fraud may come into equity for the purpose of having the instrument corrected, and the contract, as reformed, enforced.

Bills which seek to have absolute deeds declared to be mortgages, and for the consequent enforcement of the mortgagor's equity of redemption, are illustrations of this species of reformation.1

469. The general nature of mistake and fraud has been attempted to be explained in former chapters. What we have to do with now is the method in which the court applies the equitable remedy of reformation, for the purpose of redressing injuries growing out of mistake or fraud. The general principles by which the court is guided in such cases are well settled. A person who seeks to rectify a deed on the ground of mistake must establish, in the clearest and most satisfactory manner, that the alleged intention to which he desires it to be made conformable continued concurrently in the minds of all parties down to the time of its execution; and, also, must be able to show exactly and precisely the form to which the deed ought to be brought.2

To reform a contract, and then enforce it in its new shape, calls for a much greater exercise of the power of a chancellor than simply to set the transaction aside. Reformation is a much more delicate remedy than rescission. Hence, in order to justify a decree for reformation in cases of pure mistake, it is necessary that the mistake should have been mutual. Where the mistake has been on one side only, the utmost that the party desiring relief can obtain is rescission, not reformation. The case is, of course, different if any element of fraud exists; for it has been properly held that where there is mistake on one side, and fraud on the other, there is a case for reformation."

470. The difficulties which arise in these cases grow, principally, out of questions of evidence. Where the instrument recites an agreement which it professes to carry out, but fails to do so,

1 See ante, chap. on Mortgages.

2 By the Lord Chancellor in Fowler v. Fowler, 4 De G. & J. 265. See, also, Stockridge v. Hudson Iron Co., 107 Mass. 290.

3 Ante, page 194.

4 Bellows v. Steno, 14 N. Hamp. 175; Cooper v. The Farmers' Ins. Co., 14 Wright (Pa.), 299.

5 Welles v Yates, 44 New York, 525.

the case for reformation is perfectly clear; but where there is no recital of any prior agreement, but the alleged mistake is attempted to be proved by extrinsic evidence, the limits of the equity for correction are more difficult to define. The distinction which ought to be borne in mind seems to be between those cases in which the intention of the parties has not been accurately expressed, and those in which the intention, though accurately expressed, has been reached through some misapprehension or ignorance.2 In the first class of cases the true remedy is reformation, and evidence is admissible to show what the intention. of the parties really was. Thus, to refer to an instance cited in a former chapter, if there is an agreement that part of the purchase-money of certain real estate should be paid by a judgment note for a certain sum, "with interest," and these words are omitted from the note by mistake, it is competent to show this omission by parol evidence for the purpose of obtaining a decree correcting the instrument. The general principle, therefore, that where no statutory provision intervenes, parol evidence is admissible for the purpose of correcting a mistake in a written instrument, and of carrying it into effect as corrected (in other words, for the purpose of applying the equitable remedy of reformation), has, accordingly, been adopted by many decisions throughout the United States; but relief will be granted only where there is a plain mistake clearly made out by satisfactory proofs. The same result now seems to have been reached in England; although there is great reluctance to admit parol testimony unless it is corroborated by other evidence. And on both sides of the Atlantic it now seems to be established that the courts may, under certain circumstances, and when the

1 Adams's Eq. 169. See Bold v. Hutchinson, 5 De G. M. & G. 558, 568; 2 Spence Eq. 140, 141.

Whitney v. Whitney, 5 Dana, 330; Stockbridge v. Hudson Iron Co., 107 Mass. 290; 1 Sug. V. and P. 262 (8th Am.

2 See ante, p. 193, Accident and Mis- ed.); notes to Woollam v. Hearn, 2 Lead.

take.

3 Gump's Appeal, 15 P. F. Smith, 476; and see the other cases cited, ante, p. 193, note 3.

4 See Gillespie v. Moon, 2 Johns. Ch. 595; Lyman v. Little, 15 Verm. 576;

Cas. Eq. 683 (3d Am. ed.); ante, p. 193. 5 See Alexander v. Crosbie, Ll. & G. (temp. Sug.) 145; Mortimer v. Shortall, 2 Dr. & War. 363; Kerr on Fraud and Mistake, 423; 1 Sug. V. and P. 262 (8th Am. ed.).

parol evidence is very conclusive, grant the relief sought, even though the mistake is denied by the answer of the defendant.1

Where the statute of frauds intervenes, the admissibility of parol evidence is necessarily attended with greater difficulty. The authorities upon this subject have already been noticed in the chapter on specific performance; it will, consequently, be sufficient to refer to the conclusion there stated.2

In cases of fraud there is less reluctance to admit parol evidence for the purpose of reforming a written contract than in cases of bald mistake.

Thus it was said in a former chapter that parol evidence was admissible for the purpose of showing that a deed absolute on its face was intended to be a mortgage, and, therefore, that the grantor should be entitled to avail himself of his equity of redemption. This is the rule in most of the States of the Union ;* but in Massachusetts, Maine, Connecticut, New Hampshire, and perhaps some other States, parol evidence, in such cases, seems to have been considered inadmissible; although in some of these

1 Fowler v. Fowler, 4 De G. & J. 273; Gray v. Woods, 4 Blackf. 432. See, also, the cases cited in the two preceding notes; and Kerr on Fraud and Mistake, and Sugden V. and P., ut sup.

