
    H. D. Gilpin v. William Smith.
    The general rule is, that the vendee of land who has not been evicted, must rely upon his covenants in the deed; but a fraudulent sale is always an exception to it.
    H. being the owner of a tract of land, which he desired to sell, represented to S., who desired to purchase it, that an eighty acre Jot, on which was a very valuable spring of water, the only one on the place, and which was not far from the dwelling-house on the tract, was a portion of the land, and belonged to him, and would he included in the sale; S. informed H., that he was very desirous of buying a place with a fine spring on it, and would not buy one without such a spring ; S. relying on these representations of H., purchased the land, and on discovering afterwards, that H. had no title whatever to the eighty acres on which the spring was located, filed a bill for a rescission of the contract; held, that S. was entitled to have the contract rescinded; for if H. knew, as it was more than probable he did, that he had no title to the eighty acres, it was a fraud on S. to sell them to him ; and if he did not know it, the effect on S. was the same; he was induced by the false representations of H. in a material matter, to purchase; and H. was bound to make those representations good; or the contract would be rescinded.
    And in such a case, it would make no difference that H. had passed off the notes given by S., for the purchase-money, to J., in payment of a debt; and that J. had passed them off to G., in like payment of a debt; when G. attempted to subject the land to the payment of the notes, under a mortgage which S. had given H. at the time of purchase, S. could, if he had not delayed an unreasonable length of time after discovering the fraud on him, and had done nothing to induce either J. or G. to take the notes or part with any security for their respective debts, set up the same defence against the payment of the notes in the hands of G., and have the same relief, that he could if the notes had never passed out of the hands of H.
    A mere promise by the maker, to pay the assignee of a note, after the assignment, will not have the effect of waiving any equity or defence, which the maker might have had at the time against the note; but a promise before assignment, on the strength of which the assignment is taken, will preclude a previous defence ; and the■ reason of this rule will apply where only a conditional assignment is made in payment of a previous debt by the assignor, and the maker promises payment before the assignor is discharged from the debt, by reason of which promises, the assignor is discharged by the as-signee.
    In this case, the maker of notes given for land, to secure which he had executed a mortgage on the land, in answer to a bill filed by the second assignee of the notes, to foreclose the mortgage, set up fraud on the part of the payee of the notes in the sale of the land, and asked a rescission of the contract of sale ; the holder of the notes insisted that the maker had precluded himself from this defence by promises to him to pay the notes, on the faith of which he had released his immediate assignor from liability to him, on the debt for which he received these notes ; the facts and circumstances of the case are reviewed, and the conclusion reached that no such promises had been made, and that the maker might successfully insist upon his defence.
    The maker of a note secured by mortgage, having an equitable defence to it, promised the assignee, that if he would give him one, two, and three years on the principal part of the debt, he would pay it; the assignee assented to this, and thereupon released his immediate assignor from liability to him, on account of these notes ; and soon after, without waiting for the expiration of the three years, filed his bill to foreclose the original mortgage and note, without offering to perform his part of the agreement for the extension of the time ; held, that the maker of the note was not precluded from setting up his equitable defence to it; his conditional promise not having been acted upon by the holder of the notes, he was not himself bound by it.
    II. in the year 1836, sold to S. a tract of land, and received certain notes, and a mortgage on it; in the sale, H. committed a fraud on S,, and assigned the notes to J., who assigned them to G.; in 1840, H. went to Texas, and in the same year, S. discovered the fraud that had been practised on him ; in December, 184 i, G. filed a bill to foreclose the mortgage on the notes given for the purchase-money ; and in February, 1842, S. answered and filed a cross-bill, setting up the fraud on the part of H., and praying a rescission of the contract of sale; held, that uhder the circumstances, S. had not been guilty of such delay as would preclude him ; the law only requires reasonable vigilance.
    On appeal from the superior court of chancery; Hon. Stephen Cocke, chancellor.
    Henry D. Gilpin alleges, that on the 29th day of April, 1836, William Smith executed a mortgage to Thomas B. J. Hadley of the property therein mentioned, which was duly recorded, for the'purpose of securing the payment, among other debts, of a bond to Hadley for ten thousand dollars, payable on the 1st day of March, 1841, and four promissory notes, of five hundred dollars each, payable on the 1st day of September, 1839, 1st day of March, 1840, and the 1st day of March, 1841. That afterwards, Hadley, for a valuable consideration, transferred to John Ingersoll, syndic for the estate of John Ingersoll & Co., this bond and notes, and also assigned the mortgage, so far as it was intended to secure said bond and notes; and Ingersoll, for a valuable consideration, assigned the bond, notes and mortgage, to complainant, the assignee of Theodore Thompson; that complainant had called upon Smith, the defendant, to pay, which he refused; and the bill prays for an account of the mortgage debt, and for decree for foreclosure.
    The mortgage exhibited with the bill is dated the 29th day of April, 1836; is between William Smith and Margaret his wife, of the one part, and Thomas B. J. Hadley of the other; and to secure the payment of said bond and notes, and other notes, conveys in mortgage “the hereinafter described land and negroes, to wit, all that tract or parcel of land, situate, lying and being in the county of Madison, known as Woodland Place, containing eight hundred acres, it being the same land sold by Caleb and Thomas Reed, by indenture dated the 30th day of December, 1834, and recorded in deed book B, pages 482 - 485, to T. B. J. Hadley, and conveyed by said Hadley and Piety L. his wife, to the said William Smith, by deed dated 26th April, 1836. The description of said land, contained in said deeds of conveyance, is hereby referred to, and.made part of this indenture ; also the following negroes, &c.”
    The conveyance just above referred to is dated the 30th day of December, 1834, and is between Thomas Reed and Caleb Reed, and Martha his wife, of the one part, and Thomas B. J. Hadley of the other, and purports to convey “the following described tracts or parcels of land, to wit: the west half of the south-west quarter of section thirty, township eight, range one, west, containing eighty acres more or less, in the Choctaw district, granted to Malakiah Howell, by patent bearing date the 1st day of April, 1829, recorded in vol. viii. page 328; -also the west half of the north-west quarter of section thirty-one, of the same range and township, and granted to said M. Howell by patent bearing date the 1st day of May, 1828, and recorded in vol. vii. page 330, and afterwards sold by said M. Howell to said Caleb Reed, his heirs, &c. by deed bearing date the 19th day of February, 1831; also the east half of the north-west quarter of section number thirty-one, township number eight, range two, west, purchased of the United States by said Caleb Reed, as appears from Receiver’s receipt No. 5415, and dated Mount Salus, 15th October, 1830; also the west half of the south-east quarter of section thirty, township eight, range one, west, purchased by George Ogden of the United States, and sold by him to Caleb Reed, his heirs, &c. by deed dated the 6th December, 1831; also all of the east half of the north-west quarter of section number thirty-one, granted to Leon H. Gwin, his patent bearing date the 20th day of April, 1826, and recorded in vol. iv. page 7, and sold to the said Caleb Reed, his heirs; &c. by John H. Morris, administrator of the estate of said Gwin, deceased, by deed dated 15th October, 1832, excepting twenty-two acres of the same, beginning at the south-west corner of the same, and sold by said party of the first part to William Denson, by deed dated the 17th July, 1833, and recorded in the clerk’s office of the county of Madison, in book B, pages 23 and 24; also the east half of the south-east quarter of section twenty-five, in township eight, of range two, west, granted to the said Caleb Reed by patent bearing date the 5th January, 1831, and recorded in vol. ix. page 259, containing eighty and T%ss acres, more or less; also the east half of the south-east quarter of section number thirty, in township eight, of range one, west, granted to John House by patent dated 8th April, 1829, and recorded in vol. viii. page 343, sold by said House to James House, by deed dated the day of , 18 , and sold by said James House to said Caleb Reed, his heirs, &c. by deed dated the 17th June, 1829, and recorded in the clerk’s office of Madison county, in book of deeds, pages 82 and 83; also east half of the north-east quarter of section number - thirty-six, in township number eight, of range number two, west, purchased of the United States by James C. Dickson, and sold by said Dickson to said Caleb Reed by deed dated the 3d day of April, 1832; also twenty-two acres of the north-east quarter of section thirty-one, sold by William Denson and Mary his wife, by deed dated the 17th July, 1833, to the said Caleb and Thomas Reed, their heirs, &c.; and also two acres of land on which the gin and mill are built, one acre was sold to said Caleb Reed, his heirs, &c. by Samuel Duke and wife, by deed dated the 21st February, 1833, and the other acre, situated on the south-west corner of the west half of the north-east quarter of section thirty, to be laid off to the best advantage to suit the gin, sold to said Caleb Reed by J. W. Camp, by his bond for titles, dated 21st day of February, 1823.”
