Chamberlain v. Fox Coal & Coke Co.

92 Tenn. 13
CourtTennessee Supreme Court
DecidedOctober 17, 1892
StatusPublished
Cited by3 cases

This text of 92 Tenn. 13 (Chamberlain v. Fox Coal & Coke Co.) is published on Counsel Stack Legal Research, covering Tennessee Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chamberlain v. Fox Coal & Coke Co., 92 Tenn. 13 (Tenn. 1892).

Opinion

Lurton, J.

The complainant seeks a . rescission of a contract of sale of a leasehold estate in a tract of 5,700 acres, upon which is situated a valuable coal-mine. The conveyance also embraced certain movables, such as miners’ houses, coal-cars, rail and tramways, screens, scales, mining tools, and also certain rights of way over adjacent lands. The conveyance was made by the Eox Coal and Coke Company, a Tennessee corporation, which [15]*15was. the assignee of a lease, originally made in 1885 to other parties, for a term of ninety-nine years. The consideration expressed in the deed is $57,500, and the assumption "by the vendee of the rents, payable to the original lessors and owners of the fee; and upon the further consideration that the vendee should expend, within one year, the sunl of ten thousand dollars in permanent improvement of the mines. Twenty-five hundred dollars was paid in cash, and for the remainder notes Avere executed, maturing at different dates.

IJpon the pleadings and proof, the Chancellor, upon final hearing, dismissed the bill. The complainant has assigned as error the action of the Chancellor in not finding, upon the -evidence,' that a fraud Avas practiced upon complainant, by misr representations made to induce the sale, concerning the daily output of the mines Avhile being oper’-ated by the vendor. "We do not think the Chancellor erred in this respect. Complainant and one Hood do testify that Mr. Line, the secretary of the defendant company, did represent, that the output had averaged betAveen- tAvo hundred and tAvo hundred and fifty tons per day. Mr. Line Amry positively denies the statement. He ■ is confirmed, as to what passed between himself and Mr. Cham-bei’lin at the time the sale Avas consummated, by the eAÚdence of Mr. Pritchard, who Avas present during the negotiations as counsel for the Eox Coal and Coke Company. Whatever question may be made upon the competency of the evidence of [16]*16Mr. Pritchard as to subsequent transactions about which he testifies, there can he no doubt but that, at the time these negotiations for the sale were pending, Mr. Pritchard represented the vendor alone, and was competent, when called by his client, to say what representations had or had not been made. The representations to the witness, Hood, are laid at a different time and place.

Assuming both Mr. Hood and Mr. Line to be equally credible witnesses, complainant’s case,, on this point, must fail, because not supported by the weight of proof. To strengthen this view, there is the added circumstance that complainant had sent two competent persons to examine the property, and this fact, taken with the positive testimony of both Mr. Line and Mr. Pritchard, indicates that complainant was fully advised as to the character and prospects of this property by his agents, and acted upon their reports to him.

The materiality of the alleged misrepresentation does not clearly appear. Whether defendants had obtained an output of from forty to fifty tons per day, or two hundred tons per day, might depend entirely upon the force employed by them, and not be a consequence of the want of ...capacity in the mines to put out the larger quantity with an adequate force. That the property is very valuable as a coal property is freely admitted by Mr. Hood, complainant’s agent for the examination of the property. This witness says that “taking the report of Mr. Lawson as a basis” (an expert sent [17]*17to examine and report upon the property by .complainant), “I should say it was a large property, and capable of turning out a large quantity of coal.”

To rescind a contract of sale upon the ground of a misrepresentation as to the character, capacity, or quality of the property sold, it ought to be made to clearly appear that such misrepresentation was concerning a material matter, and operated as a material inducement to the purchase.

The next insistence of complainant was, and is,, that the defendant company were guilty of such fraudulent concealment of a material fact affecting; its title and right of possession as entitles him to a rescission. The facts upon which this allegation rests are substantially these: In 1873 a grant was issued by the State 'to one B. E. Walker, for a portion of the lands covered by the leasehold estate conveyed to complainant. In 1881 Walker filed a bill in the Chancery Court against the Eox heirs, who are .the original lessors under whom the Eox Coal and Coke Company claimed. The object of this bill was to remove the Eox title as a cloud upon the Walker title, to stay waste, and to eject the Eox heirs from the land covered by the grant to Walker. The Eox heirs claimed under a grant much older than that held by Walker, but were unable to connect themselves with it, for the reason that one link in their chain of title was a Sheriff’s deed, which they did not support with a record showing judgment and [18]*18levy.- Neither Walker or the Eoxes had had such continuous, exclusive, adverse possession of the lands covered by both grants as to 'vest a title under the statute of limitations. Walker failed in liis suit, however, because of the effect of the older grant as an outstanding superior title. This suit was finally decided in 1886, and the opinion of this Court, reported in 85 Tenn., 154 et seq., shows fully the facts .as to the respoctivev titles and possessions and the ground upon which Walker failed to recover the land claimed bj' him in that suit.

After losing- his ejectment suit, Walker at once instituted another suit, for the purpose of obtaining possession from the Foxes, or those claiming under them, of the lands covered by his grant. For this purpose he brought an action at law of forcible entry and detainer before a Justice of the Peace ■of Ithea County. Instead, of making the Foxes, or their then lessees, Line and Winchester, defendants, he instituted his suit against three cmploxjes of the lessees, and alleged that they — Davis, Blevins, and Travis — had wrongfully and forcibly entered upon his lands and deprived him of the possession. There was a judgment by the Justice in favor of Walker, and an appeal by the defendants to the Circuit Court. This is the suit which was pending at the time of the sale to complainant. Line and Winchester had in the meantime, and while the suit was pending, sold and > assigned their lease to the defendant, the “Fox Coal and Coke Company.”

[19]*19The Tact that this suit was pending was known to the vendor of complainant, and it did not comriiunicate its pendency to the complainant. The contention of complainant is, that inasmuch as neither the Eox Coal and Coke Company nor its remote lessor had any such legal title as would support an action of ejectment to recover possession of the lands embraced by Walker’s grant, that the concealment of the pendency of a suit which imperiled the possession of the coal-mines, which were altogether within the Walker claim, was such a fraudulent concealment of a material fact as amounts, in law, to a ground for rescission.

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Bluebook (online)
92 Tenn. 13, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chamberlain-v-fox-coal-coke-co-tenn-1892.