CHANCERY. FAILURE OF A DEFENDANT TO ANSWER. Continued.
terest, and become purchasers at the sale without notice of his secret
lien, the purchasers will succeed to the interest of the vendee, under
the original contract of purchase, fully discharged from the lien of the
equitable mortgage. Fitzhugh et al. v. Smith, 486.
12. Where a petition to enforce a lien for materials furnished in the
erection of a building is filed against the vendee and vendor of land,
which alleges that the former holds the premises under a contract of
purchase from the latter, and the vendor fails to answer, and a decree
is taken and the land sold to the petitioners, this will not prejudice
the vendor's right to require payment of the purchase money and in-
terest before parting with the title. But if he has any other claim upon
the land, such as an equitable mortgage or secret lien, and fails to dis-
close it before decree and sale, the purchaser of the land without notice,
will take the land discharged of such secret claim or interest. Ibid.
486.
13. No effort to collect at law. A party having paid a debt as security
for another, filed his bill in equity, alleging that his debtor had left the
State, taking with him all his effects; that he had sold all his real es-
tate and conveyed certain city lots to his son, who had conveyed to his
mother, and that these conveyances were made without consideration,
and for the purpose of defrauding complainant and other creditors.
The court found the amount of indebtedness, and decreed it a lien upon
the lots, and required the son and mother to convey to the debtor, and
directed sale of the lots for the payment of the debt and costs: Held,
that complainant should first have reduced his demand to judgment
before coming into equity to question the disposition of the debtor's
property, and subject it to the payment of his debt. Dewey et al. v. Eck-
ert, 218.
14. Under the circumstances above stated, the complainant might
have proceeded by attachment against the property alleged to have
been fraudulently conveyed, obtained his judgment, and then gone into
equity to remove the conveyances out of the way of his execution, or
to subject the property to sale in satisfaction of his judgment. Ibid.
218.
15. When it will be granted. Where the title of a vendee of land is
sold under a valid decree against him, the purchaser, upon receiving a
master's deed therefor, succeeds to his position as vendee; and, upon
complying with the terms of sale, may maintain a bill against the ven-
dor for specific performance. Fitzhugh et al. v. Smith, 486.
16. Of the character of relief granted. S sold a lot to H for seven hun-
dred and fifty dollars, on credit, giving a contract for a deed, which was
never recorded, reserving the right to declare a forfeiture for non-pay-
CHANCERY. SPECIFIC PERFORMANCE.
ment, and making time of the essence. The vendee afterward loaned
H three hundred dollars, secured by an assignment of the contract, to
enable the latter to erect a building upon the lot, in the progress of
which H incurred an indebtedness to F and B for materials. They,
uniting with other lien holders, filed a petition to establish a lien on
the premises, making the vendor and vendee defendants, alleging in
the petition that H held the premises under a contract of purchase from
S. The latter suffered the petition to be taken as confessed, and a de-
cree and sale followed of the interest of H in the premises; F and B
became the purchasers, and received the master's deed. After receiv
ing their deed, they tendered to S eight hundred and eighty-five dollars,
and demanded a deed; and, upon his refusal, filed their bill for specific
performance. The defendant filed no cross bill, asking for affirmative
relief. The circuit court, on the hearing, refused to decree that S should
execute a deed to complainants upon their payment of the amount of
the purchase money found to be due, with interest, but ordered the
premises to be sold, and payment out of the proceeds to be made: first,
the amount of the purchase money and interest due to S; secondly, the
amount of the original lien of F and B; thirdly, to S the amount of his
loan to H, and interest; and, finally, to F and B the amount due the
other lien holders, which they had paid at their purchase: Held, that
the decree was erroneous; that no sale should have been ordered; that
the complainants having succeeded to the rights of the original vendee,
were not entitled to such relief, and that the vendor was not entitled to
any affirmative relief; that the complainants were not bound to pay S
the sum loaned by him to H; that the proper decree was to require the
complainants to pay the amount due upon the contract of sale, with
interest, in specie, the contract providing for its payment in gold or
its equivalent, within thirty days after entering the decree, and that
the master in chancery pay the same over to S upon his executing a
proper deed. Fitzhugh et al. v. Smith, 486.
