R. 84.

a lJohn L 50.

a 40, note -2 Camp. IR. 348-7 John. 14. 383. 14. 383.

b 3 Stewart, eStewart

c 71. alCamp.N P.

a J Nott & M,Cord, 78.

a 2Nott & M Cord 186

b 1 Serg. & Rawl. 43 J. 5 Id. 204—3 Starkie, 1614.

a 5 Lit~47 3 Id. US.

b 1Jhn.Ch, ~. 213.

a iFonb.363after

b n `.~Cow.195