of acquiescing in it, or of avoiding it (). But until the party defrauded disaffirms the contract it remains good (m).

If a party be induced to purchase an article by fraudulent Where Fraud representations of the seller respecting it, he may treat it is practised as a good contract, or the moment he chooses to declare it Buyer. void, he may recover the price from the seller (0).

upon the

If, when it is avoided, nothing has occurred to alter Except where the position of affairs, the rights and remedies of the it works injustice. parties are the same as if it had been void from the beginning; but if any alteration has taken place, their rights and remedies are subject to the effect of that alteration (p). Thus where the plaintiff was induced by the Fraud of the defendants to become a shareholder in a company, it was held, that as he had in the interval between the making of the contract and the discovery of the Fraud, received dividends, and otherwise dealt with the property, he could not treat the contract as void, and sue for money had and received; but, though he could not rescind the contract, inasmuch as such rescission would work injustice, yet he might bring an action on the deceit, and recover his real damages (1).

deal with the

But if after discovering the Fraud he continue to deal Where he with the article as his own, he cannot recover back the continues to money from the seller (). And the right to repudiate article. the contract is not afterwards revived by the discovery of another incident in the Fraud (r).

upon the

A sale of goods effected by the Fraud of the buyer is Where Fraud not absolutely void, but the seller may elect to treat it as is practised a valid transaction (s), or has a right to treat the contract Seller. as a nullity, and recover the value of the goods in an action of Trover (t).

If he does not treat the sale as void before the buyer Resale by the has resold the goods to an innocent vendee (s), or pledged Buyer to an them for a bona fide advance (u), the property will pass Vendee. to the vendee.

(1) Murray v. Mann, 2 Ex. 541; Urquhart v. Macpherson, L. R., 3 App. Cas. 831; Story on Sales, 126.

(m) Dawes v. Harness, L. R., 10 C. P. 166; 44 L. J., C. P. 194; Clough v. London and North Western Rail. Co., L. R., 7 Ex. 26, 34; 41 L. J., Ex. 17; 25 L. T., N. S. 708. (0) Murray v. Mann, 2 Ex. 541. (p) See Broom's Maxims, 4th ed. 293; and per Blackburn, J., R. v. Saddlers' Co., 32 L. J., Q. B. 343.

(q) Clarke v. Dickson, 27 L. J., Q. B. 223.

(r) Campbell v. Fleming, 1 A. & E. 40.

(s) White v. Garden, 20 L. J., C. P. 166.

(t) Ferguson v. Carrington, 9 B. & C. 59; S. C. 3 C. & P. 457; Load v. Green, 15 M. & W. 216, 221.

(u) Kingsford v. Merry, 11 Ex. 577.

innocent

Contract with

But the property will not pass to an innocent vendee, unless the relation of vendor and vendee existed between the original owner of the goods, and the person who has fraudulently obtained them; for, if there be not a sale between these parties there is no contract, which the owner can either affirm or disaffirm (x). Thus where A., who had formerly been B.'s agent, and had been known to the plaintiff as such, after his agency ceased, obtained goods from the plaintiff in the name of B., which he handed over to the defendant, an auctioneer, by whom they were sold it was held, that the plaintiff might maintain Trover against the defendants, for there was never any sale to A., or any contract between him and the plaintiffs (y).

All contracts of purchase made with the fraudulent intent to cheat intent to cheat the seller, and dispose of the goods at a swindling price, to raise money, are held void (≈).

the seller.

Preconceived

design of not paying for goods.

Question for the Jury.

Resale at a

It would appear that where the buyer purchases goods with the preconceived design of not paying for them, such sale does not pass the property therein (a). Thus where some Sheep had been bought under such circumstances, Chief Justice Abbott held that if the buyer contracted for, and obtained possession of the Sheep in question, with a preconceived design of not paying for them, that would be such a fraud as would vitiate the sale and prevent the property from passing to him (6).

Whether the buyer has obtained possession of the goods with such a preconceived design, is a question for the Jury (b).

The resale of the goods at reduced prices immediately reduced price. after the buyer has obtained possession of them, is evidence that such prior transaction is fraudulent (c).

Unstamped

agreement admissible to prove Fraud.

A document which purports to be an agreement, and is valid upon the face of it, but which is tendered in evi dence to show the transaction with which it is connected to be a Fraud, is admissible in evidence, although unstamped (d).

(x) Kingsford v. Merry, 26 L. J., Ex. 83.

(y) Higgons v. Barton, 26 L. J., Ex. 342.

(z) Gibson v. Carruthers, 8 M. & W. 346.

(a) See Irving v. Motley, 7 Bing. 551; Load v. Green, 15 M. & W. 221; Ferguson v. Carrington, 9 B.

& C. 59; see Chit. Contr. 11th ed. 382.

