65 Iowa 702 | Iowa | 1885
The defendant, while admitting the execution of the agreement declared on, averred in his answer that he was induced to enter into it by the fraud of the plaintiff, and also that the agreement was entered into by mutual mistake. He averred that it was represented by the plaintiff that the aggregate liabilities of Carey & Warren would not exceed $15,000, and that it was believed and understood that the defendant Gun
The case is now before ns upon rehearing. When it was first before us, it was assumed that the issue presented was an equitable issue, but the court thought that, nevertheless, as no affirmative relief was sought, it might be tried by a jury. Upon further consideration of the case we have come to think that this view cannot be sustained. It seems to us that the court improperly assumed that the issue is an equitable one. The defendant does not aver in his answer that there was an agreement that the liability which he assumed should be limited to $5,000. If such had been the fact, it would appear that the mistake was made when the parties came to put their oral agreement in writing. But there is no pretense that there is any difference between the terms of the oral agreement and of the writing intended to express it. The mistake, then, if any, was in regard to the subject-matter of the contract. If the facts are as averred, the parties did not know what they were contracting about. They supposed that they knew, but they were mistaken. Where a material mutual mistake is made by parties in respect to the subject-matter of a contract, the result is that in contemplation of law there is no contract. The minds of the parties do not meet. If an action be brought on such contract, it is competent for the defendant to deny its existence, and in support of the denial he may allege and prove the mistake. In such case the deter-
In case the party aggrieved by the mistake should not see fit to wait until he should be sued, it would be his right to-bring an action for cancellation, and the issue then presented would be the same as in the case of the cross-action above supposed. If the mistake did not exist in the subject-matter so as to prevent the minds of the parties from meeting, but merely in the terms of the writing by which the parties undertook to express their valid oral agreement, then the writing, being conclusive in an action of law, would need to be reformed, or, what is substantially the same thing, the true agreement of the parties would need to be determined and expressed in a judicial decision. The determination and expression of the true agreement would call for the exercise of equity powers. Rut the determination of the existence or non-existence of a contract, where no cancellation is asked, may, we think, be made in a court of law, and in the exercise only of such powers as belong to a court sitting as a court-of law. "We do not say that this rule would apply in the-case of a deed, where there had been such mistake in the subject-matter as to entitle the grantor to have the deed declared' null. Possibly the force given to a deed is such that it would' be deemed to-have passed the legal title notwithstanding the mistake. If so, the party aggrieved would have only an equitable right, and while he might, of course, assert such right by answer in an action at law, vet, as his answer would set
In support of our conclusion that the issue in question presented by the defendant’s answer was not an equitable but legal issue, and that the motion, therefore, was properly overruled, we have allowed our discussion to take a somewhat wider range than might be thought strictly necessary; but we have felt constrained to do so, partly for the purpose of setting forth with greater clearness our position, and partly as preliminary to another question which we now proceed to consider.
The view which this court took upon the former hearing, respecting the trial of an equitable issue by a jury, was such that this instruction was not specially considered in the opinion. The petition for a rehearing was directed mostly against the view' as expressed, assuming that, if that view
Reversed.