1 Jones v. Edney, 3 Camp. 285.
2 Farrer v. Nightingal, 2 Esp. 639.
3 Nichol v. Godts, 10 Exch. 191; 26 Eng. Law & Eq. 527.
fact as a defence to an action for the consideration-money; or he may wholly abandon the contract; or he may reclaim the purchase-money, if he have advanced it.1 But if the vendee the thing sold, and go to the essence of the contract.1 The same rule applies where the title of the vendor fails as to a part of a mass or number of goods sold. If the whole number be a material inducement to the sale in fact; or if the contract be entire, so as to render the whole a material inducement in law, the buyer may treat the sale as void.2 But if the quantity, in respect to which the title fails, be slight and unimportant;3 or if, being material, the vendee choose to keep it, without objection; or if, the contract being entire, the vendee accept the portion in respect to which the title is good, the only effect of the mistake would be to reduce the price proportionally to the failure.4
1 Story on Sales, § 188, 203; Bradeen v. Brooks, 22 Me. 463; Code Nap. art. 1599. The decisions upon this point are most embarrassing and contradictory, and the comment of Mr. Chancellor Kent will be instructive. He says (Comm. vol. ii. p. 470): "On the subject of the claim to a completion of the purchase, or to the payment or return of the consideration-money, in a case where the title or the essential qualities of part of the subject fail, and there is no charge of fraud, the law does not seem to be clearly and precisely settled; and it is difficult to reconcile the cases, or make the law harmonize on this vexatious question. The rules on this branch of the law of sales are in constant discussion, and of great practical utility, and they ought to be .distinctly understood. It would seem to be sound doctrine, that a substantial error between the parties concerning the subject-matter of the contract, either as to the nature of the article, or as to the consideration, or as to the security intended, would destroy the consent requisite to its validity. The principles which govern the subject, as to defects in the quality or quantity of the thing sold, require a more extended examination; and they are the same in their application to sales of lands and chattels.
"In the case of a purchase of land, where the title in part fails, the Court of Chancery will decree a return of the purchase-money, even after the purchase has been carried completely into execution, by the delivery of the deed and payment of the money, provided there had been a fraudulent misrepresentation as to the title. But if there be no ingredient of fraud, and the purchaser is not evicted, the insufficiency of the title is no ground for relief against a security given for the purchase-money, or for rescinding the purchase, and claiming restitution of the money. The party is remitted to his remedies at law on his covenants to insure the title. In Frisbee v. Hoffnagle, the purchaser, in a suit at law upon his note given to the vendor for the purchase-money, was allowed to show in his defence, in avoidance of the note, a total failure of title, notwithstanding he had taken a deed with full covenants, and had not been evicted. But the authority of that case and the doctrine of it, were much impaired by the Supreme Court in Maine, in a subsequent case, founded on like circumstances; and they were afterwards in a degree restored by the doubts thrown over the last decision by the Supreme Court of Massachusetts in Knapp v. Lee. The same defence was made to a promissory note in the case of Greenleaf v. Cook, and it was overruled on the ground that the title to the land, for the consideration of which the note was given, had only partially failed; and it was said, that to make it a good defence in any case, the failure must be total. This case at Washington is contrary to the defence set up and allowed, and to the principle established in the case of Gray v. Handkinson; but it seems to be supported by the case of Day v. Nix, where it was decided by the English court of C. B., that a partial failure of the consideration of a note was no still retain undisturbed possession of the property sold, and a fortiori if no claim be made against him by an adverse party, he cannot plead want of title in the vendor, in defence of an action for the price.1 This rule, however, does not hold in sales of real property; and in such cases the vendee cannot utterly disclaim the sale, but is put to his remedy on the covenants in his deed.2
§ 534. Where the want of title is only partial,- as if goods be sold which are under mortgage, - the vendee may avoid the sale, and reclaim the purchase-money, which he may have advanced, if the incumbrance materially diminish the value of defence, provided the quantum of damages arising upon the failure was not susceptible of definite computation. The cases are in opposition to each other, and they leave the question how far and to what extent a failure of title will be a good defence, as between the original parties to an action for the consideration-money on a contract of sale, in a state of painful uncertainty. I apprehend that in sales of land the technical rule remits the party back to his covenants in his deed; and if there be no ingredient of fraud in the case, and the party has not had the precaution to secure himself by covenants, he has no remedy for his money, even on a failure of title. This is the strict English rule, both at law and in equity; and it applies equally to chattels, when the vendor sells without any averment of title, and without possession. In sales of chattels, the purchaser cannot resist payment in cases free from fraud, while the contract continues open, and he has possession. But in this country the rule has received very considerable relaxation. In respect to lands, the same rule has been considered to be the law in New York; while, on the other hand, in South Carolina, their courts of equity will allow a party suffering by the failure of title, in a case without warranty, to recover back the purchase-money, in the sale of real as well as of personal estates." See Knapp u. Lee, 3 Pick. 452; Day v. Nix, 9 Moore, 159.