Allgood v. Bank of Piedmont

HARALSON, J. 1. The defense attempted to be set up by defendant, in his original answer, so far as the same is made a cross-bill, is without any merit, on the facts presented. The right to rescind a contract because of fraudulent representations, to be available must be promptly asserted. The person who claims to have been misled, “is required, as soon as he learns the truth, [425] with all reasonable diligence to disaffirm the contract, or abandon the transaction, and give the other party an. opportunity of rescinding it, and restoring both of them to their original position. He is not allowed to go on and derive all possible benefits from the transaction and then claim to be relieved from his own obligations by a rescission, or refusal to perform on his part. If after discovering the untruth of the representations, he conducts himself with reference to the transaction, as though it were still outstanding and binding, he thereby waives all benefit and relief from the misrepresentation.” ,2 Pom. Eq. Juris., § 897. “Fraudulent misrepresentations in the sale of real estate do not confer upon the defrauded party the speculative advantage of being entitled to wait for the rise or fall in the value of property, and then act according to his interest in the matter.” He must, as is everywhere held, act promptly on ascertaining the faisity of the representations, and avail himself of the right to rescind, or he loses it. If he takes the risk on a speculative venture, he places himself, as to that matter, on an equality with his adversary, and must, thereafter, hold his peace.—Howle v. N. B. Land Co., 95 Ala. 391; Goree v. Clements, 94 Ala. 343 ; B. W. & E. Co. v. E. L. Co., 93 Ala. 549 ; Lockwood v. Fitts, 90 Ala. 150 ; Sheffield L. & I. Co. v. Neill, 87 Ala. 161; Ansley v. Bank of Piedmont, 113 Ala. 467. 2. The contract of sale of the lots in question occurred on the 6th January, 1890. The bill was filed on the 15th August, 1895. It is not pretended, that the defendant ever made any offer to rescind this sale, before he filed his answer and cross-bill in this case, — a period of over five and a half years. He says in his original answer, “that he has not paid any of said notes, and has never intended to pay (them),” on account of the alleged fraud and misrepresentations of the Improvement Company. Again, he states in the last amendment filed to the cross-bill, “that there was no definite time fixed by said (Improvement) Company, for the completion of said promised industries, and as it seemed to be slowly complying with its said promises and guaranties, this respondent made no complaint and waited patiently to see the outcome without making any offer to rescind said contract.” [426] 3. The defendant lived in the town of Piedmont, and .was a witness of the condition of affairs there, — how well the Improvement Company kept its promises to improve and develop a city, or how far short ’it fell in doing so. He knew all the while what was going on, and waited patiently for over five and a half years, in the hope that something advantageous in the speculation would turn up for him, before making any offer to rescind, and then in a cross-bill, when this suit was commenced against him. The scheme on his part, as he himself puts it, was a purely speculative venture, wherein he seeks to visit his disappointment on his adversary. His defense, on this branch of the case, even admitting that the representations made by the Improvement Company, were, as he claims, false and fraudulent, is, as we have said, without any merit in a court of equity. What has been said applies with equal force to section six to the amended answer and cross-bill. 4. Besides, neither in the original answer and cross-bill, nor in any of the amendments filed thereto, did the defendant offer to do equity. He is in possession of the property sold to him, has in his possession his bond for titles, and seeks relief in the cross-bill without ever having offered to put the Land Company in statu quo by a rescission of his contract. The cross-bill and each amendment thereto, was demurred to on this ground, and the demurrers were properly sustained. The facts set up in the 7th amendment, even if true, are not available for the relief he seeks, while he retains possession of the lot, and does not offer to do equity.—Grider v. Amer. Freehold Land Mortg. Co., 99 Ala. 281; Giddens v. Bolling, Ib. 319 ; New Eng. Mortg. Sec. Co. v. Powell, 97 Ala. 483. The demurrer to the' last amendment, numbered 6i, was not acted on, and must be treated as waived. The allegations therein were denied by the complainant in the original bill, — defendant in the cross-bill. On the hearing, the complainant in the cross-bill offered no proof to sustain the averments of this amendment. The burden was om'him to prove them. We find no error in the decree of the chancery court, and it is affirmed. Affirmed.