Smith v. Evans

He who avoids an executed contract on the ground of infancy, must refund the consideration received by him.

Samuel Smith was the owner of three hundred and twenty-three acres of land lying in Bledsoe county. He made a will, in which he directed that this land, after his death, should be rented out till his three sons, John, William, and Evander, should arrive at twenty-one years of age, and that it should then be equally divided 'between them. He died in 1820, having appointed Samuel Terry his executor. Samuel Terry died, and Scot Terry became his executor. In 1828, when John, the eldest, became of age, John, William and Evander, with the approbation of Scot Terry, the executor of the will, made a joint deed of conveyance of the tract devised to them, to Evans, for the sum of eighteen hundred dollars. This deed was duly acknowledged and possession delivered to Evans. The sum of six hundred dollars was paid to John, and two notes of six hundred each were executed and made payable to Scot Terry, as executor of the will of Smith, deceased, one specifying on its face to be for the benefit of William Smith, and the other for the benefit of Evander. The note for the benefit of Evander was made payable five years after date, and bearing legal interest from its date. Evander Smith having obtained possession of the note before he arrived at the age of 21 years, to wit, in 1839, sold and transferred it to Bridgman, and appropriated the proceeds. Evans paid to Bridgman the amount of the note. In 1841 E. Smith filed this bill against Evans and Bridgman, to set aside and annul the deed of conveyance, so far as he was concerned, which he had made to Evans, on the ground that he was an infant when he made it. Evans admitted, in his answer, that he took the deed from Evander Smith, the complainant, at the time when he was under twenty-one years of age, but insisted that it was made with the consent and approbation of bis two elder brothers and of Scot Terry, the executor of the will and testamentary guardian of complainant, and that he had paid a full and adequate consideration for the land. He farther stated, that he had made valuable improvements on the place; and insisted, that in the event the deed of conveyance was set aside, the consideration paid by him to the assignee of complainant with interest, and the value of improvements made, should be refunded. The case was tried on bill, answer, replication and proof, at the March term, 1844, before Chancellor Ridley. He declared the deed of conveyance, so far as executed by complainant, void, and directed the consideration money and interest to be refunded, and ordered the clerk to take an account of the rents and profits, the consideration money and interest thereupon, together with the value of the improvements, and report. The complainant appealed. He cited or commented on the following authorities: 1 Story’s Eq. Jur. 246, 247; Rich-monds vs. McMinn, 6 Yerger; Tucker vs. Mooreland, 10 Peters’s Rep. 59; Grace vs. Hale, 2 Hum. The deeds of infants are not void, but merely voidable, and subject to their election, when they come of age, either to affirm or disavow them. This position is sustained by the case of Wheaton vs. East, 5 Yerg. Rep. 41, and authorities there referred to; 10 Peters’s Rep. 58; 15 Wend. Rep, 64, 681; 2 Kent’s Com. 193, and indeed by all the respectable American and English authorities on the subject running back to the case of Zouch vs. Parsons, 3 Burr. 1794. The contracts of infants are either executed or they are execu-tory; and those which are executed by passing the infant’s interest and vesting it in another for a fair equivalent received are, from their very nature, necessarily voidable merely, and not void. 5 Yerg. Rep. 41. Whatever may be the rule in executory contracts, it is clear that the executed contract of an infant is voidable only, and only the infant or his legal representatives can avoid it. 1 American Chancery Digest; 2 Hill, 541. No deed of an infant can at this day be declared void, unless it appear from the face of it that it is manifestly injurious to him, (except perhaps feoffment to a guardian, feoffment with livery by attorney — account stated — release of debts by infant executor, and a few such specified cases;) and as the deeds in this case were executed by the complainant, and the possession of the land delivered - for a full and fair consideration actually paid and so expressed on the face of the deeds; and as they were made jointly with two brothers of the infant who were of lawful age, each convejfing a similar interest for a like consideration, it cannot be pretended that they are void on account of being manifestly to the infant’s prejudice, nor that ■ they are fraudulent; but must be regarded as fair contracts, freely executed by both parties to them, and at most only voidable at the election of the infant, when of full agé; on the ground of infancy alone. The vendor’s infancy at the time he made, and also at the time he acknowledged the execution of these deeds before the clerk, being admitted, and no confirmation by him after coming of age alledged or proved, it may be conceded that the deeds are voidable at his option, and he having elected to disaffirm them, and filed his bill to set them aside, the question, whether or not he shall restore the consideration received by him before he is permitted to disaffirm, or as a consequence of his disaf-firmation, is deemed the only material one arising in this case. What is the effect of the disaffirmance of a voidable, executed contract? Does it enable the infant to retake his property conveyed away by him during minority and to retain the consideration received for it? or does it merely enable him to set aside, when he comes of age, what he chooses to consider an improvident contract made in the heedlessness of youth, and place the parties as they were before the contract was made, each being entitled from the other to the thing with which he had parted? There is no pretence of actual unfairness in this transaction; and if the contracts be rescinded, it must be, not for inadequacy of consideration, fraud, mental imbecility or any such cause, but alone on the ground of the infancy of the vendor. Judge Reeve in his learned treatise on Domestic Relations, (243 to 249,) maintains with great ability the doctrine, that when an infant avoids, on the ground of infancy, his executory contract to pay money for goods purchased and received by him, the seller may sue for the goods and recover them back; or in other words, that when the infant disaffirms the contract the parties are placed in the position which they occupied before it was made; the infant pays nothing, and the vendor is entitled to his goods. The current of ancient and modern English authority is admitted to be against this doctrine, especially if the defence of infancy be made during minority, as it may be, against the performance of an executory contract. But if after attaining full age the contract is avoided on the plea of infancy, the purchaser being in the actual possession of the goods sold, it may well be doubted whether he would