International Land Co. v. Marshall ( 1908 )

Two principles settled by the great weight of authority respecting the contracts and liabilities of infants, apparently not antagonistic, abstractly stated, in practical application, produce two conflicting lines of adjudications: (1) The contracts of infants, when not for necessaries, impose nothing but voidable liabilities; (2) Infancy being in law a shield, and not a sword, cannot be pleaded to avoid liability for frauds, trespasses, or torts. To reconcile same, or, rather, to determine properly where one begins and the other ends, is not without difficulty.

The first reported adjudication is that of Grove v. Nevill (decided during the reign of King Charles II) 16 Car. II, Rot. 401, 83 Eng. Rep. (Full Reprint) 1238, King's Bench Book 12, p. 1238, 1 Keble, 778, being "an action upon the case in the nature of deceit on sale by the defendant of goods as his own, whereas in truth they were another's. The defendant pleads nonage at the time of the sale, to which the plaintiff demurred." One of the judges considered that the same was a tort as waste or escape, and that nonage was no plea, but the majority of the court was of the contrary opinion, holding that there was no actual tort, or anything ex delicto, but only excontractu, which was voidable by plea, and only a tort by construction of law. One of the judges declined to vote either way.

The next case is that of Johnson v. Pie, (decided a year later) 1 Lev. 169, 83 Eng. Rep. (Full Reprint) 353, King's Bench Book 12, p. 353, which was an action of case, "for that the defendant, being an infant, affirmed himself to be of full age, and by means thereof the plaintiff lent him 100 pounds, and so he had cheated the plaintiff by this false affirmation. After verdict for the plaintiff of not guilty, and 100 pounds damages, 'twas moved in arrest of judgment that the action would not lie for this false affirmation; but the plaintiff ought to have informed himself by others, and cited Grove and Nevill's Case, to be adjudged in this court in Easter Term, 16 Car. 2, Rot. 400, where in case against an infant for selling a false jewel, affirming it to be a true one, 'twas adjudged the action did not lie; to which 'twas answered that this is a trespass on the case, and an infant is chargeable for trespasses, though not for contracts." Two of the judges held that the action did not lie because the affirmation, being by an infant, was void, and that it was not like under trespass, felony, etc., for under such circumstances a fact or act was done. The other judge doubted, and was of the opinion that infants are chargeable for trespasses, and so if he cheat with false dice, etc.

The English law from the earliest period has thrown the mantle of protection around the minor or infant on account of his ignorance and inexperience, and the courts have experienced great difficulty in applying the facts to said principles. In many cases they have either expressly denied or absolutely ignored the doctrine that an infant can be held liable in a court of law for a fraud or deceit connected with a contract, limiting such application to acts purely ex delicto. They proceed upon the ground that the invalidity of an infant's contract is a matter defensive for his protection, and of which all persons dealing with him must take notice; that neither an honest belief by the opposite party that he is of full age, nor a false affirmation to that effect by himself, operates to take the matter out of the general rule since the incapacity to bind himself springs not out of the belief of either of the contracting parties upon the subject, but upon the existence of his minority; that to hold an infant liable for or estopped by any fraud or falsehood in any manner connected with a contract, whether before or at the time of making it, is to deprive him of the protection which the law has given him in consideration of his ignorance and inexperience.

There is a long line of decisions, both English and American, sustaining the doctrine announced in the case of Johnson v.Pie, supra. Brown v. Dunham, 1 Root (Conn.) 273; Norris v.Wait, 2 Rich. Law (S.C.) 148, 44 Am. Dec. 283; West v. Moore, 14 Vt. (6 Book Ann. Ed.) 444, 39 Am. Dec. 235; Schenk v.Strong, 4 N.J. Law, 97; Jennings v. Rundall, 8 T. R. 335;People v. Kendall, 25 Wend. 399, 37 Am. Dec. 240; Penrose v.Curren, 3 Rawle (Pa.) 351, 24 Am. Dec. 356; Brown et al. v.McCune, 5 Sanf. (N.Y.) 224; Wilt v. Walsh, 6 Watts (Pa.) 9;Price v. Hewett, 8 Exch. 146; Green v. Greenbank, 2 Marsh. 485;Morrill v. Aden, 19 Vt. 505; Hewitt v. Warren, 10 Hun. (N.Y.) 560. In the case of Evroy v. Nicholas et al., 2 Eq. Ca. Abr. 488, 22 Eng. Rep. (Full Reprint) Chancery Book 2, p. 415, decided in the year 1720, it was said:

