doubtful, or that there is some outstanding contingent interest which may, perhaps, at a future period, be the means of evicting the purchaser; and to protect the purchaser, and enable him to recover against the vendor in case of eviction the covenant of warranty is inserted in the deed. And yet, in many cases of this kind, the purchaser continues to hold and enjoy the land until all question as to the title is removed, by lapse of time or otherwise. Now, in such

cases, if the purchaser were permitted to set up an outstanding title in the original patentees or their heirs, or in someone who had received a title, directly or indirectly, from them, it might be very difficult, if not impossible, for the vendor to trace a perfect claim of title from the original patentee to himself, although he was in fact the legal owner of the premises at the time of the sale. Permitting the purchaser to set up such a defense before eviction would, as a general rule, be making a new contract for the parties which they never intended to make for themselves."

In Lattin v. Vail (1837) 17 Wend. (N. Y.) 188, in holding it to be no defense to a purchase-money note that it was given as part consideration for land which the grantor covenanted was free from encumbrances, but which was subject to a mortgage for a sum exceeding the amount of the note, the court said: "The defendant's counsel insist that it shows a total failure of the consideration for which the note was given; but in this they are mistaken. The title has not failed, nor have the defendants been disturbed in the enjoyment of the land. There is an outstanding encumbrance which, if not extinguished by the plaintiff, may at some future period operate to defeat the title; but it is impossible to say that the consideration has wholly failed so long as the defendants remain in the undisturbed enjoyment of the property for which the note was given. There has been no breach of the covenant of seisin (Stanard v. Eldridge (1819) 16 Johns. (N. Y.) 254), and although the covenant against encumbrances is broken,

the defendants would only be entitled to nominal damages so long as the mortgage remains outstanding." In Shire v. Plimpton (1900) 50 App. Div. 117, 63 N. Y. Supp. 568, where the grantee for many years had been in undisturbed possession under a deed containing general covenants of title, it was held that there had been no breach of the covenant of warranty, and hence such defect was no defense to the foreclosure of the mortgage, although the grantee produced evidence tending to show that the defect in the title depreciated the market value of the premises by a substantial amount. It is held in Norton v. Jackson (1855) 5 Cal. 262, that a purchaser of land in possession under a deed containing a covenant of warranty cannot resist payment of the purchase price so long as he remains in possession; nor can he secure a reduction thereof on the ground of a defect of title. However, equity can relieve the vendee in such circumstances by granting a rescission of the contract where the grantor is insolvent and unable to respond in damages for breach of the covenant, and it appears there is a paramount outstanding title in another. In Haldane v. Sweet (1884) 55 Mich. 196, 20 N. W. 902, it is held that where the holders of the alleged outstanding title do not appear to have asserted the same, and their right is at least doubtful, the vendee who is in possession will be left to a suit on his covenant. He cannot defend a suit to foreclose a mortgage for a portion of the purchase price upon the ground of this defect. And Jourolmon v. Ewing (1897) 26 C. C. A. 23, 47 U. S. App. 679, 80 Fed. 604, holds that where the grantee has been put in possession of land conveyed with covenants of warranty, and has not been ousted or otherwise disturbed in his possession, he cannot refuse payment of the purchase price according to his agreement by showing that some third person has a title adverse to his grantor, even though he did not know of such adverse claim at the time he took his deed, providing no fraud was practised upon him. It is held in Bryant

v. Green (1921) 193 Ky. 139, 235 S. W. 10, that, where the vendee is in possession under a conveyance containing general warranties, he is not entitled to a rescission of the contract when sued for the purchase money, even though the vendor at the time of the sale may have represented his title as perfect, when in fact it was not. The court said that in such case the vendee must pay the purchase money and rely upon the covenants of warranty if he is ever evicted. And see Makainai v. Goo Wan Hoy (1902) 14 Haw. 281, holding that, where the vendee is in possession under a deed with covenants of title, failure of consideration on the ground that no title passed is not a defense to an action on a purchase-money note where the vendee has not been evicted, or obliged to pay off the encumbrance, or otherwise injured.

It is held in Abbott v. Allen (1817) 2 Johns. Ch. (N. Y.) 519, that where the grantee is in possession and has held possession for a number of years, and no adverse title has been asserted to the land, nor any adverse proceeding threatened, and the grantee has full covenants of title, to one of which he can immediately resort in courts of law, being the covenant of seisin, if the grantor was not seised the grantor's remedy at law for the residue of the purchase money will not be stayed by injunction.

