Potter v. Taggart

11 N.W. 678, 54 Wis. 395, 1882 Wisc. LEXIS 59
CourtWisconsin Supreme Court
DecidedMarch 14, 1882
StatusPublished
Cited by25 cases

This text of 11 N.W. 678 (Potter v. Taggart) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Potter v. Taggart, 11 N.W. 678, 54 Wis. 395, 1882 Wisc. LEXIS 59 (Wis. 1882).

Opinion

Taylor, J.

It will be seen by the complaint that the appellant seeks to rescind a contract of purchase, and recover back from the respondent the purchase money of the note and mortgage, basing his rescission upon the ground of the alleged fraudulent representations and concealment on the part of the respondent of the fact that twenty-two acres of the land described in the mortgage had been released by the respondent before the sale thereof to the appellant.

The learned counsel for the respondent insists — first, that the complaint does not show that the appellant was injured by the alleged fraudulent representations and concealment of the respondent, and so fails to state any reason for a rescission of the contract; and second, that it fails to show that he returned or offered to return the note and mortgage to the respondent before the action was commenced, and in that respect fails to show him in a position to demand his puichase money back.

We are inclined to hold that after answer, upon an objection taken for the first time to its sufficiency, the complaint is sufficient in both respects. In the case of Hazleton v. Union Bank, 32 Wis., 34-43, Justice Lyon, in delivering the opinion, says: “The rule is well settled that a greater latitude of presumption may be indulged in to sustain a complaint where the objection that it does not state a cause of action is taken for the first time at the trial, and after an issne of fact has been taken upon it by answer, than where the same objection is taken by demurrer.” The same rule was stated in Teetshorn v. Hull, 30 Wis., 162-167; Hamlin v. Haight, 32 Wis., 238-242; Luth[399]*399eran Evangelical Church v. Gristgau, 31 Wis., 328; Johnson v. Ashland Lumber Co., 45 Wis., 119; Johannes v. Youngs, id., 448; Wittmann v. Watry, id., 493. Under the rule established by the cases cited, we think the complaint sufficiently alleges that the respondent was guilty of making either a fraudulent representation or a fraudulent concealment of the fact that a part of the property described in the mortgage had been released before the date of the sale, and that such fraud was injurious to the appellant.

The allegations of the complaint show, as a matter of fact, that the mortgage was of less value as a security after the release of the twenty-two acres than it was before such release. It alleges that the twenty-two acres were in fact sold for $125; and it is a fair inference that the mortgage as a security was at least worth as much less as the value of the land sold and released. But in addition to this, there is a positive allegation in the complaint that, by reason of the release of the twenty-two acres, “ the mortgage became thereby and was of much less value, and that said note became and was of less value, than they would .have been had not said release been executed, and that said note and-'mortgage thereby became of little value to the plaintiff, and thereby the plaintiff has lost all the benefit and advantage which he might and would have derived from the purchase of said note and mortgage.”

If it be necessary, in order to entitle a party who has been induced to make a purchase of a note and mortgage or any other property by the false and fraudulent representations of his vendor, to show that he has been damaged in' fact by such false representations, in order to entitle him to rescind the contract and recover back the purchase money, it would seem that the allegations above quoted from the complaint clearly show such damage. Certainly, if his note and mortgage were still well secured, notwithstanding the release, then the plaintiff could not have truthfully made the statement “ that he had lost all the benefit and advantage which he might and would [400]*400have derived from tbe purchase of said note and mortgage.” The only legitimate benefit and advantage he could dei’iye from the purchase of the note and mortgage would be to receive upon the same the amount secured thereby, with interest; and if, by reason of the release, he was unable to secure the payment of that amount, then he was damaged by such release. Upon this point, though the allegations are quite general, yet, under the rule above quoted, they are quite sufficient to show that the appellant has sustained damage by reason of the release of the twenty-two acres before his purchase, and that by reason of such release he would be unable to collect the amount due upon the same. • :

Upon the second point -we think the allegations of the complaint are sufficient. The rule as to the rescission of contracts, stated by Leake in his Digest of the Law of Contracts, is as follows: “ The fact that the contract was induced by fraud gives the party defrauded the right, on discovering the fraud, to elect whether he will continue to treat the contract as binding, or avoid it; but the contract continues valid until he has determined his election by avoiding it.” “ He must determine his election to rescind by express words to that effect, or by some unequivocal act, under circumstances which render such words or act binding.” The complaint in this action states that, as soon as the appellant ascertained that he had been defrauded in the purchase of the note and mortgage, he immediately went to the respondent “for the purpose of demanding of him a return of the $403.91 so paid by the appellant to the respondent, and to return to him the said note and mortgage; but the respondent then and there refused to do anything in regard to the matter, and then and there refused, and still does refuse, to return to plaintiff said sum or any part thereof.” It is true, this allegation does not state in express words that the appellant offered to return the note and mortgage to the respondent, but we think it is fairly to be inferred from the language used that he did make such [401]*401offer. He says be went to the respondent for the purpose of mating such offer and to demand his money back, and; that the respondent refused to do anything in regard to the matter, and “then and there refused, and still does refuse,.to return the money or any part thereof.” The refusal of the respondent to 'do anything about the lhatter, and to return the money or any part thereof, clearly implies that he was requested by the appellant to do something' about it and to return the money.

In order to rescind a contract by a purchaser, when a ground • for rescission exists, it is not necessary to make any formal tender of the property held by the purchaser; it is sufficient to offer to make return of the same (see Van Trott v. Wiese, 36 Wis., 439-448; Mann v. Stowell, 3 Pin., 220); and if the vendor refuses to receive the property back and return the purchase money, or do anything except to keep what he has, no formal tender of the property is necessary. The right of the vendor to have the property formally tendered is waived by his refusal to accept it in advance.

In Wright v. Young, 6 Wis., 127, this court say: “In this case the appellant has from the outset resisted the performance of the contract, and insisted that it was not binding on him. Any tender to him, while occupying this ground of defense,' would have been au idle ceremony.” So, in the case at bar, the respondent insists that the appellant has no right to rescind the contract, and refuses to return the purchase money, or any part thereof. By taking that position he relieves the appellant from making any formal tender of the note and mortgage.

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Bluebook (online)
11 N.W. 678, 54 Wis. 395, 1882 Wisc. LEXIS 59, Counsel Stack Legal Research, https://law.counselstack.com/opinion/potter-v-taggart-wis-1882.