"A., an heir to his father and special occupant, became entitled to a lease for three lives of certain lands in Hampshire, and, being an infant of about 17 years of age, B., who was his guardian, or acted as such, in 1727 did, by A.'s approbation, for 157 pounds sign a demise of the said lands to the plaintiff for 21 years, to commence from May, 1730, at which time a lease in being would determine, about six months before A. would come to age. The money was either paid to A. himself or to his guardian by his consent, and the infant, to shew his good liking for the bargain, witnessed the deed and the receipt of the money. B. proving afterwards insolvent, and having made several disadvantageous bargains for A., he would have set aside this lease, and actually demised the lands to C., another defendant, who entered upon and evicted the plaintiff and took a crop of corn which the plaintiff had sowed. The bill against A. was to make a new lease of the premises for 21 years, or to refund the 157 pounds fine; and against C. to have satisfaction for the crop. And it was objected for A. that no interest passed by the lease of the guardian, who was nominal, neither testamentary guardian, nor guardian in socage; and, if he had been so, the lease could not be obligatory during A.'s nonage, and that, therefore, the lease in point of law was absolutely void; and, although A. witnessed the lease, yet that could not bind him any more than if he had really executed it, which he might have avoided at his coming to age. King, Chancellor. Infants have no privileges to cheat men. This lease was made with the consent and approbation of A., the infant, who was above the age of discretion, and knew what he was doing, and it is certain his consenting to the lease was the only inducement the plaintiff could have to take it at so large a fine, being he was not to possess the lands 'till six months before the determination of the infancy, etc., and therefore, whether ever the money came to A.'s hands or not, he ought to make good the lease or refund the fine; for otherwise the plaintiff and all other persons would be defrauded by the collusion of an infant and his guardian, and so decreed that, A.'s refusing to make a lease, he shall repay the fine. But, as to the crop, his lordship would not meddle about that, because in point of law the lease was absolutely null."

In the case of Drury v. Drury (decided by the Lord Chancellor in the year 1760) 2 Eden, 39 Reg. Lib. A. 1760, fol. 465, 28 Eng. Rep. (Full Reprint) Chancery Book 8, p. 818, it was declared "that the defendant, Lady Drury, being an infant at the time of her executing the indenture on the 5th of October, 1737, was not barred of her dower in the intestate's real estate, nor of her share of her personal estate, under the statute of distribution." After the decree had been pronounced, the Earl of Buckinghamshire and Lady Mary Ann Drury intermarried, and, the cause being revived, an appeal was prosecuted to the House of Lords. Earl of Buckinghamshire v.Drury, 2 Eden, 59, 28 Eng. Rep. (Full Reprint) Chancery Book 8, p. 818. In that case the Earl of Hardwicke said:

"See the case of Davilla v. Davilla, 2 Vern. 724, before cited, and Lord Cowper's reasoning at the end of the case, that the husband might think it not necessary to make a will because he might consider his wife barred by the agreement. A contrary construction would be to make this adult infant commit a fraud upon her husband by claiming in contradiction to the articles. But minors are not allowed to take advantage of infancy to support a fraud. There was a decree by Lord Cowper (analogous to the case in 2 Leo, 108, of Pigot v. Russel), where tenant in tail applied to borrow money on a mortgage. The attorney's clerk who engrossed the deed was the issue in tail, was then about the age of 18, and knew of his being issue in tail, but took no notice of it. Lord Cowper relieved against this minor, and would not suffer him to take advantage of his own fraud. Vide note following Watts v.Haiswell, infra. In this case I must take it Sir Thomas Drury relied on this agreement, and therefore made no will, and otherwise that he was drawn in and deceived."

