Worley v. Tuggle

67 Ky. 168 | Ky. Ct. App. | 1868

Lead Opinion

CHIEF JUSTICE WILLIAMS

delivered the opinion of the majority op the court,

JUDGE ROBERTSON dissenting:

It is a well-established and undoubted fact, that when the vendor contracted the land to Jane Early and Henry Tuggle, and agreed to convey it to their children, Marshall Early and John Tuggle, a lien was to be reserved for the unpaid purchase price, and both contracting parties instructed the draftsman to so draw the deed as to secure this lien; and when he had drawn it, he then assured the parties that the language used did secure such lien, it stating the amount of the consideration, “paid and to he paid,” without specifying how much remained unpaid, all fortified by the then insolvency of Henry Tuggle, who died soon after wholly insolvent.

This language, before our revision, would have secured the vendor’s lien; but since the revision of our statutes, no vendor’s lien is secured when the title is conveyed, “ unless it be expressly slated in the deed what part of the consideration remains unpaid.” (2 Slant. Rev. Slat., 230.)

Both the notes sued upon are dated the same day of the deed, and one recites that it is given in part pay for a certain tract of land this day deeded to John Tuggle and Marshall Early.

As the vendor seeks to reform the deed, and then enforce his lien, it presents the single question of legal power in the chancellor to do so.

This case presents a mutual mistake of law and fact by both the contracting parties and draftsman; and though the. land was conveyed to the minor children of the purchasers, yet, as they are mere volunteers, they stand in no more favorable attitude, nor have they higher equities, than if it had been conveyed to the parents.

Whatever may be said as to the danger of admitting parol or extraneous evidence to contradict, alter, or add to written instruments, it is now settled, by such an overwhelming current of authority, both in the American States and England, that this may be done when, through mistake, oversight, or fraud, the written memorial does not truly set out the contract, as scarcely to be regarded as longer an open question. But all the authorities agree that such evidence is to be cautiously received, and the case clearty made out, else the courts should hold to the written memorial as the highest and best evidence of the contract; but when it thus does appear, the written memorial, instead of attesting an agreement voluntarily entered into by the contracting parties, makes for them a bargain which the mind of neither party ever assented to, and to hold the injured party bound would simply make a rule of evidence, intended to secure justice, instrumental in perpetrating the grossest fraud.

After a long struggle, in which honesty, good faith, and integrity were attempting to free the administration of justice from fraul, chicanery, and unconscientious advantages, to- be obtained through a too strict adherence to a very salutary rule of evidence, the true philosophy of the rule was determined perfectly consonant with the just stability of written instruments and the strictest integrity, by admitting the above named exceptions. But as those willing to avail themselves of unconscientious advantages are always seeking, with watchful vigilance, to secure such benefits, by either rules of property or of evidence, the next great struggle in which integrity, honesty, and fair dealing had to meet the same wary, watchful chicanery, in attempting to protect its unconsciéntious advantages under the rules of law, was upon the statute of frauds and perjuries, which substantially declare, among other things, that no suit should be brought against the party to be charged for any sale of real estate, fyc., unless upon some memorandum, in writing; signed by him.

The developing science of the law, and its ever-waxing love of justice, increasing the omnipotence of the chancellor for equitable purposes, soon settled that this statute in nowise modified the above named exceptions to the rule of evidence, nor curtailed the equitable jurisdiction of courts.

But still, with more plausibility and seeming adherence to law, it was contended that even when, by mistake, oversight, or fraud, the deed of conveyance did not conform to the real contract of the parties, that all the chancellor could do would be to cancel the deed, and put the parties in statu quo; that to reform the deed, and then enforce a specific performance, would be to render the statute nugatory, whilst it was conceded that any unfair provision inserted for the vendee’s benefit, not according to the contract, could be modified, and the deed made to conform to the real intention of the parties; yet, when any advantageous covenant in his favor had been left out, that the chancellor was powerless to enforce it,-thus making a statute professedly enacted to prevent fraud, often the instrument of the grossest deception and injustice; and though the English courts first went off on this line of construction, yet the advancing science of the law, and the ever-operating influences of justice to rid it of all technicalities calculated to foster fraud and suppress impartial justice, have induced the English courts, in more modern times, to depart from this line of adjudication, and to recognize the power to reform the deed, and then enforce it according to the real contract.

The rale thus early adopted by the English courts lacked the great and essential element of mutuality; for it often happened that the parties could not be put in statu quo, and then the vendee was made to suffer the consequences of an innocent mistake or a fraud, and abide by a contract to which his mind never assented.

But to the honor of American jurisprudence it may be said, that its judicial mind, inspired with a devoted love of justice, and less embarrassed with the mere letter, better appreciated the spirit of the statute, hence their earlier advancement to the administration of its true equity and spirit, unencumbered by its mere letter, and that, too, more in consonance with the science of equity jurisprudence.

