Worley v. Tuggle, &C.

• Decision Date: 16 October 1868
• Citation: 67 Ky. 168
• Parties: Worley vs. Tuggle, &c.
• Court: Kentucky Court of Appeals

67 Ky. 168

Worley vs. Tuggle, &c.

Court of Appeals of Kentucky.

October 16, 1868.

APPEAL FROM WHITLEY CIRCUIT COURT.

A. J. JAMES, For Appellant.

CHIEF JUSTICE WILLIAMS DELIVERED THE OPINION

OF THE MAJORITY OF THE COURT, JUDGE ROBERTSON DISSENTING:

It is a well-established and undoubted fact, that when the vendor contracted the land to Jane Early and Henry Tuggle, and agreed to convey it to their children, Marshall Early and John Tuggle, a lien was to be reserved for the unpaid purchase price, and both contracting parties instructed the draftsman to so draw the deed as to secure this lien; and when he had drawn it, he then assured the parties that the language used did secure such lien, it stating the amount of the consideration, "paid and to be paid," without specifying how much remained unpaid, all fortified by the then insolvency of Henry Tuggle, who died soon after wholly insolvent.

This language, before our revision, would have secured the vendor's lien; but since the revision of our statutes, no vendor's lien is secured when the title is conveyed, "unless it be expressly stated in the deed what part of the consideration remains unpaid." (2 Stant. Rev. Stat., 230.)

Both the notes sued upon are dated the same day of the deed, and one recites that it is given in part pay for a certain tract of land this day deeded to John Tuggle and Marshall Early.

As the vendor seeks to reform the deed, and then enforce his lien, it presents the single question of legal power in the chancellor to do so.

This case presents a mutual mistake of law and fact by both the contracting parties and draftsman; and though the land was conveyed to the minor children of the purchasers, yet, as they are mere volunteers, they stand in no more favorable attitude, nor have they higher equities, than if it had been conveyed to the parents.

Whatever may be said as to the danger of admitting parol or extraneous evidence to contradict, alter, or add to written instruments, it is now settled, by such an over-whelming current of authority, both in the American States and England, that this may be done when, through mistake, oversight, or fraud, the written memorial does not truly set out the contract, as scarcely to be regarded as longer an open question. But all the authorities agree that such evidence is to be cautiously received, and the case clearly made out, else the courts should hold to the written memorial as the highest and best evidence of the contract; but when it thus does appear, the written memorial, instead of attesting an agreement voluntarily entered into by the contracting parties, makes for them a bargain which the mind of neither party ever assented to, and to hold the injured party bound would simply make a rule of evidence, intended to secure justice, instrumental in perpetrating the grossest fraud.

After a long struggle, in which honesty, good faith, and integrity were attempting to free the administration of justice from fraud, chicanery, and unconscientious advantages, to be obtained through a too strict adherence to a very salutary rule of evidence, the true philosophy of the rule was determined perfectly consonant with the just stability of written instruments and the strictest integrity, by admitting the above named exceptions. But as those willing to avail themselves of unconscientious advantages are always seeking, with watchful vigilance, to secure such benefits, by either rules of property or of evidence, the next great struggle in which integrity, honesty, and fair dealing had to meet the same wary, watchful chicanery, in attempting to protect its unconscientious advantages under the rules of law, was upon the statute of frauds and perjuries, which substantially declare, among other things, that no suit should be brought against the party to be charged for any sale of real estate, &c., unless upon some memorandum, in writing, signed by him.

The developing science of the law, and its ever-waxing love of justice, increasing the omnipotence of the chancellor for equitable purposes, soon settled that this statute in nowise modified the above named exceptions to the rule of evidence, nor curtailed the equitable jurisdiction of courts.

