The opinion of the court was delivered by
Yeazey, J.
Taking up the exceptions in the order in which-they stand in the plaintiff’s brief, the first point urged was not the subject of exception in the court below.
The second point is, that it was error for the court to exclude the testimony offered by the plaintiff to show that the defendant, on the 11th day of June, was examined for the purpose and with a view of taking ont policies in other companies. This is put on the ground that on the trial the only defense claimed was. alleged false representations of the plaintiff at the' time the defendant made his application for insurance, whereas the plaintiff claims that it appeared by the defendant’s letter of June 20,, that he was seeking to surrender his policies and give up his-contract for other and different reasons.
Assuming that the proposition of law is sound upon which he rests, as stated in the brief, for the basis of the alleged error in excluding the testimony, the argument fails, because there is no-such inconsistency as claimed. The letter charges the same-wrong which constituted the defense on the trial; and in its allusion to taking insurance, we do not understand it as a statement' that the defendant was not going to take any more insurance of' any kind, but was intending to take all the paid-up policies-that he could. The clause, “ to carry no more insurance,” taken in connection with the next line, must have had reference to-insurance requiring stated premiums. So that the letter was-consistent with the fact of examination for other insurance and with the defense made on the trial.
The next point urged is that the court should have held, as-matter of law, that the defendant did not repudiate the contract in a reasonable time. This is put on the ground that the facts were not in controversy.
The plaintiff was the general agent of the North Western Mutual Life Insurance Co., and in the negotiations with the [478]*478defendant the plaintiff produced a book, called the North Western Estimate Book, containing an estimate of the probable amount of surplus to which the policies taken by the defendant would be entitled at their maturity, which was $794 on each thousand dollars of insurance. The defendant’s evidence tended to show that the plaintiff represented the estimates to be those •of the company. It was conceded they wore not the estimates •of the company, and the plaintiff denied that he represented they were. The policies were issued the 8th of June, and the defendant testified that he learned that said estimates were not those of the company before the 11th of June, and he wrote to the company in reference to the matter on the 12th of June, and not .getting any reply before the 20th of June, he on that day returned the policies and wrote a letter to the plaintiff, called exhibit 5, enclosing the policies and demanding his note. The parties lived in adjoining towns, and there was a daily mail between these towns.
The fraud of the .plaintiff in the alleged misrepresentations was the defense on the trial. The question whether he made them was submitted to the jury. .A contract induced by fraud is only voidable, not void, and if, after discovery of the fraud, the party acquiesces by express words or an unequivocal act, such as treating the property as his own, his election will be determined, and he cannot afterwards reject the property. Mere delay also may have the same effect, if, while deliberating, the position of the vendor has been altered. Benj. on Sales, s. 342, and cases cited in notes. Different forms of expression have been used by courts in stating when the defrauded party must rescind. In this State, in Mateson v. Holt, 45 Vt. 336, it was said : “ The right of recission must be exercised at the earliest practicable moment after discovery ” of the ground of it. In Hilton Safe Co. v. Lisdale, 48 Vt. 83, “within reasonable time ” is the expression. In Downer v. Smith, 32 Vt. 1, “ with all reasonable dispatch.” In Powell v. Woodsworth, 46 Vt. 378, it was held that a purchaser who is entitled to rescind the ■contract for fraud, but who delays doing so for the purpose of ■affording the vendor, at his request, an opportunity of attempt[479]*479ing to make the thing sold of value and satisfactory to the purchaser, is not precluded by such delay from thereafter rescinding the contract. In Schiffer v. Dietz, 83 N. Y. 300, the court said: “ A party claiming to rescind a contract for fraud must act promptly on discovery of the fraud.” In Cobb v. Hatfield, 46 N. Y. 533, “at the earliest practicable moment after discovery of the cheat,” is the language.
We do not understand that the different forms of expression, ¿as above quoted, show conflict in the rulings of the respective •courts as to the degree of promptness required in rescinding ; but ¿they do indicate that it may vary under different circumstances.
