Couch v. Crane

Mar 11, 1914

Reporters:: , ,
Before:: Evans

Evans, P. J.

(After stating the foregoing facts.)

1. One of the prayers of the petition was for a judgment against Mrs. Couch, to be declared a special lien on the property. The defendant is not liable to the plaintiff on the basis that she was the assignee of the plaintiff’s vendee; for it is well settled that the assignee of the vendee is not subject to the obligations of the contract, except upon his option to enforce specific performance. 6 Pom. Eq. Jur. § 851. If the assignee of the vendee is liable to the vendor, it is because of her assumption of the vendee’s obligation. The petition alleged that the defendant “assumed or agreed to assume the débts due your petitioner for the purchase of said property.”. The defendant specially demurred to the sufficiency of this allegation as creating an obligation to pay the notes of the vendee, on the ground that the alleged contract of assumption and the consideration were not pleaded. The defendant was entitled to more specific allegation on this point, and the special demurrer ought to have been sustained.

2. The defendant also demurred specially to the prayer of the petition for a sale of the property by a receiver and an appropriation of the proceeds of sale to the payment of the debt of Mrs. Key, on the ground that the plaintiff was not entitled to this relief unless her mother, the ‘plaintiff’s vendee, was a party, so that a judgment might be had against her, adjudging the plaintiff entitled to recover some or all of the unpaid purchase-money due on the notes. The plaintiff would not be entitled to a sale of the property and the application of the proceeds to the payment of the notes, without a judgment fixing the amount due; and the maker of the notes would be a necessary party to this relief. But this error was corrected by the defendant’s voluntary motion to have the vendee’s administratrix made a party, which was granted by the court.

3. The plaintiff amended his petition, praying a recovery of the property. No objection was made to this amendment. A vendor of *27real estate; who sells it on credit, delivering possession to the vendee, taking notes, and giving bond to make title when the purchase-money is paid, may either sue for the land upon the failure to pay the notes or any of them (Alston v. Wingfield, 53 Ga. 18; McHan v. Stansell, 39 Ga. 197); or, upon failure of the purchaser to pay the notes as they mature, the vendor may sue on them to judgment, file a deed and have it recorded, and sell the land as provided by law in such cases. Civil Code (1910), § 6037. Both remedies, however, can not be concurrently pursued in the same action. This right of action against the vendee to recover possession of the property on the vendee’s default extends to the vendee’s assignee in possession. So that, independently of the plaintiff’s right to other relief prayed, the petition stated a cause of action for the recovery of the property.

4. The plaintiff did not strike his prayer for a sale of the property by a receiver for the purpose of applying the proceeds of the sale to the payment of the purchase-money notes. The administratrix of the vendee, who was the maker of the notes, would be a proper, even if not a necessary, party to the grant of this relief; and there was no error in allowing her to be made a party defendant on her own motion.

5. The plaintiff in his petition, as originally filed, prayed judgment against Mrs. Couch for the balance of the purchase-money; and also the appointment of a receiver to sell the property and apply the proceeds thereof to the balance due on the purchase-money debt. He amended his petition, praying for a recovery of the property. The administratrix of the vendee was made a party defendant on her own motion. The plaintiff in his petition as finally amended was pressing inconsistent remedies, i. e., a recovery of the property, and also a recovery of‘the balance of the purchase-money through the medium of a sale by a receiver. A plaintiff can not pursue inconsistent remedies in the same action. If an appropriate demurrer had been filed, he would have been put to an election; but no such demurrer was filed, and the answer was responsive to both remedies pursued by the plaintiff.