    The conveyance secondly mentioned in said mortgage, is from Thomas B. J. Hadley, and Piety L. his wife, to the defendant Smith, dated the 26th of April, 1836, and purports to convey “ the following described land, situate, lying, and being in the county of Madison, state aforesaid, to wit: the west half of the south-west quarter of section thirty, township eight, range one, west; the west half of the north-west quarter of section thirty-one, same range and township; the east half of the northwest quarter of section thirty-one, township eight, range two, west; the west half of the south-east quarter of section thirty, township eight, range one, west; also all of the east half of the north-west quarter of section thirty-one, excepting twenty-two acres of the same, beginning at the south-west corner, and sold by Caleb Reed to William Denson, by deed dated the 17th of July, 1833, and recorded in the clerk’s office in Madison county; also the east half of the south-east quarter of section number twenty-five, in township eight, range two, west; also the east half of the south-east quarter of section thirty, in township eight, of range one, west; also the east half of the northeast quarter of section number thirty-six, township eight, range two, west; also twenty-two acres of the north-east quarter of section thirty-one, sold by William Denson and Mary his wife, to Caleb Reed, by deed dated the 19th of July, 1833; also two acres of land, on which the gin and mill are built, to be laid off best to suit one gin ; also a quarter section of land sold by John Lackey to Caleb and Thomas Reed, and known as the Lackey Tract, all of which land is in the Choctaw district, and is known as Woodland Place, it being the same land sold and conveyed to Thomas B. J. Hadley by Caleb and Thomas Reed, by indenture dated the 30th of December, 1834, and recorded in the clerk’s office of Madison county in book B, pages 482, 483, 484, 485, where the same is more fully described, and which description is hereby made a part of this deed.”
    Hadley’s assignment to Ingersoll was exhibited with the bill; it bore date December 14, 1837, was indorsed on the mortgage itself, and purported to be in consideration of the sum of seven thousand seven hundred and eighty-one dollars and eighteen cents.
    The assignment from Ingersoll, syndic of Ingersoll & Co., was also on the mortgage, was dated 28th day of August, A. D. 1838, and was as follows: “ Know all men, by these presents, that I, John Ingersoll, syndic of the estate of Ingersoll & Co., of the county and state aforesaid, have this day for, and in consideration of, a full acquittance on account of a certain debt, and by me incurred while trading under the firm and style of Ingersoll & Co., in the city of New Orleans, to one Theodore Thompson, of Philadelphia, assigned to Henry D. Gilpin, Esq., assignee of said Thompson, all the rights vested in me by the annexed mortgage, so far as they go to secure the payment of the bond lettered A, for the sum of ten thousand dollars; and the four notes of five hundred dollars each, &e., dated 29th of April, 1836, and drawn by W. Smith, and indorsed by James M. Smith, and cited in the annexed mortgage.”
    On the 10th of Febuary, 1842, the defendant, Smith, filed his answer and cross-bill, in which he adfnits the execution of the bond, notes and mortgage: that all of the debt mentioned in the mortgage was paid, except the bond and the four notes claimed by the complainant, and one of the five hundred dollar notes claimed by Briggs, Lacoste & Co., two hundred of which had been paid: he knew nothing of the assignment of the bond and notes to complainant, except what he had heard, and no demand was ever made of him, of payment before commencement of suit.
    In the cross-bill, it is alleged, that some time about the 1st day of January, 1836, Hadley proposed to sell to Smith his plantation in Madison county, called Woodland Place; that in showing the plantation to Smith, Hadley pointed out the south half of section number thirty, township eight, range one, west; the east half of south-east quarter of section twenty-five, township eight, range two, west; the "north-west quarter of section thirty-one, township eight, range one, west, except twenty-two acres, (in lieu of said twenty-two acres, there were twenty-two acres added to the plantation from the west half of the north-east quarter of section thirty-one, township eight, range one, west); east half of north-east quarter section thirty-six, township eight, range two, west; and two acres, on which the gin and mill-house were situated, the same being situated on a part of two-eighths, that is to say, the south-west corner of the west half of the north-east quarter of section thirty, township eight, range one, west; and the south-east corner of the east half of the north-west quarter of section thirty, township eight, range one, west, which two acres were laid oif to the best advantage for carrying on the operations of the gin and mill. Smith examined the plantation, and was pleased with it, as shown by Hadley, and with a valuable spring, represented by Hadley to be on the east half of the south-east quarter of section thirty, township eight, range one, west; and without such spring, he would not have bought. In showing the land, Hadley represented that there were two-eighths of land, situated about one mile and a half from the main body of the plantation, known by the name of the Lackey Place, which he represented to be of the best quality, to wit, the west half of the south-west quarter of section twenty-four, and the east half of south-east quarter of section twenty-three, township eight, range two, west. He also represented that the lands between the Woodland Place and the Lackey Place, were of the best quality, and could be purchased at a low price, being owned by persons in small parcels; and Hadley pledged his word that he had good title to all of said land, and that he would convey the same to Smith. That Smith, after a partial examination of the land, and relying on the representations and statements of said Hadley, made a purchase, the consideration of which was the notes and bonds in the mortgage mentioned: Hadley conveyed to Smith, by deed in fee, (referred to above), and Smith executed the mortgage. That Hadley purchased from Caleb and Thomas Reed, and wrote the deed from Reeds to him, having their title papers before him, and knew all the land owned by them, and intended to be conveyed; Hadley also drew the deed from himself and wife to Smith. That frequently, after the making the agreement with Hadley, Smith endeavored to get from him his deed from the Reeds, but could not do so until Smith learnt what he has ascertained to be true, that the east half of the south-east quarter of section thirty was never owned by said Hadley or Reed, but was owned by the heirs of Washington Darden; that eighth being the eighth on which was the spring, which was one of the principal inducements to make the purchase, and which the heirs of Darden had taken possession of. Smith, finding he had been deceived, went into an investigation of the titles. That as to the eighth, on which the spring was situated, the Reeds never had, nor pretended that they had, any title, and did not intend to convey it to Pladley, but it was fraudulently inserted in the deed from Reeds by Hadley; and instead of the spring eighth, the Reeds intended to convey to Hadley the west half of the south-west quarter of section thirty-one, township eight, range one, west, the title to which was in Reeds, and was-with the papers before Hadley when he drew the deed from the Reeds to him; and Smith had also ascertained that the west half of the south-east quarter of section thirty, township eight, range one, west, sold to him by Pladley, was purchased of the government by one George Ogden, and no conveyance from Ogden to any one could be found; none was on record in Madison. That the east half of the south-west quarter of section thirty, township eight, range one, west, though sold or intended to be sold by Hadley to Smith, was not embraced in the deed from the Reeds to him. This eighth adjoined that eighth on which the house was situated, and was the most valuable one purchasedand Hadley, knowing he had no title to it, inserted in lieu thereof an eighth situated six miles from it, and forming no part of the Woodland Place. The east half of the north-east quarter of section thirty-six, township eight, range two, west, was entered and purchased from the government by David House, who had conveyed to no one that Smith could ascertain. Caleb Reed furnished Smith with a deed from James C. Dickson for the same, but none to him. The east half of the north-west quarter of section thirty-one, township eight, range one west, was entered by Leon Gwin, who sold to no one that Smith could ascertain. He has, however, found a deed from John H. Morris, calling himself administrator, but no authority could be found for his conveyance. The two eighths, called the Lackey Place, one entered in the name of John T. Lackey, who conveyed to Caleb Reed, who, the deed recites, gave a bond for title to Had-ley,- which had not yet been found; the other entered in the name of Archibald Lackey, and no conveyance from him to any one had been found; and as to those two eighths, Hadley fraudulently inserted them in the deed to Smith, under the pretence that they had been conveyed to him by the Reeds, when he knew it had not been done. That the representations of Hadley, as to the quality of the land called the Lackey Place, and as to the quality of the laud between the same and the Woodland Place, which were relied upon, were false. There were several other eighths of the land, to which Hadley, at- the time he made the sale, could show no title of record to the same; Smith prayed the rescission of the contract of sale, an account, &c., and made Hadley and Gilpin defendants to his cross-bill.
