WHITWORTH V. THOMAS.

[83 ALABAMA, 808.]

SELLER OF HORSE WHO REPRESENTS HIM TO BE SOUND, knowing him to be unsound, and thereby misleading the purchaser, who is unable to discover the defect by ordinary observation, perpetrates a fraud which will entitle the purchaser to rescind on demand made within a reasonable time after the discovery of the fraud.

IN ACTION FOR RESCISSION OF CONTRACT FOR EXCHANGE OF HORSES on the ground of defendant's fraud, the defendant cannot set up the fraud of the plaintiff as a defense.

IN STATUTORY ACTION CORRESPONDING TO DETINUE, there can be no set-off or recoupment of damages.

ON QUESTION OF SOUNDNESS OF HORSE, it is relevant and competent to prove what kind of and how much work was done by the animal while in the purchaser's hands.

ACTION for recovery of a mule, with damages for its detention. The opinion states the facts.

R. C. Hunt and W. L. Martin, for the appellants.

J. E. Brown, for the respondents.

By Court, STONE, C. J. The present suit is a statutory action for the recovery of a chattel in specie, corresponding to the common-law action of detinue in every respect material to the decision of this appeal. Thomas exchanged with Whitworth a mule for a mare, giving and paying a small difference. About two weeks after the exchange, he tendered the mare back, and demanded a rescission, claiming that the mare was unsound when traded to him, and that he had been defrauded in the trade. Whitworth refused to receive the mare, and refused to rescind. Thomas thereupon brought this action to recover the mule. There is no contrariety of testimony bearing on the points stated above.

There is no pretense in this case that there was any warranty of the soundness of the mare. The scope of the contention is, that the mare was unsound; that the fact was known to Whitworth, but unknown to Thomas; and that, in negotiating the trade, Whitworth represented that she was sound, so far as he knew, and by means thereof induced Thomas to make the trade. If these were the facts, they armed Thomas with the right to rescind, if seasonably and properly demanded. The demand would be seasonable and proper, if he tendered the mare back with no undue delay, after discovering the deceit practiced upon him: 3 Brickell's Digest, 736, secs. 78-80; Perry v. Johnson, 59 Ala. 648; 2 Par

sons on Contracts, bottom page, 920; 3 Wait's Actions and Defenses, 432, 455, 456. If a seller knows the horse to be unsound, and informs the buyer that he is sound so far as he knows; and the buyer, not knowing the contrary, nor able to discover it by ordinary observation, relies on such representation, and consummates the trade, this, if injury result from it, constitutes a fraud; and the buyer is authorized to rescind, if he demand it within a reasonable time after discovering the fraud.

The maxim, In pari delicto, potior est conditio possidentis, has no application to a case like this. That maxim applies, and only applies, where two or more are jointly concerned in the perpetration of one and the same fraud,-a conspiracy or combination to accomplish an illegal object, through fraud, by which some third person is to be the sufferer. It does not permit one independent deceit or fraud to be set off against another deceit or fraud, so as, on that account, to estop the latter from maintaining his suit. It may confer a right to a cross-action. It does not deny to either party all right to sue.

The plaintiff's right of action in this case depends on his ability to show that Whitworth had defrauded him in the exchange of the mare for the mule. The issue raised the inquiries whether the mare was unsound when the trade was made; whether Whitworth knew it; and whether he used any expression, or resorted to any artifice, with a view of concealing that fact, or of throwing Thomas off his guard. If these inquiries be answered in the affirmative, and if Thomas trusted them, and suffered injury as a consequence, this part of his complaint is made good. In the present action,- statutory detinue, no question of recoupment or set-off could have been considered, even if it had been attempted. It was not offered to be raised by the pleadings: Code 1886, sec. 2683.

It follows, from what is said above, that any and all testimony tending to show legitimately that the mare was unsound when traded, that Whitworth knew it, and that he made any false representations in regard to it, or practiced any deceit or artifice to mislead Thomas, should have been received; and any legal testimony tending to disprove either of these propositions was also admissible. On the other hand, any proof of misrepresentation of the qualities of the mule, alleged to have been made by Thomas, was wholly immaterial. The value of the mule, and of his hire, was pertinent only as tending to furnish a basis of recovery.

All the testimony in regard to the working qualities of the mule, and in reference to Thomas's representations in relation thereto, was properly ruled out by the court; and we will not make further reference to rulings on that question.

