Smith v. Stewart

• Decision Date: 30 June 1880
• Citation: 83 N.C. 406
• Court: North Carolina Supreme Court
• Parties: WILLIAM SMITH and another, Ex'rs, v. J. W. STEWART and others.

83 N.C. 406

WILLIAM SMITH and another, Ex'rs,

v.J. W. STEWART and others.

Supreme Court of North Carolina.

June Term, 1880.

CIVIL ACTION tried at Fall Term, 1879, of MECKLENBURG Superior Court before Buxton, J.

The case was heard upon exceptions to an account, and the defendants appealed from the ruling and judgment of the court below.

Mr. A. Burwell, for plaintiffs .

Messrs. @## @Wilson & Son, for defendants

, cited the following cases, referred to in the opinion of this court, Pearsall v. Myers, 64 N. C., 549; Dunn v. Tillery, 79 N. C., 497; Hook v. Fentress, Phil. Eq., 229; Lowder v. Roding, 8 Ired. Eq., 208.

SMITH, C. J.

The plaintiffs' action is to recover the amount due from the defendants on their promissory note given for a tract of land sold by them as executors of J. A. Campbell, and as the property of their testator, and the defence set up is the want of title in the vendors.

When the cause was called for trial it was by consent of parties adjudged that the contract of sale be rescinded and the note canceled, and a reference was made to the clerk to ascertain and report the rents and profits of the land during the occupancy of the defendant, Stewart.

The clerk accordingly proceeded to take the account, both parties being present, and to hear the evidence adduced, and made his report ascertaining the balance due for the use and occupation, after allowing sundry credits, to be $588.68. To this report the defendants filed numerous exceptions, which, condensed in form, are as follows:

1. That the plaintiffs are not entitled to any compensation for the use of the land, and if they are so entitled, the measure of the compensation is the interest due on the purchase money.

2. That the annual rental allowed ($150) is excessive and not sustained by the weight of the testimony.

3. That no interest should be charged on the annual sums.

4. That the defendant has not been allowed divers credits, to-wit, for

a. Repairs on out-buildings.

b. Guano used in 1878 on the land.

c. Fences built on the land. d. Ditching and draining bottom land.

e. Improvement of the land from industry and labor of defendants.

f. Value of manure left when the plaintiffs regained possession.

Upon hearing the exceptions, the court overruled the first and fourth, sustained third, and in part the second, reducing the value of the rental to $75 for the first year, $100 for the second, and left undisturbed the referee's allowance of $150 for each of the three remaining years. The result of all which is to reduce the indebtedness of the defendants to $348.68.

The defendants appeal presents but two questions:

1. Should the defendant be charged with the rental value of the lands, or with the annual interest on the purchase money?

2. Is he entitled to credits as specified in the 4th exception?

The legal consequences of the rescission of the contract of sale is to restore the parties, as far as practicable, to the position they would have occupied if no contract had been entered into. The vendee is entitled to the return of any of the purchase money he may have paid, the vendor to the value of the use and occupation of the premises, that is, to a fair rental annual value thereof, and this involves the allowance of any improvements bestowed increasing the value of the premises during the possession. Upon this basis the court seems to have acted in diminishing the charge for the two first years of the occupancy.

This rule, consonant with the principles of equity, has been recognized in the rulings of the court in cases in this respect similar to the present.

Thus, where land was sold by an executrix in a mistaken exercise of power supposed to be conferred and the sale was vacated, the reference was for “an account reimbursing (Whitaker) the purchaser, the value of what he paid for the land and charging him with rents and profits.” Wetherell v. Gorman, 73 N. C., 380. When the account had been taken, upon a second appeal from rulings upon exceptions thereto, the court adhered to the terms of the order of reference, declaring that in ascertaining a fair rent “the enhanced value of the land by reason of any improvement made thereon,” not the costs of the improvement, was the proper credit to be allowed. 74 N. C., 603.

Again in Hill v. Brower, 76 N. C., 124, the first sale being annulled and a resale ordered, BYNUM, J., referring to the claim for improvements, says: “If the land will sell for so much, he (the purchaser) is entitled to the repayment, with interest,...