    Gilpin answered, denying all knowledge of the agreement between Hadley and Smith, other than such as was obtained from the original and cross-bill; knows nothing of the fraud alleged against Hadley. He insists that Smith is precluded from the relief he asks by his cross-bill by reason of his acts; that after the bond and notes on which the bill was filed were asssigned to Ingersoll, Smith had repeated conversations with lngefsoll, in which he never intimated that he had any offset or claim against said bond and notes; and about the time that the same were assigned to Gilpin, it was communicated to the agent of said Gilpin what had passed on the subject, and after the assignment, Smith informed the agent of Gilpin that he had no offset or defence, and tried, through Ingersoll, to make arrangement for payment; and Gilpin never knew of any defence until the filing of the cross-bill.
    The cross-bill was taken for confessed as to Hadley. The deeds filed as exhibits, with the answer and cross-bill of Smith, together with the certificate of the register of the land office, and the certificate from probate clerk in Madison, were filed, designed to show the lands to which there was no title in Had-ley when he conveyed to Smith. It was contended that six eighths of sections sold were in this condition, including the eighth on which the spring was situated. It is not deemed requisite, in view of the opinion of the court, to enter more at length into the details of the alleged fraud; it is sufficient to state, that as to the eighth of land on which the spring was located, as well as other eighths, it appeared that Hadley had no title whatever.
    On behalf of Smith, T. J. H. Richey testified, that he was present at the trade between Reed and Hadley, and was requested to be a witness. The land intended to be sold was the west half of south-east quarter, section thirty, township eight, range one, west; south-west quarter of same section, north-west quarter of section thirty-one, except twenty-two acres, to be taken from the south end of the east half of the north-west quarter, and twenty-two acres added to the south end of the west half of the south-east quarter of section thirty, from the north end of the west half of the north-east quarter of section thirty-one; also the west half of the south-west quarter of section thirty-one. Two acres on which the gin and mill is situated, all in township eight, range one, west; also east half of south-east quarter, section twenty-five; east half of northeast quarter of section thirty-six ;■ west half of south-west quarter of section twenty-four; and east half of south-east quarter of section twenty-three, all in township eight, range two, west. The last mentioned two eighths are known as the Lackey Place.
    That the west half of south-east quarter, section thirty, on which the buildings are situated, was not very good land; the residue of the land was very fine, except the Lackey Place, on which the witness said there were not more than sixty acres of good land above overflow; and except, also, the west half of the south-west quarter of section thirty-one, which was low and wet, unfit for cultivation if cleared. At the time of sale, Reed threw on a table before Hadley a number of title papers, and remarked, that here were his title papers to the land sold, and said he would employ a lawyer to draw ofi the numbers correctly, for that he was totally ignorant of such matters; to which Hadley replied, it was unnecessary to go to that expense, he was qualified and interested, and would do it correctly. Reed then told him there was among the papers a certificate in his name, for an eighth on Bogue Pheliah, six miles off, and he must be cautious not to insert that in the deed, and that the lands were lying connected, except the Lackey Place. Had-ley said he could draw the deed correctly, and would be satisfied with the title he could get from the papers. The east half of south-west quarter, section thirty, is situated adjoining the eighth, on which was the dwelling-house; on the west, the best eighth for cultivation, all cleared very fine land, and being near the centre of the plantation, its advantages, as to location and fertility, as connected with the residue of the lands, made it indispensable, and was a part of the land sold by Caleb Reed to Hadley. The east half of north-west quarter, section thirty-one, township eight, range two, west, was no part of the land sold by Reed to Hadley; it lies six miles from the plantation. The east half of the south-east quarter of section thirty, township eight, range one, west, lies between one and two hundred yards from the dwelling-house; on it was a remarkably fine spring, the greater part of the land on that eighth was very fine, and was no part of the land sold to Hadley by Reed; witness lived near the plantation several years. The spring eighth was uninclosed, and the spring was used by the Reeds, and was almost indispensable to the enjoyment of the land; certainly very important, there being no other water on the plantation fit for family use during the year. Caleb Reed, in the presence of witness, stated to Hadley, at the time Hadley was drawing the deed, that he, Reed, had no title to the Lackey Place, but would give him a title bond. He has examined the questions and answers of Caleb Reed in this cause, and would, if asked the same questions, answer in like manner, except that he knew nothing about riding over the land.
    The witness, Caleb Reed, testified, that he and his brother, Thomas Reed, sold the Woodland plantation to Hadley, in the year 1834, and testifies the same as witness Richey, what subdivisions were embraced in the plantation. Hadley rode over the land, and was shown the worst part of it: as to the drawing the deed, the eighth on Bogue Pheliah, and as to the title to the Lackey Place, he testifies the same with Richey, and in addition, that Hadley took Reed’s title papers home with him, and kept them several days. He further testifies, that among the title papers given Hadley, by which to draw the deed, there was no evidence of title to the east half of the south-east quarter of section thirty, township eight, range one, west; and neither he nor his brother ever pretended to have any title to the same, or proposed to sell it. He believes the title to said eighth at the time of the sale was, and now is, in the heirs of Washington Darden ; on that eighth there was a spring of fine water, and there was no water for family use, or for stock, on the land sold, except it might be found on the Lackey Place.
    The lands known as the Lackey Place were very inferior, and were sold at half price. The lands between the Woodland Place and the Lackey Place were of an inferior quality, and owned by the heirs of Washington Darden, who, or a greater part of them, were, in 1836, and still are minors, and the same could not in 1836, or since, have been purchased at a low or at any price. There was a slough between the Lackey Place and the Woodland Place, which is easily filled when the creek is up, and when filled is about one hundred yards wide and six feet deep, and detracts from the value of the land. It was shown to Hadley at the time he purchased. The witness details particularly the title papers exhibited to Hadley; but it is not deemed necessary to set them out.
    The difference in the value of the plantation between it with the spring eighth, and without it, was almost incalculable. When he sold to Hadley, the spring eighth was uninclosed, and remained so until 1839, when a part of it round the spring was inclosed. The east half of the south-west quarter, section thirty, township eight, range one, west, was the best eighth in the plantation, and adjoins the eighth on which the buildings and improvements are situated. In answer to an interrogatory in these words, “ How did it happen that you and your brother conveyed to Hadley the east half of south-east quarter of section thirty, township eight, range one, west, the spring tract, and the eighth of land six miles off, which you say you did not sell him, and omitted to convey the east half of south-west quarter of section thirty, and the west half of south-west quarter of section thirty, township eight, range one, west, which you say you did sell him 1 ” He answers, “ we were imposed upon in this respect by Hadley, who promised to write the deed in conformity to the contract, and I relied on his capacity and integrity to do so; but he, for fraudulent purposes, failed to do so, and I could not tell, from looking at the deed, whether the land was correctly described or not; and the first time I learned that lands were embraced in the deed which we did not sell, and lands omitted which we did sell, was in 1838, when I requested him to pay the purchase-money, or entered his notes for collection, when he wrote me a letter, which is lost or mislaid, stating that there were errors in the deed, and if-1 did not agree to a mode of settlement, which would be greatly to my injury, he would file a bill to set aside the contract.” Said witness further testifies, that Hadley removed to Texas in 1840, where he now resides, and is insolvent. Thomas Reed died some time in the year 1836, in November. Witness resides in Noxubee county, Miss.; neither the witness nor Thomas Reed ever conveyed to Hadley the two eighths called the Lackey Place, but only gave him a title bond,
