Sneve v. Schwartz

141 N.W. 348, 25 N.D. 287, 1913 N.D. LEXIS 108
CourtNorth Dakota Supreme Court
DecidedMarch 5, 1913
StatusPublished
Cited by3 cases

This text of 141 N.W. 348 (Sneve v. Schwartz) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sneve v. Schwartz, 141 N.W. 348, 25 N.D. 287, 1913 N.D. LEXIS 108 (N.D. 1913).

Opinion

Burke, J.

The plaintiffs, husband and wife, were on the 29th day of September, 1909, the owners of a half section of land in Ward county. Upon that date they entered into the following written contract with the defendants: “ . . . the parties of the first part, for and in consideration of the parties of the second part, transferring by good and sufficient warranty deed, as shown by an abstract of title to be furnished free and clear of all encumbrance, of all the following described real estate [describing a 5-acre tract and also a certain block 11], and the one-half interest in the following described nursery stock [describing over 100,000 trees and shrubs]. The parties of the second part, for and in consideration of the transfer of said property by the parties of the second part, to convey to the parties of the second part by good and sufficient warranty deed, free and clear of all encumbrance save and except a mortgage of $2,100, and abstract of title to said property to be furnished [describing the said farm]. Parties of the first part hereby agree to pay all interest up to and including December 1, 1909, on said $2,100 mortgage. It is hereby agreed between the parties that each party to this contract shall pay the 1909 taxes on the property which they agree to convey by this contract. The parties to this contract have this day made and executed deeds in accordance with this contract, except the block 11 heretofore described; deed to same to be delivered November 15, 1909. Said deeds to be deposited in the Second National Bank of Minot in escrow, until such time as the abstract of title to the various pieces of real estate are filed and an opportunity is [293]*293given the parties herein to examine the same.” (Signed by the plaintiffs and defendants.)

On the 29th of December, 1909, this suit was instituted. The complaint is too long to be set out in full in this opinion, and we will merely state its contents briefly. First, it is alleged that the plaintiffs owned the farm land described. Next, the written contract is set up, and that the said farm was worth the sum of $10,000. It is then alleged that the plaintiff, John S. Sneve was of unsound mind, which fact was known to the defendants. It is further alleged that false and fraudulent representations were made by the defendants to plaintiffs, as follows: “That the defendants alleged that they were the owners of the 5-acre tract and said block 11, and a half interest in the said nursery stock, which representations were untrue. Plaintiffs alleged on information and belief that the defendants never owned any of said property. It is further alleged that the defendants represented that they had done the business in the said nursery line to the amount of $20,000 in the previous year; that they had a contract with the city of Minot to furnish to such city all trees and shrubs that such city might need, and that they had a contract, or practically so, with the Soo Railroad Company, whereby they were to furnish said railway with all the trees and shrubs that it should need between the city of Minneapolis and the Rocky Mountains. It is further alleged that defendants represented that the nursery stock was worth the sum of $10,000. The complaint then alleges that all of these representations were false and made to induce the plaintiffs to enter into said contract, and that had it not been for the mental condition of said John S. Sneve the contracts would not have been made. It is further- alleged that the defendants never executed deeds to the property upon their part to be conveyed, or deposited the same in escrow, but that the plaintiffs executed the deed to their said farm in favor of the defendants, but that said deed was not deposited in escrow, but fell into the hands of the defendants, by whom it was recorded, and that said defendants went into possession of said farm, and have ever since maintained such possession. That the rental value of such farm is the sum of $500 per annum, and the plaintiffs pray judgment that the said contract be declared void and canceled; that the deed executed by plaintiffs be declared null and void, and be canceled of record, and that the plaintiffs recover damages for the use of the land. To this complaint the [294]*294defendants interposed a demurrer on the ground that said complaint does not state facts sufficient to constitute a cause of action, and urge fourteen reasons in support thereof. We will take up and dispose of these in the order named in the brief.

(1) The first and most serious objection raised to the complaint is that it contains no allegation of rescission, thus raising the question as to the necessity of giving notice to. the adverse party of the intention to rescind before bringing action. The general rule unquestionably is that the party believing himself defrauded must elect to rescind and make his election known in some manner to the other party. This is founded upon the plainest principles of justice. The rule, however, is not broader than the principles of justice upon which it is founded. In executory contracts, where the parties have merely agreed to transfer their property at some future time, the necessity for the notification is not so imperative as in contracts fully executed, because the other party knows that until the negotiations are finally completed there is a possibility of some disagreement necessitating the abandonment thereof. So, in the case at bar, where neither party was to part with his property until a future date, there would be less reason why one of the parties should notify the other of his intention to r'escind on account of fraud. And this for the reason that the party in the wrong might rectify his wrongful acts, before the day of final settlement. In other words, the plaintiff herein, who was merely to deposit his deed in escrow, might not feel justified in rescinding the contract because he had discovered that the defendants had no title to the premises which they were obligated to convey, because the defendants might acquire the property by the time the deeds were to be formally transferred. The defendants had until November 15 within which to deposit their last deed and furnish the abstract. This action was begun on the 29th of December following, which was about as soon as the plaintiffs could be expected to act. We conclude, therefore, that in this action at least there was no necessity for the plaintiffs notifying the defendants of their election to rescind, otherwise than by the bringing of an action promptly upon learning of the deceit practised upon them. Brown v. Search, 131 Wis. 109, 111 N. W. 210.

(2) Second, it is urged that even if notice of rescission can be given by action, that in this case such action was not begun promptly after [295]*295the discovery of the fraud. As noted above, the defendants had until November 15, 1909, to deposit the deed to block 11, and to furnish an abstract of its title. The complaint was dated December 29, 1909, about fortyfour days thereafter. It is but reasonable to suppose that upon the 15th of November the plaintiffs would make some inquiry as to why defendants had not deposited the deed, and to make investigations with a view to learning whether or not defendants had title to the property. They would have also to investigate the other representations made by defendants to learn if they were fraudulent, and to make investigations as to the financial responsibility of the defendants to aid them in electing whether they should sue for damages or rescind. After that it would take some time to consult an attorney and for the attorney to investigate the facts sufficiently to draw an intelligent complaint.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Schaff v. Kennelly
61 N.W.2d 538 (North Dakota Supreme Court, 1953)
Dwinnell v. Boehmer
234 N.W. 655 (North Dakota Supreme Court, 1931)
Rosenwater v. Selleseth
156 N.W. 540 (North Dakota Supreme Court, 1916)

Cite This Page — Counsel Stack

Bluebook (online)
141 N.W. 348, 25 N.D. 287, 1913 N.D. LEXIS 108, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sneve-v-schwartz-nd-1913.