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child v. Llewellyn Realty Co. (1912) 82 N. J. L. 423, 82 Atl. 924.

New York. Northridge v. Moore (1890) 118 N. Y. 419, 23 N. E. 570; Cockroft v. New York & H. R. Co. (1877) 69 N. Y. 201; Walton v. Meeks (1890) 120 N. Y. 79, 23 N. E. 1115; Blate v. Clarry (1906) 50 Misc. 668, 99 N. Y. Supp. 463; Baldwin v. Munn (1829) 2 Wend. 399, 20 Am. Dec. 627. Pennsylvania. Orr v. Greiner

(1916) 254 Pa. 308, 98 Atl. 951.

Texas. Hall v. York (1859) 22 Tex. 642; Vaughn v. Farmers & M. Nat. Bank (1910) 59 Tex. Civ. App. 380, 126 S. W. 690.

Washington. Babcock, C. & Co. v. Urquhart (1909) 53 Wash. 168, 101 Pac. 713; Crawford v. Smith (1923) 127 Wash. 77, 219 Pac. 855.

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England. Flureau v. Thornhill (1776) 2 W. Bl. 1078, 96 Eng. Reprint, 635; Pounsett v. Fuller (1856) 17 C. B. 660, 139 Eng. Reprint, 1235; Bain v. Fothergill (1874) L. R. 7 H. L. 158; Engel v. Fitch (1868) L. R. 3 Q. B. 314, s. c. subsequent appeal in (1869) L. R. 4 Q. B. 659 — Exch. Ch.; Sikes v. Wild (1861) 1 Best & S. 587, 121 Eng. Reprint, 832, affirmed in (1863) '4 Best & S. 421, 122 Eng. Reprint, 517 -Exch. Ch.; Day v. Singleton [1899] 2 Ch. 320 C. A.; Ontario Asphalt Block Co. v. Montreuil (1916) 52 Can. S. C. 541, 27 D. L. R. 514, Ann. Cas. 1917B, 852.

In Atwood v. Walker (1901) 179 Mass. 514, 61 N. E. 58, where a contract for the sale of real estate was executed in the state of New York, and the vendor made the contract in good faith, but was unable to give a good title, it was held that the rule of New York as to the measure of damages should apply, and not that of Massachusetts, and, applying the rule of New York, the vendee was limited to the recovery of the amount he had paid on the purchase price.

Under the California Code, the venIdee is not entitled to recover as his measure of damages the difference between the price agreed to be paid and the value of the land, except where there has been bad faith on the part of the vendor. Smith v. Bangham (Cal.) supra. Where nothing has been

paid on the purchase price, and no expenses have been incurred in examining the title and preparing the necessary papers, the vendee is not entitled to recover any damage. Wilson v. White (Cal.) supra. Under this rule, the mere failure to convey according to the terms of the contract is held in Kentucky not to be sufficient evidence of a fraudulent inability upon the part of the vendor. Rutledge v. Lawrence (Ky.) supra. The fact that the defect in the title consisted of mortgages which were liens upon the land does not prevent the application of the principle relieving the vendor, where he acts without knowledge and in good faith. So long as these elements appear in the transaction, it matters not whether the title is imperfect of itself, or is rendered defective by reason of encumbrances on the land. Cockroft v. New York & H. R. Co. (1877) 69 N. Y. 201. It is pointed out in this case that the encumbrances were not ordinary mortgages, the release of which might have been obtained, but were mortgages held by trustees for the bondholders of the vendor company, who had no legal authority to release the land, and there was no lawful method of obtaining a discharge of the lien. Nor could they be paid, for they were not yet due. In Walton v. Meeks (1890) 120 N. Y. 79, 23 N. E. 1115, where the measure of damage was held to be the amount paid on the purchase price, it appeared that the vendor was unable to convey to the vendee a marketable title to the land, although it did not appear that the vendor's title was not a good title. The court said that the rule was well settled that the vendee in a contract for the sale of land is not entitled to recover, aside from purchase money paid and expenses of the examination of the title, other than nominal damages for a breach on the part of the vendor arising from his inability to convey a good or marketable title. Only nominal damages are recoverable where the vendee had paid nothing on the purchase price at the time the vendor ascertained that his title was defective, he having contracted to sell the land in good faith,

believing he had a good title. Baldwin v. Munn (1829) 2 Wend. (N. Y.) 399, 20 Am. Dec. 627.

It is said in Hall v. York (1859) 22 Tex. 642, that every man who sells land that does not belong to him commits a fraud. But unless there be additional circumstances of fraud, and special damages resulting to the vendee, the measure of damages against such a vendor would be only the purchase money and interest.

