[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *381 This action was brought by Robert Woodburn to obtain a judgment canceling and declaring void a deed of conveyance of certain mining property made by him to the defendants, upon the ground that it was executed by him by reason of fraudulent representations and undue influence *382 on the part of the defendants, and at a time when he was mentally incompetent to transact ordinary business, and that upon being restored to capacity and discovery of the fraud he had rescinded the transaction and demanded a reconveyance of the property, offering at the same time to restore the consideration he had received therefor.
The deed of conveyance was executed October 14, 1899, and the notice of rescission and the demand for a reconveyance was made October 24th, and upon its refusal this action was commenced against the grantees therein October 28, 1899. Issues were joined upon the allegations of the complaint, but before the trial of these issues Woodburn died, and in April, 1901, the executors of his will — the appellants herein — were substituted as plaintiffs in the cause. In the complaint it is alleged that at the time of the execution of the deed Woodburn received from the defendants the sum of twenty-five thousand dollars as the consideration for its execution, and that the property was then, and at all times since has been, of the value of one hundred and fifty thousand dollars. In their original answer the defendants denied that they "paid" to Woodburn twenty-five thousand dollars as the consideration for the execution and delivery of the deed "except as follows"; and allege that they were at that time the owners of a certificate of deposit for twenty-five thousand dollars, deposited in the Bank of California in San Francisco, which by its terms was made payable to one of them, and that at the time of the execution of said deed the payee named in the said certificate of deposit duly indorsed the same to Woodburn or his order, and that Woodburn received and accepted the said certificate of deposit in full payment and satisfaction for the execution to them of the said deed of conveyance. In August, 1901, after the appellants had been substituted as plaintiffs in the action, the defendants filed a supplemental answer, in which they alleged that Woodburn, in November, 1899, borrowed from the Bank of Shasta County fifty-five hundred dollars, and transferred and assigned to the bank the said certificate of deposit as collateral security therefor; and that on April 23, 1900, he borrowed from that bank the further sum of three thousand dollars, and that the said bank received and continued to hold the certificate of deposit as such collateral security until after his death; that in *383 December, 1900, by virtue of an agreement on the part of the executors of his will — the present plaintiffs — the certificate of deposit was paid by the Bank of California to the Bank of Shasta County, and that the latter bank, after reimbursing itself for the moneys loaned to Woodburn, paid the remainder to the plaintiffs as his executors, and that the assets of the estate of Woodburn do not exceed the sum of sixteen thousand dollars. Upon these facts the defendants alleged that the transaction was ratified and confirmed, both by Woodburn in his lifetime and by his executors since his death, and that as they have put it out of their power to restore to the defendants the certificate of deposit which was given to Woodburn, they cannot maintain the present action.
When the case came on for trial, the plaintiffs having previously given notice thereof, moved the court to strike out defendant's supplemental answer, and also presented a demurrer to its sufficiency. During the argument thereon, it was admitted on their behalf that the averments in said answer of the pledge of the certificate of deposit by Woodburn to the Bank of Shasta County as collateral security for loans to him, and its subsequent collection by that bank from the Bank of California and payment of the balance thereof to the plaintiffs, were true. The court thereupon ordered that the plaintiffs immediately deposit with the clerk of the court twenty-five thousand dollars, or a certificate of deposit of the Bank of California for that sum, payable upon demand to the order of the clerk, to abide the result of the trial, and that upon such deposit the demurrer to the supplemental answer would be sustained, and the motion to strike it out would be granted, and that failing to make such deposit the pleading would stand. The plaintiffs excepted to this order, and the hearing of the case was continued until September 30, 1901, and the plaintiffs were given until that day within which to make the said deposit. When the cause was called for trial on that day the plaintiffs' counsel stated that they declined to make the deposit ordered by the court, upon the ground that the court had no authority to require them to make such deposit before a