The circuit court erred in refusing to allow the defendant to ask the plaintiff, on cross-examination as a witness, to state what work the mare had done since he traded for her. An answer to this question would have tended to prove the mare's capacity for work, and would have shed some light on the question of her soundness.

In rebuttal, plaintiff was asked by his counsel, "Did you treat the mare well or ill?" In form, the question was, perhaps, objectionable, but that furnishes no ground of reversal. In substance, the answer was but a short-hand rendering of the facts, subject to having the details called out on crossexamination, if requested. The court did not err in allowing this question to be answered.

A witness for defendant was asked, "What character of work and service is the mare performing for plaintiff at this time?" This, on motion of plaintiff, was excluded. In this the circuit court erred, for reasons stated above.

Lisle, a witness for plaintiff, was asked if he heard Mrs. Latham, one of the defendants, say anything about trading the mare. There was exception to the ruling of the court, permitting this question to be asked. The question was proper, but the answer was too remote to shed any proper light on the question at issue.

Reversed and remanded.

RESCISSION OF CONTRACTS GENERALLY: See notes to Johnson v. Evans, 50 Am. Dec. 672-681; and Bryant v. Isburgh, 74 Id. 657-662.

EFFECT OF FRAUD OR CONCEALMENT IN SALE: See notes to Hughes v. Robertson, 15 Am. Dec. 106-108; and Barnard v. Duncan, 93 Id. 425-431.

SET-OFF AND COUNTERCLAIM GENERALLY: See the notes to Gregg v. James, 12 Am. Dec. 152-157; and Woodruff v. Garner, 89 Id. 842.

RECRIMINATORY FRAUD. The question of how far the fraud of the plaintiff may be availed of as a recriminatory defense is one which has been the subject of much discussion in the several states. The class of cases in which the question has been most frequently considered are those where deeds, conveyances, sales, and other contracts relating to the transfer of real and personal estate, have been made and entered into for the purpose of defrauding creditors, and thereafter one of the parties has sought to rescind such fraudulent executed contracts, or to enforce them when executory. As preliminary to the consideration of this question, it may be stated that although there are some exceptions, yet it is a conclusive rule of law, adjudicated by a great weight of authorities, that deeds, conveyances, contracts, and transac