2 See ante, p. 353. This subject was elaborately examined in the case of Glass v. Hulbert, 102 Mass. 31, where the rule was laid down to be that "when the proposed reformation of an instrument involves the specific performance of an oral agreement within the statute of frauds, or when the term sought to be added would so modify the instrument as to make it operate to convey an interest or secure a right, which can only be conveyed or secured through an instrument in writing, and for which no writing has ever existed, the statute of frauds is a sufficient answer to such a proceeding, unless the plea of the statute can be met by some ground of estoppel to deprive the party of the right to set up that defence" (citing Jordan v. Sawkins, 1 Ves., Jr.

402; Osborn v. Phelps, 19 Conn. 63; Clinan v. Cooke, 1 Sch. & Lef 22); but that "a rectification by making the contract include obligations or subject matter, to which its written terms will not apply, is a direct enforcement of the oral agreement, as much in conflict with the statute of frauds as if there were no writing at all."

3 Ante, p. 160.

4 Russell v. Southard, 12 Howard, 139; Morgan v. Shinn, 15 Wal. 105; Marks v. Pell, 1 Johns. Ch. 594; Horn v. Keteltas, 46 N. Y. 605; Sweet v. Parker, 7 C. E. Green, 453; Odenbaugh v. Bradford, 17 P. F. Sm. 96; Maffitt v. Rynd, 19 Id. 387; Conner v. Chase, 15 Verm. 764; Bank of Westminster v. Whyte, 1 Maryl. Ch. 536; 3 Id. 508; Webb v. Rice, 6 Hill, 219; Conwell v. Evill, 4 Blackf. 67; Sugden V. and P. 267 note; 2 Wash. Real Prop 50 et seq.; ante, p. 160, note 2.

51 Sugden V. and P. 267, note.

States the question cannot, perhaps, be considered as definitely settled.1

471. In addition to reforming instruments by direct evidence, in cases of fraud or mistake, correction will be sometimes made by presumption of law, or rather of equity. Thus where a joint and several debt exists, and a bond is afterwards given to secure the same which is drawn in such a way as to make the obligation merely joint and not joint and several, equity will reform the instrument upon the presumption that the writing by which the debt was to be secured was intended to follow in its terms the nature of the debt itself, and the correction will therefore take place in favor of the presumed intention of the parties.3 Indeed some cases have gone still further, and it has been held that whenever a loan is made to two jointly it will be presumed in equity that every debtor was to be permanently liable until the money should be paid; and that therefore a debt so arising, though at law it is the joint debt of all the co-debtors, shall be treated in equity as the several debt of each; but it has been doubted whether these authorities have not carried the doctrine under consideration too far. The doctrine will not apply when the original creation of the debt was in the form of a joint obligation, for in such a case there can be no presumption that the contract of the parties was meant to assume a different shape, and equity will not interfere upon conjecture merely." Nor will such a presumption be entertained in the case of a mere surety, whose duty is measured solely by the legal force of the bond, and who is under no moral obligation to pay the obligee independent of his covenant. There is nothing, therefore, in such a case, on which to found an equity for the interposition of a court of chancery. Where, however, the evidence plainly establishes

1 See Newton v. Fay, 10 Allen, 505; Thorpe v. Jackson, 2 Y. & C. Exch. 553. Howe v. Russell, 36 Maine, 115. See United States v. Price, 9 How. 103.

Wyche v. Green, 11 Geo. 172.

3 Hyde v. Tanner, 1 Barb. 75; Weaver v. Shryock, 6 Serg. & R. 262; Pickersgill v. Lahens, 15 Wallace, 144. See, also, Stiles v. Brock, 1 Barr, 215.

4 Simpson v. Vaughan, 2 Atk. 31;

6 Jones v. Beach, 2 De G. M. & G. 886. 6 Sumner v. Powell, 2 Meriv. 30; Underhill v. Horwood, 10 Ves. 209; Jones v. Beach, 2 De G. M. & G. 886; Moser v. Libenguth, 2 Rawle, 428.

7 Pickersgill v. Lahens, 15 Wallace 144.

the fact that the intention of the parties was to make the instrument several as well as joint, it will be reformed even as against the estate of one who was only a surety.1

Upon the same principle of reformation, if a mortgage is made of a wife's property, and the equity of redemption is limited to the husband alone, and it appears from all the circumstances of the case that nothing more was intended to affect it (the property of the wife) than the creation of a mortgage, equity will interfere by reforming the instrument, and restoring the equity of redemption to the wife.2

472. It has been stated in a former chapter that in certain cases of fraud and mistake the proper redress which ought in justice to be afforded to the injured party is that the transaction into which he has entered should be set aside, and the written evidence thereof surrendered or destroyed. Some of the rules also upon which a court of equity acts in cases of rescission have been attempted to be pointed out; such as those which relate to the admissibility of parol evidence in such cases, and those also by which the loss of the complainant's right to relief through confirmation, acquiescence, or delay is controlled. In addition to the above, it may be stated here, that a transaction which is capable of being rescinded on the ground of fraud, is to be treated as good until rescinded, and not as bad until confirmed, or, in other words, that a contract which may be set aside at the option of the injured party, is to be considered as being in effective operation until that party takes measures to enforce his right to rescind.3 This was well put by Mr. Mellish, in his argument in Oakes v. Turquand before the IIouse of Lords, in the following query: when you say that an agreement is voidable and not void, and when the complainant endeavors to insist upon his right to treat it as void, is the agreement to be taken as valid until rescinded, or, when rescinded, to be taken to have been void from the first? And this query was answered by the tribunal to which it was addressed to the effect that the

1 Olmsted v. Olmsted, 38 Conn. 318. 2 Demarest v. Wynkoop, 3 John. Ch. 129; Whitebread v. Smith, 3 De G. M. & G. 737.

It will be remembered that the injured person must, in many cases, be very prompt. See ante, p. 254.

4 Afterwards Lord Justice Mellish.