In Babcock, C. & Co. v. Urquhart (1909) 53 Wash. 168, 101 Pac. 713, where the measure of damage was held to be the amount paid by the vendee on the purchase price, the breach complained of was due to the inability of the vendor to give title to the amount of water contracted for.

In Engell v. Fitch (1869) L. R. 4 Q. B. (Eng.) 659-Exch. Ch., it is said that the rule in Flureau v. Thornhill (1776) 2 W. Bl. 1078, 96 Eng. Reprint, 635, is wholly confined to cases of inability of the vendor to make title, and is not extended to other breaches of executory contracts for the sale of property. In Pounsett V. Fuller (1856) 17 C. B. 660, 139 Eng. Reprint, 1235, where there was a breach of a contract to sell the shooting on a certain manor, and after the execution of the contract it was discovered that the vendor had a mere equitable title and the owner of the manor refused to confirm it, it was held that the vendee was only entitled to recover nominal damages and any expense of investigating the title. He was not entitled to damages for the loss of his bargain, or expenses incurred in obtaining shooting elsewhere, or in endeavoring to substitute a new contract on the failure of the one in question. The court said that although the vendor had no right to sell what he professed to sell, inasmuch as it was an incorporeal hereditament which could only be granted under seal, yet as a layman he had a fair right to believe he had the power to sell which he professed to have, and therefore his case comes within the qualification of the rule as expressed in Hopkins v. Grazebrook (1826) 6 Barn. & C. 31, 108 Eng. Reprint, 364. In Flureau v. Thornhill

(Eng.) supra, where the vendor could not convey a good title, but offered the vendee his election either to take the title with all its faults, or to receive back his deposit with interest and costs, it was held that the vendee was not entitled to recover damages as compensation for the loss of his bargain. Blackstone, J., remarked that these contracts are merely upon condition, frequently expressed, but always implied, that the vendor has a good title. If he has not, the return of the deposit with interest and costs is all that can be expected. It has been held that the doctrine of Flureau v. Thornhill can have no application, where the failure either to make out a title or to give possession arises, not from the inability of the vendor to protect his title, but from his unwillingness either to remedy the defect in the title or to obtain possession, on the score of expense. Engel v. Fitch (1868) L. R. 3 Q. B. (Eng.) 314, s. c. subsequent appeal in (1869) L. R. 4 Q. B. 659 Exch. Ch. So, it has been held that the English rule respecting the vendee's damage for breach by the vendor of his executory contract to convey real estate does not apply where the ground of the breach is a defective title in the vendor, and it appears that in the contract he expressly undertook to make a good title. Ontario Asphalt Block Co. v. Montreuil (1916) 52 Can. S. C. 541, 27 D. L. R. 514, Ann. Cas. 1917B, 852. This case involved a lease containing an option to purchase the premises during the term thereof, which was for a ten-year period, and the lessee was required to make expensive improvements upon the premises. In these circumstances the lessor was held not liable to the vendee for loss of the latter's profit, based upon the difference between the value of the land at the time of the lease, and its value at the time, some years later, when the vendee sought to exercise the option to purchase, although the improvements had been made and the land had largely increased in value. The inability to convey in this case was due to the fact that the land was held by the lessor under a devise to himself

for life, and then to his children. The vendee sought specific performance, and a judgment was entered decreeing specific performance of the agreement for the interest of the defendant in the demised land, and an abatement of the purchase money for the difference in value, on the date of the lease, between an estate in fee simple and an estate for the life of the decedent in respect of so much of the land as the defendant was not able to convey in fee, the abatement of the purchase price being based upon the value of the property as fixed by the contract.

In jurisdictions wherein the courts deny in toto the operation of the rule of good faith, it is held that, where an executory contract fails because of the defective title of the vendor, he is nevertheless liable to the vendee for compensation for the loss of his bargain, computed either on the basis of the difference between the contract price and the market value of the real estate, or the actual value of the real estate less the amount, if any, unpaid upon the purchase price.

United States. Hopkins v. Lee (1821) 6 Wheat. 109, 5 L. ed. 218; Harten v. Löffler (1909) 212 U. S. 397, 53 L. ed. 568, 29 Sup. Ct. Rep. 351; Watkins V. American Nat. Bank

(1905) 67 C. C. A. 110, 134 Fed. 36, writ of error dismissed in (1905) 199 U. S. 599, 50 L. ed. 327, 26 Sup. Ct. Rep. 746; Hampton Stave Co. v. Gardner (1907) 83 C. C. A. 521, 154 Fed. 808.

