74 P. 333 | Or. | 1903
after stating the facts as above, delivered the opinion of the court.
“We are able, however, to pay a third of the principal on all these small judgments and to pay you a reasonable proportion of your attorney’s fees and costs, and in full settlement of these judgments we will give you notes secured by the property in the hands of the Trustees, payable in the order in which judgments are liens upon the property. * * Upon payment of this one-third and the amount to be arranged for with yourself, and the issuance of these notes under the agreement that they were to be paid out of the Nodine property, we would expect a release of these judgments so as to free the land.”
Upon receipt of this letter, Eakin prepared and forwarded letters to the defendant and its assignor, the Utah Loan & Trust Company, and other of his clients holding judgments against Nodine, wherein he explained that Nodine had made arrangements with Starr under which he had deeded his land and transferred all his personal property
There are, therefore, two well-defined classes of mistakes common to parties entering into contracts : (1) A mistake in law as to the legal effect of the contract actually made by them ; and (2) a mistake in law in reducing to writing the contract, whereby it does not carry out or effectuate the intention of the parties. In the former the contract actually entered into will seldom, if ever, be relieved against, unless there are other equitable features calling for the interposition of the court. In the second class the mistake is not in the contract, but terms are used or omitted which give the instrument a legal effect not intended by the parties, and different from the contract actually made; and here equity will always grant relief, unless barred on some other ground.
It is also insisted that, under the decree of the court below, the defendant is enjoined from instituting any action or proceeding against plaintiffs on the notes so reformed, because of a misapplication of the trust funds. We do not understand such to be the effect of the decree. It restrains the defendant from prosecuting an action or proceedings on the notes as executed, and does not deprive it of any remedy it may have to recover on the notes as reformed, or against the trustees for neglect of duty. The decree of the court below is affirmed. Affirmed.