tions entered into in fraud of creditors are valid between the parties: Jackson v. Cadwell, 1 Cow. 622; Owen v. Dixon, 17 Conn. 496; Kinnemon v. Miller, 2 Md. Ch. 407; Babcock v. Booth, 2 Hill, 181; 38 Am. Dec. 578; Sherk v. Endress, 3 Watts & S. 255; White v. Brocaw, 14 Ohio St. 339; Worth v. Northam, 4 Ired. 102; Jackson v. Marshall, 1 Id. 323; 3 Am. Dec. 695; Tremper v. Barton, 18 Ohio, 418; Crocker v. Crocker, 17 How. Pr. 504; Moore v. Livingston, 14 Id. 1; Henriques v. Hone, 2 Edw. Ch. 119; Waterbury v. Westervelt, 9 N. Y. 598; Trimble v. Doty, 16 Ohio St. 118, 129; Brown v. Webb, 20 Ohio, 389; Cushwa v. Cushwa's Lessee, 5 Md. 44; Atkinson v. Phillips, 1 Md Ch. 507, 515; Dunnock v. Dunnock, 3 Id. 140; Douglass's Lessee v. Dunlap, 10 Ohio, 162, 163; Lessee of Simon v. Gibson, 1 Yeates, 291; Walton v. Tusten, 49 Miss. 569, 575; Snodgrass v. Andrews, 30 Id. 472, 488; 64 Am. Dec. 169; Skinner v. Oakes, 10 Mo. App. 45, 50; Jacobs v. Smith, 89 Mo. 673; Schenck v. Hart, 32 N. J. Eq. 774, 781; McMaster v. Campbell, 41 Mich. 513, 516; Gully v. Hull, 31 Miss. 20; Davis v. Swanson, 54 Ala. 277; 25 Am. Rep. 678; Crawford v. Lyle, 30 Mo. App. 585; Holt v. Creamer, 34 N. J. Eq. 181, 182; Armstrong v. Stovall, 26 Miss. 275, 277; Bush v. Rogan, 65 Ga. 320; 38 Am. Rep. 785; George v. Williamson, 26 Mo. 190; 72 Am. Dec. 203; Frink v. Roe, 70 Cal. 296, 308; Parkhurst v. McGraw, 24 Miss. 134; Gardner v. Short, 19 N. J. Eq. 341; Lokerson v. Stillwell, 13 Id. 357; Osborne v. Moss, 7 Johns. 161; 5 Am. Dec. 252, and note; Jackson v. Garnsey, 16 Johns. 189, 192; Thomas v. Soper, 5 Munf. 28; Cutler v. Tuttle, 19 N. J. Eq. 549, 562; Ogden v. Prentice, 33 Barb. 160; Finley v. McConnell, 60 Ill. 259; Isaacs v. Gearheart, 12 B. Mon. 235; Tobin v. Helm, 4 J. J. Marsh. 288, 291; Gilpin v. Davis, 2 Bibb, 416, 418; 5 Am. Dec. 622; Lemay v. Bibeau, 2 Minn. 291; Jones v. Rahilly, 16 Id. 320; Edwards v. Haverstick, 53 Ind. 348; Chapin v. Pease, 10 Conn. 69; 25 Am. Dec. 56; Anderson v. Dunn, 19 Ark. 650, 659; Piper v. Johnston, 12 Minn. 60, 66; Shealey v. Edwards, 75 Ala. 411; Coon v. Rigden, 4 Col. 275, 281; Rochelle v. Harrison, 8 Port. 351; Henry v. Stevens, 108 Ind. 280; Kelley v. Karsner, 72 Ala. 106; Anderson v. Brown, 72 Ga. 713, 722; Edwards v. Kilpatrick, 70 Id. 328; Pickett v. Pipkin, 64 Ala. 520; Eddins v. Wilson, 1 Id. 237; Lessee of Hartley v. McAnulty, 4 Yeates, 95; 2 Am. Dec. 396; Lessee of Church v. Church, 4 Yeates, 280; Tiernay v. Claflin, 15 R. I. 220, 222; Pemberton v. Smith, 3 Head, 18; Battle v. Street, 85 Tenn. 282, 293; Murphy v. Hubert, 16 Pa. St. 50; Hoeser v. Kraeka, 29 Tex. 450, 453; Kid v. Mitchell, 1 Nott & McC. 334; 9 Am. Dec. 702; Reichart v. Castator, 5 Binn. 109; 6 Am. Dec. 402, and note 406; note 14 Am. Dec. 703; Hubbs v. Brockwell, 3 Sneed, 574; Smith v. Grim, 28 Pa. St. 95; 65 Am. Dec. 400, and note 401; Abbey v. Commercial Bank of New Orleans, 34 Miss. 571; 69 Am. Dec. 401, and note 405; Williams v. Lowe, 4 Humph. 62; Jackson v. Marshall, 1 Murph. 323; 3 Am. Dec. 695; Worth v. Northam, 4 Ired. 102; Vick v. Flowers, 1 Murph. 32; Epperson v. Young, 8 Tex. 135; Stewart v. Iglehart, 7 Gill & J. 132; 28 Am. Dec. 202, and note 206; Sides v. McCullough, 7 Mart. (La.) 654; 12 Am. Dec. 519; Banks v. Thomas, Meigs, 28; Seligman v. Wilson, 1 Tex. App. 896; Eyrick v. Hetrick, 13 Pa. St. 488; Choteau v. Jones, 11 Ill. 300; 50 Am. Dec. 460, and note 469; Britt v. Aylett, 11 Ark. 475; 52 Am. Dec. 282, and note 285; Mason v. Baker, 1 A. K. Marsh. 208; 10 Am. Dec. 724; Byrd v. Curlin, 1 Humph. 466; Lynch v. Sanders, 9 Dana, 59; Dale v. Harrison, 1 Bibb, 65; Davy v. Kelley, 66 Wis. 452; notes 31 Am. Dec. 484; 42 Id. 169; Butler v. Moore, 73 Me. 151; 40 Am. Rep. 348; Clemens v. Clemens, 28 Wis. 637; 9 Am. Rep. 520; Zuver v. Clark, 104 Pa. St. 222; Sill v. Swackhammer, 103 Id. 7; Jacobi v. Schloss, 7 Cold. 385; Snodgrass v. Andrews, 30 Miss. 472; 64 Am. Dec. 169, and note 175; Telford v. Adams, 6 Watts, 429.

V.