decree was rendered in their favor. The court thereupon ordered that the demurrer to the supplemental answer be overruled, and that the motion to strike it out be denied, to which order the plaintiffs thereupon duly *384 excepted. The court then stating that it was ready to proceed with the trial of the cause, counsel for the plaintiffs made an opening statement to the effect that they would prove all the allegations set forth in their complaint, and, while admitting that the facts set forth in the aforesaid supplemental answer, so far as relates to the hypothecation by Woodburn of the certificate of deposit and the subsequent cashing of the same, were substantially true, stated that they would also prove that at all times since the commencement of the action Woodburn and his executors had been and were then able, ready, and willing to return to the defendants, or to pay into court subject to their order, twenty-five thousand dollars, either in gold coin or in the form of certificate of deposit for that sum, whenever the court should by its decree and judgment order the reconveyance of the mining properties to the plaintiffs. Upon this statement, Mr. Cross, of counsel for defendants, said, "Then we ask this court as preliminary to the proceedings in this case, that you pay that money into court for us." And upon the court replying, "You may take such an order," counsel for the plaintiffs excepted thereto, and stated that they declined to pay it upon the grounds previously stated. Thereupon Mr. Cross moved for a nonsuit upon the grounds that they were entitled thereto, by reason of the opening statement and the admission made by plaintiffs' counsel, and the failure of plaintiffs to pay into court the twenty-five thousand dollars which the court had ordered them to pay as a condition of the right to proceed with the trial of the cause. The court thereupon granted the motion for a nonsuit, and ordered that a judgment of dismissal be entered, to which the plaintiffs duly accepted. The plaintiffs afterwards moved for a new trial, which was denied by the court, and from this order the present appeal has been taken.
Upon an appeal from an order granting or denying a new trial, only such matters can be considered as are made grounds upon which the superior court is authorized to grant or deny the motion. Neither the sufficiency of a pleading nor the action of the superior court upon a demurrer thereto, or upon a motion to strike out the pleading or any portion thereof, can be considered. As no evidence was introduced before the court in the present case, only the errors of law occurring at the trial and excepted to by the plaintiff can be considered. *385
The trial of a cause includes all the rulings of the court and the proceedings before it which conduce to the decision which it makes upon the issues in the case as the basis of its judgment.(People v. Turner,
1. A party to a controversy involving a right to a certain sum of money cannot be required to pay that money into court, unless it is either clearly admitted by him in his pleading or shown in some proceeding in the cause that he has himself no right to retain it, and that his antagonist is entitled to it, or at least has an absolute interest therein. Such admission must be free from any condition, and the antagonist must himself claim an immediate right to the money before he can ask that it be deposited in court. If the admission make the right of the other party dependent upon his performance of some condition, or if the other party does not claim any right to the money, or disputes the existence of the condition, the court will not order the money to be deposited before a hearing in the cause and a judicial determination of the respective rights of the parties, for the reason, as given by Lord Cairns in Hagall v. Currie, L.R. 2 Ch. App. 449, that "if money is ordered to be brought in, which is not clearly due, very gross injustice may be done, as the defendant may be put to great inconvenience, and afterwards be told that his view of the case was correct." A court ought not to require a litigant to surrender his property to another, or for his *386
benefit, until there has been a judicial hearing and determination that he has no right to such property; but an order that he pay money into court without such hearing is, in effect, an arbitrary judgment against his right to its possession. The principle upon which the rule rests was very fully considered inMcKim v. Thompson, 1 Bland, 150, wherein it was held that the order for such payment must depend upon a judicial determination, upon the facts as then shown to the court, that the party from whom the payment is asked has no right or title to hold the money, and that he cannot be allowed at any subsequent stage of the cause to contradict or explain away those facts. The same principle was declared by Lord Cottenham in Richardson v. Bank ofEngland, 4 Mylne Co. 165. (See, also, Peacham v. Daw, 6 Madd. 98; Hopkins v. McEldery, 4 Md. Ch. 23; McTighe v. Wadleigh,
