There appears to be little difference between the position of one who has obtained goods by means of a fraudulent contract of purchase, subsequently disaffirmed by the seller, and the position of one who has taken goods by force. In both cases the wrongdoer is guilty of conversion;5 in both cases the tort results in a benefit
1 Fuller v. Duren, 1860, 36 Ala. 73; 76 Am. Dec. 318; Kidney v. Persons, 1868, 41 Vt. 386; 98 Am. Dec. 595; Saville v. Welch, 1886, 58 Vt. 683; 5 Atl. 491.
2 Strickland v. Burns, 1848, 14 Ala. 511, 515; Miller v. Miller, 1828, 7 Pick. (Mass.) 133 ; 19 Am. Dec. 264. And see cases cited in preceding note.
3 Burton Lbr. Co. v. Wilder, 1895, 108 Ala. 669; 18 So. 552. 4Neate v. Harding, 1851, 6 Exch. 349; First Nat. Bank v. Henry, to him (see ante, Sec. Sec. 271, 272). Therefore, a fraudulent purchaser, in case the seller avoids the contract, should be suable in either trover or assumpsit. This is the rule in some jurisdictions.1 Says the Kentucky Court of Appeals, in Dietz's Assignee v. Sutcliffe:2
1905, 159 Ala. 367; 49 So. 97; Mason v. Waite, 1822, 17 Mass. 560; Tryon v. Baker, 1873, 7 Lans. (N. Y. Sup. Ct.) 511; Boyle v. Staten Island, etc., Land Co., 1897, 17 App. Div. 624; 45 N. Y. Supp. 496; aff. 1900, 163 N. Y. 586; 57 N. E. 1104; Hornefius v. Wilkinson, 1908, 51 Or. 45; 93 Pac. 474; Gould v. Baker, 1896, 12 Tex. Civ. App. 669 35 S. W. 708; Elwell v. Martin, 1859, 32 Vt. 217; Lawson's Exr. v. Lawson, 1861, 16 Gratt. (Va.) 230; 80 Am. Dec. 702. Cf. Smith v. Smith, 1862, 43 N. H. 536.
5Farwell v. Hanchett, 1887, 120 111. 573; 11 N. E. 875; Thurston v. Blanchard, 1839, 22 Pick. (Mass.) 18; 33 Am. Dec. 700; Baird v. Howard, 1894, 51 Ohio St. 57 ; 36 N. E. 732 ; 22 L. R. A. 846 ; 46 Am. St. Rep. 550; Kryn v. Kahn, 1903, 54 Atl. 870, (N. J. Sup. Ct.).
"Nor do we see how.....it is possible to say that the plaintiffs, on repudiating the contract for fraud, had not their election between contract and tort as to the form of action. The remaining question is, what is the effect of a waiver of the tort ? 'Does it restore the express contract which has been repudiated for the fraud, or does it leave the parties in the same condition as if no express contract had been made - to such relations as result by implication of law from the delivery of goods by the plaintiff and their possession by the defendant ? On this subject the decisions are conflicting, but I think the weight of authority, as well as the true and logical effect of the acts of the parties, is to leave the parties to stand upon the rights and obligations resulting from the delivery and possession of the goods.' "
But there are cases to the contrary.3 In the most conspicuous of them, Ferguson v. Carrington,4 where it appeared that the plaintiffs had been induced by the fraudulent representations of the defendant to sell him goods on credit, it was held that an action for goods sold and delivered could not be maintained until the expiration of the credit given in the contract. Lord Tenter-don, C. J., with whom all of the judges concurred, declared that:
1 Dietz's Assignee v. Sutcliffe, 1883, 80 Ky. 650; Roth v. Palmer, 1858, 27 Barb. (N. Y. Sup. Ct.) 652; Crown Cycle Co. v. Brown, 1901, 39 Or. 285; 64 Pac. 451. See Williston, "Sales," Sec. 648.
21883, 80 Ky. 650, 654.
3 Ferguson v. Carrington, 1829, 9 Barn. & Cr. 59, (cf. Hill v. Perrott, 1810, 3 Taunt. 274; Abbotts v. Barry, 1820, 2 Brod. & Bing. 369); Bechtel v. Chase, 1909, 156 Cal. 707, 711-12; 106 Pac. 81; Kellogg v. Turpie, 1879, 93 I11. 265; 34 Am. Rep. 163; Allen v. Ford, 1837, 19 Pick. (Mass.) 217 ; Bedier v. Fuller, 1895, 106 Mich. 342; 64 N. W. 331, (The rule in Michigan was changed by statute in 1897 : see Mich. Comp. Laws, Sec. 10,421; Anderson Co. v. Pungs, 1903, 134 Mich. 79; 95 N. W. 985.). And see Jones v. Brown, 1895, 167 Pa. St. 395; 31 Atl. 647.
In Emerson v. Detroit, etc., Spring Co., 1894, 100 Mich. 127, 133; 58 N. W. 659, the court said: "It is suggested that, as a fraud was perpetrated upon the creditor, he would have the right to waive the tort and sue in assumpsit. But we are aware of no case which authorizes a party to first turn a contract into a tort, and then shift it back into the form of a new contract other than the original one."
4 1829, 9 Barn. & Cr. 59.
"It was competent to the plaintiffs to have brought trover, and to have treated the contract as a nullity, and to have considered the defendant not as a purchaser of the goods, but as a person who had tortiously got possession of them; but that the plaintiffs by bringing assumpsit had affirmed that, at the time of the action brought, there was a contract existing between them and the defendant. The only contract proved, was a sale of goods on credit. The time of the credit had not expired, and consequently the action was brought too soon."
The fallacy of this argument is apparent. The bringing of an action for goods sold and delivered against a buyer does not necessarily affirm the contract of sale. The action referred to is both a contractual remedy and an alternative remedy in certain cases of tort. As has been seen (ante, Sec. 277), it may be used against one who converts the plaintiff's property by force and without the semblance of a contract. And, in the case under discussion, the circumstance of the commencement of the action before the expiration of the credit stipulated for in the contract makes it obvious that the plaintiffs were not using the action as a vehicle for the enforcement of their contractual rights. They had repudiated the contract because of the buyer's fraud, and then had elected the remedy of assumpsit for goods sold and delivered, instead of the remedy of trover.
One who wishes to avoid a contract on the ground of fraud must ordinarily restore to the other party anything he may have received in performance of the contract. Consequently, one who is induced by fraudulent representations to exchange personal property cannot recover the value of the property parted with, upon the theory of "waiver of tort and suit in assumpsit," while retaining the property received by him in the exchange.1
1 See Bechtel v. Chase, 1909, 156 Cal. 707; 106 Pac. 81.