Carr v. Swift

ROBERTSON, P. J. Plaintiff brought his action against the defendants, husband and wife, on a promissory note for $800 alleging that it was secured by a deed of trust oh real estate in Carter county, that the deed of trust was foreclosed and that $74.91 was realized for said sale and credited on the note. Judgment was.asked for the balance. The defendants answered, admitting the execution of the note and alleging three separate defenses. The third defense, a counterclaim, the one upon which the judgment was entered, alleged that the note was given in a trade between plaintiff and defendants, that the defendants traded a stock of merchandise valued at $1823.19 to the plaintiff for land represented to be encumbered for the sum of $1554.27; that as a part of the trans [89] action defendants executed the said note and the plaintiff also paid them the sum of $200 in cash; that this trade was brought about and induced by reason of false and fraudulent representations made by the plaintiff to defendants as to the character of improvements on and the title of plaintiff to said land; that the plaintiff represented that it was encumbered for said sum of $1554.27 only, when as a matter of fact there were three other deeds of trust thereon, and that they had been damaged in the sum of $3000 on account of the fraud and deceit of the plaintiff. A jury was waived and the trial resulted in a judgment against plaintiff on his cause of action and in favor of the defendants for $1600. The plaintiff has appealed. No declarations of law were asked or given. The deed of trust referred to in plaintiff’s petition as securing the note was on the land traded to defendants and the notice of foreclosure was first published one month after the note became due. The plaintiff was the purchaser at the sale and the trustee’s deed to him recites that it is made subject to three prior deeds of trust, aggregating considerably more than the amount represented to. be against it when the trade was made. The burden of appellant’s contention here is based on the erroneous assumption that the counterclaim is one in equity based on a rescission. “In cases of fraud and deceit the party has two remedies. First, he may rescind that contract, or, secondly, he may fully perform the contract, and sue for damages resulting from the fraud and deceit. Nor does it appear that there can be a waiver of damages for the fraud and deceit, so. long as the party adheres to the original contract. He is not compelled to abandon his original, contract upon the discovery of fraud, but may go on in the«fulfillment thereof and rely upon his action for fraud and deceit.” [Brown v. Mining Co., 231 Mo. 166, 172, 132 S. W. 693.] The question of laches insisted upon by plaintiff here which may be invoked in an action in [90] equity where a party seeks to rescind the contract and recover back the property of which he has been defrauded is not involved in the third defense, which is one at law for fraud and deceit. The plaintiff also contends that the defendants should be confined to the covenants in the warranty deed, executed by the plaintiff, but such is not the law, since the counterclaim is in the nature of an action of law for damages and “Fraud vitiates even the most formal documents.” [Sawyer v. Walker, 204 Mo. 133, 159, 102 S. W. 544.] The deed was only incidentally involved. A defrauded grantee is not confined to the covenants of warranty in his deed “nor need he go into equity to rescind the contract, but he may hold what he got under the contract and sue at law for his damages.” [Judd v. Walker, 215 Mo. 312, 355, 114 S. W. 979.] There is no contention made here that the judgment is excessive. It is amply supported by the testimony and manifestly just. The judgment is affirmed. Farrington, J., concurs. Sturgis, J., concurs in result and files separate opinion.