And it was ordered by the House of Lords:

"That so much of the said decree complained of by the said appeal whereby an account is directed of the personal estate of the intestate, Sir Thomas Drury, etc., be affirmed, and that the residue of the said decree should be reversed; and it was declared that the respondent is bound by the agreement entered into in consideration of, and previous to, her marriage with the said Sir Thomas Drury, and that the same ought to be performed and carried into execution, and that the respondent is thereby barred of her dower, and of any share of the said Sir Thomas Drury's personal estate under the statute for distribution of intestate's estates."

In the case of Ex parte Unity Joint-Stock Mutual BankingAssociation, in the Matter of Octavious King, a Bankrupt, andEx parte in the same matter (decided June 1, 1858, before the Lord Justices) 3 Deg. J. 63, 44 Eng. Rep. (Full Reprint) Chancery Book, 24 p. 1194, Lord Justice Knight Bruce said:

"It is unnecessary to say what in this case we might have thought it fit to do if we had been exercising a jurisdiction merely legal, for our jurisdiction is equitable as well as legal. Again, with respect to our equitable jurisdiction, it is not material to say what we might have thought the proper course to be taken in the absence of decision; for I think that, upon the admitted facts, the case is concluded by the judicial opinions of Lord Cowper, Lord Hardwicke, Lord Thurlow, and other eminent judges which it would be improper in us practically to question. A young man who from his appearance might well have been taken to be more than 21 years of age engaged in trade, and wished to borrow or to obtain credit, and for the purpose of so doing represented himself to the petitioning creditor as of the age of 22, expressly and distinctly so represented himself. We feel no difficulty or doubt on the question whether the minor did at the time believe or not believe what he said, for it is impossible from the materials before us to infer that he did believe his statement to be true or was ignorant of his own age when he obtained the money. The question is whether in the view of a court of equity, according to the sense of decisions not now to be disputed, he has made himself liable to pay the debt, whatever his liability or nonliability at law. In my opinion we are compelled to say that he has."

The Lord Justice Turner:

"I have the strongest inclination to expunge this proof, but the authorities are too strong to permit us to do so. If the course which has been taken by courts of equity on this subject is to be altered, it must be so by the House of Lords, and not by us."

The other class of decisions, both English and American, whilst recognizing the nonliability of an infant upon its contract, yet differentiate between holding him upon a contract and making him responsible for his frauds, deceits, and falsehood in matters connected therewith, but not forming a constituent part of it, wherever the action brought or defense pleaded sounds in tort and not in contract, although the deceit or fraud upon which the same is based was connected with the contract. In the case of Grove v. Nevill, supra, the gravamen was that the infant by deceit in the sale of goods as his own, whereas in truth they were another's, the complainant was damaged, there being no allegation that the infant then and there falsely alleged that he was over the age of 21 years, and that the plaintiff relying upon such statement bought said goods; and it appears that the case of Johnson v. Pie, supra, was decided upon the authority of Grove v. Nevill, supra, the reasoning of which was based upon a false assumption. In the argument of Johnson v. Pie the Grove and Nevill Case was cited, "where, in case against an infant for selling a false jewel, affirming it to be a true one, it was adjudged the action did not lie," and the case seems to have been considered as if the affirmation that he was of age was to be regarded as a part of the contract. But there is a wide difference between the two cases. In the Grove and Nevill Case the subject-matter of the contract was the jewel which was sold. The affirmation that it was a true one was a false warranty of the article sold. If the defendant had been of age, assumpsit might have been maintained. The infant was not to be charged by adopting a different form of action. But the representation in Johnson v.Pie and in the present case, that the defendant was of full age, was not a part of the contract, nor did it grow out of the contract, or in any way result from it. It is not any part of its terms, nor was it the consideration upon which the contract was founded. No contract was made about the defendant's age. The sale of the goods was not a consideration for this affirmation or representation. The representation was not a foundation for an action of assumpsit. The matter arises purelyex delicto. The fraud was intended to induce, and did induce, the plaintiff to make a contract for the purchase of the land covered by the deed, but that by no means makes it a part and parcel of the deed. It was antecedent to the deed, and, if the infant is liable for positive wrong connected with the contract, but arising after the contract is made, he may well be answerable for one committed before the contract was entered into, although it may have led to the contract. It has been said that "all the infants in England might be ruined" if infants were bound by acts that sound in deceit. But this cannot be a reason why the action should not be maintained for fraudulent wrongs, done, for the same reason would seem to apply equally in cases of slander, trover, and trespass. The latter are as much the results of indiscretion as the former, and quite as likely to be committed. In Bac. Abr., Infancy, 1, 3, it is said:

