68 Ky. 478 | Ky. Ct. App. | 1869
Lead Opinion
JUDGE ROBERTSON
delivered the opinion of the court,
W. McKay Hoge, born November 14, 1844, in Wheeling, Virginia, without patrimonial estate or expectancy, was engaged as a clerk in the Quarter-Master’s Department at Nashville, in the spring and early summer of the year 1864, and threatening to expose extensive swindling against the Federal Government, received for “ hush money” as much probably as twenty thousand dollars in United States Treasury notes.
The bargain, was concluded, the seventeen thousand dollars paid, and Middleton’s bond for a title to the land executed on the 20th of August, 1864; but Hoge then being a minor, Middleton seems to have considered the .sale incomplete and precarious unless Hoge’s mother, then a widow, should approve the arrangement and become a substituted party, and whom they visited ip September, 1864, and then consulted. Middleton told her that he had sold the land to her son for thirteen thousand dollars, of which six thousand dollars were paid in cash, and seven thousand dollars secured by note, on six years’ credit. On her expression of surprise that her son could pay so much, Middleton told her how, as before suggested, he had gotten the money, and Hoge tacitly concurred, and thus confirmed that statement; whereupon, his mother seemed to approve the contract,
Middleton gathered and cribbed the corn for Hoge, and saved and shocked the fodder on the ground; and about the 1st of January, 1865, he delivered possession of all the property sold to Hoge, whose mother came and occupied the premises with him April the 1st, 186j>, when Middleton delivered a conveyance of the legal title to her, and which, either then or afterwards, was ante-dated, so as to synchronize with the date of the initial agreement between him and her son; but an obvious erasure rather indicates that the substituted date was inserted after the delivery; and if so, the presumption would be that the alteration was made by her son as an expedient for protecting the property in her name as original and sole purchaser, so as to secure to himself the beneficial use against his creditors, and against the government if it should seek reclamation. He was then still a minor; but on the 8th day of January, 1866, after he had attained majority, :he executed and had recorded a deed recognizing his mother’s title, and declaring himself her agent, manager, and co-occupant only.
He and his mother, after cultivating two crops on it, sold and she conveyed it to John Middleton, a son of H. C. Middleton, for thirteen thousand dollars, paid in money, and her note to his father, which he bought from him. And John Middleton took possession of the farm, and has ever since lived on it, and cultivated it as his own.
On the 4th of March, 1867, W. McKay Hoge filed a petition ordinary against H. C. Middleton, alleging that when he bought the land it was not worth more than about half of the price extorted for it — charging that Middleton knew that fact, and fraudulently affirmed that it. was worth twenty-two thousand dollars, and seeking judgment jor damages for the imputed fraud. That petition virtually waived an avoidance of sale on the ground of infancy.
An amended petition, more minute in the detail of facts, alleged the infancy, not for avoidance, but only as an evidence of imposition and fraud. And Middleton’s answer controverted all the material allegations conducing to show undue advantage or fraudulent misrepresentation.
A second amended petition, substantially like the first in its charges, sought a rescission on the ground of infancy ; and the case being transferred to equity, was heard Without any other reply to that amendment than what was contained in the answer to the same allegations, in effect, in the first amendment, including the
John Middleton was finally made a party, and charged with buying the land with his father’s means, and as his agent; all of which he traversed by his answer. And the facts in relation to that matter conduce to show that John Middleton, against his father’s will, bought the land for his own use and with his own funds, which were, and had long been, on deposit in his own name, and were ample for that end; and every semblance to the contrary is sufficiently denied and explained.
A careful analysis of the multifarious pleadings, voluminous depositions, and all the exhibits, judicially establishes the foregoing as the essential facts of the case.
The chancellor, assuming that the conveyance to John Middleton operated as a rescission of the sale by H. C. Middleton, adjudged against said H. C. Middleton, in favor of W. McKay Hoge, eleven thousand six hundred and seven dollar’s, the balance of the seventeen thousand dollars advanced for the land and corn, after deducting rents and the five thousand dollars paid by John Middleton, and two hundred and eighty dollars, at which he estimated the corn, delivered.
As John Middleton’s title is unaffected by the decree, and he may, therefore, and propably will, hold the land, his father, by this decree, gets only five thousand dollars, instead of twenty-two thousand dollars, for it; and,if — as he might and probably would — Hoge should enforce his judgment by the exaction of its amount in money, H. C. Middleton might lose his land, and get nothing for it. This seems to be improvident and inequitable.