But still, with more plausibility and seeming adherence to law, it was contended that even when, by mistake, oversight, or fraud, the deed of conveyance did not conform to the real contract of the parties, that all the chancellor could do would be to cancel the deed, and put the parties in statu quo; that to reform the deed, and then enforce a specific performance, would be to render the statute nugatory, whilst it was conceded that any unfair provision inserted for the vendee's benefit, not according to the contract, could be modified, and the deed made to conform to the real intention of the parties; yet, when any advantageous covenant in his favor had been left out, that the chancellor was powerless to enforce it, thus making a statute professedly enacted to prevent fraud, often the instrument of the grossest deception and injustice; and though the English courts first went off on this line of construction, yet the advancing science of the law, and the ever-operating influences of justice to rid it of all technicalities calculated to foster fraud and suppress impartial justice, have induced the English courts, in more modern times, to depart from this line of adjudication and to recognize the power to reform the deed, and then enforce it according to the real contract.

The rule thus early adopted by the English courts lacked the great and essential element of mutuality; for it often happened that the parties could not be put in statu quo, and then the vendee was made to suffer the consequences of an innocent mistake or a fraud, and abide by a contract to which his mind never assented.

But to the honor of American jurisprudence it may be said, that its judicial mind, inspired with a devoted love of justice, and less embarrassed with the mere letter, better appreciated the spirit of the statute, hence their earlier advancement to the administration of its true equity and spirit, unencumbered by its mere letter, and that, too, more in consonance with the science of equity jurisprudence.

Mr. Justice Story, in his work on Equity Jurisprudence (vol. 1, sec. 152), says: "One of the most common classes of cases in which relief is sought in equity, on account of a mistake in fact, is that of written instruments, either executed or executory. Sometimes, by mistake, the written agreement contains less than the parties intended; sometimes it contains more, and sometimes it simply varies from their intent by expressing something different in substance from the truth of that intent. In all such cases, if the mistake is clearly made out by proof entirely satisfactory, equity will reform the contract, so as to make it conformable to the precise intent of the parties."

Again, in section 154, he says: "The danger of setting aside the solemn engagements of parties, when reduced to writing, by the introduction of parol evidence, substituting other material terms and stipulations, is sufficiently obvious. But what shall be said where those terms and stipulations are suppressed or omitted by fraud or imposition? Shall the guilty party be allowed to avail himself of such a triumph over innocence and credulity, to accomplish his own base designs? That would be to allow a rule, introduced to suppress fraud, to be the most effectual promotion and encouragement of it, and hence courts of equity have not hesitated to entertain jurisdiction to reform all contracts, where a fraudulent suppression, omission, or insertion of a material stipulation exists, notwithstanding, to some extent, it breaks in upon the uniformity of the rule as to the exclusion of parol evidence to vary or control written contracts, wisely deeming such cases a proper exception to the rule, and proving its general soundness."

And in the next section he says: "It is upon the same ground that equity interferes in cases of written agreements, where there has been an innocent omission or insertion of a material stipulation, contrary to the intention of both parties, and under a mutual mistake. To allow it to prevail in such a case would be to work a surprise or fraud upon both parties, and certainly upon the sufferers; as much injustice would, to the full extent, be done under such circumstances as would be done by a positive fraud or an inevitable accident.

"A court of equity would be of little value if it could suppress only positive fraud, and leave mutual mistakes, innocently made, to work intolerable mischiefs contrary to the intention of parties. It would be to allow an act, originating in innocence, to operate ultimately as a fraud, by enabling the party, who receives the benefit of the mistake, to resist the claims of justice, under the shelter of a rule to promote it. It would be a great defect in the moral jurisdiction of the court, if, under such circumstances, it were incapable of administering relief." And in section 158 he says: "Many of the cases included under this head (mistake) have arisen under circumstances which brought them within the reach of the statute of frauds, which requires certain contracts to be in writing; but the rule as to rejecting parol evidence to contradict written agreements, is by no means confined to such cases. It stands as a general rule of law, independent of that statute. It is founded upon the ground that the written instrument furnishes better evidence of the deliberate intention of the parties, than any parol proof can supply; and the exceptions to the rule, originating in accident and mistake, have been equally applied to written instruments within and without the statute of frauds." (Motleux vs. London Assurance Com., 1 Atk., 545; Hinkle vs. Royal Exchange Assurance Co., 1 Ves., 317; Leyman vs. U. S. Ins. Co., 2 John's Chy. Rep., 630; Head vs. Boston Mar. Ins. Co., 2 Cranch...