17. Tender-whether necessary. Where the complainants in a bill for
specific performance have succeeded to the rights of the original ven-
dee, by purchase at a judicial sale, and the vendee's contract of purchase
has not been recorded so as to give notice of its terms, it will not be
necessary for the complainants, before filing their bill, to make a formal
tender of the precise sum due the vendor. It will be sufficient if they
offer to perform the contract when the vendor declines to recognize their
right to a deed unless they pay him money which he had loaned the
vendee. Ibid. 486.
18. Of the character of funds in which payment must be made. Where,
by the terms of a contract for the sale of land, the purchase money is
made payable, with interest, in specie funds, on bill for specific per-
formance against the vendor, the decree, if for the complainants, must
require them to pay in specie the sum due on the contract. Ibid. 486.
19. Party not chargeable with laches. A purchased three eighty-acre
CHANCERY. SPECIFIC PERFORMANCE.
tracts of land and a lot of two acres; and afterward being unable to pay,
reconveyed to B, his grantor, two of the eighty-acre tracts, and it was
contended that he intended also to include in this conveyance the two-
acre tract. He never paid the taxes afterward on it; but about six
years afterward, by a verbal contract, sold it to C for $40, to be paid in
rails. C took possession and built a house on it, and improved the
same, and offered to make payment, and demanded a deed. A then
informed him that the title was in B, and told him he must go to the
latter for a deed, which he did, and took a bond for a deed. He then
sold his interest to D, who sold to E. After this, A filed a bill against
E to enjoin the removal of the building, and E filed a cross bill to re-
form the deed from A to B, by inserting therein the premises in dispute,
and subsequently amended his bill, praying for specific performance of
the verbal contract of sale to C, which was decreed by the circuit court
upon payment of the purchase money due: Held, that the decree was
proper, and that the conduct of A, in sending C to B for a deed, relieved
C of all charge of laches, in abandoning his contract with A, and that
E, under the circumstances, was not chargeable with laches. Hamilton
v. Rook, 139.
RESCISSION OF CONTRACT FOR FRAUD.
20. General rule. On the principles of equity and justice, a contract
to be obligatory must be justly and fairly made. The contracting par-
ties are bound to deal honestly and act in good faith with each other.
There should be a reciprocity of candor and fairness. Mitchell et al. v.
McDougall, 498.
21. False representations. A false representation by the vendor which
influences the conduct of the other party, and induces him to make the
purchase, will vitiate and avoid the contract. And in making the rep-
⚫resentation it is immaterial whether he knows it to be false or not, for
the consequences are the same to the vendee. If he relies on the truth
of the declaration, he is equally imposed on and injured, and ought to
have redress from the one who has been the cause of the injury. Ibid.
498.
22. Suppressio veri. The undue concealment, which amounts to a
fraud, for which a court of equity will grant relief, is the non-disclos-
ure of those facts and circumstances which one party is under some
legal or equitable obligation to communicate to the other, and which
the latter has a right, not merely in foro conscientiæ, but juris et de jure to
know. Under such circumstances the concealment of an important
fact would be improper and unjust; it would be an undue concealment
on account of the fiduciary relation existing; but where the parties, in
the absence of any such relation, are treating for an estate, and the
purchaser knows from surface indications, or otherwise, there is a val-
uable mine upon the land, he is not bound to disclose that fact to the
owner; for the means of information on the subject are as accessible to
CHANCERY. RESCISSION OF CONTRACT FOR FRAUD. Continued.
the one as to the other. The concealment of facts of which the other
party is ignorant, must be by a party who is under some special obliga-
tion, by confidence reposed, or otherwise, to communicate them truly
and fairly, to justify a court of equity in taking cognizance. Mitchell
et al. v. McDougall, 498.