    Stephen H. Darden being examined, testifies, that the spring eighth belongs to the heirs of Washington Darden, of whom he is one; none of it was inclosed until 1839, when a small part of it was inclosed, including the spring; some time after its inclosure, Smith complained, saying he had purchased it of Hadley; at which witness was much surprised, and he had determined not to let Smith use water from the spring, unless he gave up all claim to it. Smith asked time to look into the title, and some time in 1841, Smith informed witness that he was satisfied that he had no title to said eighth; that Hadley had imposed upon him. The use of the water from this spring was all important to Smith, there being no other water on the land purchased of Hadley. The Reeds, never to his knowledge, claimed said eighth. Hadley now resides in Texas. He was considered insolvent when he left this state.
    James M. Smith testifies, that some time in January, 1836, he went with Wm. Smith and Hadley to examine the land proposed to be sold by Hadley to Smith. The land Hadley showed as that proposed to be sold, was the same as that described by the witness Richey. The witness proceeds: “ We examined the plantation partially, after which we left, being late in the evening; we had not time to examine the Lackey Place. There was much conversation about the quality of the land, and the titles to it, and the location. Hadley was asked by Smith if his titles were good and indisputable, to which he replied in the affirmative. He (Had-ley) also praised the land as being very fertile, and that there was a free stone spring of water on the eighth lying east of the house, which never failed in the driest seasons; and the witness distinctly remembers, that Smith said he could not be induced to purchase any land, unless there was a good and never failing spring upon it. The Lackey two eighths were represented by.Hadley as being exceedingly rich and valuable, and Smith objected on account of their being detached from the main tract; to which Hadley replied, he could very easily purchase the intervening lands at a low price, as they were owned by different persons in tracts too small to make a plantation, and they were also very rich and valuable. In examining the land, we went about half a mile from the house westward, where I parted from Smith and Hadley a short time, and walked in the field; when I returned, I told Smith I thought well of the land, as far as I had examined it. Smith and myself went to and came from the place in company. I think Smith never before saw the place, and am certain, that except the time alluded to, he did not go to the same before he made the purchase. I think, the purchase was made the third day after the examination. The trade was concluded in Jackson, and upon the representations of Hadley, more than upon any examination, for I distinctly remember several gentlemen having said to Smith that Hadley could be relied upon as a man of truth and veracity. Hadley, when showing the land, held out the spring as an inducement to the purchase, and stated his title to it to be indisputable. The spring was all important to the plantation. The east half of the south-west quarter of section thirty, township eight, range one, west, is the eighth lying west of the eighth on which the dwelling and other buildings are situated, and was a part of the land shown as part of the plantation. I think it was all cleared, and perhaps the best land on the plantation, and that which I mostly examined, when I was examining the land. I am well satisfied that Smith would not have made the purchase had he not relied upon Hadley’s representations about the Lackey Place and the intervening lands. The said Wm. Smith was raised in Maryland, moved from there, and came to the house of witness, near Clinton, about the 1st of January, 1835, with his family, amounting to about sixty persons, and was without a home. Smith, in inquiring for a place for a home, always placed great importance upon a spring, and was very particular in inquiring of Hadley whether his title to the land was good, and Hadley represented it to be good, which Smith relied upon; and Hadley made representations which the,witness afterwards found to be false. The east half of the north-west quarter, section three, township eight, range two, west, was six miles from the dwelling-house, and was not, shown nor intended to be purchased as part of the plantation. I made out a diagram from Hadley’s deed, by which I first learned that the east half of the south-west quarter of section thirty, township eight, range one, west, was not embraced in the deed to Smith. Hadley now resides in Texas, and is insolvent.”
    On behalf of Gilpin, Franklin Wharton testified, that he had personal knowledge that the bond and notes in controversy were . assigned and transferred to Henry D. Gilpin, by John Ingersoll, He was the agent of Gilpin, to make and perfect the arrangement between Ingersoll and Gilpin. Previously to the assignment and delivery of the bonds and notes aforesaid, Ingersoll frequently assured him, that Smith had no offsets or defence against them; that he had seen Smith; that Smith had introduced himself to Ingersoll, and asked if he was the owner of said bond and notes, to which he replied affirmatively, and Smith did not then pretend that he had any offset or defence. Witness considered this all important, as he was aware of the law of Mississippi in relation to negotiable instruments. After witness received the bond and notes, he made inquiry as to the residence of the maker of the notes and bond, and went to the house of Smith, and arrived there the 24th of December, 1840; he told Mr. Smith he was the holder, as agent of Gilpin, of said bond and notes. Smith stated, that said notes and bond were part of the consideration or price of the land on which he resided; that the title to a portion of it was defective; that his titles were then in the hands of a lawyer for examination; that he did not know whether he would pay or not. Witness remained at his house all night, and the next morning he stated, that he had reflected much on the subject, and had decided to accept the proposition which witness had made to him, to wit, that he should pay the small notes immediately, and that he should have time for one, two, and three years on the bond. He stated that he would be in New Orleans about the 15th of January, and would pay the notes, and witness should then and there extend the time to him on the bond. This arrangement was then closed. It was not until after witness made this arrangement with Smith, that he gave a filial discharge to Ingersoll, for the debt he owed Gilpin, as assignee, and for which these notes and bond were taken in payment; and for which he informed Smith that Gilpin had received them.
    On being cross-examined, he stated, that the transfer to Gil-pin, as he believes, took place in the latter part of 1839, or commencement of 1840. Ingersoll had many conversations with him relative to the transfer of the bond and notes, and frequently mentioned his conversation with Smith. He does not recollect the date; it was, however, previous to the delivery of the bond and notes, and in Philadelphia and New Orleans. The transfer was made by Ingersoll to Gilpin, for a pre-existing debt, but at the time he received the bond and notes, he did not discharge Ingersoll, but only after his visit to Smith, as before stated. He thinks the negotiation for the transfer by Ingersoll was commenced in 1839, and concluded in 1841.
    John Ingersoll testified, that the bond and notes in contest were once his property; they were assigned to him by T. B. J. Hadley. He transferred them to H. D. Gilpin without recourse. He does not recollect the time ; and the transfer was in payment of a debt he owed Gilpin. After the transfer to Gilpin, he thinks in the summer of 1839, he met Smith on the river; Smith inquired what witness had done with the bond and notes, to which he replied that they were in the possession of Gilpin. Smith said he would try and see him, and make provision for their payment. He said nothing of any offset against them, or any thing of the kind. This was the only conversation he ever had with Smith.
    To cross interrogatories, the. witness answered, that he had no interest in this controversy. The only conversation he ever had with Smith, was that before stated, which was after the transfer to Gilpin. In that conversation, Smith said nothing about the title to the land, but fully acknowledged his liability to pay. The notes and bond were delivered to witness by Had-ley, in payment of a debt due him for about the same amount. He never had any conversation with Gilpin about the solvency of Smith. He made the proposition to Gilpin to transfer said bond and notes, by letter, and Gilpin appointed Mr. Wharton, of New Orleans, his agent, who made inquiries as to Mr. Smith’s ability to pay, as Wharton informed witness. The witness was indebted to Mr. Gilpin, and had no means except notes and claims in suit in Mississippi and elsewhere, and those claims insufficient. The debt he owed Gilpin, as assignee of Thompson, was about the amount transferred.
    On this state of pleading and proof, the chancellor decreed in favor of Smith, that the contract of sale between Hadley and Smith should be rescinded; and an account taken of the rents and profits, and of the sums paid by Smith, and of the improvements of a lasting character put by him on the land; and if the balance should be in favor of Smith, a lien was declared in his favor upon the land; and if against Smith, that he should pay to Gilpin.
    From this decree Gilpin appealed.
    
