Kimball v. Saguin

• Decision Date: 07 October 1892
• Citation: 53 N.W. 116,86 Iowa 186
• Parties: KIMBALL ET AL. v. SAGUIN ET AL.
• Court: Iowa Supreme Court

86 Iowa 186

53 N.W. 116

KIMBALL ET AL.

v.SAGUIN ET AL.

Supreme Court of Iowa.

Oct. 7, 1892.

Appeal from district court, Pottawattamie county; H. E. DEEMER, Judge.

This is an action upon a promissory note executed by defendant Saguin to defendant William Siedentopf or order, by whom it was assigned to defendant Farnsworth, by him to the First National Bank of Council Bluffs, and by said bank to the plaintiff. Saguin alone defends, and alleges that said note, together with $1,500 in cash, was given to Siedentopf in consideration of a conveyance to defendant of certain real estate by said Siedentopf; that for the purpose of inducing defendant to make said purchase and to pay said money and execute said note, the said Siedentopf made certain false and fraudulent representations concerning the title in himself to said real estate, knowing the said representations to be false; that, relying upon said false representations as true, he, the defendant, was induced to pay said money to execute said note to Siedentopf, and to receive from him his deed of conveyance for the real estate so purchased; and that the title so conveyed to him has wholly failed; wherefore he says there is no consideration for said note. He alleges that neither the plaintiffs, nor either of the assignees of said note, were bona fide purchasers thereof for value before due without notice, wherefore he asks that said note be fully canceled. Issues were joined by reply, the case submitted to a jury, and a verdict for defendant Saguin, with certain special findings, returned. Judgment was entered upon the verdict and findings in favor of defendant Saguin. Plaintiffs appeal.Finley Burke, George W. Hewitt, and W. H. Ware, for appellants.

A. T. & I. N. Flickinger, for appellees.

GIVEN, J.

1. The conveyance from Siedentopf to Saguin was with limited covenants, as follows: “Do hereby covenant to warrant and defend the title to said premises against the lawful claims of all persons claiming by, through, or under me.” The failure of title alleged was not by reason of any person claiming through or under the defendant Siedentopf, but because of his having no valid title to the property conveyed. There is no allegation of a breach of the covenant in the deed, or of a verbal warranty and breach thereof; but the defense is fraud and deceit in knowingly and fraudulently misrepresenting the title held by the grantor. Appellants contend that an action or defense for deceit in misrepresentation of title will not lie; that the only remedy for a failure of title is upon the covenants in the deed; and that, where these are limited, the purchaser takes all risks not covered by the limited covenant; and if there be no covenant, as in case of a quitclaim deed, he takes all risks as to title; that when it is intended that the vendor shall answer for the title, covenants are inserted in the deed that define the terms of the contract; that covenants will not be implied; and that the purchaser takes the title at his own risk, except as it may be warranted by covenants in the deed. In considering the question before us we must keep in mind the distinction between an action for a breach of warranty and an action for fraud and deceit. Appellant cites cases wherein the courts have either expressed doubts upon the right to maintain an action for fraudulent representations as to the grantor's title, or the opinion that such an action could not be maintained, but an examination of these cases shows that the question before us was not involved nor determined. In Leonard v. Pitney, 5 Wend. 30, MARCY, J., says: “Doubts may well be entertained whether an action at law will lie for a deceitful and false representation of title in the vendor of real estate. Such an action has not as yet, I believe, been sustained, except, it may be, in some of the states where the same tribunal is possessed of equity jurisdiction as well as the powers of a court of common law. There is, however, no occasion now to examine that question.” In Frost v. Raymond, 2 Caines, at page 192, the court recognizes the rule “that, if there be no covenant of title in a deed, the purchaser takes, at his own risk, the goodness of the title.” It is said “the parties to deeds know that a covenant is required to hold the seller to warrant the title, and they regulate their contract accordingly. If there be any fraud in the sale the purchaser has his remedy. If one sell land, affirming he had a good title, when he had no title, an action on the case for a deceit will lie.” Here the distinction between an action on a contract of warranty and for a deceit is recognized, and the case is authority for the right to maintain an action for deceit. In Whitney v. Allaire, 1 N. Y. 305, it is said that it is a strong argument against the...