Mr. Justice Story, in his work on Equity Jurisprudence {vol. 1, sec. 152), says: “ One of the most common classes of cases in which relief is sought in equity, on account of a mistake in fact, is that of written instruments, either executed or executory. Sometimes, by mistake, the written agreement contains less than the parties intended; sometimes it contains more, and sometimes it simply varies from their intent by expressing something different in substance from the truth of that intent. In all such cases, if the mistake is clearly made out by proof entirely satisfactory, equity will reform the contract, so as to make it conformable to the precise intent of the parties."

Again, in section 154, he says: “The danger of setting aside the solemn engagements of parties, when reduced to writing, by the introduction of parol evidence, substituting other material terms and stipulations, is sufficiently obvious. But what shall be said where those terms and stipulations are suppressed or omitted by fraud or imposition? Shall the guilty party be allowed to avail himself of such a triumph over innocence and credulity, to accomplish his own base designs? That would be to allow a rule, introduced to suppress fraud, to be the most effectual promotion and encouragement of it, and hence courts of equity have not hesitated to entertain jurisdiction to reform all contracts, where a fraudulent suppression, omission, or insertion of a material stipulation exists, notwithstanding, to some extent, it breaks in upon the uniformity of the rule as to the exclusion of parol evidence to vary or control written contracts, wisely deeming such cases a proper exception to the rule, and proving its general soundness.”

And in the next section he says: “It is upon the same ground that equity interferes in cases of written agreements, where there has been an innocent omission or insertion of a material stipulation, contrary to the intention of both parties, and under a mutual mistake. To allow it to prevail in such a case would be to work a surprise or fraud upon both parties, and certainly upon the sufferers ; as much injustice would, to the full extent, be done under such circumstances as would be done by a positive fraud or an inevitable accident.

“A court of equity would be of little value if it could suppress only positive fraud, and leave mutual mistakes, innocently made, to work intolerable mischiefs contrary to the intention of parties. It would be to allow an act, originating in innocence, to operate ultimately as a fraud, by enabling the party, who receives the benefit of the mistake, to resist the claims of justice, under the shelter of a rule to promote it. It would be a great defect in the moral jurisdiction of the court, if, under such circumstances, it were incapable of administering relief.” And in section 158 he says: “ Many of the cases included under this head (mistake) have arisen under circumstances wdiich brought them within the reach of the statute of frauds, which requires certain contracts to be in writing; but the rule as to rejecting parol evidence to contradict written agreements, is by no means confined to such cases. It stands as a general rule of law, independent of that statute. It is founded upon the ground that the written instrument furnishes better evidence of the deliberate intention of the parties, than any parol proof can supply; and the exceptions to the rule, originating in accident and mistake, have been equally applied to written instruments within and without the statute of frauds.” (Motleux vs. London Assurance Com,., 1 Atk., 545; Hinkle vs. Royal Exchange Assurance Co., 1 Ves., 317; Leyman vs. U. S. Ins. Co., 2 John’s Chy. Rep., 630; Head vs. Boston Mar. Ins. Co., 2 Cranch, 419, 444; Mar. Ins. B., chap. 8, sec. 4; Andrews vs. Essex Fire and Mar. Ins., 3 Mason’s Rep., 10; Delaware Ins. Co. vs. Hagan, 2 Wash. Cir. Rep., 5.)

Story (sec. 159) again says: “The relief granted by courts of equity in cases of this character is not confined to mere executory contracts, by altering and conforming them to the real intent of the parties, but it is extended to solemn instruments which are made by parties in pursuance of such executory or preliminary contracts; and, indeed, if the court acted otherwise, there would be a great defect of justice, and the main evils of the mistake would remain irremediable; hence, in preliminary contracts for conveyances, settlements, and other solemn instruments, the courts act efficiently by reforming the preliminary contract itself, and decreeing a due execution of it, as reformed, if no conveyance or other solemn instrument in pursuance of it has been executed; and if such conveyance or instrument has been executed, it reforms the latter also, by making it such as the parties originally intended and various authorities are referred to.

In section 161, in answer to the disinclination of the British courts to receive parol evidence to reform and enforce written instruments, Story says: “ But it is extremely difficult to perceive the principle upon which such decisions can be supported, consistently with the acknowledged exercise of jurisdiction in the courts to reform written contracts and to decree relief thereon.”

In America, Mr. Chancellor Kent, after a most elaborate consideration of the subject, has not hesitated to reject the distinction as unfounded in justice, and has decreed relief to a plaintiff standing in this precise predicament.

Mr. Chancellor Kent has forcibly said: “That it cannot make any difference in reasonableness and justice of the remedy, whether the mistake was to the prejudice of one party or the other. If the court has a competent jurisdiction to correct such mistakes, and that is a point settled, the agreement, when corrected, and made to speak the real sense of the parties, ought to be enforced as well as any other agreement, perfect in the first instance.” It ought to have the same efficacy, and be entitled to the same protection, when made accurate under the decree of the court, as. when made accurate by the act of the. parties. (Kisselback vs. Livingston, 4 John. Chy. R., 148.)

