Bedell v. Bedell , 44 N.Y. Sup. Ct. 419 ( 1885 )

DykmaN, J.:

Tbe plaintiff commenced an action against ber husband, tbe-defendant, Charles C. Bedell, for a limited divorce and obtained a judgment in her favor. Tbe judgment required tbe defendant to-pay ber $250 a year for ber maintenance and to give ber security for such payment. In obedience to tbe requirements of tbe judgment tbe bond was fnrnisbed, and tbe condition was complied with by tbe payment of tbe allowance for several years. On tbe 26th day of January, 1882, tbe defendant executed an instrument in writing purporting to be an agreement between herself and her bus-band, by which she agreed to cancel tbe bond for tbe allowance- and release him from all obligations for future support and maintenance.

This action is brought to set aside that agreement ana restore tba bond and tbe judgment on thea allegation that tbe same was procured by fraud and misrepresentation. At the trial tbe plaintiff was called as a witness in ber own behalf to show that ber signature to tbe instrument was procured by Earl A. Holdridge by misrepresentations, and also that she received no consideration therefor. Tbe testimony was excluded under a decision of the trial court that no evidence of conversation between tbe plaintiff and Holdridge-was proper until it was shown that be was tbe agent of tbe plaintiff’s husband.

Tbe plaintiff’s counsel finally stated to tbe court that if proof' was admitted respecting the manner in which tbe execution of tbe paper was procured, they should claim that those facts will show in connection with tbe fact that tbe husband subsequently accepted tbe paper, that as matter of law tbe defendant is chargeable with tbe acts of tbe brother as bis agent. That was overruled by tbe court — tbe plaintiff excepted. Tbe case of tbe plaintiff was dismissed by the court. Tbe plaintiff has appealed from tbe judgment.

Our conclusion is that the exclusion of the testimony was erroneous. If admitted, it would have shown that no consideration was paid for the agreement, that it was obtained by fraudulent representation, and that it had been accepted by the husband. Those facts entitle the plaintiff to relief on the principle that fraud vitiates all transactions into which it enters. It is not a question of agency, but a question of fraud. If the instrument in question was obtained from the plaintiff by misrepresentation and fraud it cannot be held against her. It is quite immaterial who perpetrated the fraud, the defendant cannot enjoy its results and retain its benefits by a claim that it was unauthorized by him. He has accepted an instrument tainted with fraud for which he has paid no consideration. He ■cannot retain the instrument for use against the plaintiff on the .ground that the fraud was unauthorized by him and committed without his knowledge or procurement. The instrument was not executed in the interest of the plaintiff. It was not procured for her and is not held by her, but it was procured for her husband and was delivered to him, and when he accepted it he received it with all the infirmities to which it was subject, and they were sufficient for its destruction.

The judgment should be reversed and a new trial granted, with ■costs to abide the event.

PRATT, J.:

Defendants claim that fraud of a person not a contracting party, nor an agent of such party, cannot invalidate an instrument thereby procured.

The question arose in Bridgeman v. Green (Wilmot, 58-64), and Lord HardwicK held that interests so gained could not be held by an innocent. party, and observed that were the rule otherwise it would be almost impossible to reach a case of fraud.

Lord WiLMOT, on a subsequent hearing of the case, said: “ There is no pretense that * * * -was a party to an imposition. Does it follow from thence that he must keep the money? No; whoever receives it must take it tainted and infected with the * * * imposition of the person procuring it. Let the hand that receives it be never so chaste, if it comes through a polluted channel the obligation of restitution will follow it.”

In Huguenin v. Baseley (14 Vesey, 289) the question arose, and Lord Eldon quotes Bridgman v. Green with approbation, and says i “ I should regret that any doubt could be entertained whether it is-not competent to a Court of Equity to take away from third persons the benefits which they have derived from the fraud, imposition or undue influence of others.” He quotes Lord Thuelow that it is against conscience that one person should hold a benefit which he derived from the fraud of another. The rule is familiar in the courts of this State.

In Whelan v. Whelan (3 Cowen, 587) a contract was set aside against a party who had no knowledge of the fraud. So in Bergen v. Udall (31 Barb. 9), the deed being to an innocent purchaser did not affect the operation of the rule. It follows that the evidence offered by the plaintiff should have been received.

A new trial should be granted, with costs to abide the event.

Present — DykMan and Pratt, JJ.; BarnaRd, P. J., not sitting.

Judgment reversed, and new trial granted, costs to abide event.