Kerley v. Richardson

By the Court.

Benning, J.

delivering the opinion.

[1.] The only question in this case is, what was the measure of ■damages which Kerley was liable to pay for failing to comply with the condition in his bond, that he would “make or cause-to be made” to Harper or his order, good “titles” to lot of land No. 796, in the 2d district and fourth section ?

The Court below held that measure to be, the value .of the land at the time when the title should have been made.

If the outstanding right or interest in the State of Georgia, which constituted the breach of this condition in the bond, was an incumbrance, then there seems to bo no dispute between the parties, that the measure of the damages to be paid by Kerley, was what it cost Richardson, the assignee of the bond, to remove the incumbrance. At any rate, that is what the law, it seems, has, in such case, made the measure. (Martin vs. Atkinson, 7 Ga. R. 237. Sedge. Meas. Dam. 185.)

Was the outstanding right or interest in the State, then, an incumbrance? Greenleaf, in his work on Evidence, impliedly says, that an incumbrance is anything which shows that “ a third person has a right to or an interest in the land granted, to the diminution of the value of the land granted, though consistent with the passing of the fee by the deed of conveyance.” “Therefore,” he says, “a public highway over the land; a claim of dower; a private right of way; a lien by judgment, or by mortgage made by the grantor to the grantee, or any mortgagee, unless it be one which the covenantee is bound to pay; or any other outstanding elder and better title, is an incumbrance, the existence of which is a breach of this covenant.” (2 Green. Ev. §242.)

In these positions, he is supported by many cases which he cites, but they are all American cases.

There is, however, English authority for some of the positions, if not for all; at least, there is for the position, that an outstanding elder and better title is an incumbrance. A case is stated in Viner’s Abridgement, in which an estate for life was held to be an incumbrance. (14 Vin. Abr. Incumbrances, (A.)

So the common form of the covenant against incumbrances is, that the land shall be enjoyed “free and clear”' “ of, from and against all and all manner of former and other gifts, grants, feoffments, leases, mortgages, bargains, sales,” &c. (Platt, on Cov. 330.)

Under these authorities, it may be safely said, that an outstanding elder and better title, is an incumbrance.

If this be so then, as the right or interest of the State in the land was an outstanding elder and better title than that of Kerley, that right or interest was an incumbrance on the land.

It follows, that when Richardson extinguished that incumbrance by paying to the State a certain sum of money, he became entitled to recover of Kerley for the breach of the condition in Kerley’s bond, produced by the existence of that incumbrance, a sum equal to that so paid to the State, together with interest on that sum.

But whether we regard the right or interest of the State in the land, as an incumbrance or as an outstanding elder and better title, which was not an incumbrance, this sum is all that Richardson was entitled to recover of Kerley.

In Smith vs. Compton, (30 Barn. and Adolph. 189, 407,) the breach was of a covenant that the vendor “ had in himself good right, &c. to appoint and to grant, bargain and sell, &c. the premises and the breach consisted in another person’s “being lawfully entitled to the premises” — a suit by that person and a “ compromise” of the suit on the payment to the plaintiff by the purchaser of a certain sum of money. And all that the purchaser recovered, was that amount of money and his costs. He did not oven contend for more.

In harmony with this case are cases in some of the States of this Union. (Sedgewich Meas. Dam. 181, 182, 183, 184. 4 Kent’s Com. 477.) And no cases, as far as I know, opposed to it.

It is true, as a general rule, that for the breach of warranty or the breach of any of the covenants for title, which,, in modern times, have, in England, come to take the place of -warranty, the measure of damages may be stated to be the purchase money and interest. And this rule is founded upon the reason, that the purchase money and interest may, in general, be taken to be a compensation for the loss occasioned by the breach — the purchase money and interest being a fair measure of the value of the land purchased, at the time of the purchase, which land is what, in the greater number of cases, is. lost by the breach. But the land, or the value of the land, js not that which is lost in all cases. In some cases, the breach extends to only a part of the land sold — in some, it extends to . only a part of the interest in the whole land sold, as when the- ■ outstanding better title is but a lease for years — in some, it consists in the existence of an incumbrance which the purchaser can and does remove before actual eviction, for a less sum-than the value of the land. In all these cases, what the purchaser loses by a breach of the covenant, is less than the value-of the land. And so the reason of the general rule, that the purchase money and interest is the measure of damages, requires that in these cases something less than that purchase money and interest should be the measure of the damages — the reason of that rule requires that whatever shall be a compensation for the actual loss sustained in these cases, shall be the amount of the damages to be recovered in them.

The decision of this Court in Martin vs. Atkinson, (supra) is not considered to be in conflict with this view. In that case, the purchaser lost the whole land. It is true, he afterwards bought it back again, and for a less sum than the price of his first purchase. In the present case, it is only by hard con.struction and intendment that the purchaser can be said to have lost land of which he was never out of the possession. In-the former case, there is no way of telling how much the purchaser lost by being for a time out of possession — how much the land might have been lessened in value by what occurred while he was out of possession.

In the opinion, therefore, of this Court, the charge of the-Court should have been, that Richardson, the complainant, was entitled to have a credit entered on his note, for the amount, which it cost him, Richardson, to get the grant from the State,, besides interest on that amount, commencing at the time it was paid, and for no more. *

A new trial, therefore, becomes necessary.