In Shearer v. Backer (1925) 207 Ky. 455, 269 S. W. 543, where the grantees in possession under a warranty deed commenced an action against the grantors and their successors under the Declaratory Judgment Act to enjoin the collection or transfer by the defendants of the purchase-money lien notes, for a declaration as to the disputed rights of the appellees to convey title to the land, and more especially to determine whether or not the title conveyed to them was subject to defeasance under the will of a prior owner, it was held that the grantees were not entitled to relief against the payment of the purchase-price note, or to a declaratory judgment. Upon the latter point the court said: "After appellants have

accepted a warranted title and are in full and undisputed possession of the land, what may or may not happen to their title or possession is simply a speculative argument that is not now, and may never become, an actual controversy about rights or duties; and it was not the purpose of the Declaratory Judgment Act to impose upon the courts the burden of answering such abstract and speculative propositions of law simply to satisfy the curiosity or fears of the parties about possible controversies that may may not arise out of their executed contract."

or

An outstanding dower interest is not a defect in a title that will induce equity to restrain the prosecution of a proceeding for the foreclosure of a purchase-money mortgage given by the grantee who is in possession. Glenn v. Whipple (1858) 12 N. J. Eq. 50. In Clementson v. Streeter (1884) 59 Wis. 429, 18 N. W. 340, it is held that the fact that the grantor had only a life estate in the land he conveyed by a deed with covenants of warranty does not furnish grounds to the grantee to resist the foreclosure of a purchase-money mortgage, .where he has not been disturbed in his possession. A voidable title in the grantor, due to the fact that his predecessor in title was an infant at the time of the conveyance, is not such a defect as to induce a court of equity to enjoin proceedings to foreclose a deed of trust given by the grantee in possession for the unpaid purchase money, where the minor has brought no suit to avoid his deed, nor threatened any. Harding v. Commercial Loan Co. (1876) 84 III. 251. That there was an outstanding vendor's lien against the property was held not a defense in behalf of a subsequent vendee in possession, in a suit against him to recover the amount due on the purchase price, where, although his immediate vendor was insolvent, the subsequent vendor was liable on his warranty. White v. Ewing (1895) 16 C. C. A. 296, 37 U. S. App. 365, 69 Fed. 451.

The rule is stated in Topp v. White (1873) 12 Heisk. (Tenn.) 165, to be well settled in Tennessee that a pur

chaser of land in possession under a deed with covenants of warranty, in the absence of fraud and before eviction, is entitled to no relief in equity against the payment of the purchase money upon the ground of defect in title. And it is held that, where the vendee is in possession under a warranty of title, the court will not, by injunction, stay the collection of the remaining unpaid purchase money until the vendor shall exhibit a valid and connected chain of title to the land, and, if any be lost by better title, an abatement as to this portion. Young v. Butler (1858) 1 Head (Tenn.) 639.

But it has been held that, where the vendor conveys by a deed with covenants of warranty and against encumbrances, the vendee, although in possession, may reduce the amount of the recovery sought by the vendor for the balance of the purchase price, by proof of the partial failure of the consideration which has resulted from the existence of encumbrances against the property. Williams v. Neely Neely (1904) 69 L.R.A. 232, 67 C. C. A. 171, 134 Fed. 1. The court said: "The reason for this rule is that the covenants in the deed and the promise in the note are mutual covenants, and the performance of each is the consideration of, and the completion of, the obligor's promise to perform the other. This is an evident proposition so long as the contract of sale is executory, and the covenant to vest good title and the promise to pay the purchase price are embodied in a single written instrument, which is signed by both the parties. Partial failure of the plaintiff to perform is always a good defense pro tanto to an action for damages for the defendant's failure to keep his agreement, or to a suit to enforce its specific performance. The reason for the rule, and its appropriate application to a covenant against encumbrances and a promissory note for the purchase price, would be equally obvious if these mutual covenants which accompany the transfer of title were embodied in a single written agreement which was signed by the parties.