(b) Earl of Bristol v. Wilsmore, 1 B. & C. 521.

(c) Ferguson v. Carrington, 9 B. & C. 59; S. C. 3 C. & P. 457.

(d) Holmes v. Sixsmith, 7 Ex. 802; Reg. v. Gompertz, 9 Q. B. 824.

is dis

If a buyer, under terms to pay for goods on delivery, Payment by a obtains possession of them by giving a Cheque, which is Cheque which afterwards dishonoured, he gains no property in the goods, honoured. if at the time of giving the Cheque, he had no reasonable ground to expect that it would be paid (e).

The contract of an infant, however fair and conducive Fraud of an to his interests it may be, is not binding on him, unless it Infant. be for necessaries. By the Common Law, however, the contracts of an infant, other than for necessaries, were for the most part only voidable. But now, by the 37 & 38 Vict. c. 62, s. 1, all contracts, whether by specialty or by simple contract, entered into by infants for the repayment of money lent or to be lent, or for goods supplied or to be supplied (other than contracts for necessaries), and all accounts stated with infants, are made absolutely void; provided always, that the above enactment "shall not invalidate any contract into which an infant may, by any existing or future statute, or by the rules of Common Law or Equity, enter, except such as are now by law voidable" (f). And it was no answer at law to a plea of infancy, that the defendant, at the time of entering into the contract, fraudulently represented himself to be of full age; and that the other party believing this representation, and on the faith thereof, contracted with him (g). Nor did these facts form the subject of a good replication, on equitable grounds, to a plea of infancy(), although in such a case a Court of Equity might grant relief against the infant on the ground of fraud (i).

Woman.

A husband is not liable for any fraud of the wife, Of a married which is directly connected with and dependent upon a contract (). In a case in which an action had been brought against a husband and wife for a false and fraudulent representation by the wife to the plaintiffs, that she was sole and unmarried at the time of her signing a promissory note as surety to them for a third person, whereby they were induced to advance a sum of money to that person, it was held that an action would not lie. And Pollock, C. B., said, "A feme covert is unquestionably

(e) Hawse v. Crowe, R. & M. 414; Earl of Bristol v. Wilsmore, 1 B. & C. 521.

(f) Chit. Contr. 10th ed. 138. (g) Johnson v. Pye, 1 Sid. 258. (h) Bartlett v. Wills, 31 L. J., Q. B. 57.

(i) Nelson v. Stocker, 28 L. J., C. 760.

(k) Liverpool Adelphi Loan Association v. Fairhurst, 9 Ex. 422; Wright v. Leonard, 30 L. J., C. P. 365.

Where a con

is old and

incapable of binding herself by a contract; it is altogether void, and no action will lie against her husband or herself for the breach of it. But she is undoubtedly responsible for all torts committed by her on any person, as for any other personal wrongs. But when the fraud is directly connected with the contract with the wife, and is the means of effecting it, and parcel of the same transaction, the wife cannot be responsible, and the husband be sued for it together with the wife" (1).

Equity will give relief where there is no reasonable tracting party equality between the contracting parties, e. g., in a case in weakminded. which the vendor, being an aged, illiterate, weakminded man, though not a person absolutely incapable of managing his own affairs, executed a deed of conveyance of his property for a grossly inadequate consideration (m).

Drunkenness

of a contracting party.

Goods kept by

sober.

Where a party, when he enters into a contract, is in such a state of drunkenness as not to know what he is doing, and particularly when it appears that this was known to the other party, he cannot be compelled to perform the contract (n).

If, however, a man buys a Horse when so drunk as not a party when to know what he is doing, but keeps it after he is sober, he cannot set up his drunkenness as an answer to an action for the price (0).

(1) See note (k), ante.

(m) Longmate v. Ledger, 6 Jur., N. S. 481. See also Roberts' Principles of Equity, 3rd ed. 79.

(n) Gore v. Gibson, 13 M. & W. 626.

(0) See Chit. Contr. 10th ed. 137; Gore v. Gibson, 13 M. & W. 626.

tender the

WHERE a Horse has been sold warranted Sound, which Buyer neither it can be clearly proved was Unsound at the time of Sale, bound to the seller is liable to an action on the Warranty, without Horse nor either the Horse being returned or Notice given of the give Notice. Unsoundness. And in a case where there was a breach of Warranty, Lord Loughborough said, "No length of time elapsed after the sale will alter the nature of a contract originally false. It is not necessary that the Horse should be returned to the seller or that Notice should be given" (a). Where a Horse warranted Sound turns out Unsound, Seller not the seller is not bound to take it back again; nor can the bound to take buyer, by reason of the Unsoundness, resist an action for back the

(a) Fielder v. Starkie, 1 H. Bla. 17; and see Poulton v. Lattimore, I B. & C. 265.

Horse.