Bates v. Delavan

5 Paige Ch. 299 | New York Court of Chancery | 1835

The Chancellor.

The allegations in the bill as to the giving up the possession of the premises, after the judgment of the supreme court of Vermont in the ejectment suit, and as to the alleged repairs ofiset against mesne profits, are not admitted by the answer, or proved; they must, therefore, be laid out of question in the decision of this cause. Some of the allegations in the answer, not responsive to the bill, must also be rejected for wapt of proof. The objection to the decree of the circuit court of the United States, that it is interlocutory merely, and-not final, is not sustained by the facts. The decree purports to dispose of every question in the cause, including the costs of suit, and is therefore a final decree. The direction to prepare a formal decree, in conformity with the decision of the court, I presume, means nothing more than that the decree shall be drawn up in the proper form, to be signed by the judges, and enrolled. But a formal enrolment of a decree in equity is not absolutely necessary to its validity.as a matter of evidence. (Winans v. Dunham, 5 Wend. Rep. 47.) And, in the present case, the informality in the mode of exemplifying the decree of the circuit court of the United States is waived by the written stipulation of the defendant’s solicitor. Tire important question in relation to the decree, therefore, is, how far it is binding upon the defendant, who was not within the jurisdiction of the court, and who -did not appear in the cause.

By the 11th section of the judiciary act of 1789, (1 Laws of U. S. 55,) it is provided that no civil suit shall be brought ■before a circuit or district court, against an inhabitant of the United States, by any original process in any other district than that whereof he is an inhabitant, or in which he shall be found at the time of serving the writ. It has, however, been frequently decided, by the courts of the United States, that cross-bills, and injunction, bills to stay proceedings, or to obtain relief against suits or judgments in the same court, between the same parties or their representatives, are not original suits within the meaning of this section of the judiciary act. (See Conk. Treat. 83; Dunlap v. Stetson 4 Mason’s Rep. 349.) The same principle was distinctly recognized by this court in Rogers v. Rogers, (1 Paige’s Rep. 183,) where the defendant, in an injunction bill to restrain proceedings in a suit at law in the state court, was not permitted to remove the cause into the circuit court of the United States as an original suit. So far as related to the two notes in the hands of the attorney of Delavan for collection, and on which suits were actually pending in the circuit court of the United States at the time of filing the bill in that court, and the service of the subpoena on such attorney, the bill in equity might be properly considered as a proceeding in rem, and as a defence to the suits which had been commenced on the law side of the court.

As to the regularity of the substituted service of the subpoena upon the attorney without a previous order of the court, it is improper for this court to express an opinion. Neither is it important to the decision of this cause, that I should inquire how far the decree of the circuit court is binding and conclusive as to those two notes, as the defendant, in his answer to the present bill, offers to deliver up all the notes, to be can-celled, under the direction of this court.

The bill in the circuit court of the United States, so far as it sought the repayment of the $750 which was paid at the time of the execution of the deed, and to have the third note of $500, on which no suit had been commenced, delivered up and cancelled, was not in the nature of a defence to the suits pending in that court, but was clearly an original bill. And as the defendant resided in this state, and was not served with process, and refused to appear and litigate his rights upon that bill, the circuit court had no jurisdiction to make a decree against him in relation to those matters. The part of the decree, therefore, which directs the repayment of the $750, with interest, and the delivering up of the third note to be cancelled, will not be enforced by this court, as a decree in personan against the defendant. By the lex loci rel sitae, property, belonging to a person who is not within the jurisdiction of a court of law, or equity, may be made subject to the jurisdiction of the court, so as to render the judgment or -decree of such court binding, as a proceeding in rem, against the property which is within its jurisdiction. But. where the defendant, or party proceeded against, does not reside in the state or country where the suit is brought, and is not served with process and does not appear, the judgment or decree in such suit will not be allowed to operate in personam, against such party, in the courts of any other state. This question appears to have arisen and been decided in the same way, in nearly half of the states of the union. And 1 am not aware that the courts of any state have held such a proceeding conclusive upon the rights of a party proceeded against, who has not appeared or otherwise submitted his rights to the decision of the court in which such proceedings were instituted. (See 1 New Hamp. R. 242 ; 6 Pick. Mass. R. 232; 4 Conn. R. 380; 2 Verm. Rep. 263 ; 5 John. Rep. 37; 2 Dallas’ Penn. Rep. 261; 2 Leigh’s Virg. Rep. 172; 1 Den. N. C. Rep. 187; 1 Bailey’s S. C. Rep. 242; Hard. Kent. R. 413; 2 Verger’s Tenn. Rep. 484; 6 Ham. Ohio Rep. 44,117 ; 2 Blackf. Indi. Rep. 108; 1 Breese’s Ill. Rep. 259; 2 Stewart’s Alab. Rep. 280, 399, 445; Missouri Rep. 517, 529 ; 3 Mason’s C. C. Rep. 251.) Judge Story, in his very learned and valuable commentary on the subject of the conflict of the laws, in considering the extra-territorial effect of a judgment or decree in personam against a non-resident, by a mere citation vils et modis, where the party proceeded against is not within the jurisdiction and does not appear, also arrives at the conclusion that its effect is purely local, and is elsewhere to be held and considered as a mere nullity, so far as the personal liability of such party is concerned. (Story’s Confl. of Laws, 458, § 546. Idem, 508, § 609.) In deciding upon the .merits of this case, therefore, I shall lay the decree of the circuit court of the United States for the district of Vermont entirely out of view, as being in no way binding upon the defendant personally, as to the $750 and the interest thereon, or as to the last of the $500 notes. And I shall proceed .to dispose of the case in the same manner as if that decree had never •been made.