So it is an undoubted doctrine of law and equity that such fraudulent deed vests the title absolutely in the grantee, and gives to him a legal and perfect estate, except as to those persons actually defrauded by the transaction, since such conveyance passes as valid a title as if it were bona fide and for a full and adequate consideration: Zuver v. Clark, 104 Pa. St. 222; Sill v. Swackhammer, 103 Id. 7; Lynch v. Sanders, 9 Dana, 59; Chapin v. Pease, 10 Conn. 69; 25 Am. Dec. 56; Jackson v. Garnsey, 16 Johns. 189, 192; Parkhurst McGraw, 24 Miss. 134; Skinner v. Oakes, 10 Mo. App. 45, 50; Jacobs v. Smith, 89 Mo. 673; McMaster v. Campbell, 41 Mich. 513, 516; Lemay v. Bibeau, 2 Minn. 291; Moore v. Livingston, 14 How. Pr. 1; Waterbury v. Westervelt, 9 N. Y. 598; Henriques v. Hone, 2 Edw. Ch. 119; Crocker v. Crocker, 17 How. Pr. 504; and this rule is said to hold true although no consideration was paid or possession given: Hoeser v. Kraeka, 29 Tex. 450, 453; Chapin v. Pease, 10 Conn. 69; 25 Am. Dec. 56; in this last case the conveyance was volun. tary. But in Tierney v. Claflin, 15 R. I. 220, the rule was qualified and there limited to innocent grantees, though the case was not argued so far as the limitation was concerned: See also Newell v. Newell, 34 Miss. 385; and it was said in Hess v. Final, 32 Mich. 516, that such a conveyance may be good between the parties when based on a valid consideration. The court, however, although not directly making the distinction there between those cases where a consideration exists and those where the conveyance is voluntary, impliedly intimates that such a distinction exists. So a similar distinction is made in Georgia between those cases where the conveyance is voluntary and where the whole consideration was paid: Bush v. Rogan, 65 Ga. 320; 38 Am. Rep. 785. The illustration of this in Goodwyn v. Goodwyn, 20 Ga. 600, being that if A sells property to B to defeat a third party, and such property is paid for by B, this entitles B to sue for and recover it from A; not so, however, if B paid nothing as a consideration. If B obtained possession he can hold it as against A and those holding as volunteers under him, although if he failed to get possession the court will refuse its aid to compel the execution of the covinous contract.

HEIRS, PRIVIES, ASSIGNS, ETC., HOW FAR BOUND. Such fraudulent deed is equally binding upon the grantor, his heirs, privies, assigns, and those claiming under him: Reichart v. Castator, 5 Binn. 109; 6 Am. Dec. 402, and note 406; Mason v. Baker, 1 A. K. Marsh. 65; 10 Am. Dec. 724; Skinner v. Oakes, 10 Mo. App. 45, 50; Jacobs v. Smith, 89 Mo. 673; Dale v. Harrison, 4 Bibb, 65; Crawford v. Lyle, 3 Mo. App. 585; Finley v. McConnell, GO Ill. 259; Horner v. Zimmerman, 45 Id. 14; Lyons v. Robbins, 46 Id. 276; Fitzgerald v. Forristal, 48 Id. 228; Bush v. Rogan, 65 Ga. 320; 38 Am. Rep. 785; Anderson v. Brown, 72 Ga. 713, 722; Edward v. Kilpatrick, 70 Id. 328; Battle v. Street, 85 Tenn. 282, 293; Murphy v. Hubert, 16 Pa. St. 50; note 14 Am. Dec. 703; Kid v. Mitchell, 1 Nott & McC. 334; 9 Am. Dec. 702; Smith v. Grim, 28 Pa. St. 95; 67 Am. Dec. 400; Tremper v. Barton, 18 Ohio, 418; Terrel's Heirs v. Cropper, 9 Mart. (La.) 350; 13 Am. Dec. 309; Cushwa v. Cushwa's Lessee, 5 Md. 44. EXECUTED AND EXECUTORY CONTRACTS. Although the courts with few exceptions have decided that conveyances and contracts made and entered into in fraud of creditors are valid and binding between the parties, yet an examination of the cases discovers that the application of this principle has been the real source of controversy, especially in regard to executory con. tracts. As elucidating this point, and arriving at a determination of the governing rule, it will be eminently proper to consider some of the several cases wherein the question has been discussed. The case of Clemens v. Clemens, 28 Wis. 637, 9 Am. Rep. 520, is a leading case in Wisconsin.