Colonial Development Corp. v. Bragdon

219 Mass. 170 | Mass. | 1914

Rttgg, C. J.

Bragdon, who hereafter will be referred to as the defendant, entered into a contract in writing with the Colonial Development Corporation, hereinafter called the plaintiff, for the purchase of two lots of land on Long Island in the State of New York, to be paid for in instalments. A description of the land, the terms of payment, the kind of deed to be given, together with a stipulation as to the maximum amount of taxes and assessments for three years, and as to conveyance in case of the defendant’s death before payment in full, and a guaranty that the lots were “high and dry, and free from all incumbrances,” were set out in the contract. It contained this further clause: “No agent of this company has authority ... to make any reference, representation or agreement not contained in this contract and none not contained herein shall be binding upon the seller, or in any wise effect [sz'c] the validity of this contract or form any part thereof, but all statements made have been merged and set forth herein.” The contract was executed in duplicate and each party retained an original. The defendant testified that he “read the contract over before he signed it and knew of its terms and conditions.” He was allowed to introduce evidence tending to show, and the jury found, that he was induced to sign the contract by reason of false material representations knowingly made by authorized agents of the plaintiff to the effect that the lots were part of a tract cut up and laid out in streets; that there were several substantial buildings upon other parts of the tract; that the land was in every way ready and suitable for immediate building and occupancy; and that the lots were within twenty minutes’ walk from the railroad station.

The question is whether these facts and findings constitute a defense to an action on this contract. The representations plainly were fraudulent in their nature and, apart from the paragraph of the contract quoted at length, would invalidate any agreement made in reliance upon them. But the parties chose, after all the preliminary statements and negotiations were ended, to put the contract in writing. It is not contended that the defendant was induced to sign that contract through any misrepresentation as to its contents or meaning. On the contrary, his own evidence was that before signing he read it through and understood its terms. One of those terms, to which he himself assented, was that no agent of the plaintiff had any authority to make any representations not contained in the contract. Further stipulations, to which he likewise assented, were in substance, that every representation to which he would undertake to hold the seller was written in the contract and every statement upon which he relied was set out in it. He intentionally and intelligently, without any trick, mistake, duress, covin or fraud as to its contents, signed this written contract, which was plain in its phraseology. In the light of the evidence and findings of the jury, it was a most unwise agreement for him to make. But he made it freely, when he knew what he was about. It is a fundamental principle of law that, contracts in writing voluntarily executed with full knowledge of their contents by rational beings acting/in their own judgment must be enforced.

The defendant relies on the proposition that fraud vitiates every contract. But there is a distinction between a fraud which is antecedent to a contract, and fraud which enters into the making of the contract. The present case belongs to the former class. It constitutes no defense to an action on this contract. Nor does it afford ground for an independent action. Cannon v. Burrell, 193 Mass. 534. McCoy v. Metropolitan Life Ins. Co. 133 Mass. 82.

This seems a hard case. But contracts freely made by intelligent persons cannot be abrogated simply because they are unwise.

In each case let the entry be

Exceptions sustained.