A moment's reflection will, however, convince that it can make no difference in the rights of the parties to the sale, or in the legal effect of the transaction, that the covenant of the vendor is in one writing and the promise of the vendee is in another. The performance of the one is still the consideration and the condition subsequent of the other, and a partial failure to perform one ought to be, and is still, a defense pro tanto to an action or a suit upon the other."

The rule is stated in Coy v. Downie (1874) 14 Fla. 544: "The right of the... grantees to resist the collection of a part or the whole of the purchase money of the premises, under the broken covenants in the deed, cannot be questioned, whatever appropriate offsets by way of recoupment or otherwise may exist in consequence of the failure of title to, or possession of, the whole or any part of the property, and under the express covenants of seisin of title in fee simple, of possession and quiet enjoyment, and against defects and encumbrances, they may be set up against and in bar of a suit to recover the purchase money, or they may be recovered by direct action upon the covenants. The grantors are liable for any breach of their covenants, and, as this mortgage was given to secure them, the recoupment or offsets may be made against the claim of the present plaintiff, who was one of them, and who represents them in this suit."

And see Williams v. Baker (1903) 100 Mo. App. 284, 73 S. W. 339, holding that partial failure of consideration for the purchase price of land may be interposed to defeat a suit to enforce the vendor's lien for the balance of such purchase price, although the failure of consideration is due to a defective title, and the grantee holds possession under a warranty deed.

In order that a vendee in possession under a deed with warranty may resist payment of the purchase money on the ground of a paramount title outstanding in a third person, he must establish the existing validity of such outstanding title. Eviction is not

necessary, but evidence must clearly show a subsisting, outstanding title, and that the land is actually claimed under it. Cook v. Jackson (1857) 20 Tex. 209. And in Johnson v. Long (1863) 27 Tex. 21, the court said that the vendee, in order to resist the payment of the purchase money, must establish beyond doubt that the title had failed, in whole or in part, or that there was danger of eviction. And it is held in Price v. Blount (1874) 41 Tex. 472, that, in order for the purchaser to resist payment of the purchase price on the ground of defective title, he must show with reasonable certainty that the title has failed, in whole or in part, and that there has been eviction, or that there is danger of it. In Cooper v. Singleton (1857) 19 Tex. 260, 70 Am. Dec. 333, after stating the general rule that the vendee in possession under a deed containing warranties of title cannot resist payment of the purchase money on the ground merely of defect or failure in the title, where there has been no fraudulent representation by the vendor, the court said that this is not the rule as recognized by the courts of Texas; that the Texas rule is that, "though there may be a deed with covenants of warranty, yet the vendee may resist the payment of the purchase money in cases where the title has turned out to be wholly defective, or there be a valid outstanding title in others; that, where there clearly was no title in the vendor, the purchaser is not compelled to pay, and then, after eviction, seek his remedy on the covenants of his deed, especially where the vendor is, or may probably be, insolvent, or beyond the reach of the court." In Warren v. Clark (1894) Tex. Civ. App. —, 24 S. W. 1105, the court, while holding that total failure of consideration is not a defense to an action on the purchase price of land conveyed by a deed with covenants of title, nevertheless holds that where the failure of title to a portion of the land was clearly established, the grantee was entitled to a proportionate abatement of the purchase price. So, it is held in Demaret v. Bennett (1867) 29 Tex.

262, that the vendee of land who took possession under a deed with warranty, without any notice of a defect in the title, may resist the payment of the purchase money by showing his title to be worthless, and the existence of a superior outstanding title, by actual ouster, or, what is tantamount to the same, an indisputable superior outstanding title, and that he is liable to be evicted. To the same effect is Hoy v. Peacock (1913) Tex. Civ. App. 154 S. W. 677. In Smith v. White (1913) 71 W. Va. 639, 48 L.R.A. (N.S.) 623, 78 S. E. 378, the court said that it has long been a settled rule of practice, both in Virginia and in this state, that a court of equity, when once it has acquired jurisdiction of the cause of action and the parties, will determine all the questions involved. Thus, "where there has been a conveyance of land with covenants of general warranty, equity has power

.to

enjoin the collection of the purchase money before actual ouster, if it be clearly shown that the grantor's title is defective." And it is held in Wamsley v. Stalnaker (1884) 24 W. Va. 214, that equity will enjoin the collection of purchase money at the instance of a grantee in possession under a conveyance containing a general warranty of title, where the title is questioned by a suit, either prosecuted or threatened, or where it is clearly shown that the title is defective.