6. Where a vendor sues on his title and recovers the land from the vendee, a rescission ensues by operation of law; for he can not rightfully retain both land and purchase-money. McDaniel v. Gray, 69 Ga. 433. [Rescission involves restoration to the original *28status, and if the vendor seeks to recover the land, the vendee by equitable plea may require an accounting for the purchase-money paid in part performance of the contract by the vendee. In such an accounting the vendee is to be charged with damages occasioned by her breach and a fair rental value of the property during the time it was held in possession under the agreement. Lytle v. Scottish American Mortgage Co., 122 Ga. 458 (50 S. E. 402). The assignee of a bond for title acquires all the rights and equities which the assignor has therein. Walker v. Maddox, 105 Ga. 253 (31 S. E. 165); Burney Tailoring Co. v. Cuzzort, 132 Ga. 852 (65 S. E. 140). When Mrs. Key transferred her bond for title to Mrs. Couch, the latter acquired all of Mrs. Key’s equities therein, which embraced a right to have an equitable accounting from the vendor for so much of the purchase-money as was paid to him by Mrs. Key in pursuance of the contract of sale. The 27th paragraph of Mrs. Couch’s answer is as follows: “But defendant says that it would be inequitable and unjust to allow plaintiff to take charge of and recover this property from her without refunding and repaying the money her mother paid out. She says she is willing to account for every dollar in rents that the place is worth, and let him account to her for the interest on the money which she paid out two years ago, and that it would be equitable to have an accounting between her and said plaintiff; that she be made to account for the rents of the place, and he should be made to account for the interest on the money that she has paid out, and if he wants the property back, she is willing for him to take it, provided he return her money; but if he is not willing to return her money with interest, then she prays that the court find that she has paid all the place is worth,” etc. In the concluding sentence of paragraph 29 of her answer she prays: “that the court see to it that she is not molested, and that this property is not taken from her, and that she be not caused to lose the money which her mother turned over to her; but that the court wait and have an accounting between her and said plaintiff, ‘and let’ a jury pass upon the question, and that the court award this place; and if not, that the court award her the money expended by her mother.” Her answer also contained a prayer for general relief. While the answer praying for an equitable accounting may not have been technically drawn and may be open to special demurrer, yet, as against a general demurrer, it is sufficient *29to require the submission of the matter to a jury, and should not have been stricken as a whole. So long as the plaintiff is insisting upon both of his remedies, he can not object to an answer responsive and appropriate to both remedies.

7. Neither the vendee nor her assignee is entitled to a rescission of the contract on the ground of fraud, under the facts alleged in their answers. For the exercise of the right of rescission of a contract for fraud, the defrauded party must act promptly on the discovery of the fraud, and must restore or offer to restore whatever he has received by virtue of the contract, if it is of any value. Civil Code (1910), § 4305; Hunt v. Hardwick, 68 Ga. 100; Jordy v. Dunlevie, 139 Ga. 325 (77 S. E. 162). There is a general averment in the pleas that Mrs. Couch made complaint to the plaintiff and asked for a rescission of the contract, agreeing to pay him rent on the place for what time she and her mother had occupied the same, provided he would pay them back the money they had expended, which the plaintiff refused. It does not appear when this offer was made. But it does appear that the alleged fraudulent acts and representations complained of were known to both Mrs. Couch and her mother when the latter, more than a year after she had been in possession of the property, paid the first purchase-money note. If the offer of restoration occurred prior to this time, and the vendee, with a full knowledge of the alleged fraudulent acts and conduct of the plaintiff, paid to the plaintiff one of the purchase-money notes, such payment would amount to a waiver of the fraud and an affirmance of the contract, and estop the defendant from claiming a rescission of it. Tuttle v. Stovall, 134 Ga. 325 (67 S. E. 806, 20 Ann. Cas. 168). If the offer to restore was made after the payment of the note with knowledge of the fraud, she can not disaffirm a contract after electing to perform it. There is still another reason why the administratrix can not have rescission of the contract, and that is because her intestate conveyed her equity and rights in the property before her death, and put it out of her power to restore the status.

8. Mrs. Couch as assignee of her mother has no right of action against the plaintiff on account of the fraud alleged to have been practised on her mother. A right of action for injuries arising from fraud can hot be assigned. Civil Code, § 3655; Morehead v. Ayers, 136 Ga. 488 (71 S. E. 798).

*309. Is the administratrix of the vendee, under the allegations of her answer, entitled to have au abatement of the purchase-price on the ground of failure of consideration? The representations of the plaintiff are not alleged to be warranties. Those representations are alleged to have been fraudulent statements made with the intent to induce the vendee to pay a larger price for the property than it was actually worth. There is a clear distinction between the rule of law touching a misrepresentation upon which one has acted to his injury in the purchase of property, and a warranty touching the character and quality of the property sold. Misrepresentations or other deceptive means used to induce the purchase may afford ground for rescission of the contract, or be the basis of an action for damages; in such case the action is not based on any warrant}‘, but upon the fraudulent conduct practised. A warranty enters into and forms a part of the contract between seller and purchaser. And in case the purchaser is sued for the purchase-money, he can recoup or offset any damages he may have sustained in consequence of the breach. Newman v. Claflin, 107 Ga. 89 (32 S. E. 493). The administratrix is not seeking to recover damages by way of cross-action for any deceit on her intestate, .but to have an abatement of the purchase-price on the ground that there is a failure of consideration. The contract of sale is expressed in writing, and the administratrix can not set up any express parol warranty by way of addition to or in variance of the writing. Moreover, .no judgment is sought against the administratrix. We reach the conclusion that the plea of failure of consideration is not good in law.

Judgment on main bill of exceptions affirmed in part and reversed in part; on cross-bill affirmed.

ATI the Justices concur.