This section is from the book "Dart's Treatise On The Law And Practice Relating To Vendors And Purchasers Of Real Estate", by J. Henry Dart . Also available from Amazon: A treatise on the law and practice relating to vendors and purchasers of real estate.
Terms on which purchaser is relieved in Equity.
(c) Brett v. dowser, (1880) 5 C. P.D. 376.
(d) See Attwood v. Small, (1838) 6 C. & F. 232; Pike v. Tigers, (1839) 2 D. & Wal. 1, 252; Cockelly. Taylor, (1852) 15Beav. 103; Re Evans, (1894) 38 Sol. J. 546.
(e) See Edwards v. M'Leay, (1818) 2 Sw. 289 ; Hart v. Swaine, (1877) 7 Ch. D. 42 ; 47 L. J. Ch. 5 ; and see Seton, 6th ed. 2306.
(/) See Sug. 14th ed. 254. (g) Edwards v. M'Lcay, sup. See the decree.
(h) See Gibson v. D'Este, (1843) 2 T. & C. C. C. 581 ; Bloomer v. Spittle, (1872) 13 Eq. 427.
(i) See the decrees in Gibson v. D'Este, sup. ; Wilde v. Gibson, (1848) 1 H. L. C. 636; and Murray v. Palmer, (1805) 2 Sch. & L. 474,490 ; hut see, contra, the judgment, ib. 489; and see Summers v. Griffiths, (1866) 35 Beav. 27 ; Frees v. Coke, (1871) 6 Ch. 645, where a direction as to annual rests was on appeal struck out of the decree.
(k) See Gibson v. D'Este, sup.
In one case the purchaser, obtaining a decree for rescinding a purchase on the ground of fraud, was allowed to follow the stock in which part of the purchase-money had been invested (n) ; but the decree rescinding the purchase was subsequently reversed; and it became unnecessary to prosecute an appeal which had been lodged to the House of Lords. Lord St. Leonards remarks that this is the only case in which Equity has, under such circumstances, followed the purchase-money, and that the order, on appeal, could hardly have been maintained (o).
Allowed to follow purchase-money, semble.
A claim after conveyance, simply for compensation in respect of defects in the estate, will be dismissed in the absence of an express condition for condensation (p); though such defects, accompanied by fraudulent misrepresentation or concealment, may be a ground for rescinding the executed contract.
Bill for compensation not attainable.
While the contract is still executory, and rescission upon ordinary equitable grounds is therefore still possible, the common condition for compensation appears simply to provide an additional remedy, alternative to that of rescission. But rescission may become impossible, either by the contract having been executed (q), or by the purchaser having otherwise affirmed the contract. In such cases it is a question of intention whether the remedy by way of compensation for the error, misstatement or omission remains, though the other remedy has become impossible. It is true that where parties enter into a preliminary contract, which is afterwards to bo carried out by a deed, the contract becomes extinguished in the deed when it is executed, and can no longer be looked at for any purpose. But the ordinary contract for compensation is construed not as one which is intended to be carried out by the deed of conveyance, but as continuing to exist outside it; and it may therefore be enforced after the conveyance has been executed (r). The condition is not, however, intended to apply to the case of a defect of title, but only to an error or misstatement in the description of the subject-matter of the sale, such as an error in the quantity, nature, tenure or amount of the vendor's interest. Thus, where, after completion of a sale by the Court, it was found that some of the dwelling rooms over a cellar beneath the property belonged to a third party, the purchaser's claim for compensation was refused (s) ; so, where the property sold as freehold turned out to be a life estate only (t). If the purchaser knows of a defect before completion, it seems that he cannot take advantage of the condition after completion.
Effect of condition for compensation after completion.
(I) Donovan v. Flicker, (1821) Jac. 165.
(m) See Neesom v. Clarkson, (1845) 4 Ha. 97 ; Frees v. Coke, (1871) 6 Ch. 645, 651.
(») Attivood v. Small, (1838) 6 C. & F. 232 ; Ernest v. Croysdill, (1860) 2D. F. & J. 175, at pp. 188, 107.
(o) Sug. 14th ed. 256.
(p) Newham v. Kay, (1824) 13 Pr. 749 ; Leuty v. Uillas, (1858) 2 D. & J. 110 ; 27 L. J. Ch. 534 ; Clayton v. Leech, (1889) 41 Ch. D. 103 ; 61 L. T. 69; Debenhatn v. Sawbridge, 1901, 2 Ch. 98, 108 ; 70 L. J. Ch. 525.
(q) Sup. p. 808.
It is conceived that as the cause of action arises at the date of the contract for purchase, the remedy will be barred after six years, where that contract is not under seal.
Remedy on condition barred six years after contract.
A purchaser may, after conveyance, bring an action for damages for a fraudulent misrepresentation of the property (u) or the title, though it is made not directly to the purchaser, but to a person in treaty for the property, and who communicates it to the purchaser (x) : or may recover the purchase-money, if the circumstances of the case entitle him to set aside the transaction (y) ; he may also recover damages for breach of an agreement which is in fact collateral, e.g., where the vendor on a sale agreed to execute certain fixtures, etc. (z).
Action for damages.
(r) Cann v. C, (1830) 3 Si. 447 ; Bos v. Helsham, (1866) L. R. 2 Ex. 72 ; 36 L. J. Ex. 20 ; Re Turner and Skelton, (1879) 13 Ch. D. 130 ; 49 L. J. Ch. 114; rainier v. Johnson, (1884) 13 Q. B. D. 351 ; Phelps v. White, (1881) 7 L. R. Ir. 160 ; Flewitt v. Walker, (1885) 33 W. R. 894 ; Man-son v. Thacker, (1878) 7 Ch. D. 620; 47 L. J. Ch. 312 ; Beslry v. B., (1878) 9 Ch. D. 103; Allen v. Richardson, (1879) 13 Ch. D. 524; Clayton v. Leech, (1889) 41 Ch. D. 103; 61 L. T. 69 ; Cobbett v. Locke King, (1900) 16 T. L. R. 379 ; Debenham v. Sawbridge, 1901, 2 Ch. 98 ; 70 L. J. Ch. 525. See Boston v. B., (1903) 73 L. J. K. B. 17, as to collateral agreement by third party to pay purchasemoney to the purchaser after completion.
(s) Debenham v. Sawbridge, sup.
(t) Ex p. Riches, cited in Debenham v. Sawbridge, sup., at p. 151.
(u) Dobellv. Stevens, (1825) 3 B. & C. 623 ; 3 L. J. Q. B. 89 ; Mummery v. Paul, (1845) 1 C. B. 316; Gerhard v. Bates, (1853) 2 E. & B. 476 ; 22 L. J. Q. B. 364 ; Fuller v. Wilson, (1842) 3 Q. B. 58, 68 ; though made by an agent, S. C. ; Wanton v. Cop-pard, 1899, 1 Ch. 92 ; 68 L. J. Ch. 8 ; but see contra, Lord Campbell's dictum, (1848) 1 H. L. C. 615, as to the distinction in this respect between actions on the contract and on the case; Brownlie v. Campbell, (1880) 5 A. C. 925, 949.