§ 95. Equitable defences are very frequent in actions brought to recover possession of lands by the vendors against the vendees, when an agreement to convey the land in question has been entered into. As illustrations, the following have been upheld : when the complaint alleged the non-payment of the purchase price at the stipulated time, and a consequent forfeiture, the defence that the time of payment had been extended by an oral agreement, and that a tender had been duly made in compliance with such agreement; 2 in an action in all respects the same on the part of the plaintiff, the defence that a tender had been made and kept good, the court expressly refusing to grant the affirmative relief of specific performance to the defendant. The vendee's right to possession under a contract to convey is a very familiar species of equitable defence to actions brought to recover the land by the vendor. In an action by the grantee of the vendor, who took with constructive notice of the defendant's interest, the right of the vendee's assignee to possession and to a deed of conveyance is a good equitable defence in bar. To an action for the foreclosure of a mortgage executed by the defendant to the plaintiff's assignor, the answer alleged a mistake in the instrument in relation to the terms and times of payment, claiming that, when corrected, nothing would be due, and demanded the affirmative relief of a reformation. This remedy was granted by the court, although the mortgagee was not a party to the action. In pleading an equitable defence, all the facts should be averred which are necessary to the existence of the equitable right. In ciples, the plaintiff ought not to be put into possession of the premises, he cannot recover in the action." The principle so concisely and clearly enunciated is a complete answer to the reasoning of Mr. Justice Talcott, quoted supra in the note to § 91. See McLane v. White, 5 Minn. 178; Richardson v. Bates, 8 Ohio St. 257, 264. 1 In Cavalli v. Allen, 57 N. Y. 508, 514, it was held that the vendee in possession may set up, as an equitable defence, the same equitable rights which he could have enforced had he brought an action for a specific performance. 2 Cythe v. Fountain, 51 Barb. 186, 188. 3 Harris v. Vinyard, 42 Mo. 568. 4 Petty v. Malier, 15 B. Mon. 604; Onson v. Cown, 22 Wisc. 329. But it is held in Kentucky that in an action for trespass to lands, brought by a vendor in possession against the vendee, the rights of the latter under his contract do not constitute an equitable defence for the trespass, which was an entry upon the land under a claim of right founded upon the contract; in other words, the contract does not give the vendee a right of entry, although it would be an equitable defence to an action brought to recover the land if he was already in possession. Creager v. Walker, 7 Bush, 1, 3. 5 Talbert v. Singleton, 42 Cal. 390, 395, 396; Cavalli v. Allen, 57 N. Y. 508. Andrews v. Gillespie, 47 N. Y. 487, 490. The objection of the want of the mortgagee as a party was expressly taken and as expressly overruled, the court many instances this right is, from the nature of the case, a right to affirmative remedy; and, whether this remedy is demanded or not, the answer should contain all the substantial facts that would be found in a cross-bill in chancery.1 § 96. These defences are not, however, confined to actions involving the title to lands, or those brought upon contracts relating to land; they are proper in actions based upon mercantile agreements, and in all others where an equity may arise and affect the rights of the parties. The complaint in an action upon a promissory note demanded judgment for a certain balance unpaid. A defence that the note was given upon a settlement, and that by mistake the amount was made too large by a certain sum which was more than the unpaid balance claimed by the plaintiff, was held a good equitable bar to the action, without any specific relief demanded or awarded; 2 and in an action upon a policy of reinsurance the recovery was defeated by the fact, set up in defence, that the same person acted as agent for both the parties in procuring the policy to be issued, and that his agency for the plaintiff was unknown to the defendant at the time. Here, also, no affirmative relief was granted; nor could any have been given .except cancellation of the policy, which would certainly have been entirely useless. The assignee of a lease bringing an action. for the rent, the defendant averred that the assignment to the plaintiff, although absolute in form, was in fact given as collateral holding that he was not a necessary party in order to a judgment of reformation. 