"Also it seems that if an infant, being above the age of discretion, be guilty of any fraud in affirming himself to be of full age, or if by combination with his guardian, etc., he makes any contract or agreement, with the intent afterwards to elude it by reason of his privilege of infancy, that a court of equity will deem it good against him according to the circumstances of the fraud." (3 Gwillim's Bac. 604.)

If an infant has fraudulently represented that he is of full age, or actively and purposely conceals his minority, whereby the other party is induced to enter into a contract, then it is held that the infant will be estopped in equity by his fraud from avoiding the contract on the ground of infancy to the prejudice of the other contracting party. Ferguson v. Bobo, 54 Miss. 121;Davidson v. Young, 38 Ill. 145; Conroe v. Birdsall, 1 Johns. Cas. (N.Y.) 127, 1 Am. Dec. 105.

In the state of New Hampshire there is an apparent conflict of authority. In the case of Fitts v. Hall, 9 N.H. 441, an infant had bought a lot of hats, for which he had executed his note, and, in an action upon the note, he availed himself successfully of the plea of infancy. Suit was then brought against him for deceit practiced in affirming at and before the purchase that he was an adult, and this was maintained in an elaborate opinion, reviewing the same to some extent, and expressly disapproving the case of Johnson v. Pie. Later, in the case of Prescott v. Norris, 32 N.H. 101, the Supreme Court of the state, while citing the case of Fitts v. Hall, apparently with disapproval, held that an infant who sold and warranted a barrel of gin to be pure could not be held liable for the false warranty because that was a part of the contract.

Likewise, in South Carolina, in the case of Norris v. Wait, 2 Rich. Law (S.C.) 148, 44 Am. Dec. 283, it was said that an infant could not prejudice his rights in a court of law by neglecting to state his title to the purchaser of his property from another; yet afterwards, in the case of Vance v. Word, 1 Nott McC. (S.C.) 199, 9 Am. Dec. 683, it was held that infancy was no defense to an action for a deceit practiced in selling a horse.

In the case of Badger v. Phinney, 15 Mass. 359, 8 Am. Dec. 105, the Supreme Court of that state held that where goods had been obtained by a minor upon the false affirmation that he was of age only vitiated the contract so that no title ever vested in the minor, and that he might be treated as having unlawfully converted them, and might be sued in trover or replevin. This doctrine was approved by Judge Story (Story on Contracts, §§ 107-111.)