Alabama.-Pinkston v. Huie (1846) 9 Ala. 252; Snodgrass v. Reynolds (1885) 79 Ala. 452, 58 Am. Rep. 601; Hamaker v. Coons (1897) 117 Ala. 603, 23 So. 655.

Connecticut. Wells v. Abernethy (1824) 5 Conn. 222. Georgia. Bryant v. Hambrick (1850) 9 Ga. 133; Irwin v. Askew (1885) 74 Ga. 581; Butler v. Milam (1921) 26 Ga. App. 126, 105 S. E. 628. Illinois. Buckmaster v. Grundy (1836) 2 Ill. 310; McKee v. Brandon (1840) 3 Ill. 339; Gale v. Dean (1858) 20 Ill. 320; Plummer v. Rigdon (1875) 78 III. 222, 20 Am. Rep. 261; McMillen v. Betz (1922) 224 Ill. App. 117. Hill v. Hobart (1839) 16

Maine.

Me. 165; Warren v. Wheeler (1842) 21 Me. 484.

Massachusetts.

Adams v. North American Ins. Co. (1912) 210 Mass. 550, 96 N. E. 1094. Minnesota.

Fleckten v. Spicer

(1896) 63 Minn. 454, 65 N. W. 926; Vallentyne v. Immigration Land Co. (1905) 95 Minn. 195, 103 N. W. 1028, 5 Ann. Cas. 212; Finnis v. Selover, B. & Co. (1909) 108 Minn. 331, 122 N. W. 174; Nostdal v. Morehart (1916) 132 Minn. 351, 157 N. W. 586.

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Ohio.

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McCarty v. Lingham (1924) 111 Ohio St. 551, 146 N. E. 64. Tennessee. Shaw v. Wilkins (1848) 8 Humph. 647, 49 Am. Dec. 692. Wisconsin. MCFARLANE v. DIXON (reported herewith) ante, 1.

Wyoming. - Francis V. Brown (1915) 22 Wyo. 528, 145 Pac. 750.

It is held in Hampton Stave Co. v. Gardner (1907) 83 C. C. A. 521, 154 Fed. 805, that, upon a breach by the vendor of a covenant to furnish an abstract of title under a contract granting a time option to purchase land, the measure of damages is the difference between the contract price and the value of the land, and the issue of whether or not the vendee would have purchased the land if the vendor had furnished the abstract is speculative and immaterial.

In Fleckten v. Spicer (Minn.) supra, the vendee in an action for damages for breach of contract to convey, she having been evicted from the premises after having gone into possession thereof under a contract of

purchase, alleged that when the vendor sold the land to her he had no title, and, knowing that he had none, fraudulently represented to her that he had, by reason of which she was induced to purchase the land. On the trial she failed to prove fraud or fraudulent representations on the vendor's part, but established other facts entitling her to recover some damage. In these circumstances the court said that the proper measure of damage was not the purchase price already paid, but full compensatory damage. Two of these elements were the loss of the purchaser's bargain, and compensation for her improvements, which might be measured by deducting the amount of the purchase price of the land, and all unpaid interest thereon which had accrued up to the time of the eviction, from the value of the land at the time of the eviction. And

in Erickson v. Bennet (1888) 39 Minn. 326, 40 N. W. 157, where the measure of damage was held to be compensation for loss of the vendee's profits, the vendor had fraudulently represented the condition of the title. So, in Bender v. Barton (1913) 182 Ala. 181, 62 So. 732, where the vendor misrepresented the condition of the title, claiming title under a deed which he had secured wrongfully, it was held that the vendee was entitled to recover all damage which he had suffered as the natural and proximate result of the vendor's breach, which might reasonably be supposed to have been within the contemplation of the parties at the time the contract was made, as a probable result of the breach. See, upon this point, Robinson v. Harman (1848) 1 Exch. 850, 154 Eng. Reprint, 363, which, however, involved a sale of lease, and hence is not strictly within the scope of the annotation, but which holds that, where the vendor, in answer to express inquiries as to his power to lease and as to the legal estate being vested in trustees, took upon himself positively to assert that the property was his out and out, and that he alone had the power of leasing, and the contract was made after such statement, and in reliance thereon, he is liable for

damages, including compensation for loss of the vendee's bargain.

Bryant v. Hambrick (1850) 9 Ga. 133, holds that, in an action on a bond for title to land, the measure of damage is not the amount of the purchase money with interest thereon, but it is the value of the land at the time when the title should have been made. The court said that a rule limiting recovery to the amount of the purchase money paid would tempt the vendor to violate his contract, in any case where the property increased in value.

In Pinkston v. Huie (1846) 9 Ala. 252, where a bond was given for a deed by the wife of the vendor, to be executed by her after she became of age, and this contract was broken, the measure of damage was held to be the value of her title at the time the contract was to be performed, with interest.