In Wiswall vs. Hall, 3 Paige, 313, where the defendant, being the owner of a certain lot, No. 22, bounded on the Hudson river at the line of tide water, had obtained a grant from the corporation of the right to, and did erect, a wharf in front of his lot. He then sold the premises to complainant, and conveyed them as lot No. 22, as the same was described in and had been occupied and held under a certain deed which was particularly described. Now this lot No. 22 did not embrace the wharf, nor was it conveyed in the deed described; but the defendant held it under a grant from the corporation. The defendant, by Ms answer, insisted that he did not intend to sell anything more than the lot as it originally was. The chancellor said he was satisfied, from the evidence, that this allegation was true; but he was also of opinion that the defendant knew that the plaintiff did not so understand the bargain, and that, although he assented to take a conveyance limited to lot No. 22, it was only because he believed that lot and the conveyance embraced the wharf, and he decreed that the defendant should execute a release thereof.

In De Peyster vs. Hasbrouck (1 Kernan, N. York R., 587), the appellate court of New York directed the reformation of a mortgage of real estate, and enforced a lien thereon, because valuable erections, which the mortgage supposed' were mortgaged, stood on adjoining ground to that actually described in the deed, these being appraised before the mortgage was executed at six thousand five hundred dollars, and the mortgagee loaning twelve thousand doldollars, supposing the mortgage included these, with the other premises, and reversed the decision of the supreme court refusing to reform the mortgage, and then to enforce it, because they believed it inconsistent with the statute of frauds. The New York appellate court, referring to the case of Weswall vs. Hall, said : ‘‘ This case is upon principle identical; and it is unnecessary to refer to cases to establish the familiar doctrine that where, through- mistake or fraud, a contract or' conveyance fails to express the actual agreement of the parties, it will be reformed by a court of equity so as to correspond with such actual agreement.”

And in Rider vs. Powell (28 N. Y. R., 312), after due consideration, the appellate court of New York held, that where a mortgage of real estate had been executed to secure ten annual payments of three hundred dollars each, but had, through mistake, left out the annual interest on the entire sum of three thousand dollars, that it should be reformed and specifically enforced.

In Hunter vs. Bilyeu, &c. (30 Ill., 246), the Supreme Court of Illinois, after thorough argument, decided that the vendee, upon bill filed against the heirs of the vendor, could have a bond reformed so as to include lands left out by mistake in the description of several tracts, and was entitled to a specific enforcement of the reformed bond, and, therefore, directed a conveyance of the tracts left out.

In Huffman vs. Fry et al. (5 Jones’ Equity R., 415), the Supreme Court of North Carolina held, at the instance of the mortgagee, that the mortgage could be reformed and specifically enforced against the general creditors, it clearly appearing that the mortgage, through mistake, was made to secure one dollar instead of one hundred dollars.

The two New York, the Illinois, and the North Carolina cases, were instances of reformation sought by the vendees against the vendors, and were clearly within the statute of frauds.

In Brown vs. Lampton (35 Vt., 258), the vendor sought the reformation of the deed of conveyance, because it conveyed the tract of land sold, together with all its appurtenances, without reservation; whereas, by the contract the vendor was to retain the right to use the water from a spring, and to convey it through acqueducts to several houses owned by him, situated near by; but which reservation, by mistake, was left out. The Supreme Court of Vermont directed the vendee to reconvey this right to use the spring, though he denied the mistake.

This court, in Athy vs. McHenry (6 B. Mon., 59), directed a perpetual injunction as to Athey and his subsequent vendees against erecting any building on ten feet front of a lot in the city of Louisville, so as to exclude air and light from the house of his vendor, McHenry, it being shown that when the latter sold him the strip of ten feet it was agreed that the front was to remain an open space, and not to be covered by any building, so as to exclude air and light from the vendor’s house; but this was left out of the deed of conveyance by mistake. Nor will it do to say, in response to this decision, that the statute of frauds was not alluded to, for as the statute had no application to the case, there was no need of reference to it.

And in Thomas vs. McCormack (9 Dana, 108), this court, expounding the rules governing writings and deeds, said that parol evidence could be heard as against them, either for fraud or mistake, when asserted in the pleadings, and could be relieved against.

In Bates et al. vs. James' heirs (MSS. Opin., last term), this court reversed the chancellor’s judgment in rescinding a contract of exchange of Jefferson county, Kentucky, for Mississippi lands, because the deed, by mistake, described lands in Mississippi six miles from where the lands sold were situated; yet the vendor, offering to correct the mistake, this court directed it to be done, and the vendee held thereto. And, at the present sitting, this court, in Mourning vs. Stratton, has held, that when a vendor had assigned the vendee’s note before he conveyed by deed, of which the vendee had notice, that a subsequent conveyance by the vendor, without specifying the note held by his assignee, was a fraud upon the holder of the note, and did not waive his lien.

And in Mattingly and wife vs. Speak et al. (4 Bush), this court held, that where a father, intending to convey land to his married daughter and the heirs of her body, through mistake conveyed it to the son-in-law and his heirs, the deed could be reformed, even after the death of both the grantor and grantee, upon clear and satisfactory evidence of the mistake.