In this case it is not necessary to determine as to the liability in actions at law of infants for frauds and torts connected with contracts. The following propositions are raised in this record: (1) Whether or not the plaintiff is entitled to any relief, without paying back to the defendant the $125 received by him on December 26, 1905, at the time the deed was made and delivered to the defendant. (2) Whether or not the plaintiff is entitled to any relief in this case without paying back to the defendant the $250 received by him on December 28 or 29, 1905, and credited as a part payment on the consideration for said land. It is settled by the great weight of authority that equity will regard the circumstances surrounding the transaction — the appearance of the minor; his intelligence; the character of his representations; the advantage he has gained by the fraudulent representations; and the disadvantage to which the person deceived has been put by them in determining whether he shall be permitted to invoke successfully the plea of infancy. That an infant must restore the property which he obtains on a contract where he has been guilty of deceit or fraud before he can avoid it is the universal rule in equity. Petty v. Roberts, 7 Bush. (Ky.) 411;Damron v. Commonwealth, 110 Ky. 268, 61 S.W. 459, 96 Am. St. Rep. 453; Schmitheimer v Eiseman, 70 Ky. 298; Davis v. Tingle, 8 B. Mon. (Ky.) 542; Wright v. Arnold, 14 B. Mon. (Ky.) 638, 61 Am. Dec. 172; Hayes, Adm'x, v. Parker, 41 N.J. Eq. 631, 7 A. 511; Pemberton Building Loan Association v. Adams, 53 N.J. Eq. 258, 31 A. 280; Adams v. Fite, 3 Baxt. (Tenn.) 70;Ostrander v. Quinn, 84 Miss. 230, 36 So. 257, 105 Am. St. Rep. 426; Ferguson v. Bobo, 54 Miss. 121; Levy v. Gray,56 Miss. 318; Brantley v. Wolf, 60 Miss. 430; Yeager v. Knight,60 Miss. 732; Willie v Brooks, 45 Miss. 542; Upshaw v.Gibson, 53 Miss. 341; Baker v. Stone et ux., 136 Mass. 406;Thormaehlen v Kaeppel, 86 Wis. 382, 56 N.W. 1089; Ryan v.Growney, 125 Mo. 483, 28 S.W. 189, 755; Davidson v. Young etal., 38 Ill. 149; Bradshaw v. Van Winkle, 133 Ind. 134, 32 N.E. 877; Williamson v. Jones, 43 W. Va. 562,, 27 S.E. 413, 38 L. R. A. 694, 64 Am. St. Rep. 891; 2 Pomeroy Eq. Jur. (2d Ed.) § 945; 2 Hermon on Estoppel Res Adjudicata, § 1119; Bigelow on Estoppel (5th Ed.) p. 600; 2 Kent's Com., p. 240.

In the case of Alfrey v. Colbert (Ind. T.) 104 S.W. 646, the court said:

"It is contended by the appellants that the appellee misrepresented his age, and perpetrated a fraud in inducing them to pay $550 for the land in controversy. On the other hand, the appellee contends that the money paid to him while a minor has been wasted and squandered, and that consequently he should not be compelled to return the same. The court below found that the plaintiff at the time of executing the first and second deeds was inexperienced; that his education and training was limited; that plaintiff was of weak and feeble mind, and, although not insane, his case comes within the category where his property should be placed in the hands of a curator; that the consideration paid by defendants was wholly inadequate. But, in view of the misrepresentations made by the appellee as to his age, we think the court below very properly ordered that the appellee should refund to the defendants within one year from the date thereof all moneys paid to him for and on account of the purchase of said lands, which the court finds to be $555, with interest at the rate of 6 per cent. per annum."

From the facts agreed to have been established by the evidence, if the appellee, Joseph Marshall, had been of age, he could have executed a valid deed to the appellant covering said land, and on account of the affidavit made by said appellee for the purpose of selling said land that he was 21 years of age, and had been since June 21, 1905, and, taken in connection with his physical appearance, the appellant, as a reasonable person, believed the same to be true; that the said appellant at the time the deed was executed paid to the appellee the sum of $125 and executed a proper note for the balance of the purchase price thereon. "He who comes into equity must come in with clean hands." "He that hath committed iniquity shall not have equity." Pomeroy's Eq. Jur. (3d Ed.) § 397. The appellee will not be permitted to invoke the powers of equity for the purpose of having the conveyance canceled without offering to return the said $125.

