La Cueva Ranch Co. v. Brewer

ALSCHULER, Circuit Judge (after stating the facts as above). We are satisfied that the plaintiff’s rescission of the deed and bill of sale and repossession of the property it had conveyed pursuant to the contract, amounted to a rescission of the contract. Indeed, it was charged in the New Mexico suit that the contract was procured by the fraud of the intended purchasers, and upon the ground of such fraud and of the abandonment of the contract by the purchasers and of the premises, the relief prayed for was granted, and the seller re-vested with the property. It is elementary that one who rescinds a contract for fraud in its procurement, or for any other cause, may not assert any right under it. To the extent that the declaration predicates the action upon the stipulated interest on the purchase price up to the time plaintiff repossessed itself of the property, the court properly1 directed the verdict. Plaintiff insists that it is entitled to recover for use and occupation of the property while in the possession of the purchasers or [965] their corporate representative, and that the stipulated interest is the proper measure of the value of its use. It is extremely doubtful whether the declaration states a cause of action for the use and occupation of the property; but, even if it may be construed as stating such cause of action, there was no evidence offered to show the value of such use, unless, indeed, it may be said that the stipulated interest on the purchase price evidences such value. This is untenable. There is no necessary, or even probable, relation between interest on the purchase price and rental value. If, as is sometimes the case, the contract had provided for no interest whatever, would it follow that the premises had no rental value at all? Or if prospective purchasers were willing to pay a high rate of interest to secure title to premises which to their minds had large speculative value, would this be the measure of the present rental value of the property? We think a mere statement of the proposition requires a negative answer. If the question of use and occupation alone were involved, we would be required to find that the District Court properly instructed the jury in favor of defendants. But there is involved also personal property which passed under the contract, and which it is alleged in the declaration and shown by the proffered rejected evidence was not returned to plaintiff. True, the declaration makes such allegation rather indirectly, but it appears by necessary inference. As to the real estate, it alleges the contract price, and the taking back of the property at the same price. It alleges further that personal property was taken by the purchasers at an agreed price, which was its value; that the purchasers, or their corporation, the Mora Company, disposed of certain of that personal property, and that plaintiff received back of this personal property, at the agreed value and price at which it was turned over to the purchasers, something over $2,000 less than the property received by the purchasers under the contract. The offer of proof was in accord with the allegations, and it is our view that the declaration charges, and the offered proof shows prima facie that the purchasers received from the seller, and did not return, personal property of over $2,000 in value, for which, in the. absence of exculpating proof, plaintiff would be entitled to recover. The court’s direction in favor of the defendants having been general, the judgment must be and is reversed, and the cause remanded for new trial.