The provision of the statute of frauds is, that no suit shall be brought to charge any person, “ upon any contract for the sale of real estate, or any lease thereof for a longer term than one year, unless the promise, contract, agreement, &c., or some memorandum or note thereof, be in writing, and signed at' the close thereof by the party to be charged.”

It will at once be perceived that this suit is not to charge any person upon any contract for the sale of land, but it is a suit by the vendor to correct a mistake in his own deed, by which he conveyed aright — rather by which he waived a right — in himself contrary to the contract, and clearly does not fall within either the letter or spirit of the statute of frauds, but belongs peculiarly to that class of cases wherein courts of equity reform and specifically enforce the reformed contract, for fraud, omission, or mistake.

It has never been held that when the vendor had delivered to the vendee his memorandum in writing on the sale of land, that he must have a memorandum in writing to enable him to recover the purchase price, because, even the statute of frauds does not require this; but no one can be compelled to convey lands, unless the sale be attested by a writing; when, however, a contract of sale is so attested, though, through fraud or mistake, the real sale, as made, is not set forth, yet the current of American authorities recognize the power and duty of the chancellor to reform the writing, and then enforce it, when certainly coming within the provisions of the statute ; but when it does not come within the purview of the statute, as this case docs not, there is no contrariety of adjudicated authority in Eng'land or Amei’ica; for it then falls within the general jurisdiction of the chancellor to correct for fraud, omission, or mistake, unqualified by the statute, also justified by the same exceptions to that rule of evidence which recognizes written as of higher and more reliable testimony than parol, equally recognized by the courts of both countries.

After the contract of sale, and until the deed was executed and delivered, the vendor, bf the laws of this State, had a lien for the unpaid purchase price. This lien, it was contracted, should be continued, and not waived by the deed, and the draftsman was instructed to so draw it; and he and the parties thought it was so drawn. No third innocent party, as purchaser for a valuable consideration, is involved. To say that the vendor lost his lien beyond the power of the chancellor to allow and enforce it, is to make the law an agent of fraud and the chancellor an imbecile in the administration of justice, likewise to destroy every principle upon which contracts are upheld and regarded, as neither the mind of the one nor the other party assented to such a contract; beside, there was no consideration contracted or paid to uphold it; but simply, by mistake, the deed sets out a contract never made; and when the vendor seeks to enforce the real contract, the vendee meets him with the deed, and a denial of the right of the court to investigate it, or of the vendor to show mistake, omission, or fraud, and that, too, in a case not within the statute of frauds.

Before our revision almost anj"- vague expression in the vendor’s deed, showing that all the purchase money had not been paid, was held sufficient to put subsequent vendees upon their guard, such as used in this deed, of “paid and to be paid f hence, after vendees, who had paid all the purchase price to their vendors, were often surprised by the assertion of a lien by some remote vendor, and thus injustice was sometimes done to remote vendees. To remedy this evil, our Revised Statutes require the amount of the vendor’s unpaid purchase price to be specified in his deed of conveyance, else his lien is thereby waived; but, as between the original parties or volunteers under them, this was never intended either to work a fraud, to alter the rules of evidence, nor to take from the chancellor one of his most valuable jurisdictions.

It is said by Story, and is a most just and reasonable rule, that, in the reformation of deeds, the just rights and equities of third and innocent parties, purchasers for a valuable consideration, without notice, are not to be disturbed; for, as between vendor and innocent remote vendees, the loss should fall on the one who, through his own negligence, may, to some extent, be regarded as the author of the misfortune. The evidence of the draftsman alone, since the adoption of our Civil Code, is sufficient to establish the allegation of mistake, though denied in the answer.

Section 142, Civil Code, requiring that the pleadings, with certain exceptions, should be verified, provides “that such verification shall not make other or greater proof necessary on the side of the adverse party.”

And in Albro vs. Lawson (17 B. Mon., 644), this court held, that the rule which required two witnesses, or one witness, with strong corroborating circumstances, to overcome a denial in an answer in chancery, has been changed by said section of the Code, which was subsequently affirmed by this court in Enders vs. Williams (1 Met., 354-5). So it may now be regarded that the oath of the plaintiff and the defendant making an issue, are equivalents, and the issue to be adjudicated upon the evidence. But one witness testified in this case — the draftsman. There are no contrariety of facts, but the language of the deed, the insolvency of the purchaser, Henry Tuggle, both signally confirm the positive and emphatic statements of the only witness that a lien was contracted for, and was to be retained, and was to be set out in the deed, and that all the parties thought it was so set out.

Wherefore, the judgment is reversed, with directions to reform the deed and allow the lien, selling first the undivided interest of Jno. Tuggle for that purpose.

Judge Robertson dissenting.

