Defects in an estate may be either patent, that is, such as might be discovered by ordinary vigilance on the part of a purchaser; e. g. the existence of an open footpath over the property (a), or the ruinous state of buildings (b); or latent, - that is, such as the greatest attention (c) would not enable him to discover; e. g. the existence of defects in a ship's bottom when sold afloat (d): it is held that a vendor is not bound to point out patent defects (e).

Preliminary negotiations; rules to be observed in.

As to disclosure or concealment of defects, incumbrances, etc, by vendor.

Vendor need not point out patent defect.

But he must not, either during a treaty for, or while intending, a sale, endeavour to conceal a defect, or to divert a purchaser's attention from it: in neither case, if proved, can he enforce the agreement in Equity (f): and in the first, (as where a vendor, about to sell a house, purposely plastered and papered over a defect in the main wall (g),) the purchaser may recover his deposit at Law: and this, although the estate be sold "with all faults (h)."

But at Law, where the plaintiff, knowing that a nuisance existed which rendered his house unfit for a residence, employed an agent to dispose of it, without mentioning to him the nuisance, and the agent, upon being asked by the intended lessee whether there were any objection to the house, replied that there was not; a majority of the Court held, that this was no defence to an action for breach of the agreement to take the house (i); inasmuch as the plaintiff made no false representation, and the agent, although he made one, did not know it to be false.

But, in a suit for specific performance, the decision would doubtless have been in favour of the lessee; and, in fact, a vendor cannot, although the estate be sold subject to all faults (j), rely on the aid of a Court of Equity, if he omit to disclose a latent defect which the purchaser has no means of ascertaining (k).

But must not conceal or divert attention from it.

Vendor selling by agent and not communicating to him material defect, allowed to enforce contract at law.

But vendor not disclosing latent defects cannot enforce specific performance.

(a) Oldfield or Bowles v. Round, 5 Ves. 508.

(b) Grant v. Munt, Coop. 177.

(c) Sug. 383.

(d) See Mellish v. Motteux, 1 Pea. Ca. 156.

(e) Sug. 2.

(f) Sug. 2; see Shirley v. Strat-ton, 1 Bro. C. C. 440; Small v. Attwood, You. 490.

(g) 4 Taunt. 785.

(h) Schneider v. Heath, 3 Camp. 506.

(i) Cornfoot v. Fowke, 6 Mee. & W. 358; and see Wilson v. Fuller, 3 Ad. & E., N. S. (in error) 68; 3 Gale & D. 570.

As to incumbrances and defects in title: - A vendor must produce to the purchaser all documents of title in his possession (l) or power; and inform him of all material facts not apparent thereon (m); but he need not direct attention to defects, etc, apparent on the title deeds (n); or to any matter of which the purchaser has actual or implied notice; for instance, upon the sale of leaseholds (o) the stringent or unusual character of the covenants need not be mentioned; as notice of the lease is notice of its contents; but there must, of course, be no misrepresentation (p) upon the subject, nor any artifice to divert attention.

And it may, perhaps, be doubted, whether the above rule as to notice, (general as are the terms in which it is laid down (q),) would, if the question arose in a suit for specific performance, be held to apply so as to affect the purchaser with notice of any matter in a lease which is not in its nature incidental to such an instrument; whether, for instance, such implied notice, although extending to unusual covenants on the sale of the term, would also extend to a clause of pre-emption contained in a lease, upon the sale of the reversion (r).

It is conceived, that upon the purchase of an estate in possession, those facts only are so far material as to render their disclosure obligatory upon the vendor, which affect his power to give to the purchaser that which he has contracted for; and that, if he buy subject to a known risk, circumstances which increase the amount of risk need not, in general, be stated; for instance, it has been held that the grantor of a personal annuity, or his agents, although bound to give honest answers to all relevant questions put by the intended grantee, need not voluntarily disclose the fact of his being already under large pecuniary liabilities (s); but where the consideration for the annuity is a reversionary interest belonging to the purchaser, the grantor is bound, in Equity, to communicate to the purchaser the unhealthy state of the proposed cestui que vie (t).

Must produce deeds, and state all material facts; but need not point out defect in title; nor matter of which purchaser has notice.

Whether it is universally true that notice of lease is notice of all its contents.

What facts are material to title within the above rule.

(j) Sug. 2.

(k) See Lucas v. James, 7 Ha. 410.

(l) 1 Jarm. C. by S. 63.

(m) Cooper, 312; and see Gibson v. D'Este, 2 Y.& C. C. C. 542; Sug. 6.

(n) Sug. 8.

(o) Hall v. Smith, 14 Ves. 426; Pope v. Garland, 4 Y. & C. 394; Walter v. Maunde, 1 Jac. & W. 181; Smith v. Capron, 7 Ha. 189.

(p) See the judgment in Pope v. Garland, 4 Y. & C. 401, 402, and cases cited.

(q) See Sug. 8.

(r) In Martin v. Cotter, 3 J. & L. 506, Sugden, C, intimates an opinion that the doctrine as to a lease being notice has been carried too far: and see Nelthorpe v. Holgate, 1 Coll. 203; and Flight v. Barton, 3 Myl. & K. 282.

And the mere preparation of an annuity deed by the grantor's solicitor does not place him in any confidential relation towards the grantee, even although no other solicitor be employed in the transaction (u).

A solicitor, however, is liable, at law (v) and in Equity (w), who by his misrepresentation induces a person to purchase his client's estate with a defective title.

We may also, in connection with the above head, observe, that a purchaser suspecting that a third person has a claim on the estate, should (x), in the presence of witnesses (who may take notes of what passes) (y), inquire of him whether such be the fact, and the amount of his claim; at the same time stating his own intention to purchase (z): and if such person deny the existence of his claim, or assert that it is confined to a specified sum, he will, in Equity, be bound by his denial or assertion (a):

Not matters which increase a known risk; semble.

Except on purchase of a reversionary interest.

Vendor's solicitor liable for misrepresentation.

Purchaser should inquire of party supposed to have a claim on the estate.

Supposed claimant bound by his statement or denial.

(s) Adamson v. Evitt, 2 Russ. & M. 72.

(t) Davies v. Cooper, 5 Myl. & Cr. 270.

(u) Adamson v. Evitt, 2 Russ. & M. 72.

(v) Sug. 6, n. (f).

(w) Arnot v. Biscoe, 1 Ves. s. 96.

(x) Sug. 9; Ibbottson v. Rhodes, 2 Vern. 554.

(y) Doe v. Perkins, 3 Durn. & E. 749.

(z) 2 Vern. 554.

(a) Pearson v. Morgan, 2 Bro. but, although bound to answer truly, if at all, he may, it would appear, decline to answer, unless the intended purchaser offer to redeem him (b).

So, if the interest contracted for be merely equitable, the purchaser should inquire of the trustees whether there are any and what incumbrances; and, on completion, should give them notice of the sale; this is advisable for the sake as well of avoiding litigation with future, as of discovering the existence of present incumbrancers; at the same time, when the purchase is of an equitable estate in land, it appears to be settled that no priority is obtained by inquiry and notice (c).

The trustees will be liable in Equity if they give false information, either fraudulently or merely through forget-fulness (d).