23. Suggestio falsi. In this case the plaintiff and defendant made an
exchange of property, the plaintiff conveying to defendant a lot and
residence in the city of Bloomington, which he valued at five thousand
five hundred dollars, for one hundred and sixty acres of land, and a
lot and a half in the town of Montevallo, all in Missouri, which was
conveyed by defendant to plaintiff. The defendant assumed an incum-
brance of one thousand dollars on the Bloomington property, and gave
his note for three hundred dollars, difference in the exchange. The
plaintiff had never seen the Missouri property, while defendant was
well acquainted with it. Plaintiff was induced to make the exchange
solely upon the representations of defendant that the land was good
land, and the same occupied by Judge Smith before the rebellion, and
improved by him; that the land was worth twenty dollars an acre;
and that there was a house a story and a half high on the lots, worth
one thousand dollars, which was a desirable residence, renting for eight
dollars per month. The land conveyed was not the Smith farm; was
stony, poorly timbered, and comparatively worthless, and had been
purchased by defendant a short time before for four dollars an acre.
The Smith farm was worth probably fifteen dollars an acre. The house
in Montevallo proved to be a mere shell, one story high, occupied by
hogs and goats, unfit for human abode, and not worth over two hundred
and fifty dollars. As soon as plaintiff discovered the facts, he de-
manded of defendant a rescission of the contract and a reconveyance of
his property, and made a tender of deed for Missouri property and de-
fendant's note of three hundred dollars. On refusal, he filed his bill
for rescission, and pending the suit the house was burned, the defend-
ant having insured same at three thousand dollars. The circuit court
dismissed the bill: Held, that the court erred in dismissing the bill on
the facts of the case; and that as the plaintiff made the contract wholly
on the representations of defendant, which proved to be untrue, and
did not receive the property he contracted for, he was entitled to have
the contract rescinded. Ibid. 498.
24. Mistake-not to be corrected in such case. In such case the de-
fendant admitted there was a mistake in his conveyance of the Mis-
souri land in not describing the Smith land, and offered to correct his
deed so as to convey in fact the Smith farm, and insisted that a mistake
in his conveyance was no ground of rescission; but it was held, in
view of the fraud practiced upon the plaintiff, it would be unjust to
allow the defendant to correct the mistake, and thus retain the con-
tract as made; and that, under the circumstances of the case, the
CHANCERY. RESCISSION OF CONTRACT FOR FRAUD. Continued.
plaintiff had a right to take advantage of such mistake and repudiate the entire contract. Mitchell et al. v. McDougall, 498.
25. As to the relative value of the property exchanged. On bill filed to set aside a deed given for land in exchange for other lands, on the ground that the contract was induced by false representations of the location, quality, and value of the lands taken in exchange, the defendant offered to prove that the property conveyed by him was equal in value to the property conveyed by the complainant: Held, that the proof was irrelevant, the question in such case being whether the complainant received in exchange what he bargained for, and had a right to expect from the representations upon which he relied in ignorance of the facts. Ibid. 498.
26. Disposition of insurance on loss by fire. Where the purchaser of real estate had made an addition to the buildings thereon, and effected an insurance on the whole, and pending a bill by his grantor to rescind for fraud, the buildings were consumed by fire, when the insurance company was. made a party by supplemental bill, it was held that a court of equity, in decreeing a rescission, would place the parties in statu quo as far as possible; and that, as the insurance money represented the buildings destroyed, it was proper, after deducting the premiums paid by the defendant, and the cost of the addition, to require the company to pay the balance of the insurance money to the complainant. Ibid. 498.
27. On bill in chancery to set aside a conveyance of an interest in land, made by the grantor to secure the location of the line of a railroad near such land, on the ground of fraudulent representations of the grantee and others interested with him, to induce the conveyance, the court refused to decide whether, if the fraud were proved, the complainant could have relief, and affirmed a decree dismissing the bill for want of proof of the fraud. Linder v. Carpenter, 309.
28. In matters of account. On bill for taking an account between partners where the accounts are complex and intricate, the matter should always be referred to a master, to be examined and reported, in order to a final decree; and where the parties, by stipulation to save expense, seek to impose the labor of the master upon the court, this court will not examine intricate and complicated accounts on appeal, but will affirm the decree of the court below. Riner v. Touslee, 266.
29. If the complainant in this class of cases should procure an ex parte order for a hearing without a reference, this court would reverse the decree below for want of a reference to the master. Ibid. 266.
EXCEPTING TO MASTER'S REPORT.
30. Of the necessity thereof. Where a party to a suit in chancery fails to except to the master's report of the sum due him, he will be pre
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