On the face of the record, W. McKay Hoge, invoicing the aid of a court of equity", certainly stands, with such a decree in his hands, in an unbecoming and graceless
Such is, but too often, the result of an adventurous and perverted spirit of litigation; and a thorough analysis of the facts exhibited in this large record strongly inclines to the conclusion, that whatever semblance of cause there may be for the outcry of fraud raised against the appellant, the appellee himself is apparently more obnoxious to the same imputation, and ought not to have gone into equity for an investigation of the conduct of the parties, or for unconscientious relief. Waiving several preliminary objections to the decree sought to be reversed by this appeal, we shall consider, in reference to the land, only the questions of fraud, of infancy, and of confirmation.
But to protect inexperienced and confiding infancy against unjust advantage, often taken of such immaturity, the law not only allows infants to avoid most of their contracts, but assumes that contracts, not equal
In this case, according to the legal test, actual fraud is not established, and constructive fraud is disproved, so far as the land is concerned.
It is evident that the parties intended that the note for seven thousand dollars should be payable in paper currency, like that with which the fifteen thousand dollars were paid; and, in that character, it was transferred by the appellant to his son John, and by him canceled by its exchange with the appellee and his mother for the land they sold to him. We shall, therefore, consider the whole consideration of twenty-two thousand dollars as depreciated paper currency, which, on the 20th of August, 1864, was as low as two hundred and fifty dollars in Treasury notes for one hundred dollars in coin. The fifteen thousand dollars advanced on that day were then worth only six thousand dollars in gold. At the date of the sale to John Middleton, that currency had risen to one hundred and forty dollars for one hundred dollars in gold. So that, if the note be considered, the appellee got more of gold value for the land, by about twenty-five hundred dollars, than he gave. Before he bought he seemed apprehensive of continuing depreciation indefinitely; and was, therefore, anxious to convert what he had into something safer and less liable to fluctuation; and, had he not invested it in land, he would probably have exchanged it for gold. Had he made that exchange, he would have gotten no more for his fifteen
Fourteen witnesses testified as to the vendible value of the land in August, 1864; and nine of them, who were respectable and intelligent neighbors, concurred in the opinion that it was worth, at least, twenty-two thousand dollars; and the other five, apparently not duly appreciating the accessory value of such improvements, estimated the value of the land, as sold, at from eight thousand dollars to fifteen thousand dollars. A proper analysis of the facts and reasons disclosed by all the fourteen witnesses, shows a decided preponderance, intrinsic as well as numerical, in favor of twenty-two thousand dollars as the value, and especially to the appellant, who, by such a sale, dislocated his entire tract, and divided the unsold portion into two unimproved fragments.
It thus sufficiently appears, that, in representing the land as worth twenty-two thousand dollars, the appellant had good reason to believe, and should be presumed to have believed, that the representation was true; and, consequently, that statement cannot be deemed a fraud on infancy; and that being the only imputed fraud, the charge of fraud is not sustained.
All these cumulative evidences of confirmation cannot be eluded by the pretense that the appellee was ignorant of his right to avoid. He certainly knew all the facts, and must be presumed to have known that his purchase was, by law, voidable; and, instead of implying his ignorance of his rights, his suggestion to Gen. Whitaker that the appellant had been advised by counsel that'the contract could not then be avoided, imports that he also had considered that question and consulted about it; and it is quite manifest, that as Whitaker’s object was to find an interest which he might subject to his client’s execution against the appellee, the object of the latter was to convince him that he had no available interest in the land, and that the whole interest, legal and beneficial, in the land, was, in good faith, irrevocably in his mother; and this shows how ingenuously he had managed the whole affair, and how wmll he understood the entire subject, and all his rights.
A voidable purchase of property by an infant may be confirmed by acts which might not confirm a sale by him; and a sale might be confirmed by acts which wmuld not confirm a promise; and, for obvious reasons, less will be required for the confirmation of executed than executoi’y contracts by infants. All this is established by abundant authority and palpable reason, as
But as to the corn, which was probably consumed during infancy, and respecting which there may not have been any binding confirmation, the judgment of this court is essentially different. The corn, when sold, was not worth two thousand dollars, according to the testimony, carefully analysed and weighed. It was worth to the appellee only about one thousand two hundred dollars; and if infancy and exorbitance of price should avoid the sale as constructively fraudulent, the appellee should be charged with the value of the corn which he consumed; and, therefore, he is not entitled to restitution of more than eight hundred dollars in the currency in which he paid the two thousand dollars for the corn. And to that extent he is apparently entitled to equitable relief.