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Dissenting Opinion

JUDGE ROBERTSON

delivered the following dissenting opinion:

Henry Tuggle, having bought from the appellant, Elijah Worley, a tract of land, for the unpaid price of which, he gave his promissory notes, the legal title was conveyed to his son and to his step-son; and having afterwards died intestate and insolvent, this suit in rem was brought against his surviving widow and heirs for enforcing an alleged lien not reserved by the deed, which, as charged, omitted it through mistake. Only one witness testified to the allegation denied by the answer. The circuit court dismissed the petition. Oral evidence of such a mistake in the written memorial of the contract required to be in writing, cannot availably supply the omission or change the legal effect of the written memorial, so as to subject the vendee or the land to any liability not imposed by the writing. Were the law otherwise, the statute requiring written evidence might be evaded and often frustrated by oral testimony of what the statute requires to be shown by written evidence only, before a suit can be maintained on it.

The deed neither reserves an express lien nor recites the amount of the unpaid consideration from which, according to a statute of this State, an implied lien would have resulted. The appellant now insists that the unwritten contract for a lien should be enforced against the plea of the statute of frauds and perjuries, providing, in effect, that no suit shall be maintained for enforcing a contract for the sale of land, or for an encumbrance on it subjecting it to sale, unless there be a written memorial of the contract as sought to be enforced. But reason, policy, and authority all oppose this assumption.

The philosophy of evidence interdicts, as a general rule, oral testimony inconsistent with written evidence, intrinsically the highest, and presumptively intended by the parties to be the only, evidence of this contract. Policy and justice, however, have, to a qualified extent, relaxed this prudent rule in cases of well-established fraud or mistake in reducing the oral contract to writing. And even in contracts within the scope of the statute, the reason of the exception allows a defendant to prove that a written contract sought to be enforced against him is, through mistake, essentially different from that intended by the contracting parties. And this is not inconsistent with the statute which, intending only to save land from the danger’ of false and suborned testimony, does not provide that a wnitten memorial of sale may not be resisted for mistake when sought to be specifically enforced. Except for the purpose of enforcement, a written contract for land, like every other written contract, may be modified by clear proof of essential mistake. For all defensive purposes, the statute requiring written evidence does not apply, but leaves evidence to the common law tests of competency and effect; and, consequently, no doctrine is either better settled or is more consistent than that which allows a defendant to resist the equity of the extraordinary relief of a specific execution of a written contract for land, by oral proof of the rebutting equity, resulting from a mistake in making the written memorial describe a contract which was, in fact, never made or contemplated. This violates no statute of frauds, and is, therefore, permissible on the general principle which allows oral to contradict written evidence. But the statute excludes that principle whenever a party to a contract for land seeks to enforce an oral agreement against or in lieu of that which, as required, is written. In such a case, the other party may well say, “ however clearly you may seem to prove by oral testimony a contract different from the written memorial, and however conclusively you may thus show that the contract, as written, should not be enforced, yet, nevertheless, there is no written evidence of the contract, which I deny, and which you are seeking to enforce in defiance of the inexorable and conservative statute, which peremptorily forbids the enforcement of any such oral contract.”

Were the only question in such a case the admissibility of oral to contradict written testimony, then certainly both plaintifF and defendant would stand on the same platform, and be entitled to the same privilege. But that is not the decisive question when a party seeks a specific execution of an oral sale of land, or of a lien upon land. The statute then comes in, and, without qualification or exception, inflexiby requires written evidence of the alleged contract, and, in its application to such a case, the statute is fortified by the fact that the parties had prudently reduced to writing a contract essentially different from that sought to be enforced on oral evidence, in opposition to the evidence which they had chosen as the surest test of their rights. But, waiving this consideration, it is evident that superseding the written evidence, leaves the contract without any other than oral evidence, and the status of the parties is precisely what it would have been had there never been any written memorial. This would be the inevitable and utmost effect of proving mistake; and then, if the transmuted contract be enforced, will it not be enforced as a contract merely oral, in the teeth of the statute, and may not the legislative purpose be perverted and altogether frustrated ?

A single example may sufficiently illustrate the right doctrine and the true contradistinctive principle. A, owning two tracts of land of different quality and value, sells to B the tract worth one hundred per cent, the most; but his bond for a title, through either fraud or mistake, clearly describes the least valuable tract, and cannot be so construed as to embrace the tract actually sold. B refusing to pay for the inferior tract,s A sues him for a specific execution of the contract, as falsely written. In resisting A’s asserted equity B may prove the true contract, and defeat the suit; but can he, by retorting a prayer for a specific execution of the oral contract for the better tract, coerce a conveyance of it? The statute is dead unless it says no ; and then for what purpose was it made ? A bonus of a portion of the land might suborn witnesses to testify falsely to the alleged mistake, and thus take from the owner land he never sold. To save from any such perjury and spoliation of real estate, was the only object of the statute; and to deny its availibilty in such a case would virtually nullify it. And here we may see why a plaintiff cannot, by suit, take from the defendant his land without written testimony, and why, at the same time, he cannot, even on written evidence, impose on him land he never actually sold him; and why, therefore, oral proof of mistake may be available for resisting a specific execution of a written contract for land, but can never entitle a plaintiff to a specific execution of any unwritten contract. And it is rather strange that Chancellor Kent once said that he could not see why, if a defendant might resist a specific execution of a written contract for land by oral proof of mistake, a plaintiff might not have a reciprocal right to enforce an oral contract "by proof of mistake in a written memorial; and it may be still stranger that Mr. Story seemed to indorse that unauthoritative saying, never authoritatively ratified or recognized. The true and sure clue to the labjrinth which perplexed those eminent jurists is quite palpable : it is, that the statute of frauds applies to one and does not apply to the other class of cases. This clue shows w^hy, also, a deed purporting an absolute sale may, by oral testimony of mistake, be showm to have been intended only as a mortgage, and why a deed, purporting to be only a mortgage, can never be transformed, by oral proof, into an absolute sale. In the former case the statute of frauds does not prevent resistance to a written contract, but in the latter case it prevents a recovery beyond or against a written contract; and this is perfectly consistent, has never been judicially disregarded even by Story or Kent, and is impregnably established by an overwhelming current of authority, British and American, both judicial and elementary. Any other doctrine is inconsistent, and indefensible on principle.