The case of Powell v. Woodsworth, supra, and the text of Benjamin show that mere delay is not necessarily conclusive. The earliest practicable moment ” is the sharpest expression ■found. No court says the earliest moment. The adjective practicable imports difference according to circumstances. Assuming that the law requires action at the earliest practicable moment, it would still be a question of fact, at least generally, when that moment arrived, even if there was no dispute as to the circumstances. Some may point one way and some the other. No •case is cited where it was held to he a matter of law for the court. In Andrew v. Hensler, 18 Wall. 254, reasonable diligence is the requirement, and it was there held that what is reasonable diligence is a question of fact to be decided by the jury according to the special circumstances of each case.
In this case the defendant had learned that the estimates in the book produced were not those of the company, as represented, not that the latter would not adopt them or make like estimates. He might reasonably infer that it would, in view of the relation between the plaintiff and the company. He did not acquiesce by any word or treat the policies as valid., It was, so far as appears, a case of mere delay, in good faith and fairly required in order to make the legal status clear. As the case stood we think it was clearly a question for the jury whether the defendant acted with due promptness in rescinding. The late case of Whitcomb v. Denio, 52 Vt. 38, is full authority for this conclusion.
[480]*480The next point is that exhibit 9 was improperly admitted in evidence. Counsel state no reason why, and we see none.
The plaintiff further contends that he was entitled to judgment notwithstanding the verdict, under his motion ; and this on the ground that he had paid to the company, before the rescission, the amount of the defendant’s note to him, and if defendant would rescind he must put the plaintiff in the same position he was before he paid the money.
The right to rescind is not thus limited.
The duty of the defrauded party to restore only means that her must restore what he has received. The law does not concern itself about the losses of the wrong-doer resulting from his entanglements “in the meshes of his own knavish plots.” The fault is-his own, and not that of his intended victim.
Free access — add to your briefcase to read the full text and ask questions with AI
The opinion of the court was delivered by
Yeazey, J.
Taking up the exceptions in the order in which-they stand in the plaintiff’s brief, the first point urged was not the subject of exception in the court below.
The second point is, that it was error for the court to exclude the testimony offered by the plaintiff to show that the defendant, on the 11th day of June, was examined for the purpose and with a view of taking ont policies in other companies. This is put on the ground that on the trial the only defense claimed was. alleged false representations of the plaintiff at the' time the defendant made his application for insurance, whereas the plaintiff claims that it appeared by the defendant’s letter of June 20,, that he was seeking to surrender his policies and give up his-contract for other and different reasons.
Assuming that the proposition of law is sound upon which he rests, as stated in the brief, for the basis of the alleged error in excluding the testimony, the argument fails, because there is no-such inconsistency as claimed. The letter charges the same-wrong which constituted the defense on the trial; and in its allusion to taking insurance, we do not understand it as a statement' that the defendant was not going to take any more insurance of' any kind, but was intending to take all the paid-up policies-that he could. The clause, “ to carry no more insurance,” taken in connection with the next line, must have had reference to-insurance requiring stated premiums. So that the letter was-consistent with the fact of examination for other insurance and with the defense made on the trial.
The next point urged is that the court should have held, as-matter of law, that the defendant did not repudiate the contract in a reasonable time. This is put on the ground that the facts were not in controversy.
The plaintiff was the general agent of the North Western Mutual Life Insurance Co., and in the negotiations with the [478]*478defendant the plaintiff produced a book, called the North Western Estimate Book, containing an estimate of the probable amount of surplus to which the policies taken by the defendant would be entitled at their maturity, which was $794 on each thousand dollars of insurance. The defendant’s evidence tended to show that the plaintiff represented the estimates to be those •of the company. It was conceded they wore not the estimates •of the company, and the plaintiff denied that he represented they were. The policies were issued the 8th of June, and the defendant testified that he learned that said estimates were not those of the company before the 11th of June, and he wrote to the company in reference to the matter on the 12th of June, and not .getting any reply before the 20th of June, he on that day returned the policies and wrote a letter to the plaintiff, called exhibit 5, enclosing the policies and demanding his note. The parties lived in adjoining towns, and there was a daily mail between these towns.