      Mason and Burwell, for appellant,
    Insisted, that the allegations in the cross-bill and the depositions filed in support of it, do not make a case which will entitle the defendant in error to the relief he seeks.
    1. Because, as to the alleged claim on the part of Darden’s heirs to the spring eighth, as Smith terms it, the record shows no eviction, or even any outstanding paramount title in another.
    2. Because the defects attempted to be set up as to Hadley’s title, if they existed, were cured by the fact that possession accompanied Hadley’s deed to Smith, which would operate as notice to creditors and purchasers; and with the exception of the eighty acres, the bill states that Darden’s heirs claimed, his possession has been undisturbed, and not even threatened. Dixon v. Lacoste, 1 S. & M. 70; 1 John. Oh. C. 219; 2 lb. 622; Bumpas v. Plainer, 1 John. Ch. Rep. 212 ; 2 lb. 521; Halls v. Thompson, 1 S. & M. 443, 485.
    3. Because, were even the fact of misrepresentation on Had-ley’s part proven, yet Smith has failed to pursue his remedy in proper time after the injury was discovered.
    
      4. Because, even were the three first positions untenable or untrue, yet Smith has waived any defence he might have had, by his subsequent promises made to Wharton, agent of the plaintiff in error, whereby he induced him to receive these notes and bonds as a payment from Ingersoll, and discharge him. Hamer v. Johnston, 5 How. 698; Swift v. Tyson, 16 Pet. 1.
    