On this subject, Story, in his Equity Jurisprudence (section 161), says: “It is admitted that a defendant, against whom a specific performance of a written agreement is sought, may insist, by way of answer, upon mistake as a bar to such a bill; because, he may insist on any matter which shows it to be inequitable to grant such relief. A court of equity is not, like a court of law, bound to enforce a written contract; but it may exercise its discretion when a specific performance is sought, and may leave the party to his remedy at law. It will not, therefore, interfere to sustain a bill for a specific performance, and "when it would be against conscience and justice to do so. On the other hand, it seems equally clear that a party may, as plaintiff, have a relief against a written contract by having the same set aside; and canceled or modified, whenever it is founded in a mistake of material facts ; and it would be unconscientious and unjust for the other party to enforce it at law or in equity. But the case intended to be put differs from each of these. It is where the party plaintiff seeks, not to set aside the agreement, but to enforce it when it is rel. formed and varied by the parol evidence. A very strong inclination of opinion has been repeatedly expressed by the English courts not to decree a specific performance in this latter class of cases — that is to say, not to admit parol evidence to establish a mistake in a written agreement, and then to enforce it as varied and established by that evidence. On various occasions, such relief has, under such circumstances, been denied.” And his numerous citations of unquestioned authorities sustain this text.

The same author, in his chapter on Specific Performance (sections 770 and 770a), says: “ The statute has said that no person shall be charged with the execution of an agreement who has not personally or by his agent signed a written agreement. But the statute does not say that, if a written agreement is signed, the same exceptions shall not hold to it as did before the statute. Now, before the statute, if a bill had been brought for a specific performance, and it had appeared that the agreement had been prepared contrary to the intentions of the defendant, he might have resisted the performance of it. The statute has made no alteration in this respect in the situation of the defendant. It does not say that a written agreement shall bind, but only that an unwritten agreement shall not bind.

“ But, in the case of a plaintiff seeking the specific performance of a contract, if it is reduced to writing, courts of equity will not, ordinarily, entertain a bill to decree a specific performance thereof, with variations or additions or new terms, to be made and introduced into it by parol evidence; for, in such a case, the attempt is to enforce a contract partly in writing and partly by parol; and courts of equity deem the writing to be higher proof of the real intentions of the parties than any parol proof can generally be, independently of the objection which arises in many cases under the statute of frauds.”

And, in support of this text, many current decisions by the British courts are cited; and among these, is the judgment of Lord Gottenham in the London and Birmingham Railway Company vs. Winter (1 Craig & Phillips, 57), in which the chancellor said, as to oral variations from a written contract, “ that, in such a case, the contract is not in writing, but in the terms verbally stated to have been the agreement between the parties, and, therefore, refuses specifically to perform such a contract.”

And among the cases cited by the same author, in his chapter on Mistake, is that of Attorney General vs. Sitwell (Young & Coll., 559), in which Baron Alderson said: “I cannot help feeling, that, in the case of an executory agreement, first to reform, and then to decree an execution of it, would be virtually to repeal the statute of frauds. It seems to me that the court ought not, in any case, where the mistake is denied or not admitted by the answer, to admit parol evidence, and upon that evidence reform an executory agreement.”

And all other British decisions within the range of our knowledge harmonize with the principle recognized in the foregoing quotations; and we have seen no authoritative American decision essentially different.

Sugdon, in his Treatise on Vendors, collating the British authorities, announces as their unanimous conclusion, that mistake in a wu-itten contract for the sale of land, proved by oral testimony establishing a different contract, “ can only be used as a defense to a bill demanding a specific performance, and is inadmissible as a ground to compel a specific performanceand the only exception he makes is a case of part performance of an unwritten agreement, which, according to the inconsistent doctrine then recognized in England, took the case out of the statute ; and that exception has been invariably repudiated by this court as a virtual repeal of the statute; because, though part performarice may be evidence of some contract, yet it is no proof of the terms or extent of the contract, and, by subornation, men might “ be even proved out of their estates ” in defiance of the letter and policy of the statute. Consequently, this court has always been less inclined than those of England to relax the statute by the application of oral testimony. And this court, therefore, has never adjudged that an oral agreement for selling or encumbering land could, under any circumstances, be specifically enforced when the statute has not been waived; but has often decided otherwise.

