Harrell v. De Normandie

26 Tex. 120 | Tex. | 1861

Wheeler, C. J.

That the plaintiff committed a mistake in estimating the value of his certificates sufficiently appears by the evidence. He estimated them at the value of about eight hundred and thirty three dollars, when their true value was about fifteen hundred dollars. And there is little doubt that the mistake arose from basing his estimate on the principal only, omitting in the calculation the interest due upon the certificates. How he came to-make so important an omission—whether from oversight and inadvertence in fact, or from ignorance of his right to include the interest, does not appear. But that the error did occur in his calculation, causing a mistake to his disadvantage of about six-hundred and sixty seven dollars, is evident. He supposed the certificates to be actually worth at the department about eight hundred and thirty three dollars, ($832 73.) Having in view this estimate of the value of the certificates, and being advised by Be Normandie that he could sell them to Swenson, if he woulct allow a reasonable discount, he requested the former, who was apprised of their estimated value and also supposed it their true Value, to see Swenson, and authorized him to sell them to the latter for eight hundred and tw'enty dollars; that is, to allow a discount-of about thirteen dollars, ($12 78,) or about one and a half per Cent. Be Normandie did as requested; Swenson accepted the proposition; the trade was closed and the money paid; Swenson at the same time charging Be Normandie to see that there was a profit, and instructing him to prepare the Writings necessary to effect the transfer of the certificates; for which service he engaged to give him one-third of the profits. The transaction was closed. Swenson had not yet seen the certificates, but trusted to the statement of Be Normandie as to their amount or value, and the latter relied on the plaintiff Harrell’^statement and estimate. Thus, it is evident, all the parties acted and contracted on the same erroneous basis, estimating the value of the certificates at about eight hundred and thirty three dollars, and contracting upon the basis of giving and receiving reciprocally a certain per cent., about one ana a half per cent, discount upon the supposed value, as theequivalent of commissions, or exchange and interest until the-money should be realized upon the certificates by the purchaser. All the circumstances attending the? negotiation render it quite-evident that this was the basis and substance of the dealing of the parties. Swenson did not know at the time to whom the certificates belonged, and, of course, not knowing that they belonged to Harrell, he did not know that this estimate was Harrell’s, but he. knew the estimated value by De Normandie, and this was in fact Harrell’s estimate. He relied on De Normandie’s statement as the latter had on Harrell’s, or it is not to bo supposed he would have agreed upon the price he would give, and have actually paid ■the money. De Normandie knew whose certificates they were, and what the owner thought they were worth, and if it were material that the same knowledge be brought home to Swenson, he is chargeable with notice, having made De Normandie his agent'in the transaction, on the principle that notice to the agent is notice to the principal.

When the certificates were shown to Swenson, he detected the error. But the contract had been completed; and up to and at the time of its completion, the parties had acted and contracted under a mutual mistake. And we think it free from doubt that it is such a case of mutual error, mistake - and surprise as is appropriately and ordinarily a ground of relief in a court of equity.

A certain per cent, discount for the advance of the money was -doubtless the basis upon which the parties contracted. By mistake they' made an under estimate, both being in error as to the sum upon which it was to be computed, and its correction is but the •ordinary case of correcting mutual errors hi matters of fact. The effect of correcting the error is not to defeat, but to carry out and -effectuate what the parties intended.

It is true, in general, that where a party makes a contract or does an intentional act from ignorance of the law, which otherwise he would not have done, it is nevertheless binding upon him, upon the maxim ignoraniia juris non excusat. For then the contract or act is what the party intended it should be; and a court of equity will not relieve by substituting something else which was not intended. But that is very different from a case of mutual error or mistake, which defeats the real intention of the contracting parties. A contract thus made in mutual error is wanting in one.of the essential-elements of a contract. “ Contracts made in mu-. tual error, under circumstances material to their character and consequences seem, upon general principles, invalid.” (1 Story’s Eq. Jur., sec. 134.) The parties here did not intend, the one to sell and the other to buy certificates wofth fifteen hundred dollars for eight hundred and twenty dollars. That was not the contract within the intention of the contracting parties. What they did intend was on the part of the seller to submit to a certain discount, for the advance of the money, and on the part of the buyer to make a certain profit on the investment—a discount of thirteen dollars on eight hundred and thirty-three dollars, and a like profit on eight hundred and twenty dollars; and this is the contract which the law will effectuate by correcting the error in the sum on which they based their estimate, according to the truth of the case, and awarding a proportionate discount and profit upon the true value of the certificates. It is our opinion, therefore, that the judgment be reversed, and such judgment he here rendered as the court below ought to have rendered.

Beversed and rendered.