      Wm. G. Thompson, on same side.
    The point relied upon in this case for the complainant has been settled by the high court of this state, after the fullest investigation, in the cases of Land's adm’r. v. Lacosle et al., and Hamer v. Johnson et al., reported in 5 Howard. The deposition of Wharton shows clearly that the notes were taken by him, as agent for Gilpin, on the faith of the statement made by Smith that they would be paid. The deposition of Ingersoll, as well as that of Wharton, shows that Ingersoll was absolutely discharged and released from the debt he owed Gilpin, and in payment of which these notes were transferred. Gilpin then holds the notes as a bona- fide purchaser, for valuable consideration. The notes were not taken as mere security for the payment of a pre-existing debt. Wharton states distinctly that Ingersoll was not discharged until Smith had given assurance that the notes would be paid; and it is plain that Ingersoll was discharged upon the faith of that assurance.
    
      Wm. Thompson, on same side.
    
      Hughes, for Smith,
    argued,
    1. That the Court would take jurisdiction of the case made by the cross-bill, although the defendant to the cross-bill was not a defendant to the original bill; and cited the acts of 1838; Laws of Miss. pub. in 1S38, 863, 664; Cable v. Martin 6p Bell, 1 How. R. 561.
    2. That if Hadley is a necessary party to the cross-bill, but could not be made such without he was a part}'’ to the original bill, it is then insisted that- the original bill ought to be dismissed, or ordered to stand over, with directions to make him a party.
    