The fraud of the .plaintiff in the alleged misrepresentations was the defense on the trial. The question whether he made them was submitted to the jury. .A contract induced by fraud is only voidable, not void, and if, after discovery of the fraud, the party acquiesces by express words or an unequivocal act, such as treating the property as his own, his election will be determined, and he cannot afterwards reject the property. Mere delay also may have the same effect, if, while deliberating, the position of the vendor has been altered. Benj. on Sales, s. 342, and cases cited in notes. Different forms of expression have been used by courts in stating when the defrauded party must rescind. In this State, in Mateson v. Holt, 45 Vt. 336, it was said : “ The right of recission must be exercised at the earliest practicable moment after discovery ” of the ground of it. In Hilton Safe Co. v. Lisdale, 48 Vt. 83, “within reasonable time ” is the expression. In Downer v. Smith, 32 Vt. 1, “ with all reasonable dispatch.” In Powell v. Woodsworth, 46 Vt. 378, it was held that a purchaser who is entitled to rescind the ■contract for fraud, but who delays doing so for the purpose of ■affording the vendor, at his request, an opportunity of attempt[479]*479ing to make the thing sold of value and satisfactory to the purchaser, is not precluded by such delay from thereafter rescinding the contract. In Schiffer v. Dietz, 83 N. Y. 300, the court said: “ A party claiming to rescind a contract for fraud must act promptly on discovery of the fraud.” In Cobb v. Hatfield, 46 N. Y. 533, “at the earliest practicable moment after discovery of the cheat,” is the language.
We do not understand that the different forms of expression, ¿as above quoted, show conflict in the rulings of the respective •courts as to the degree of promptness required in rescinding ; but ¿they do indicate that it may vary under different circumstances.
The case of Powell v. Woodsworth, supra, and the text of Benjamin show that mere delay is not necessarily conclusive. The earliest practicable moment ” is the sharpest expression ■found. No court says the earliest moment. The adjective practicable imports difference according to circumstances. Assuming that the law requires action at the earliest practicable moment, it would still be a question of fact, at least generally, when that moment arrived, even if there was no dispute as to the circumstances. Some may point one way and some the other. No •case is cited where it was held to he a matter of law for the court. In Andrew v. Hensler, 18 Wall. 254, reasonable diligence is the requirement, and it was there held that what is reasonable diligence is a question of fact to be decided by the jury according to the special circumstances of each case.
In this case the defendant had learned that the estimates in the book produced were not those of the company, as represented, not that the latter would not adopt them or make like estimates. He might reasonably infer that it would, in view of the relation between the plaintiff and the company. He did not acquiesce by any word or treat the policies as valid., It was, so far as appears, a case of mere delay, in good faith and fairly required in order to make the legal status clear. As the case stood we think it was clearly a question for the jury whether the defendant acted with due promptness in rescinding. The late case of Whitcomb v. Denio, 52 Vt. 38, is full authority for this conclusion.
[480]*480The next point is that exhibit 9 was improperly admitted in evidence. Counsel state no reason why, and we see none.
The plaintiff further contends that he was entitled to judgment notwithstanding the verdict, under his motion ; and this on the ground that he had paid to the company, before the rescission, the amount of the defendant’s note to him, and if defendant would rescind he must put the plaintiff in the same position he was before he paid the money.
The right to rescind is not thus limited.
The duty of the defrauded party to restore only means that her must restore what he has received. The law does not concern itself about the losses of the wrong-doer resulting from his entanglements “in the meshes of his own knavish plots.” The fault is-his own, and not that of his intended victim. Where a party seeking to rescind a contract, on the ground of fraud, acts without unnecessary delay, and restores or offers to restore that which he has received, it is no answer that the wrong-doer has himself done acts which prevent his being restored to his original position. Hammond v. Pennock, 61 N. Y. 145; Masson v. Bovety 1 Denio, 69.
This rule is not in conflict with the general rule that the party who would rescind a contract for the default of the other party,, must be in condition to put the other party in statu quo. It means he must be in condition to restore fully on his part. When the defrauded party has returned to the wrong-doer all that the former received, then the latter is put in statu quo. It does not mean where he had acted with due diligence, that he must be able to put the. wrong-doer into his former position as-against his own acts after his fraud. The suggestion of counsel in argument, but not in his brief, that the plaintiff did not offer to restore fully because he did not offer to pay for the insurancepeuding the contract and before it was rescinded, is without force. It stands as it would if the subject of the contract had-been the purchase of a horse instead of policies of insurance ; a seasonable restoration with notice of rescinding would be sufficient without tendering the value' of the use in the meantime.
We find no error, and the judgment is affirmed.