And Clarke v. Hardgrove (1851) 7 Gratt. (Va.) 399, holds that where the grantee in a deed containing warranties of title, in part payment for the land, transferred to the grantor a certain bond, secured by mortgage, which he had taken from a third person on other land, and it subsequently appeared that there was a defect in the title to the land he had purchased, he was entitled to enjoin the collection of this bond by his grantor until this defect was remedied. It is said: "The court is of opinion that, as the appellant has clearly shown that at the institution of his suit the title to a portion of the land conveyed to him was defective, he had a right, notwithstanding a deed with general war

ranty had been made, to enjoin the collection of the purchase money (Koger v. Kane (1833) 5 Leigh (Va.) 606, and cases there cited); and that such right is not impaired, though the vendor is seeking to collect the purchase money, not directly from the purchaser, but from a third person on a collateral security assigned to him by the purchaser, it not being incumbent upon the purchaser, in case of such clear defect of title, to risk the hazard of the vendor's solvency." And Deal v. Dodge (1861) 26 Ill. 460, sustains the right of a grantee to rescind the contract and escape paying purchase-price notes, where the deed contained covenants of title, and the title was defeated by an encumbrance thereon existing prior to the deed.

In denying the right of the purchaser to rescind a contract for defective title, the court in Cannon v. Female Orphan Soc. (1872) 24 La. Ann. 452, said that if the purchaser has just reason to fear being disquieted, he may retain the price until the vendor gives him security.

It is also recognized in Starke v. Hill (1844) 6 Ala. 785, that equity will relieve a grantee in possession under a deed containing covenants of warranty, where there has been a failure of consideration due to defective title in the grantor. To the same effect is Patton v. England (1848) 15 Ala. 69, holding that the court of equity was a most appropriate forum for the rescission of a transaction of this kind, because of the defective title of the vendor. Dykes v. Bottoms (1892) 101 Ala. 390, 13 So. 582, also, holds that the grantee is entitled to an abatement of the purchase price as to that portion of the lands covered by the deed to him, to which the vendor had no title, where the latter seeks to enforce the vendor's lien for the purchase price.

The rule at one time prevailed in South Carolina that the grantee was entitled to proportionate relief against the purchase price, in an action at law to recover the same, where there was a partial failure of title. Farrow v. Mays (1818) 10 S. C. L. (1 Nott &

M'C.) 312; Furman v. Elmore (1819) 11 S. C. L. (2 Nott & M'C.) 199; Thompson v. M'Cord (1796) 2 S. C. L. (2 Bay) 76. And it is held that where the vendee has gone into possession, and been in receipt of the rents and profits, he cannot set up a defect in the title of the grantor as a defense to an action upon a note for the purchase price, although the defect invalidates the title and entitles the grantee to rescind the contract. The court, however, recognized that relief might be had in equity. Westbrook v. M'Millan (1829) 17 S. C. L. (1 Bail.) 259; Sumter v. Welsh (1805) 3 S. C. L. (1 Brev.) 539; Taylor v. Fulmore (1844) 30 S. C. L. (1 Rich.) 52. But the pendency of an action for dower is not a defense to the foreclosure of a mortgage for the purchase price. Childs v. Alexander (1885) 22 S. C. 185. To the same effect is Whitworth v. Stuckey (1843) 18 S. C. Eq. (1 Rich.) 404.

In Cook v. Mix (1836) 11 Conn. 432, it is held, in a suit on a purchasemoney note, that covenants in the deed formed the consideration for the note, and where no title was conveyed the purchaser might show a failure of title to reduce the damages. The court said it was very obvious that when a party does not get that which by the terms of his contract he was to receive, and for which his note is given, the consideration of the note fails entirely.

In Scantlin v. Allison (1873) 12 Kan. 85, where the heirs of the owner of real estate, with one exception, joined in a warranty deed of the land, taking a note to one of them as trustee in payment for a portion of the purchase price, and this deed, as a matter of fact, only conveyed a fractional part of the title, it was held that to the extent of the unconveyed interest in the land there was a failure of consideration, which the grantee was entitled to have offset against the amount due on the purchase price. The court said: "The defendant unquestionably got a good title to at least four fifths of said land; and as he still retains the title to said four fifths, and the possession of the whole