From the facts agreed, as proved, it further appears that on the 27th day of December, 1905, the day after the said $125 was paid to the appellee, his mother stated to the appellant that he was only 12 years old, and cautioned the defendant not to pay plaintiff any more money on the land. There is no agreement as to the proof as to whether or not appellant made reasonable investigation in order to ascertain whether or not the statement of appellee's mother was true. It appears that the appellee in fact was 19 years of age, and that his mother represented him to be only 12 years of age. The question arises as to whether or not negligence on the part of the officer of the appellant company, although the appellee had been guilty of fraud or deceit, more particularly guilty of the specific criminal offense known as false pretenses under the laws in force in that jurisdiction, would take that transaction out of the rule. Equity is to give relief to parties where it cannot be afforded at law, but equity will refuse to lend its aid in any manner to one seeking its active interposition who has been guilty of any unlawful or inequitable conduct in the matter with relation to which he seeks relief. 16 Cyc. 144. From the agreed proof, it appears that the appellee not only on the 26th day of December, 1905, practiced deceit or fraud upon the appellant company, thereby securing the sum of $125, but that a few days thereafter, by repeating the same fraud or deceit, secured the additional sum of $250. The fact that in the meantime information may have come to the officer of the appellant company, which, had it been reasonably followed up and investigated, would have prevented such additional fraud or deceit from having been practiced upon it, does not lessen the fraudulent acts of the appellee. It appears that the appellee is in possession of the land covered by the deed. Is a court of equity to lend its jurisdiction to the party initiating such fraud and deceit by cancelling this deed, though it be void? If so, it lends encouragement to such fraud. Equity says to the appellee: "you must invoke my jurisdiction with clean hands, having committed no iniquity in the transaction about which its power is sought to be exercised. If, as a result of your fraudulent act, inconvenience follows to you or the subject thereof, it flows from the necessary consequences of your own act." The doctrine of estoppel does not apply in this case. Act June 30 1902, c. 1323, §§ 16, 17, 32 Stat. 503, 504; Act April 21, 1904, c. 1402, 33 Stat. 204.

As a general rule an infant's conveyance of realty cannot be conclusively avoided by him until he reaches full age.Welch v. Bunce, 83 Ind. 382; Kilgore v. Jordan, 17 Tex. 341;Cummings v. Powell, 8 Tex. 80; Harrod v. Myers, 21 Ark. 592, 76 Am. Dec. 416; McCarthy v. Nicrosi, 72 Ala. 332, 7 Am. Rep. 418;Singer Mfg. Co. v. Lamb, 81 Mo. 221; Irvine v. Irvine, 5 Minn. 61 (Gil. 44); Zouch v. Parsons, 3 Burr. 1794; Stafford v. Roof, 9 Cow. (N.Y.) 626; Bool v. Mix, 17 Wend. (N.Y.) 119, 31 Am. Dec. 285; Matthewson v. Johnston, 1 Hoff. Ch. (N.Y.) 560;Chapman v. Chapman, 13 Ind. 396. But these authorities apply to voidable, and not void, deeds. No question is raised, however, as to the right of the infant, by his next friend, to institute this action before he attains his majority. However, the rule seems to be that, where the deed of the infant is absolutely void, there could be no objection to a suit during his infancy to have it declared void. Swafford et al. v. Ferguson et al., 3 Lea (Tenn.) 292, 31 Am. Rep. 639. However, in note to Craig v.Can Bebber, 100 Mo. 584, 13 S.W. 906, 18 Am. St. Rep. 671, it is stated, referring, to the case of Swafford v. Ferguson,supra: "It may be remarked that this case virtually stands alone among recent cases in its persistent adherence to a criterion long since exploded."

We are inclined to the doctrine, however, that where the deed is absolutely void, and there is no question of affirmance or disaffirmance, suit may be maintained during infancy to have it declared void. But in this instance, the appellee, being guilty of unlawful or inequitable conduct in the matter with relation to which he seeks relief, not offering to do equity, cannot have the interposition of the powers of equity. It may be insisted by appellee that after he reaches his majority he can more readily find a purchaser for said premises with this conveyance canceled, although it may be absolutely void; but a party with unclean hands with relation to the matter about which he seeks relief for his convenience cannot be permitted to have the aid of equity without purging himself. If a court of equity were to be permitted to lend its aid for any such purpose without equity being done by the party invoking its aid, the purpose for which courts of equity came into being would become abortive.

The judgment of the lower court is reversed, with instructions to proceed in accordance with this opinion.

Reversed and remanded.

Dunn, Hayes, and Turner, JJ., concur; Kane, J., dissents.