Wherefore, Judge Peters dissenting, the chancellor’s decree is reversed, and the case remanded, with instructions to decree the restitution of the eight hundred dollars, and interest in kind, as just indicated, and then to dismiss the appellees’ petition.
Dissenting Opinion
delivered the following as his dissenting opinion:
Being unable to concur in opinion with the majority of the court in this case, I present the following reasons for dissenting therefrom :
In the summer of 1864, the appellee, William McKay Hoge, a native of Wheeling, Virginia, and then under twenty-one years of age, arrived in Louisville, Kentucky, possessed of a very large amount of means in United States Treasury notes for one of his age; and the only evidence of how he acquired them, furnished in this record, is found in an answer of his mother, Mrs. Mary Hoge, to an interrogatory propounded to her by appellants, in which she states, that at her house in Wheeling, Virginia, in September, 1864, Mr. H. C. Middleton told her that her son had discovered some fraudulent transactions in the Quartermaster’s Department in Nashville, Tennessee, and the parties to the fraudulent transactions had paid her son money to keep the “matter quiet;" and she understood from II. C. Middleton that the money so acquired was the money with which (my) her son had paid H. C. Middleton for the farm.
On the 20th of August, 1864, while at his house, and still a minor, as Hoge alleges, Middleton sold to him one hundred acres of his land, at the price of twenty-two thousand dollars, and a field of corn on the land, at the price of two thousand dollars. For the land, he paid fifteen thousand dollars down, in United States Treasury notes, and executed his note for seven thousand dollars, the residue of the price, due six years from date, and paid the two thousand dollars down for the corn in currency.
He further alleges, that at the date of the sale the land was not worth more than seven thousand dollars or eight thousand dollars, and the corn not more than seven hundred and fifty dollars; that he was seduced into the agreement for the purchase of the land and corn by the undue influence that Middleton had acquired over him, by his professions of friendship for him, by his (Hoge’s) lonely condition in the country, having no acquaintances but Middleton and his family, and by the false representations of Middleton that the land and corn were worth the prices which he asked and had fixed on them, for the fraudulent purpose of imposing on his non-age and want of experience, and, finally, succeeded in selling him the land and corn at prices greatly beyond their fair value; and for the causes alleged prays for a rescission of the contract on equitable principles.
He denies that he made any misrepresentations in regard to the land or its value; alleges that, since he conveyed the land to Mrs. Hoge, she has sold and conveyed it to John Middleton, who was at that time in possession, and exhibits his deed to Mrs. Hoge and her deed to John Middleton. But he fails to aver, in his original answei*, or in an amended one, which he subsequently filed, consisting of twenty-one paragraphs, that he sold any corn whatever to Mrs. Hoge, or that he ever received a cent for corn! although he most emphatically denied he sold any to her son, W. McKay Ploge — resting upon his denial that he had, by his influence, induced William McKay Hoge to buy the land or the growing crop, and upon his deniál that they w'ere not worth the price at which he sold them. Finally, he insists, that if it should be made to appear that he had contracted to sell the land and corn to young Hoge, while he wras an infant, that after he arrived at full age he had, by various open and
This account of appellant, when examined, and which he gave as evidence of a ratification of the contract, amounts to nothing. The offer, according to his own statement, wms not made in the presence of young Hoge; and if it, in fact, had been made to his mother, it may be justly inferred, from her evidence afterwards taken, that she would have accepted the offer; and that is made the stronger, from the fact that he withholds the answer of Mrs. Hoge.
But he further alleges, that after appellee arrived at full age, he prevailed upon his mother to sell the land to John Middleton, and the sale was made by his procurement; and, by that sale, he and his mother put it
Appellant knew, when he went to Wheeling with appellee, that he was a minor- — that he distinctly states in his pleading; and he also positively and emphatically denies that he had made any sale or contract for the sale of the land and corn before they left for Wheeling, assigning the non-age of appellee as the reason there.for. It becomes important, then, to ascertain from the evidence how the truth is in relation thereto.
J. P. Hill proves he drew the contract for the sale of the land on the 20th of August, 1864, which was signed and delivered by Middleton to Hoge. He also drew the note for the deferred payment for the land, and saw it executed; that he saw the check drawn and delivered for the cash payment for the land and corn, on which the money was received.
