12 S.D. 127 | S.D. | 1899
The plaintiffs are husband and wife. They are Germans, with but a slight knowledge of the English language, and are unfamiliar with the laws, customs, and methods of transacting business in this country. In September, 1893, the husband purchased a threshing outfit of defendant, for which he gave four promissory notes, due at different dates from November 1, 1893, to November 1, 1895, to secure which he gave a mortgage on the outfit, which was filed in the register’s office in the proper county September 14, 1893. On December 5, 1894, plaintiffs, executed and delivered to defendant six promissory notes, aggregating the amount then due upon the notes originally given for the threshing outfit due, at different dates from October 1, 1895, to December 1, 1896, to secure which they executed a mortgage upon a quarter section of land owned by the husband, a mortgage upon 80 acres of land owned by the wife, a mortgage upon the threshing outfit, and a mortgage npon the earnings thereof. These real-estate mortgages were recorded December 8, 1894, and the chattel mortgages were filed at about the same time. These notes and mortgages were executed by the wife as a surety only. On May 30, 1896, defendant foreclosed the second mortgage on the threshing outfit by a sale of the property, which was purchased by defendant for $675, the expenses of sale being $67.85, leaving the net proceeds of the sale §607.15. On July 18, 1896, and before the commencement of this action, the
It is claimed by the plaintiffs that they intended to give the new notes and real estate mortgages upon the condition that the old notes should be surrendered, and the threshing outfit released from the first chattel mortgage, that defendant’s agent promised to surrender the old notes and release the outfit, and that they did not know they were executing mortgages on the same and on its earnings. The trial court found that the husband first heard of the new chattel mortgages in the latter part of November. 1895, and first learned positively of their existence in January, 1896. Defendant did not surrender the old notes or release the first chattel mortgage, and it is evident that it did not intend to do so, when the new notes and mortgages were executed. Both of the plaintiffs testified positively that defendant’s agent promised to do so. Upon this issue of fact the trial judge found for the plaintiffs. Concerning such issue there is a direct conflict in the evidence. The trial judge saw the witnesses. He was at liberty to believe the plaintiffs, although they were outnumbered by the witnesses for defendant, and this court cannot disturb his findings. The credibility of witnesses is always for the trial court or jury. The fact is thus established that defendant’s agent made a promise without any intention of performing it, and this was an actual fraud. Comp. Laws, § 3507. The court below also found that the plaintiffs relied upon the promise of defendant’s agent to surrender the old notes and release the threshing outfit, and that
Assuming, then, as we must, for the purpose of this appeal, that the execution of the new notes and mortgages was procured through the actual fraud of defendant’s agent, to what relief, if any are the plaintiffs entitled in a court of equity, under the circumstances disclosed by the record in this action?
First, it is contended the plaintiffs cannot rescind because they have suffered no injury. Conceding that “fraud without injury is no cause of action,” we think the retention by defendant of a lien upon the threshing outfit, after its agreement to release it, was a substantial injury to the plaintiffs. To have this property freed from any incumbrance was the principal, if not the only, inducement which led the plaintiffs to incum - ber their reality. With the old and new mortgages on this personal property, it was of no practical value. They could not sell it without the mortgagee’s written consent, nor could they control its earnings. If it had been released, as plaintiffs understood it would be, they could have used or disposed of it at pleasure. The mortgages thereon were a burden which materially affected their enjoyment of the property.
One Miller was present when the new notes and mortgages were executed The husband testified that he wanted Miller
It is further contended that plaintiffs cannot rescind because the parties cannot be placed in statu quo. The judgment rendered by the citcuit court contains this provision: “And it is further hereby ordered, adjudged, and decreed that the foreclosure sale under chattel mortgage made by the defendant of the threshing outfit aforesaid on or about May 30, 1896, is hereby declared to be a valid foreclosure sale thereof under and by virtue of the first chattel mortgage given by plaintiffs to defendant in September, 1893, by right of subrogation, and the sum of $607.15, which was the net proceeds of said sale, shall be indorsed and credited by the defendant upon the notes given by plaintiff Frederick T. Grewing for the purchase price of said threshing outfit in September, 1893.” We think the trial court, as a court of equity, had ample power to incorporate the foregoing provision in its decree, and that it fully protects defendant against any attack by the plaintiffs upon its foreclosure proceedings. This being so, the parties are placed by the decree in precisely the same position they occu
It is further contended that the plaintiffs did not rescind promptly. Recission, when not effected by consent, can be accomplished only by the use, on the part of the party rescinding, of reasonable diligence to comply with the statutory rujes, oue of which requires that he must rescind promptly up'on discovering the facts entitling him to rescind, if he is free from duress, menace, undue influence, or disability, and is aware of his right to rescind. Comp. Laws, § 3591. The question as to what is reasonable diligence in such cases depends largely upon circumstances, and is generally a mixod question of law and fact, though the delay may be so long that the court will, as a matter of law, consider the offer to rescind too late. 21 Am. & Eng. Enc. Law, 82. The contracts sought to be rescinded in this case were executed December 5, 1894. Plaintiffs first heard of the new chattel mortgages in November, 1895. Frederick Grewing swears that he then heard people talking about it, but did not believe it at all. He first really found out that defendant had the new chattel mortgages in February, when he went to Brookings and consulted an attorney in regard to the matter, who demanded a return of the old notes and a release of the first chattel mortgage, and who on July
The trial court found “that since the execution of the last executed notes and mortgages the plaintiff Frederick T. Grew
We discover no defects in the notice of rescission. As the facts found substantially correspond with the allegations of the complaint, it follows from what has already been said that it contains sufficient facts to constitute a cause of action. Atten tion has been given each assignment of error relative to rulings upon the introduction of evidence. Finding no reversible error, the judgment of the circuit court is affirmed.