Case v. Hall , 24 Wend. 101 ( 1840 )

By the Court,

Nelson, Ch. J.

There is no doubt if the vendor fraudulently represents the goods sold to be his own, when he knows them to belong to a stranger, an action on the case lies to recover damages therefor, though the real owner has not recovered the property, nor the vendee suffered any actual damage. 1 Show. 68. Cro. Eliz. 44. 1 Salk. 210, 211. 1 Ld. Raym. 593. Selw. N. P. 482, 483, and cases. 2 East, 448, n. Ross on Vendors, 334. And then upon the case of Becker v. Vrooman, 13 Johns. R. 302, the same matter might be admissible by way of defence for the purpose of reducing or extinguishing the claim for the purchase money. See also 15 Johns. R. 230, and 8 Wendell, 109. Where, however, the vendee relies on the warranty of title, express or implied, there must be a recovery by the real owner before an action can be maintained. This is in the nature of an eviction, and is the only evidence of the breach of the contract in analogy to the case of covenants real. Vibbard v. Johnson, 19 Johns. R. 77. 1 id. 274, 517. 6 id. 5. 13 id. 224. 5 Wendell, 535. Ross on Vendors, 334.

In Vibbard v. Johnson, it is true, that the purchaser knew ' the property had been claimed by a third person, but that fact has never been regarded as material to the decision of the case ; nor is it noticed in the opinion delivered by the court. On the contrary, the right to recover the purchase money is put upon the broad principle, that the only competent evidence of a breach of the implied warranty of title, was a recovery at law. It was likened to a demise of a house, where the tenant attempted to defeat the recovery for rent by denying the title of the lessor, and claiming to have paid it to C., the owner.

The principle is well sustained by analogy, and, I think, just in itself. In case of a breach of warranty, the measure of damages is the purchase money and interest. How, it would be highly inequitable to permit the vendee to retain *the possession, or enjoy the use of the prop- [ *104 ] erty thus acquired, and put his vendor at defiance. Possibly the owner may never claim, and enforce his title, or if he does, the seller may settle with him. The breach implies no bad faith, and, therefore, is compatible with perfect fair dealing between the parties ; and the indemnity is complete by responding therefor after a recovery under the paramount title..

If there has been fraud in the case, the remedy is immediate for all the damages the parties have sustained, and to which they may resort if they apprehend loss from delay in the claim of the owner.

The counsel for the defendant, in an ingenious brief, has likened the case to the covenant of seizin, and right to convey where the action accrues immediately, without an eviction ; but this would be extending the implied warranty, in this case, beyond the analogous cases of lands and chattel interests ; it is there regarded as a covenant of warranty only, not of seizin. 7 Johns. R. 258.

It is further insisted, that the facts embraced in the offer shew fraud on the part of the plaintiff, and upon that ground should have been admitted under the rule of Becker v. Vrooman. I think not. There was no offer to prove guilty knowledge. A man may very well be mistaken in respect to his title ; and we cannot, therefore, presume a knowledge of the defect. All the cases before referred to on this point, show the scienter to be material, and that it must be proved affirmatively. Though the plaintiff occupied under a contract of sale, he may have honestly supposed that he had a right to cut the timber, notwithstanding the law is otherwise.

New trial denied.