1. The jury should not be instructed to find for the defendant
unless the evidence is such as to leave no doubt that it is their
duty to return a verdict in his favor.
2. The notice of the rescission of a contract is not rendered
void by reason of the fact that it was given in Nevada on
Sunday.
3. The vendee of stock in a company, who, on the ground of
fraud, rescinded his contract of purchase, is not bound to receive
the stock certificate left on deposit for him by the vendor, and
tender it to the latter before bringing his action for the purchase
money.
4. The court submitted to the jury to determine whether from
certain letters and telegrams, when considered in connection with
the other evidence in the case, the defendant undertook to act as
the agent of the plaintiff in the purchase of stock from other
parties. The jury found, and the letters clearly showed, that he
did undertake so to act.
Held that the omission of the
court to construe the written evidence, if erroneous, affords him
no just cause of complaint.
5. Where the plaintiff's knowledge of the fraud and his neglect
to promptly rescind the contract are relied on to defeat the
action, the burden of proving the fact of such knowledge and the
time when it was acquired rests upon the defendant.
The facts are stated in the opinion of the Court.
MR. JUSTICE SWAYNE delivered the opinion of the Court.
A brief statement of the facts disclosed in the record will be
sufficient for the purposes of this opinion, and a few remarks will
suffice to dispose of the case.
Langdon lived in Minnesota. Pence lived in California, and was
engaged in mining operations. On the 10th of December, 1874,
Langdon, by a letter of that date, advised Pence that he had seen
Watson, and inquired about their mining interests. He concluded by
saying: "If any thing can be done that will be satisfactory to all
parties, let me know." Pence replied by letter of the 17th of that
month. Speaking of the mine in which he and Watson were concerned,
he said, amongst other
Page 99 U. S. 579
things:
"There is an eighth, that is, 7,500 shares, that can be bought
if taken at once, at the same I paid and the same Watson paid,
after looking and prospecting for five weeks. . . . The price is .
. . $8,368.75, gold. . . . Should you conclude to buy, you must
telegraph me here on receipt of this letter. You can pay,"
&c.
"This will put you on the ground-floor with us, or better than I
am, as I have spent about $600 to find this mine, prospect it, and
have title looked up, &c. Our title is O.K."
Langdon bought and paid the price demanded. On the 28th of
January, 1875, Pence addressed Langdon another letter from San
Francisco, in which he said:
"There have been not less than 1/2 doz. after the 7,500 shares
of stock I sold you, and all were astonished to find themselves too
late; and still more astonished when I told them there was no more
to be had at present, as we have the controlling interest, and
propose to run the mine as we think best. . . . The stock I have
deposited in the Nat. Gold Bank and Trust Co. of this city. . . . I
would like to have you come out after the roads get good and
weather pleasant in the spring."
This letter enclosed a bill commencing "Hon. R. B. Langdon,
Mina., to J. W. Pence, dr." The stock was charged and the amount
paid was credited. No person other than Pence was named as the
seller. Linton and Shepherd were interested with Langdon in the
purchase. On the 20th of June, 1875, all of them visited the mine
with Pence. They claimed then to have learned for the first time
that Pence had sold them his own stock, and to have learned also
that the stock was worth much less than they had paid for it. They
arrived on Saturday, and on the next day notified Pence that they
rescinded the contract, and required what they had paid to be
refunded. Shepherd and Linton transferred their interest to
Langdon, and he thereupon brought this suit. The code of Minnesota
authorized it to be in his name.
Upon the trial in the court below, six exceptions were taken by
Pence. Two of them were to the admission of testimony. Both of them
are so clearly without merit that we deem it unnecessary to say
more about them. He also excepted to the refusal of the court to
direct the jury to find a verdict in his favor.
Page 99 U. S. 580
Such direction can be properly given only when the state of the
evidence is such as to leave no room for doubt that it is the duty
of the jury to find accordingly. This case was certainly not within
that category.
