Griffey v. Payne ex rel. Clark

2 Bradf. 27, 1 Morris 68

• Court: Supreme Court of Iowa
• Decided: July 15, 1840
• Status: Published

Opinion

By the Court

Mason, Ch Jus.

The note on which this suit was brought was given as part consideration for a claim on the lands of the United States, consisting of three separate tracts sold by plaintiff below to defendant. The greater portion of the entire price had been paid. It appeared also from the evidence that the plaintiff had no right to dispose of two “of the tracts above mentioned. Under these circumstances the court was asked to instruct the jury that if they were satisfied that the consideration had failed to a greater amount than the balance due, or that the defendant had already paid for so much as he had received, they had a right to find lor the defendant under the statute allowing part failure of consideration to be pleaded, which instruction was refused by the Court.

We think this refusal was erroneous. It is true the plaintiff had warranted his “ claim,” title or settlers’ right to the property sold, and in case of a breach of Warranty the English courts have generally held that either the property-must be restored and the contract rescinded, or the purchase money paid and damages for the breach of warranty recovered in a, cross action. The courts in this country have however in many instances discountenanced this circuity and given a more direct remedy in cases of partial failure of consideration arising as well from breach of warranty as otherwise. The case of Hills vs Bannister and Butler, 8 Cowen 31 is of this character, and other similar decisions in New York, as well as in other States, evince a disposition to adopt what seems to us a more just and reasonable rule. But further than this, our legislature has spoken on this subject with a design as we think to reach cases of this very kind, and to sanction the American decisions above referred to. It is true this note was given before that statute was enacted:- still we see nothing to prevent its application here. It only modifies the remedy of the parties without affecting their rights. It allows the whole matter to be settled at once without the necessity of two actions to do justice on both sides.

It was contended on the argument that the note having been transferred before it became due, the above defence could not be set up. It should be recollected, however, that the note was not negotiable, and having been executed before the passage of our statute (rendering such instruments transferable in the same manner as inland bills of exchange and with the same consequences to all parties concerned,) this statute does not operate upon the case. To permit it to do so would be to affect the rights of the parties by a statute passed subsequent to the contract. The defendant can therefore set up the same defence against the assignee as though the beneficial interest still remained in the original payee.

The judgment of the court below will therefore be set aside and a new trial ordered.