491 facts must be known to both parties, to render the agreement fair and just in all its parts; and it is against all the principles of equity that one party, knowing a material ingredient in an agreement, should be permitted to suppress it, and still call for a specific performance. (a)

Pothier (6) contends that good faith and justice require that neither party to the contract of sale should conceal facts within his own knowledge, which the other has no means at the time of knowing, if the facts would materially affect the value of the commodity. But he concludes, in conformity with the doctrine of Lord Thurlow, that though misrepresentation or fraud will invalidate the contract of sale, the mere concealment of material knowledge which the one party has, touching the things sold, and which the other does not possess, may affect the conscience, but will not destroy the contract; for that would unduly restrict the freedom of commerce; and parties must, at their own risk, inform themselves of the value of the commodities they deal in. (c) He refers to the rules of morality laid down by Cicero; and he justly. considers some of them as being of too severe and elevated a character for practical application, or the cognizance of human tribunals. (d) The general rule on this subject (though it has

(a) There is a valuable reference to, and criticism on, the cases in illustration of the maxim, caveat emptor, in Broom's Selection of Legal Maxims, p. 354, London edition.

(b) Traité du Contrat de Vente, n. 233–241.

(c) Pothier, Ibid. No. 298.

(d) Cicero, de Officiis, lib. 3, secs. 12-17, states the case of a corn merchant of Alexandria, arriving at Rhodes in a time of great scarcity, with a cargo of grain, and with knowledge that a number of other vessels, with similar cargoes, had already sailed from Alexandria to Rhodes, and which he had passed on the voyage. He then puts the question whether the Alexandrian merchant was bound in conscience to inform the buyers of that fact, or to keep silence, and sell his wheat for an extravagant price; and he answers it by saying, that, in his opinion, good faith would require of a just and candid man a frank disclosure of the fact. Ad fidem bonam statuit pertinere notum esse emptori vitium quod nosset venditor. Ratio postulat ne quid insidiose, ne quid simulate. Grotius (b. 2, c. 12, sec. 9,) and Puffendorf (Droit de la Nature, liv. 5, c. 3, sec. 4,) as well as Pothier and others, dissent from the opinion of Cicero, and hold that one party is only bound not to suffer the other to be deceived as to circumstances relating intrinsically to the substance of the article sold. Rutherford, on the other hand, in his Institutes, b. 1, ch. 13, § 13, coincides with Cicero as to the case of the merchant at Rhodes, and disagrees with Grotius, on whom he comments. It is a little singular, however, that some of the best ethical writers under the Christian dispensation, should complain of the moral lessons of Cicero as being too austere in their texture, and too sublime in speculation, for actual use. There is not, indeed, a passage in all Greek and Roman antiquity equal, in moral

its exceptions, like other general rules), is, that ignorance of the law, with a full knowledge of the facts, and under circumstances repelling all presumption of fraud and imposition, furnishes no ground, either in law or equity, to rescind agreements, or reclaim money paid volnntarily under a claim of right, or to set aside solemn acts of the parties. (e)1 Another rule of equal validity,

dignity and grandeur, to that in which Cicero lays it down as a fixed principle, that we ought to do nothing that is avaricious, nothing that is dishonest, nothing that is lascivious, even though we could escape the observation of gods and men. (De Off. 3, 8.) How must the accomplished author, even of so exalted a sentiment, have been struck with awe, humiliation, and reverence, if he had known that there then existed in the province of Judea, the records of sublimer doctrines: in which were taught the existence, the unity, the power, the wisdom, the justice, the benevolence and all-pervading presence of that high and lofty One that inhabiteth eternity, and searcheth all hearts, and understandeth all the imaginations of the thoughts of the children of men.

Shotwell v.

