Young v. Daniel

Opinion of the Court by Judge Moorman Affirming. Appellants filed this suit in the Bourbon circuit court, seeking the rescission, of a contract -whereby they had purchased from appellees a lease on a coal mine with the equipment thereat for $2,000.00. The ground for the re-fief asked was-that' appellants were infants at the time the contract was made. Before trial they became of age and filed amended petitions' adopting the averments, of the original petition and asking judgment against appellees for the $2,000.00 paid under the contract. Appellees denied that appellants were infants at the time the contract was made, and also pleaded fraudulent misrepresentation and concealment by appellants of their ages, inducing appellees to believe they were twenty-one years old and to enter into the contract; and, further, that appellants entered into the contract to evade military service under -the pretense of being engaged in an essential occupation. From a judgment sustaining the [67] first of these affirmative pleas this appeal has been prosecuted. ' It was not proven that appellants made any express representation to appellees as to their ages nor, indeed, that appellees made any inquiry in respect to that subject. But it was shown that appellants toad the appearance of being more than twenty-one years of age at the time the contract -was made, that they had theretofore been engaged in purchasing coal in that community for a concern located in Louisville, and that one of them represented to appellees that he toad been engaged in the coal business with his father and knew the business, and the other represented that he had been in business for himself for some time. It also appears that they examined the mine carefully, made certain conditions upon which they would purchase it, and acted in every respect as if they were men of experience in business and understood what they were doing. In addition to this there is evidence to the effect that, when it was suggested to them that the attorney who was preparing the contract was a candidate for office and would like to have their votes, neither of them indicated that he was a minor or not old enough to vote. It was further shown that they operated the mine until the latter part of 1918 arid received the profits from it, but did not pay any royalties, as they were required to do under the contract, and before they abandoned the mine had destroyed, lost or disposed of the greater part of the equipment. On this state of facts the trial court held that they were estopped to maintain an action for a rescission of the contract. It is the general rule that a minor who makes a contract may disaffirm it on arriving at the age of twenty-one. He certainly may do so, as has been uniformly decided, if the other contracting party knew of his minority at the time the contract, was made. In some jurisdictions it is held that the infant’s false statements as to his age made at the time of entering into the contract, upon which the other party relied, will not defeat his right to avoid the contract when he arrives- of -age. But in this state it is the rule that a fraudulent misrepresentation or concealment of age which has misled the other party will thereafter estop the infant from avoiding the contract, for, as said in Schmitheimer v. Eiseman, 7 Bush 298, “Neither infancy nor coverture can excuse parties guilty of fraudulent concealment or misrepresentation, [68] for neither infants nor femes covert are privileged to practice frauds upon innocent persons.” •It -seems to be conceded by counsel for appellants that if there had been an actual representation by appellants that they were -twenty-one years of* age, upon which appellees relied, this action could not be maintained. They contend, however, that no -such representation was- .made, and in view of that fact estoppel cannot be invoked. It is true that in most of the cases in which the doctrine has been -sustained as against an infant -the record disclosed a specific statement of the infant to the effect that he was twenty-one- years of age, as in Asher v. Bennett, etc., 143 Ky. 361. But in The County Board of Education v. Hensley, 147 Ky. 441, after reviewing the earlier decisions of this court it was said: “When one deals with an infant, knowing him to be an infant, the latter is not estopped from relying upon his- infancy in avoidance of the contract; but when an infant by reason -of his personal. appearance, family surroundings, and business-activities, coupled with a misrepresentation or fraudulent, concealment, leads one- who deals with him, in good faith, and not knowing that he is an inf ant, to believe that he is of age, he will be estopped from maintaining an action to avoid his executed contract. When he comes- into equity -seeking relief, he must come with clean hands. The privilege of infancy is a shield for the protection of the infant, and not a weapon of attack; n-or is it to be. used as a means of defrauding others.” Thus it is that personal appearance, family surroundings and business activities, coupled with a misrepresentation or fraudulent concealment by the infant leading one who deals with him in good faith and not knowing of his infancy to believe he is of -age, will -estop- him from thereafter maintaining an action to avoid an executed contract. The fraudulent -concealment of a fact for the purpose of deceiving and misleading is the equivalent of a misrepresentation, and it was s-o ruled in Smith v. Cole, etc., 148 Ky. 138, where the infant made no statement as to his age, -but where his activity in negotiating the contract and his accepting the benefits of it, with his appearance and his family surroundings, induced the other party to believe that he was twenty-one years of age and to enter into the contract. But it is ©aid the- burden was on appellees to show a fraudulent concealment inducing them to make the-contract, which the evidence fails- t-o do. With this state-' [69] menf of law we agree, but we cannot adopt counsel’s view of its application to the facts. It is true that appellants testified that they did not, at the time they entered into the contract, know it was necessary for them .to be twenty-one years of age in order to make a valid contract, and they did not fail to divulge their ag'es for the purpose of deceiving or misleading appellants. This evidence is to be considered in determining whether the concealment was fraudulent, but it must be considered in conjunction with the circumstances under which the contractwas made and the degree of intelligence exhibited in appellants ’ testimony. One cannot read their testimony, given in an unusually intelligent manner, and escape the conclusion that when the contract was made they were not ignorant of the commonly understood rule that a minor cannot enter into a valid and binding contract. Hence we think the evidence as a whole shows that they then knew they could not enter into a legal contract, and, further, that they endeavored to and did deceive appellees as to their ages, except for which appellees would not have made the contract. Nor are we impressed with the suggestion that it will be a hardship on appellants to burden them with the obligations of an unprofitable contract. The question for decision cannot be examined from that point of view. It is one of law and fact. Besides, if profits and. loss are to be considered, appellants’ claim is still without merit, for the evidence does not show that the contract was unprofitable, bait tends to show that appellants received a considerable sum of money from the operation of the mine and paid none of the royalties while they had possession of it. It also shows that they abandoned the mine the latter part of the year 1918, and when appellees took it over much of the equipment that had been turned over to appellants had disappeared. Here again appellants are estopped from maintaining an action to annul the contract, for they have not accounted for the benefits-they received under it, and it is a rule of uniform application that an infant when it is in his power to do so must restore or offer to restore the property he has received under an executed contract before he can have the contract annulled on the ground of his infancy. .In view of the conclusion stated, it is not necessary to consider whether appellants purchased the lease to evade military service, It may be said, however, that [70] there is no evidence to sustain .this contention, and that reliance thereon is seemingly based on the circumstances of the times. It suffices that appellants’ conduct in the negotiations for the property estops them from maintaining an action for a cancellation of the contract. Judgment isi affirmed.