213 P. 440 | Mont. | 1923
prepared the opinion for the court.
This was an action to rescind a contract of sale brought by the buyer against the' seller. The situation which led the plaintiff to bring this action, as disclosed by the evidence, is as follows: On November 21, 1917, one S. A. Hughes, a married woman, gave to the defendant her promissory note in the sum of $1,000, due six months from date. As security for the same she executed a mortgage on certain real property and a chattel mortgage on certain personal property. At the time of giving these mortgages, Mrs. Hughes was in possession of the real estate under contract to purchase the same, and of the personal property under conditional sales contract. On December 21, 1917, in consideration of the sum of $1,000, the defendant indorsed the note to the plaintiff without recourse, and assigned to him the real estate and chattel mortgages. Both of these mortgages, at the time of their execution, were subject to other liens in large amounts. These liens were foreclosed by the holders thereof, during the years 1919 and 1920. Mrs. Hughes was thereby deprived of the possession of
On February 26, 1921, the plaintiff notified the defendant that the contract between them was rescinded upon the ground that the same was originally and at all times wholly without any consideration passing from defendant to plaintiff. He then tendered back the note and mortgages, and demanded the return of the sum of $1,000, with interest at the rate of eight per cent per annum. The complaint, filed March 2, 1921, is to the same effect. The defendant appeared by answer. Trial was had to the court sitting without a jury. Judgment was rendered for the defendant. The plaintiff appealed from the judgment.
Our statute providing for rescission of a contract (see. 7565, Rev. Codes 1921) is as follows: “A party to a contract may rescind the same in the following eases only: 1. If the consent of the party rescinding, or of any party jointly contracting with him, was given by mistake, or obtained through duress, menace, fraud, or undue influence, exercised by or with the connivance of the party as to whom he rescinds, or of any other party to the contract jointly interested with such party; 2. If, through the fault of the party as to whom he rescinds, the consideration for his obligation fails, in whole or in part; 3. If such consideration becomes entirely void from any cause; 4. If such consideration, before it is rendered to him, fails in a material respect, from any cause; or, 5. By consent of all the other parties.”
There is no suggestion of facts in the complaint that would warrant a rescission under either of the five subdivisions. Nor are the necessary facts supplied by the proof. The most that
Counsel for appellant contends that the contract in question was void in its inception because not founded on a valuable consideration, and that he is entitled to recover back the money paid on that ground. He refers to this as a rescission. f The statute does not make the absence of consideration, on one side, a ground for rescission by the other party. However, if there was in fact no consideration, which the law would recognize, there was no contract to rescind. The party who had parted with value in that case could recover it back in an action at law. Looking at the present case from that standpoint, the plaintiff is in no better position. The law has never attempted to consider the wisdom or folly of either party to a contract. “Courts of law will not make bargains for the parties to a suit, and, if a man gets what he has contracted for, will not inquire whether it was an equivalent
“Examples of consideration which the law regards as valuable, though practically o£ no financial value, are * * * delivery of a note of a third person which is useless and of no value; the surrender of a note, the principal debtor whereon is insolvent and the surety has been released.” (Page on Contracts (2d ed.), 635, citing Churchill v. Bradley, 58 Vt. 403, 56 Am. Rep. 563, 5 Atl. 189.
In Shortrede v. Cheek, 1 Adol. & E. 57, it is held that the giving of any note on which a suit might be brought is sufficient consideration to support a contract.
This court, in Maloy v. Berkin,, 11 Mont. 138, 27 Pac. 442, quotes with approval from Pomeroy on Equity Jurisprudence as follows: “The rule is well settled that where the parties were both in a situation to form an independent judgment concerning the transaction, and acted knowingly and intentionally, mere inadequacy in the price or in the subject matter, unaccompanied by other inequitable incidents, is never of itself sufficient ground for canceling an executed or executory contract.”
There is no pretense in the present case that the defendant perpetrated any fraud or practiced any deceit upon the plaintiff. The evidence by which he sought to prove that Mrs. Hughes was insolvent and the mortgages given to secure the note of no value were matters of public record. If his present contention with reference to the value of the note and mortgages is well founded, there was nothing to prevent him from ascertaining the facts from the records by which he now seeks to establish them. The plaintiff examined the property itself. Any defect in the title was apparent of record. He should have examined the title or had it examined. “A court of equity cannot relieve a person who purchases a mortgage upon
The findings of the court briefly were to the effect that the plaintiff had not established a case that would warrant a rescission. Since it could not, consistently with the foregoing opinion, have reached any other conclusion, no useful purpose could be served by discussing the ten specifications of error upon which the plaintiff bases his appeal.
We therefore recommend that the judgment be affirmed.
For the reasons given in the foregoing opinion, the judgment appealed from is affirmed.
Affirmed.