      3. It is alleged there was fraud; 1st, by Hadley, in selling the east half of the south-east quarter of section thirty, township eight, range one, west, on which there was a spring, representing that he had title, when he had none.
    2d. Selling the east half of the south-west quarter of section thirty, township eight, range one, west, and conveying instead thereof another eighth not intended to be purchased.
    3d. In representing that he had indisputable title to all the land sold, which representation’was relied upon, when he had no title as to six eighths, more than one half of the land sold.
    4th. In representing, which was relied upon, and formed one of the inducements to the purchase, that the Lackey eighths were fine land, that there was land of fine quality between them and' the Woodland Place, which could be purchased at low price, which was untrue. Halls v. Thompson, 1 S. & M. 485 ; Par-ham v. Randolph, 4 How. 435; 1 Story, Eq. Jur. 202, § 193; 1 Dev. N. C. Eq. R. 411; Boyce v. Grundy, 3 Peters, R. 210.
    5th. As to the position that Smith bad waived his rights, the testimony was reviewed, and it was contended that Wharton was decidedly contradicted by Ingersoll, by complainant’s own exhibits, and was clearly not to be believed.
    The testimony and the law were reviewed, and elaborated at length by Mr. Hughes, on all these points.
    
      Sanders and Haggin, also for Smith,
    In addition to the views presented by Mr. Hughes, insisted, that the fraud, in falsely representing the spring to be a part of the tract sold, with the loss of the eighty acres, on which it was situated, was of itself such fraud as would vitiate the sale. If Hadley were seeking to foreclose the mortgage, it would not be seriousLy contended that he could succeed; yet Hadley acquiesced in the decree, and a stranger to the contract with Smith, sought to enforce it. This he could only do by reason of Smith’s having waived his defence. On this point, counsel reviewed the testimony of Wharton, contrasted it with that of Ingersoll, and with the terms of the latter’s assignment to Gilpin, and argued that it was clear that Wharton’s statements were afterthoughts, manufactured for the occasion to meet the law of Mississippi, and were unworthy of belief. And that even if entitled to credit, Smith’s promises, as proved both by Ingersoll and Wharton, were made after the transfer to Gilpin, and did not, therefore, affect Smith’s equity; and that the pretence by Wharton that he released Ingersoll after the promises of payment by Smith, were disproved by Ingersoll, and by the written assignment produced by Gilpin, as his evidence of title to the benefit of the mortgage.
   Mr. Chief Justice Sharkey

delivered the opinion of the court.

The appellant filed his bill to foreclose a mortgage, held by him as assignee. The appellee had purchased a tract of land' from T. B. J. Hadley, and gave his bond for $10,000, together with certain promissory notes. To secure the payment, the appellee gave this mortgage on the land purchased by him. Hadley transferred the bond and four of the notes, with the mortgage, to John Ingersoll, in payment of a debt. Ingersoll transferred them to complainant, also in payment of a debt.