1 See Bruck v. Tucker, 42 Cal. 346, 352, per Wallace J. "It must be considered as settled [in California] that, in interposing such a defence, the defendant becomes an actor, and the defence interposed a pleading in equity, the sufficiency of which, in matter of substance, though not in point of mere form, is to be determined by the application of the rules of pleading observed in courts of equity in cases of like character." Cites, as decisive of this rule, Estrada. Murphy, 19 Cal. 272; Lestrade r. Barth, 19 Cal. 660; Weber v. Marshall, 19 Cal. 447; Blum v. Robinson, 24 Cal. 127; Downer v. Smith, 24 Cal. 114. See Hughes v. Davis, 40 Cal. 117; Arguello e. Edinger, 10 Cal. 150; Clark v. Huber, 25 Cal. 593, 597. 2 Seeley v. Engell, 13 N. Y. 542, re versing s. c. 17 Barb. 530. See Becker v. Sandusky City Bk., 1 Minn. 311. 8 N. Y. Central Ins. Co. v. Nat. Protection Ins. Co., 14 N. Y. 85; 20 Barb. 468. This case was peculiar. The defence established was not averred, but the answer was merely a denial, saying, "They deny that they made and executed a policy of insurance, or delivered the same to the plaintiff, as stated in the said complaint." On the trial the evidence establishing the defence stated in the text was admitted without objection; and the Court of Appeals held that however improper under the answer if objected to, as the plaintiff had failed to object, it could not raise the objection in the Appellate Court. The result was that a defence conceded to be purely equitable was proved under a denial only. See observations of Denio J. quoted in note to § 70. security for the payment of a note, that the note had been paid, and that the interest of the plaintiff had thereby ended. This defence was sustained, and here, also, no affirmative relief could have been essential to the defendant's security or protection under any circumstances; the judgment in his favor was a bar to all possible further action on the lease by the plaintiff or his assigns.1 In all the foregoing instances the single equitable defence has been spoken of as though it stood alone, unconnected with any others. others. An equitable defence, however, may be joined with any other defences, legal or equitable, which may possibly arise in the action. In many of the cases referred to in the text and cited in the notes, other defences were spread upon the record. Thus, in the action upon a policy of insurance any of the customary legal defences of misrepresentations, breach of warranties, non-compliance with provisions of the policy in regard to proofs, and the like, might have been pleaded and proved in connection with the equitable defence which was interposed.2 § 97. The remaining question to be considered is, When will affirmative equitable relief be granted to the defendant upon the facts which he alleges in his answer as constituting an equitable bar to the plaintiff's recovery? The New York Court of Appeals, in an early case, expressly held that in an action upon a covenant against incumbrances in a deed of lands, brought to recover damages for a breach thereof by means of an outstanding mortgage, the defendant may show, by way of equitable defence in bar, a mistake in the deed by which an exception of that very mortgage was omitted from the covenant, but that he could not have, in that action and upon an answer setting up all these facts, the affirmative relief of reformation. The case was decided, and the judgment sustained, expressly upon this distinction. This decision, however, cannot be regarded as correct in the light of other subsequent adjudications made by the same court and referred to in the foregoing paragraphs. Affirmative relief may certainly be given to the defendant upon his answer in all cases where, from the nature of the subject-matter and from the relations of the parties, a specific remedy in his favor is possible according to 1 Despard v. Walbridge, 15 N. Y. 374, 378; Struman v. Robb, 37 Iowa, 311, 313; Hablitgel v. Latham, 35 ib. 550. 