In Watkins v. American Nat. Bank (1905) 67 C. C. A. 110, 134 Fed. 36, writ of error dismissed in (1905) 199 U. S. 599, 50 L. ed. 327, 26 Sup. Ct. Rep. 746, where the vendor lost title to property before the time fixed for conveying it to the vendee, it was held that the measure of damage for the total breach of the covenant to convey was the value of the property which the vendor agreed to convey, in case the purchase price had been paid; where the price has not been paid, and the claim for it is released or abandoned, the measure of damages is the difference between the value of the property and the unpaid purchase price.

In Hopkins v. Lee (1821) 6 Wheat. (U. S.) 109, 5 L. ed. 218, it is held that, where the vendor had been paid the purchase price and refused to convey the land, the measure of the vendee's damage in an action for breach of the contract was the value at the time of the breach. The court said: "The price being settled by the contract . . makes no difference, nor ought it to make any; otherwise, the vendor, if the article have risen in value, would always have it in his power to discharge himself from his contract, and put the enhanced value in his own pocket; nor can it make

any difference in principle whether the contract be for the sale of real or personal property, if the lands, as is the case here, have not been improved or built on. In both cases, the vendee is entitled to have the thing agreed for, at the contract price, and to sell, himself, at its increased value."

In Nebraska it is also held that, where the vendee alleges a breach of contract to sell real estate because the vendor cannot convey a good title, he is entitled to recover for all money paid by him, whether interest or principal, the amount paid, if any, by him for taxes and for the reasonable value of improvements that he in good faith placed upon the premises, with interest from the date of each expenditure made by him, and also for such a sum as will indemnify him for the loss of his bargain, as against which the vendor is entitled to offset the rental value of the premises while held by the vendee, with interest thereon from the close of each year's possession by the vendee. Anderson v. Ohnoutka (1909) 84 Neb. 517, 121 N. W. 577; Beetem v. Follmer (1910) 87 Neb. 514, 127 N. W. 858.

In Buckmaster v. Grundy (1836) 2 Jll. 310, it is pointed out that the rule that the sum paid on the purchase price, and interest, constitute the measure of damages which applies in an action upon a warranty to recover back the consideration in case of eviction, does not apply in an action of covenant for breach in failing to convey according to the terms of the contract. In the latter case the value of the land at the time it is to be conveyed is the true measure of damages.

In Hopkins v. Yowell (1833) 5 Yerg. (Tenn.) 305, where it is held that the court should have instructed the jury to assess the vendee's damages at an amount representing the value of the land at the time the covenant was broken, with interest thereon, it is pointed out that the proof showed that the land was worth about the amount paid, but perhaps less.

c. Where breach is due to total lack of title by vendor.

While the fact that the vendor had

no title to the real estate he contracted to sell may not necessarily defeat his right to invoke in his behalf the rule limiting his liability to the vendee for breach of his contract, due to his lack of title, it may, however, have an emphatic bearing upon the question of his good faith.

Thus, it is held in Kiger v. McCarthy Co. (1909) 10 Cal. App. 308, 101 Pac. 928, that bad faith is shown on the part of the vendor, where it appears from the evidence that the legal title to the lot was vested in another, and hence the vendor was unable to convey the title which he had contracted to convey. In such case it is proper to allow as damages for breach of the contract the difference between the contract price and the market value at the time of the breach, together with payments made by the vendee thereon, with interest from the time of each payment. So, in Bugajski v. Siwka (1918) 200 Mich. 415, 166 N. W. 863, where the vendor never had title to the premises he contracted to convey, and there was evidence tending to show wilful breach of the contract on his part, the vendee was held entitled to recover as damages the difference between the actual value of the premises at the time of the breach and the purchase price. And in Lock v. Furze (1866) L. R. 1 C. P. 441, 15 Eng. Rul. Cas. 723, it is held that the rule in Flureau v. Thornhill (1776) 2 W. Bl. 1078, 96 Eng. Reprint, 635, does not apply to a lease, where the lessor has no title. So, in Hopkins v. Grazebrook (1826) 6 Barn. & C. 31, 108 Eng. Reprint, 364, where the vendor entered into a contract for the sale of land, engaging to make a good title by a certain day, knowing that he had no title to the land and depending upon the owner to convey the same to him, for his breach of the contract, due to the failure of the owner to make such conveyance, he was held liable to his vendee for the loss of the latter's profits. In Irwin v. Askew (1885) 74 Ga. 581, where the proper measure of damage for the vendor's breach of a contract to convey real estate was held to be the difference between the value of the land and its value when the

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