The objection that the notice of rescission was void because
given on Sunday is without force. It was given at the mine, which
is in Nevada. The result claimed could be produced only by a
statutory provision to that effect. The statute of Nevada relating
to the Sabbath in no wise affects the subject.
See "An Act
for the better observance of the Lord's day," of Nov. 1, 1861, 1
Compiled Laws of Nevada, p. 2, c. 3.
The stock certificate left at the Gold Bank of Langdon was never
in his possession. The affirmance of this judgment will extinguish
his claim to it, and Pence can reclaim it whenever he may choose to
do so. Langdon was not bound to receive it and tender it back to
Pence before bringing suit.
The remaining exceptions relate to instructions given to the
jury, which are as follows:
"1. In deciding this question of fact, you must take the letters
and telegrams and all of them, and looking at them in the light of
the previous relations of the parties, and of what each of the
writers knew, placing yourselves in the writers' place and
situation in order better to ascertain their meaning and purpose,
and in the light shed upon this question of fact by these letters
and telegrams, and by the history of the whole transaction, you
must determine whether the defendant did undertake to act as the
plaintiff's agent for the purchase of the stock from others."
Admitting that the court was wrong in not giving a construction
to the letters one way or the other, touching the main point in the
controversy, as is insisted, a concession perhaps not necessary to
be made, it cannot avail the plaintiff in error that it was not
done. Properly construed, we think the letters show clearly the
agency of Pence as claimed by Langdon. The jury found accordingly.
No harm was therefore done by the omission of the court, and if it
were erroneous, the error is one of which Pence certainly has no
right to complain. With respect to the duty of the court as to
construing the letters,
Page 99 U. S. 581
See Etting v. Bank of the United
States, 11 Wheat. 59;
Barreda v.
Silsbee, 21 How. 146.
"2. It was not enough to charge the plaintiff with knowledge of
the mal-character of the transaction that the language used was
such as might have caused some persons to suspect it. He might, in
view of previous friendly relations, have no suspicion of bad
faith, and might naturally regard expressions as inaccurately used,
rather than put upon them a construction which would show bad faith
on the part of the defendant, which he had no reason to
anticipate."
This, under the circumstances, we think, was exactly right.
"3. Before the plaintiff was required to affirm or rescind the
contract, he must be shown to have had actual knowledge of the
imposition practiced upon him. It is not enough to show that he
might have known or suspected it from data within his reach."
The preceding remark is applicable also to this instruction.
"4. If the jury believe that the plaintiff had no actual
knowledge or belief that defendant had put his own stock upon them,
until June, 1875, at the mine, then his repudiation of the
transaction, if made then, was sufficient."
There can be no doubt as to the soundness of their
proposition.
Acquiescence and waiver are always questions of fact. There can
be neither without knowledge. The terms import this foundation for
such action. One cannot waive or acquiesce in a wrong while
ignorant that it had been committed. Current suspicion and rumor
are not enough. There must be knowledge of facts which will enable
the party to take effectual action. Nothing short of this will do.
But he may not willfully shut his eyes to what he might readily and
ought to have known. When fully advised, he must decide and act
with reasonable dispatch. He cannot rest until the rights of third
persons are involved and the situation of the wrongdoer is
materially changed. Under such circumstances, he loses the right to
rescind, and must seek compensation in damages. But the wrongdoer
cannot make extreme vigilance and promptitude conditions of
rescission. It does not lie in his month to complain of delay
unaccompanied by acts of ownership, and by
Page 99 U. S. 582
which he has not been affected. The election to rescind or not
to rescind, once made, is final and conclusive.
The burden of proving knowledge of the fraud and the time of its
discovery rests upon the defendant.
Here Langdon was lulled into security by his relations to Pence,
and by Pence's letters.
There is no proof that he had the slightest knowledge or even
suspicion of any foul play until he visited the mine. His action
then was prompt and decided.
The instructions of the court as to the law upon the subject
were clear, accurate, and well expressed. The rest was for the
jury. With what they did we have nothing to do.
We find no error in the record.
Judgment affirmed.