Counsel for respondents have not presented any principle of law in their briefs in support of this order, nor have they cited any authority in which such an order has been sustained. Miller v.Louisville etc.,
2. Although the order overruling the plaintiffs' demurrer to the supplemental answer was a judicial declaration that the facts alleged in that answer stated a defense to the plaintiffs' cause of action, yet the court was not, for that reason, authorized *388 to grant a nonsuit or render judgment dismissing the complaint without any proof of the facts alleged in the answer, or an admission by the plaintiffs that all of these facts were true. In the absence of such admission, all of the allegations were controverted by virtue of section 462 of the Code of Civil Procedure, and it devolved upon the defendants to establish them by evidence, and unless so established the court was not authorized to grant a nonsuit. The order overruling the demurrer disposed of the issue of law presented by the pleading, but the order granting a nonsuit could be made only upon a consideration by the court of the evidence introduced by the plaintiffs, or their statement of what they intended to prove, and a decision by it that it was insufficient to establish the cause of action set forth in their complaint. Such decision, if erroneous, would be an error of law occurring at the trial, and reviewable upon an appeal from the order denying a new trial. The motion by the defendants for a nonsuit upon the opening statement and admissions of the plaintiffs conceded the truth of all the averments in the complaint and the amendments thereto. This was an admission that the defendants had, by means of fraud and undue influence, obtained the mining property from Woodburn at a sum greatly less than its value; that upon discovering the fraud Woodburn had immediately notified them of his rescission of the transaction and demanded a reconveyance of the property, and had tendered to them the certificate of deposit which he had received from them, and that upon their refusal he had commenced the present action; that, at all times since said tender the said Woodburn, during his lifetime, and the plaintiffs as his executors since his death, had been able, ready, and willing to restore to them, or pay into court subject to their order, the money which had been received from the defendants, upon receiving from them a good and sufficient reconveyance of said mining property. Upon these facts being shown by the plaintiffs, or admitted by the defendants, the court was not authorized to grant a nonsuit.
The ground chiefly relied upon by the respondents in support of the nonsuit is that by reason of the conduct of Woodburn and the plaintiffs in reference to the certificate of deposit, they had put it out of their power to restore it to the defendants, and that inasmuch as they cannot restore the identical *389
property which was received from the defendants, they have lost their right of rescission. This proposition, however, is not sustained either by the authorities cited in its support or by the statute. None of the cases cited hold that when a defrauded party has promptly rescinded the transaction and immediately thereafter commenced an action to enforce such rescission, he has been denied relief merely because at the hearing of the cause he was not able to restore the identical property which he had received. Section
The "certificate of deposit" was not the consideration for which the defendants purchased the mining property from Woodburn. They did not agree to give him the certificate of deposit in exchange for the mining property, but they purchased the property from him for the sum of twenty-five thousand dollars, and the certificate of deposit was accepted by him in payment therefor, as representing that amount of money. It would be a reproach upon the administration of justice to concede that equity is too feeble to relieve a party from a fraudulent transaction upon the ground that he has collected the amount of a certificate of deposit, or check, or other obligation which he received in that transaction, and is thus unable to restore the identical thing which he received. It is not an invariable rule that the rescission of a contract obtained by fraud will be denied merely upon the ground that the parties cannot be placed in statu quo.
If equity can still be done between the parties, courts will grant relief to the defrauded party. (Neblett v. McFarland,
Section
To the extent that the court granted a nonsuit upon the ground that the plaintiffs had failed to pay the twenty-five *392 thousand dollars into court, it erred, for the reasons stated in the former part of this opinion.
The order denying a new trial should be reversed.
Cooper, C., and Gray, C., concurred.
For the reasons given in the foregoing opinion the order denying a new trial is reversed.
Shaw, J., Angellotti, J., Van Dyke, J.
Hearing in Bank denied.