2 See Bennett v. Titherington, 6 Bush, 192; Dorsey v. Reese, 14 B. Mon. 157; the doctrines of equity jurisprudence, certainly in all cases where the answer can be considered as setting up a counter-claim. There are undoubtedly instances in which no such relief is possible. Where, however, the nature of the subject-matter and of the relations between himself and the plaintiff are such that he could have maintained an independent suit in equity against the plaintiff and procured specific relief thereby, or could have filed a cross-bill under the old practice, he may now obtain the same remedy upon his answer, at all events, as was before remarked, if the demand alleged in the answer constitutes a valid counterclaim. This is undoubtedly the general rule. In a very few States, however, cross-complaints or petitions are expressly recognized by the codes in addition to counter-claims; and the rule in those States may be that, if the demand for equitable relief do not constitute a proper counter-claim, it must be made in a cross-complaint or cross-petition, and not in an answer. Subsequently to the decision of Haire v. Baker,2 in New York, the Court of Appeals held, by way of dictum in Dobson v. Pearce, that the defendant may obtain affirmative relief upon the answer which he pleads to the plaintiff's cause of action. Finally, the doctrine was expressly established as the basis of the decision. In an action to recover possession of land, where the plaintiff held his title by a sheriff's deed given upon a sale under execution against the original owner, the defendant not only defeated the recovery by proving a mistake in the sheriff's deed, but obtained a judgment reforming that deed by correcting the mistake. While in some States the answer may be turned into a cross-petition, and affirm 1 The case of Despard v. Walbridge, cited supra, seems to be such a one. The defendant had a right to prevent a recovery against himself by one who had no interest in the lease; but he certainly could not have enforced a reassignment of the lease from the plaintiff to his assignor, nor a cancellation of that assignment, because he had no interest in or power over the instrument in question; much less could he have obtained any relief against the lease. His right was purely defensive. 3 On the trial the complaint was dismissed, but the remedy of reformation was denied. The General Term, on appeal, modified this judgment by granting the additional relief of reformation. This latter ruling was affirmed by the Court of Appeals. Bacon J., after stating the relief which would have been granted in equity under the former system, added: "But this resort is no longer necessary, since by our present system an equitable defence may be interposed as well in an action of ejectment as in any other form of proceeding, and the defendant may also claim in the 2 Haire v. Baker, 5 N. Y. 357. Dobson v. Pearce, 12 N. Y. 156, 165, same action any affirmative relief to per Allen J. 4 Bartlett v. Judd, 21 N. Y. 200, 203. which he shows himself to be entitled." ative relief obtained, yet this proceeding does not seem to be necessary, even in those States where the practice provides for such cross-petition or cross-complaint; the defendant may have the proper affirmative relief to which he is entitled upon his answer.2 In Missouri, however, it would seem that affirmative equitable relief can never be granted to the defendant upon his mere answer.3 In extreme contrast with this position is the doctrine, already discussed, which refuses to the defendant the benefit of an equitable defence as a bar to a legal cause of action, unless the facts relied upon are such that he would be awarded an affirmative remedy if he elected to demand a judgment conferring it. The general subject of affirmative relief to defendants will be treated more at large in the subsequent sections upon "Counter-claim" and "Union of Defences in One Answer." A LEGAL REMEDY OBTAINED UPON AN EQUITABLE OWNERSHIP OR EQUITABLE PRIMARY RIGHT. § 98. A special case, arising from the general union of legal and equitable forms produced by the new system, requires a particular examination. It may be properly presented under the form of the question whether the holder or possessor of a purely equitable primary right, or the owner of a purely equitable estate or interest, can maintain an action to recover a remedy which, before the change in procedure, was purely legal; or, to express the same thought in terms not entirely accurate, but which are, nevertheless, in constant use, whether such holder of a purely 1 Massie v. Stradford, 17 Ohio St. 596. This was an action for trespass to lands. The defendant, in an answer by way of cross-petition, set up an equitable title to the premises in question, and prayed for a decree establishing the legal title in himself, and an injunction against the plaintiff's further prosecution of the action at law. Hablitgel v. Latham, 35 Iowa, 550; Hammond v. Perry, 38 ib. 217. Klonne v. Bradstreet, 7 Ohio St. 322. 3 Harris v. Vinyard, 42 Mo. 568. This was an action to recover lands. The defendant set up a contract of purchase from the plaintiff's deceased father, pay- |