(e) Doctor and Student, dial. 2, ch. 46. Bilbie v. Lumley, 2 East, 469. Murray, 1 Johns. Ch. 512. Lyon v. Richmond, 2 Idem, 51, 60. Storrs v. Barker, 6 Id. 166. Brisbane v. Dacres, 5 Taunt. 143. Milnes v. Duncan, 6 Barn. & Cress. 671. Goodman v. Sayers, 2 Jac. & Walk. 262, 263. Story Com. on Eq. Jurisp. §§ 95, 125. Marshall v. Collett, 1 Y. & Coll. 238. Rankin v. Mortimere, 7 Watts, 372. Good v. Herr, 7 Watts & Serg. 253-6-8. Clarke v. Dutcher, 9 Cowen, 674. Bronson C. J., 2 Denio, 40. Norton v. Marden, 3 Shepley, 45. Norris v. Blethen, 19 Maine, 348. In Underwood v. Brockman, 4 Dana, 314-318, and Ray and Thornton v. Bank of Kentucky, 3 B. Monr. 510, the Court of Appeals in Kentucky ably and fairly discussed the question, whether relief ought to be granted on a contract made, or payment made, with full knowledge of all the facts, but through mistake as to the law, and the conclusion was, that relief might be granted when the contract was entered into or payment made in consideration of a mistaken belief of a legal liability. But the court said, that a fair compromise would not be disturbed on account of any mistake as to the law of the case. See also Gratz v. Redd, 4 B. Monr. 190, money paid by mistake, either of law or fact, may be recovered back. In the case of Elliott v. Swartwout, 10 Peters U. S. 137, it was held, that if an agent pays over to his principal, after notice not to pay, moneys

1 A rule, permitting a more extended right of recovery, has been laid down in Connecticut. It was held, that money paid under a mistake of law or fact, which the party was under no legal or moral obligation to pay, and which the other party has no right to retain, may be recovered. The case of Clarke v. Dutcher, 9 Cowen, 674, was disapproved. Northrup v. Graves, 19 Conn. 548. The opinion is well worthy of a perusal.

To the same effect is Culbreath v. Culbreath, 7 Geo. 64. Contra, and agreeable to the rule laid down in the text, is Peterborough v. Lancaster, 14 N. Hamp. 382. Baltimore & S. R. Co. v. Faunce, 6 Gill, 68.

Money paid on a judgment without actual compulsory process may be recovered back, on the reversal of the judgment. Lott v. Sweezey, 29 Barb. (N. Y.) 87. In England, equity relieved where an heir supposing certain company shares to be real estate and to have descended to him, which were in fact personalty, had executed a deed to satisfy a liability to which on the supposed footing he would have been subject. Broughton v. Hutt, 3 De G. &

J. 501.

The party must show, not merely ignorance of facts, but that he could not, with due diligence, obtain information. Wason v. Wareing, 15 Eng. L. & Eq. 121.

is that acts done and contracts made, under mistake or ignorance of a material fact, are voidable and relievable in law and

illegally demanded and received by him, he remains personally liable. The same rule was adopted in Ohio, holding that a mistake of the parties in point of law might be corrected in equity. M'Naughten v. Partridge, 11 Ohio, 223. Evants v. Strode, Ibid. 480. On the other hand, in Cadaval v. Collins, 4 Adol. & Ell. 858, and in Clarke v. Dutcher, 9 Cowen, 674, it was declared that money paid bonâ fide, and with full knowledge of the fact, cannot be recovered back, though there was no debt, and that the case of Marriot v. Hampton, 7 Term Rep. 269, was rightfully decided, where it was held, that money recovered by due process of law without fraud or undue compulsion, ought not to be recovered back. The text of the Roman law contained propositions seemingly contradictory on the point, whether a payment of money made under a mistake of the law could be reclaimed. See Dig. 22, 6, 1, 7, 8, and Code, 1, 18, 10. Vinnius and D'Aguesseau contended that the money might be recovered back, unless the person making the payment was under a natural or moral obligation to make it. Voet and Pothier were of a contrary opinion, and the French civil code followed the former authorities, and made no distinction whether it be error of law or of fact. The question has become exceedingly perplexed by contradictory opinions and decisions. In Burge's Commentaries on Colonial and Foreign Laws, vol. iii. 727-739, there is a review of the

The contract cannot be rescinded for a mistake, unless the parties can be restored to their original rights. Martin v. McCormick, 4 Sandf. (N. Y.) 366. A contract made under mutual mistake may be avoided. Ketchum v. Catlin, 21 Vermont, 191. And it must, at law, be mutual. Wood v. Scarth. 1 Foster & Fin. 293. Luce v. Izod, 25 L. J. Exch. 307.

It has also been held, that money paid by an agent, unless by the special direction of his principal, under a mistake of the legal rights of the latter, may be recovered. Per Ware J. United States v. Bartlett, Daveis, 19.

Even persons in discharge of a trust are not bound to know the laws of another country, though they concern and affect the discharge of their duties. Leslie v. Baillie, 2 Y. & Coll. Cas. in Ch. 91. Burge's Com. on Col. and Foreign Laws, vol. ii. p. 741.