In Smith vs. Smith (4 Bibb, 81), the opinion delivered by Chief Justice Boyle clearly implies, that, while oral evidence may resist, it cannot enforce a specific performance of a contract embraced by the statute of frauds respecting sales of land.

In Harrison vs. Talbot (2 Dana, 268) this court adjudged the dismission of Harrison’s cross-bill for reforming, by oral proof, a written memorial of a sale of land to him, and then for a specific enforcement of the agreement as so varied; and the only reason for that judgment was, in the language of the court, “ because he (Harrison) cannot, in the attitude of complainant, compel a specific execution of the contract varied or modified by parol evidence, nor otherwise, than according to the import and effect of the written memorial of the sale.'’'’

Hanly vs. Shrieve (1 Dana, 1) recognizes the same doctrine.

And in Churchill vs. Rogers (3 Mon., 81) the same principle was directly and specifically recognized and applied to a bill by Churchill, charging that a conveyance of land sold to him bjr Rogers did not, through mistake, embrace all' the land actually sold, and praying for an extension of the boundary so as to include the pretermitted land, or for a conveyance of that land.- The opinion of this court, delivered by Chief Justice Boyle, after stating that there was no complaint that the deed as made did not accurately describe, as to identity and quantity, the land conveyed by it, concluded as follows': “ There is indeed evidence in the cause conducing to prove a verbal agreement on the part of Rogers, that the lines might be extended so as to' include the land which is now contended by Churchill ought to have been conveyed; but to sustain the bill and grant Churchill relief on such agreement, would be directly contrary to the letter, as well as the spirit, of the statute against frauds and perjuries.”

The same doctrine has been virtually recognized, arguendo and otherwise, by this court in many cases, and has never, so far as we know or believe, been overruled or questioned by any Kentucky case. The case of Athy vs. McHenry, cited contra, does not allude to the statute, nor intimate that an oral" contract for the sale of land or encumbrance subjecting land to sale, or a written contract altered by oral testimony of sale, or such encumbrance, can be specifically enforced against the vendor when resisted on the ground of the statute. That case only decided that & purchaser should be enjoined from obstructing ventilation and light to the vendor’s house, the enjoyment of which, as an easement, was a part of the consideration of his sale of the adjoining ground, and was reserved by the agreement; but, through inadvertence, was not expressed in the conveyance. That judgment may have been right. The case was not within the statute. The vendee was not seeking to enforce an oral contract for the sale of land against the vendor, but the vendor sought to enjoin his vendee from a nuisance in violation of an oral contract not to commit it.

According to the statute as interpreted, oral evidence was admissible, and, if satisfactory, was sufficient in that case. It was not taking from the vendor any land or service sold by him without a written memorial. It was only enforcing against the vendee a part of the consideration of his purchase; and so far as the statute is concerned, the only question was, whether, in such a case, oral evidence was admissible to supply an omission in the conveyance to the vendee concerning light and air that might not have required a written contract, and which, according to the common law, untouched by the statute, was admissible in such'a case on proof of mistake in the written memorial of the contract of sale by the vendor; and, therefore, the court did not consider or allude to the statute of frauds.

That case of Alhy vs. McHenry, therefore, may be perfectly consistent with the other Kentucky cases, and with the established exposition of the statute of frauds, and certainly does not overrule, or even question, their authority, which seems not only rational and coincident with all the British decisions, but conclusive now on this court after its undeviating recognition for more than sixty years. Nor do we find that the Supreme Court of any .American State has established a conflicting doctrine; and if it had done so, it would not be either authoritative, or even availably argumentative, in this forum, against the limpid volume of its own prescriptive authority, backed by that of England, and certainly by most of the States of our Union. The converse is surely not entitled to the dignified and imposing appellation of “ the American doctrinecertainly not as much so as the doctrine of part performance is the American doctrine.

There are American, and English cases too, in which the alleged mistake or oral agreement not being denied and the statute waived, a specific performance has been, and properly, decreed; and there may be a few sporadic cases in which a divided bench has, for fraud, enforced a contract for the sale or encumbrance of land, as reformed by oral proof indisputable. Such is the case of Depeyster vs. Hasbrouck (1st Kerman's New York Reports). But this, however inconsistent or questionable, is not in the same category of a reformation and enforcement on the ground of mere mistake; and neither in New England nor New York, nor any other American State, has the judiciary authoritatively established the doctrine that, against the plea of the statute, an oral contract or a written contract, essentially varied by oral testimony, on the ground of mistake, can ever be specifically enforced by suit, except on the indefensible ground of part performance. Wherever we find dicta to that effect, we find judicial decisions to the contrary. This is true of the dictum in the case of Hunter's adm’r vs. Bilyeu, &c., in 30th Illinois Reports, in which, nevertheless, the court adjudged against the prayer for specific performance; and in the same State, the same tribunal, in the case of Updicke vs. Armstrong, as well as in other cases, adjudged that “ the statute applies.” All the New England States have likewise so adjudged, and New York has not settled any other doctrine.