not be liable for a conversion upon a failure to surrender on request; otherwise every thing sold to one under age upon his promise to pay is either voluntarily paid for or absolutely lost to the seller. A few days before an infant comes of age he purchases a valuable estate on a credit executes his notes for the purchase money, receives a title and takes possession of the estate. When his notes become due, he then being of age and in actual possession of the estate, avoids the payment of them on the ground that they were executed during his minority. The title has passed from the adult who traded with him, and his contract is binding upon him. He has traded with the infant at his peril and must lose his estate and the consideration promised for it, if the infant choose to have it so. If this be the law in relation to the executory contracts of infants it is clearly not the case as to those which are executed by them. If an infant receives rents he cannot demand them again when of age. 2 Kent’s Com. 240. If an infant pays money on his contract, and enjoys the benefit of it, and then avoids it when he comes of age, he cannot recover back the consideration paid. 2 Kent’s Com, 240: 8 Cowen’s Rep. 84, and authorities there referred to. In the 3d vol. Stephen’s Nisi Prius we find the doctrine laid down as follows: “In Holmes vs. Blogg, (8 Taunton, 511,) it was held that an infant in avoiding a lease made by him during his infancy, cannot recover back a sum of money which he had paid as a premium in consideration of it; Chief Justice Gibbs stating: cIn Lord Chief Justice Wilmot’s notes of opinions and judgments, it appears that Lord Hardwicke and Lord Mansfield were of opinion with the majority of the judges, that ‘if an infant pays money with his own hand without a valuable consideration he cannot get it back again. Wilmot’s notes, 226, n. We therefore think this action cannot be maintained, upon the ground that the infant having paid money with his own hand cannot recover it back again. Note. In Corpe vs. Ov'evion, 10 Bing. 256, Chief Justice Tindall said; ‘the ground of the judgment in Holmes vs. Blogg was, that the infant had received something of value for the money he had paid and that he could not put the defendant in the same position as before.’ “So likewise in Wilsonvs.Kearse, (Peake’s Add. Cases, 196,) Lord King was of the opinion that ‘though an infant was not compellable to complete a contract, yet that when he had paid money under it he could not recover it back, unless he could show that fraud had been practised on him.’ ” Though the executory contracts of an infant are voidable, yet when he does work, or pays money in performance of his contract, he cannot, by avoiding it, get back his money or recover a compensation for his work. McCoy vs. Hoffman, 8 Cowen’s Rep. 84. The executory contracts of an infant are voidable at any time without his restoring or being liable to restore the consideration; but it is otherwise as to contracts executed. On his coming of age and avoiding these, he must restore the consideration. 7 Cowen, 173. If an infant avoids an executed contract when he comes of age on the ground of infancy, he must restore the consideration which he had received. The privilege of infancy is to be used as a shield and not as a sword. He cannot have the benefit of the contract on one side without returning the equivalent on the other. 2 Kent’s Com. 240; 15 Mass. Rep. 359; 7 Cowen’s Rep. 179; 1 N. H. Rep. 73; 6 N. H. Rep. 330; 5 Serg. and Rawl. 309. Executed contracts can only be avoided after the infant comes of age; but executory contracts may at any time. 7 Cowen, 179. A minor, for a fair equivalent, executes his note; which is outstanding against him; when sued on it he may plead infancy and avoid its payment. But if he satisfies the note, the whólfe current of authorities clearly establishes the doctrine .thatihe cannot recover back his money at all. It is then a-Contract executed by him and is equally as binding on him, as on the person of age with whom he dealt. If the law would permit an infant, when he comes of age, to recover back money paid by him for property of which he has had and still enjoys the full benefit, and to retake property sold by him and for which he had been fully paid, it would lead to combinations between guardians-and wards, in which the ward would be permitted to sell all his property, pocket the consideration, or divide it with his guardian, and recover his property when of age, and use to his own and his guardian’s advantage all property purchased by him, and recover back all the money which he had laid out for it. Reason, justice and law hold this language in such cases: To the adult they say; “make no trade with a minor by which you involve him in debt, nor with one whom his guardian will not trust with the means to pay you, for in either case you deal at your peril;” and to the infant, when he has made an improvident sale of his property; “this contract shall be set aside if you desire it, but while you ask equity you must do equity; if your property is restored to you you must return what you received for it. It was the duty of your guardian to keep your money and hold possession of your property, and prevent you from parting with them to any one else, until you came of age. If he surrendered them to you during minority he is liable to you when of full age; and he having violated his trust in failing to exercise proper control over you and your effects, and in parting with that which the law requires him to keep and preserve, it is more just that he reimburse your losses if you have sustained any, than that one who has fairly purchased shall not only be required to return the thing purchased, but be visited with the heavy penalty of losing the whole consideration paid by him for it.” The most diligent guardians cannot prevent - infants from making executory contracts, and can upon no principle of justice or law be held responsible for them; nor can their performance be enforced against the minors to their injury. But guardians can prevent infants from executing their contracts by withholding from them the possession of the means of performance; but when they furnish such means they do so at their peril, and it is a sufficient protection to the rights of infants that their guardians are bound to deliver to them on coming of age their money and estates, notwithstanding they may have done so already during the ward’s minority. A guardian cannot take a deed from his"ward; and a payment to the ward during minority is no release of the guardian. Can he then surrender to the ward his property and money to convey and deliver to others without being clearly responsible? Certainly not. And is it not better that the ward shall look to him to repair losses resulting from his licensed and improvident dealing, than to a fair purchaser and holder of the property, who finding the ward in possession, having the full, free and' uncontrolled use and disposition of his money and estates, yielded to him by his guardian, might be ignorant of his minority, and indeed from the circumstances might infer his full age?