In several cases a distinction, not very easy to define, has been recognized between ignorance of law and a mistake of law. The first is said to be incapable of proof, but the latter may be proved; and the inclination seems to be, to give relief in the latter case. Champlin v. Laytin, 18 Wendell, 422. Hall v. Reed, 2 Barb. (N. Y.) Ch. 505, per Walworth. It was held, in Gwin v. Hamilton, 29 Ala. 233, that there is no distinction between mistakes of law and ignorance of law; and, in Gordere v. Downing, 18 Ill. 492, the court refused relief against a pure mistake of the legal effect of language used in a deed, where there was no allegation of fraud, oppression, or mistake of fact.

Ignorance of the law of a foreign government, or of the statute laws of another state of the American Union, is ignorance of fact. Bank of Chilicothe v. Dodge, 8 Barb. (N. Y.) 233. President of Merchants' Bank v. Spalding, 12 Barb. (N. Y.) 302. Hoyt v. Thompson, 19 N. Y. 207. King v. Doolittle, 1 Head, 77.

Though a draft of a banking institution of Newport, payable at a future day, is void by statute, yet a bank in another state, advancing money on such draft, in good faith, may recover back the money as paid under a mistake as to fact. Bank of Chilicothe, v. Dodge, supra. Equitable relief in mistake of law is the exception rather than the rule. Newell v. Stiles, 21 Geo. 118.

To an action for the recovery of money paid under mistake of fact it is no answer that the party might, by due diligence, have informed himself. Townsend v. Crowdy, 8 C. B. (N. S.) 477. Kelly v. Solari, 9 Mees. & W. 54. Dails v. Lloyd, 12 Q. B. 531. Contra, 1 Smith, Lead. Cas. (4th Ed.) 340.

in law and equity. (f) It has been held, that even when a party contracted under a clear mistake of his legal rights, and such rights were of a doubtful character, he might be relieved in equity. (g) The distinction in the above rules was equally known to the civil law. (h) In Lawrence v. Beaubein, (i) the distinction

authorities in the civil and English law on the question. An able writer in the American Jurist for April and July, 1840, vol. xxi. has also examined very critically and at large, all the cases, decisions, and dicta, and he concludes that there is no solid ground for the distinction between mistakes of law and mistakes of fact, as to the right to relief, and that the preponderance of authority is unequivocally on that side. It would be inadmissible in a work so general and comprehensive as the present one, to enter into the discussion. I have no doubt that injustice may sometimes result from a strict adherence to the rule refusing relief where the contract is founded on a mistake in law. But I incline to the opinion that true policy dictates that we take the law according to what I understand to be the more prevalent doctrine in the English and American courts; and that the contracts and acts of competent parties, when free from fraud of every kind, and made or done with full knowledge of all the facts, ought not to be disturbed on the allegation of ignorance of the law. It strikes my mind that such investigations as the relaxation of the rule would lead to, must be hazardous to the conscience, and pernicious as precedents. In the Spanish law the rule is explicitly laid down, that what is paid through ignorance of law cannot be recovered back, because, says the text, we are all obliged to know the laws of the kingdom; though payments through error, mistake, or ignorance of facts of what was not due, may be recovered back. Institutes of the Civil Law of Spain, by Aso & Manuel, b. 2, tit. 11, ch. 2. Mr. Whise, in his Recopilaçion of the Law of Spain and the Indies, says that every chapter of that work constitutes the corpus juris civilis of Texas.

(ƒ) Milnes v. Duncan, 6 Barn. & Cress. 671. The dictum of Bailey J., in this last case, that money paid by mistake, though with means of knowledge of the fact, cannot be recovered back, is contradicted by Mr. Baron Parke, Kelly v. Solari, 9 Mees. & W., 54. In this last case it was adjudged that money paid under a bonâ fide forgetfulness of facts, which disentitled the defendant to receive it, may be recovered back. Garwood v. Eldridge, 1 Green Ch. (N. J.) 145. The mistake or ignorance for which a contract will be relieved in equity, must be of a material fact, essential to its character, and such as the party would not by reasonable diligence have known, when put upon inquiry.2 Broadwell v. Broadwell, 1 Gillm. (Ill.) 599, S. P. Waite v. Leggett, 8 Cowen, 195. 1 Story Eq. Jur. §146. Buller J., in Lowry v. Bourdieu, Doug. 467. Stevens v. Lynch, 12 East, 38. Champlin v. Laytin, 18 Wendell, 407. Cummins v. White, 4 Blackf. (Ind.) 356. Foreign laws are treated as facts, and ignorance of them is a ground for relief, like the ignorance of any other fact. Burge's Com. on Colonial and Foreign Laws, vol. ii. 741.