Mrs. Hoge proves that the writing evidencing the sale of the land to her son was shown to her at her house in Wheeling; that both parties told her of the sale at the time; that the cash payments had been previously made, and that she paid nothing herself, and had nothing to pay.
Other witnesses prove that they heard appellant say he had sold the land to W. McKay Hoge; and Whitaker proves that Middleton and Hoge both told him the contract for the sale had been made on the 20th of August, 1864; but that they had gone to Mrs. Hoge’s residence, in Wheeling, and changed it.
But it has been urged, and not without effect, that the sale of the land — one hundred acres for two hundred and twenty dollars per acre — was no speculation — a contract not to be coveted; and to uphold that position, air examination and estimate of the gold value of the currency, in which the payments were made, is gone into, and the price of the land estimated by the gold standard, ignoring altogether the fact illustrated by the history of that period, and established by the evidence in this cause, that the price of land did not advance with the price of gold, but that sales of real estate were almost universally made for currency, and land could be bought then for about the same price in currency that it had been selling for previously in par funds.
But waiving the further consideration of the evidence of the value of the property, compared with the price given, I propose to show by the acts of appellant, H. C. Middleton himself, that he regarded the contract of sale most advantageous to himself — a speculation which he was most anxious to realize, and place beyond all contingency. If this was not so, why was appellant ■then willing to leave home, travel to Virginia, paying not only his own expenses, but those also of appellee, to substitute Mrs. Hoge as the ostensible vendee, in place of her son? The travel to Wheeling involved an outlay of money, doubled, by advancing to his compan
But as a further illustration of the efforts to show that the land, in the fall of 1804, was worth twenty-two thousand dollars in currency, and had, in less than two years thereafter, when Hoge sold it, depreciated to fourteen thousand dollars or less, many of the witnesses examined, in the estimates of value, were asked what was the value of the improvements on the land, and then the value of the land, the two estimates added, and the sum thus arrived at fixed as its value. But a fact not to be passed unnoticed in this case is, that the note for the deferred payment of seven thousand dollars, executed by Mrs. Hoge to H. 0. Middleton, is not shown by any evidence to have been payable in currency; it is not alleged to have been payable in that way. It was payable, and its payment might have been coerced, in gold, and it was secured by a lien on the land; he got, therefore, the one half of the currency value of his land in that which was equal to par funds, and, in addition, got fifteen thousand dollars in currency, -showing a clear speculation. of tlie difference between fifteen thousand dollars and seven thousand dollars in currency, according to appellant’s own theory.
With this knowledge, how easy would it be for a designing man of sense to use it to his own advantage over an inexperienced youth, with whom he had become intimate, by alluding to the probability of detection, the danger of the loss of the money, and other more serious consequences; and if there was a consciousness of guilt, a desire to secure the money might facilitate the work. But passing by the charge against him, communicated to his mother by appellant, I cannot resist the conclusion, from the evidence as developed, that a fraud in fact was perpetrated on appellee, which no sophisti-y can conceal, and no rhetoric can palliate, and for which the contract should be rescinded.
But there are other reasons why the judgment of the court below should be approved substantially. It is not disputed or controverted that appellee’s disability, under which he labored on. the 20th of August, 1864, when he first contracted with appellant and parted with his money, would have been a good ground for setting aside the contract, if it had not been changed, and he had done no act by which he lost that right. When the pretended contract was entered into, in Wheeling, by which his mother was substituted, he was still laboring under the disability of infancy. Up to that time, although he had
If there were no other facts in the record, this, of itself, it seems to me, is sufficient to show that there was a power and influence over appellee which he could not resist. The last arrangement placed him in a worse condition'than the first, unless it was advantageous to him to give up the money and land to obtain a discharge from .the payment of the note of seven thousand dollars for the unpaid purchase mo .<7, vhich I think very probable.
I proceed now to ihquire whether appellee has put it out of his power to vacate the contract, by having ratified it after he attained to his majority. That I concede may be done without a formal undertaking or promise to do so.
In Deason, &c., vs. Boyd O'Hara (1 Dana., 45), this court held, that a failure for a period of ten years to notify the party of a disaffirmance, and a sale of the •thing received in consideration of the contract, after the plaintiff arrived at full age, was a ratification of the contract, and would preclude him from avoiding it. But the court did not regard, or at least did not so declare, that the sale of the thing received was alone sufficient; and in Parsons on Contracts, 1 vol., 272, it is said the ratification must be' made with the deliberate purpose of assuming a liability from which the party knows he is discharged by law, and in nowise
Ip 2 Kent's Commentaries, 255, note a, the doctrine as laid down is: that to give validity to a voidable contract by the ratification of the party, he must be fully apprised of bis rights, and do the act deliberately, and upon examination.