As a general rule, a court of equity will not decree the specific performance of a contract of sale, if the vendor cannot make a good title, although the contract has made no provision as to covenants of warranty to be inserted in the conveyance. An exception to that rule, however, exists where, by the contract of sale, the vendee expressly assumes the risk as to the title, or agrees to take such a title as the vendor is able to give. It does not appear to be clearly settled how far, or in what cases, this court will interfere to rescind a contract of sale, after it has been consummated by the execution of the conveyance, without any covenants of warranty, where there is no fraud, but where both parlies were under a mistake as to the title of the vendor. By the civil law, an action of redhibition, to rescind a sale and to compel the vendor to take back the property and restore the purchase meney, could be brought by the vendee, wherever there was error in the essentials of the agreement, although both parties were ignorant of the defect which rendered the property sold unavailable to the purchaser for the purposes for which it was intended. This principle of the civil law appears to have been followed in the courts of some of our sister states ; and the case of Hitchcock v. Giddings, (4 Price's Rep. 135,) must have been decided, by Chief Baron Richards, on the same principle. I agree, however, with the learned commentator on American law, that the weight of authority, both in this state and in England, is against this- principle, so far as a mere failure of title is concerned; and that the vendee, who has consummated his agreement by taking a conveyance of the property, "must be limited to the rights which he has derived under the covenants therein, if lie lias taken the precaution to secure himself by covenants of warranty as to the title.^(a) And where he has neglected to take such covenants, and there is ao fraud or misrepresentation in the casé, he has no remedy to recover.back the purchase money, upon a subsequent failure of title. (2 Kents Com., 2d ed. 473.) In the present case, the .fact that the complainant has taken a mere quit-claim deed of the right and title of the defendant in the premises, with special covenants against the'claims of two particular individuals only, authorizes the conclusion that it was understood and agreed between the parties that the vendee should assume the risk of the title, in regard to the claims of all other persons.

The failure of the title as to an undivided portion of the premises, by the successful assertion of a claim against which the defendant had agreed to indemnify the complainant, would have been sufficient to enable the latter to resist the making of a decree for a specific performance, upon a bill filed by the vendor. But it does not follow from this that the complainant may rescind the whole contract, which has been in -part consummated, by the execution of the conveyance and the payment of a part of the purchase money. There are many cases in which the court will not lend its aid to compel a specific performance of an executory agreement, in which it would not feel itself authorized to interfere, by decreeing that an executed contract should be rescinded Where a vendor has agreed to convey the whole premises, and it is found that he can only perform his agreement as to an undivided part thereof, the court will not compel the purchaser to accept a partial performance, when it is evident that he will be injured by the partial failure. The party who is unable to perform his agreement in full, has, in general, no equitable claim to the interposition of the court in his behalf, if the adverse party prefers to rescind the contract in loto. But a vendor, who has only covenanted to warrant or indemnify the purchaser against a claim upon a part of the premises, can perform his covenant, by paying such indemnity, according to the spirit of the agreement contained in the conveyance. In such a case, if the vendee wishes to secure to himself the right to rescind the whole contract, upon the breach of the covenant of warranty as to a part only, he should have a special provision to that effect inserted in the deed. The complainant, therefore, is not entitled to a decree for a return of the purchase money which has been paid; the amount of the notes being more than sufficient to cover the nine fourteenths of the premises as to which the covenant of warranty extended. But as the defendant has offered to give up the notes to be cancelled, under the direction of the court, a decree must be entered to that effect, upon the complainant’s releasing all claim against the defendant on the covenants of warranty contained in the deed, and releasing to the defendant the interest, if any, which he acquired in the nine fourteenths, under the original, conveyance from the defendants.

The defendant, having succeeded as to the only matter which was really in controversy between the parties in this cause, is entitled to the costs of his defence.

(a) See Simpson v. Hawkins, 1 Dana’s Kent. Rep. 305.