(g) Lammot v. Bowly, 6 Harr. & Johns. 500, 525, 526.

(h) Pothier, Pand. 22, 6, 3, n. 4-7.

15. Code 1, 18, 10.

(i) 2 Bailey (S. C.) 623.

Ibid. sec. 4, n. 10, 11. Ibid. 41, tit. 4, 1, 2, sec.

2 In Wriedemann v. Goldschmidt, 1 Giff. 142, an acceptor was relieved against his acceptance given to indorsees in good faith on the credit of a forged bill of lading, which they and he supposed to be genuine.

between ignorance of the law and a mistake of the law was learnedly discussed, and it was held that the latter might be ground for relief in equity, though the former could not. (j) A third general rule on the subject is, that equity will rectify a mistake and give relief, and decree specific performance in cases of written contracts, where there is a plain mistake clearly made out by satisfactory parol proof, or even fairly and necessarily implied. (k) *VII. Of passing the title by delivery.1

* 492

(1.) When the terms of sale are agreed on, and the bar

(j) Mr. Justice Bronson, in Champlin v. Laytin, 18 Wendell 416, thought that the distinction taken in the Carolina case, between ignorance of the law and mistake of the law, was not solid.

(k) Gillespie v. Moon, 2 Johns. Ch. 595. Lyman v. United Ins. Co. Ibid. 630. Keisselbrack y. Livingston, 4 Idem, 144. Andrews v. Essex F. & M. Ins. Co. 3 Mason, 10, 15. Dunlap v. Stetson, 4 Idem, 349, 372. Hunt v. Rousmanier, 8 Wheaton, 174, 211. 1 Story Eq. Jur. §152, §161. Newson v. Bufferlow, 1 Dev. Eq. (N. C.) 379. 1 Yeate's Penn. 132, 138, 437. Ball v. Storie, 1 Sim. & Stu. 210. Lord Eldon, 10 Vesey, 227. Tilton v. Tilton, 9 N. Hamp. 385. Moale v. Buchanan, 11 Gill & Johns. 314. Mr. Justice Story, in his Com. on Eq. Jurisprudence, 121-194, has reviewed and collected most of the English and American cases, and drawn the proper conclusions from them with his customary ability and accuracy. Mr. Justice Turley, in Trigg v. Read, 5 Humph. (Tenn.) 529, has elaborately and ably examined the refined distinctions on this subject. So, in Duer on Insurance, vol. i. p. 132, note 11, the cases in equity correcting a clear mistake in a policy of insurance are collected. In Rogers v. Atkinson, 1 Kelly (Geo.) 12, Ch. J. Lumpkin accurately collects and examines the principal English and American cases leading to the establishment of the principle, that equity relieves against mistakes as well as fraud in contracts in writing. The subject was very learnedly discussed in that case.

1 The omission of the mode or the time of payment, or even of the price itself, does not necessarily render a sale defective. The price will be inferred to be a reasonable one. Valpy v. Gibson, 4 M., G. & Scott, 864.

Many of the decisions quoted in the text, at page [494,] and in the following pages, will be observed, on examination, not to apply to the statute of frauds, but to be illustrative of the general rules governing the contract of sale, independently of the statute. Indeed, the mass of mercantile contracts are in writing, and to such contracts the statute has no application. The distinction between the general rule of law on this subject, and the rules arising from the 17th section of the statute, must be borne in mind.

1. Where the statute does not apply, it may be laid down generally, as it may also be gathered from the text, [pp. 491-510,] that if the parties have agreed, the one to buy and the other to sell specific and determined articles, of which the price, weight, measure, or requisite fitness have been ascertained or agreed upon, or if suitable means have been provided by which these qualities or conditions may be ascertained, and the articles are put in that state for which the parties contracted, the property passes eo instanti, by virtue of the contract of sale, and without delivery.

This is not inconsistent with the lien that may remain to the vendor for payment of the price; and, though the general rule is as above stated, the parties may, by the form of the