In Tucker vs. Moreland, 10 Peters, 73, Judge Story said, after commenting on an instruction which had been submitted to a jury: “Without undertaking to apply this doctrine to its full extent, and admitting that acts in pais may amount to a confirmation of a deed, still we are of opinion that these acts should be of such a solemn and unequivocal nature as lo establish a clear intention to confirm the deed after a full knowledge that it was voidable.” And this he applied to a deed conveying real estate, showing that be did not regard any difference to exist, whether the contract was executed or merely executory. Many other authorities might bé referred to on the same point, but it is deemed unnecessary.
There never lias been a direct or expressed confirmation of this contract by W. McKay Hoge; that is not asserted on the part of appellants; bat it is contended that he, by his acts and declarations, has ratified it— that it has inferentially been ratified. The original' deed from H. C. Middleton to M. A. Hoge is in the record. The date, as originally written, has evidently been changed, as is apparent from the face of the deed; but the indorsement shows it was acknowledged the 1st of April, 1865, but was not left then in the office, and was not lodged for record until the 15th of January, 1867, fifteen days after the summons was exe
In Aug'ust, 1866 (the 24th or 25th day), W. C. Whitaker sought an interview with Hoge on the business of a client who had a debt on the latter, which he was anxious to make, and he therefore inquired into Hoge’s condition; and having learned the nature of the contract for the land, and the price paid, Whitaker proves he told him the price was a ruinous one, and he thought he could set it aside for fraud. Hoge replied that it could not be done; that Mr. Middleton had taken legal advice how the business should be arranged, and had gone to Wheeling, and had all the papers drawn up in the name of his mother, so as to put it out of his power to avail himself of any right that he might otherwise have had to set aside the contract.
J. S. Barrett proves the plaintiff came to him on several occasions, during the summer of 1866, and begged of him to intercede and try to induce the defendant (Middleton) to take the land back, and give up the note. He proposed to take six thousand dollars in cash, and the note Middleton held on his mother, for the land.
It is scarcely credible that he would have begged Barrett to intercede to get the contract set aside at the sacrifice he proposed, if he had known or believed he
It is clear, therefore, that when the acts transpired, and the declarations were made which are claimed to have amounted to a ratification of the contract on the part of W. McKay Hoge, he was not apprised of.his legal rights, and that he could disaffirm the contract; and, consequently, is not, and cannot be, precluded thereby,
But it is contended that appellee advised and procured the sale to be made of the land by Mrs. Hoge to John W. Middleton, and that he has put it out of his power to restore the land, and is, on that account, not entitled to the relief he seeks. That objection is easily answered. In an amended petition filed 24th of May, 1867, appellee says defendant, II. C. Middleton, is now the owner, and in possession of said farm, and has been since the pretended sale to John W. Middleton, which was avowedly to John, but was in fact to him, II. C. Middleton. That allegation is not denied. Moreover, Whitaker proves that II. C. Middleton informed him he had canceled the contract for the land. Wharton proves that II. C. Middleton and himself were talking about a trade of real
In Bailey vs. Bamberger (11 B. M., 113, 115), this court said: ‘‘No doubt, if one should take advantage of an infant, or should overreach or defraud him, he would be so guilty of wrong himself that he could not demand a restoration of the consideration received by the infant, before the latter could avoid his contract.” In any view of the case, therefore, which I have been able to take, the judgment of the court rescinding the contract for the land is right, and should be affirmed.
As to the corn, Finley proves he assisted in gathering and having the coni put in the crib. It was not stripped entirely of the shuck, but was thrown in with part of the shuck on, and all the corn grown in the field was gathered and put in that crib, and he supposed there were about seventy barrels. Montfort proves he measured the crib, and it will hold of shucked corn one hun
The master, in his last report, fixed the quantity at seventy barrels, and the price at four dollars per barrel, making two hundred and eighty dollars for the corn; and the judgment fixed the value at that sum. But it seems to me, from the repeated affirmations of the plaintiff below to that effect, the corn should have been valued at seven hundred and fifty dollars, and for that alone the judgment should be reversed as to the cofn; the difference of value fixed in the petition of appellee, and the amount the judgment was rendered lor by the court below.