The case of Rider vs. Powell (1 Tiffany's New York Reports) has no essential application to the question we are considering. In that case, adjudged by an almost equally divided court, it was decided that Rider, the vendor of land, might, on oral proof of mistake, reform the consideration recited in a mortgage made to secure payment; and it is well settled here and elsewhere that the recital in a deed of the consideration is not conclusive, but may be disproved or qualified by oral testimony. The Kentucky statute of frauds does not require the consideration to be stated in the written memorial of a contract for the sale of land; and we do not judicially know that the Néw York statute differs materially from ours. However this may be, the question of proof of the true consideration depended, in that case, on the common law, unaffected by the statute; and, therefore, the opinion in that case is no authority on the statute of frauds and perjuries. Nor does the case of Gillispie vs. Moore (2 Johns. Ch’y. Reps., 585), or that of Keiselbrock vs. Livingston (4 Ib., 144), adjudge more than the admitted doctrine, that in cases not within the statute of frauds and perjuries, oral evidence may modify a written agreement, and as well for the plaintiff seeking correction and enforcement as for the defendant resisting specific performance. In neither of these cases did Chancellor Kent decide that an oral contract or a written contract for the sale of land, essentially modified by oral testimony, could, if denied, be specifically enforced in defiance of the statute peremptorily declaring that no suit shall be maintained for enforcing a contract for the sale of land unless it be in writing. He said truly that the statute did not apply to the case of Keiselbrock vs. Livingston; and it is equally evident, not only that it did not apply to the case of Gillispie vs. Moore, but that the chancellor’s only object was to settle the then controverted competency of oral evidence to contradict or correct written evidence — a doctrine now universally recognized by enlightened jurists; and all the cases cited in his opinion show nothing more than that oral evidence is admissible, in cases of well-established mistake, to change a written contract; and no one of them intimates an application of that established doctrine of the modern common law to cases in which a plaintiff, on proof of mistake, and of an oral contract essentially different from the written memorial, seeks a specific performance of the oral contract; and to that class of cases alone the statute wisely applies, by its express and inevitable provision against any suit to enforce in invitum an oral agreement for the sale of land, or an encumbrance on land which may subject it to sale, and is, therefore, potentially the same thing.

A failure to discriminate clearly between cases embraced by the statute, and the more comprehensive class of cases unaffected by it, has been the cause of many indiscriminating adjudications and loose dicta on the competency of oral against written evidence, and the reciprocity of' its availability to both parties to contracts. But while what has been adjudged and said is generally true, all of it together does not show, or tend to show, except in cases of part performance, that an oral contract for the sale of land can be specifically enforced against a resisting party relying on the statute. And although neither Chancellor Kent nor Justice Story at one time perceived why oral testimony might not be equally competent against written evidence in all contracts and for all parties, yet neither of them ever so adjudged. When they spoke on that subject the British doctrine of part performance, now much regretted in England, had been recognized in most of the American States, and the precise extent of the operation of the statute of frauds and. perjuries had not been authoritatively defined. In that chaotic state of the law it is not at all strange that even those two distinguished jurists were bewildered, like many others, in the twilight. But now the true range of the statute is better defined and understood, and more consistently applied exclusively to suits for the specific performance of oral contracts for the sale of land, according to its clear and express provisions to that effect, and that only. And, excepting cases of part performance, never tolerated in Kentucky, I know of no case, British or American, in which it has been considerately and authoritatively adjudged that an oral contract for a sale of land, or, what is the same thing, an essential alteration of a written memorial of such contract, attempted by oral testimony, can be specifically enforced consistently with the statute when properly relied on. It has never been so adjudged by this court, whose prescriptive authority has been uniformly the other way.. And if that authority, and that also of England and of most of the American States, be now overruled by a majority of this court, against the opinion of the circuit court and this protest, the next and more consistent step in the revolution must be to overrule the Kentucky doctrine in respect to part performance, and thus, by one three-handed blow, strike the statute dead, and leave real estate a prejr to hired perjury. Never before was a solemn writing reformed anywhere on the solitary “ understanding” of one unimpeached witness.

Preferring to stand super antiguas vias, and satisfied also that the old Kentucky way is the right way, and that now blazing a new way, in an unexplored wilderness, must be delusive and unsafe, I cannot concur in reversing the judgment of the circuit court, sustained, as I believe it is, by principle and policy, by British and American authority, and, above all, by the undeviating, and, to us, paramount authority of our own venerable and conservative Commonwealth.

I therefore respectfully, but confidently, submit the foregoing considerations as sufficient grounds to excuse my dissent from the reasoning and judgment of a majority in this pregnant case.

Case Details

Case Name: Worley v. Tuggle

Court Name: Court of Appeals of Kentucky

Date Published: Oct 16, 1868

Citation: 67 Ky. 168

Court Abbreviation: Ky. Ct. App.