102 So. 878 | La. | 1925
This is a suit on a promissory note. The defendant has set up three several defenses, as follows:
(1) In the original answer: That said note was given as consideration for an option to purchase certain lands; that the title to said lands, or a large part thereof, is not merchantable; that there has therefore been a failure ofconsideration for said note.
(2) In an amended answer: That the allegation of the original petition (that said note was given as consideration for anoption) was made in error on the part of defendant's counsel; that said note was not given as consideration for an option, but was given without consideration whatsoever; that the Orange Land Company owned 109,000 acres of land, which it agreed to sell to one W.H. Timberlake, and the said Timberlake agreed to buy the same and pay the price; that neither said Timberlake nor said Ratcliff have at any time assigned or attempted to assign said contract to defendant; that said note was given to one T.A. Dees to be issued by him in acquiring an option on the lands covered by the contract between the Orange Land Company and said Timberlake, defendant having been informed by said Dees that said Ratcliff owned said contract, and was in a position to transfer same; that said note was issued for no other purpose, and was therefore without consideration, *710 as said Ratcliff never at any time owned or was entitled to any option on said lands, and never at any time transferred to defendant any option to purchase said land.
(3) In a supplemental answer: That said note was obtained from defendant through fraud and collusion between plaintiff and others, as disclosed by the testimony of plaintiff and his witnesses.
That is to say, plaintiff pleads three defenses, which (in reverse order) are (1) fraud; (2) want of consideration; and (3) failure of consideration.
In point of fact the said Timberlake was only acting for plaintiff, and paid the $5,000 with plaintiff's money.
Thereafter plaintiff sold his contract to one T.A. Dees, for account of defendant, for the sum of $13,000, of which defendant paid cash $3,000, and gave his note for $10,000 (being the note herein sued upon); out of which plaintiff was to allow a commission of $2,000 to Dees and $1,000 to Timberlake, and receive for himself $10,000 net for his contract. *711
Our conclusion is that the transferor of an option to buy lands does not warrant the title to the lands. This is also the rule in other jurisdictions.
"The agreement between the assignor and assignee (of a bond or contract for the conveyance of land) may expressly require that the vendor shall convey a good or marketable title, or contain a warranty of the vendors title (as in Lawson v. Sprague,
51 Wn. 286 , 98 P. 737). But by the weight of authority, if the purchaser assigns his contract or bond for title, and does not expressly warrant that the title is a good title, the assignee as between himself and the assignor assumes the risk of the validity of such title, and in the absence of fraud on the part of the assignor he must look to the original vendor in case the title proves defective." 39 Cyc. 1672.
It is therefore unnecessary to examine whether the title to part of the lands covered by the option was defective, since that would constitute no defense to the note herein sued upon.