Smith, with his answer, filed a cross-bill, making Hadley a party, in which he charges fraud in the sale by Hadley, in many particulars, and prays a rescission of the contract, and that the securities may be cancelled.

For the appellant it is now insisted, that there was no fraud, but if there was, that Smith has waived it by his promises of payment to complainant.

We have thus two questions presented. First, was the sale by Hadley to Smith so tainted with fraud as to justify a rescission of the contract % and second, if it were so, has Smith waived his equity by his subsequent promises 1

In the outset we may as well answer the objection raised by counsel, that as Smith has not been evicted, he must rely upon his covenants in the deed. This is the general rule, but a fraudulent sale is always an exception to it. Parham v. Randolph, 4 How. 435; Liddell v. Sims, 9 S. & M. 596; 5 How. 279, 542; 6 S. & M. 345. In the case of Halls v. Thompson, cited in support of this position, there was nQ fraud found to exist, and for that reason the relief was refused.

First, then, did Hadley commit a fraud in the sale to Smith ? Hadley, it seems, had purchased this same land from Reed in 1834, and had been in possession about two years. It is alleged in the cross-bill that Hadley sold land to which he had no title, falsely representing that he had a perfect title. Several subdivisions of sections are ranged under this head of fraud, but it will be sufficient to notice one eighth of a section, in reference to which the allegation is fully and clearly established ; and that is the east half of the south-east quarter of section thirty, township number eight, of range west, containing eighty acres. This land was situated very near the dwelling, and on it was a spring of water, equal to any in the country; and it was the only water on the place. It is in proof that it was indispensable, and its value to the place incalculable. It is alleged to have been the great inducement to the purchase, and but for that the purchase would not have been made. The witness, James M. Smith, says, that he went with the parties to look at the land, and Hadley pointed it out particularly, and amongst other portions, the eighth on which the spring is situated. Hadley was asked by Wm. Smith if his titles were good and indisputable, to which he replied in the affirmative. He praised the quality of the land and the spring. The witness states positively that Wm. Smith remarked, that he could not be induced to purchase any land unless there was a good and never failing spring on it. The examination of the land was a slight one, and Smith was not on it afterwards until he purchased, which was but a few days after the examination, and the witness was sure it was made more upon the representations of Hadley than from any examination. Hadley spoke of the spring as an inducement to the purchase. The witness stated that Smith had but recently come to the country, and had made many inquiries about a place to put his family on, and had spoken of a good spring of water as the greatest consideration with him. He seems to have formed a determination not to purchase a place on which there was not a spring. Whether he had placed a false estimate on the value of such a thing, is not material. His desire and his object were manifested to Hadley, and he may very well urge his disappointment, which has resulted from the false representations of Hadley, as a reason for a rescission. To a place which is otherwise destitute of water, a spring is an important object. But it is not the spring alone which he has failed to get, but also the eighty acres of land on which it was situated, which is proved to be of good quality. It is clear that Smith understood that he was buying the land on which this spring was, and it is equally clear, that he was induced so to believe from the representations of Hadley, which were untrue, and it would seem knowingly and designedly so, as Reed states that he was particular in showing every part of the tract to Hadley. He did not sell or profess to own the spring tract, nor was there amongst the title papers deposited with Hadley, from which he drew the deed himself, any evidence of title to that eighth of a section. The witness thinks that Hadley intended a fraud on him, by inserting it in the deed, and by omitting other parts of the tract, as on that account objections were raised against payment when called for, unless the witness would submit to a compromise greatly to his prejudice. But whether Hadley knew that he had no title to this part of the land or not, is in no way material. He undertook to sell it and convey by good title, and is bound to make his representations good, or forfeit the contract, as Smith purchased from a confidence in these statements. Deeming this failure a sufficient reason for setting aside the contract, we pass over the other grounds alleged. It seems not improbable that some of the other misdescriptions in the deed from Reed to Hadley, and from him to Smith, may have originated in mistake, since they were evidently prejudicial to Hadley, unless, indeed, he drew the title in that way, as the witness thinks, with a view to a ground of objection to the payment of the purchase money.

In the second place, has Smith waived his equity by his subsequent acts ? A mere, promise to pay to the assignee, after assignment, will not have this effect. Ludwick v. Croll, 2 Yeates, 464; Clay v. Johnson, 6 Monroe, 661. Such a circumstance might be calculated to rebut proof of fraud, or to show its absence. But a promise before assignment, on the strength of which the assignment was taken, would preclude a previous defence, and the reason of this rule will fully apply where only a conditional assignment is made in payment of a previous debt, and the obligor promises payment before the assignor is discharged from the debt, if he is discharged in consequence of such promises. If, then, Ingersoll only made a conditional assignment to Gilpin, and Smith induced the latter to discharge the former, he ought to be bound by it.

There is no evidence of a promise to Ingersoll before he took the assignment, or to Gilpin before he received the paper. But it seems that Smith did make promises to Gilpin’s agent, after he acquired possession, and the witness, who was the agent of Gilpin, says that he did not finally discharge Ingersoll until he had received these assurances from Smith. From this it would seem that the paper was not taken as an absolute payment, but only as collateral security, or on a condition. This is an important point, and, if it is established, must be the hinge on which the case is to turn. Ingersoll was examined as a witness; he says nothing of a conditional assignment; on the contrary, he says he transferred all his right, title and interest in the bond and notes to Gilpin, the precise time he does not recollect, in payment of a debt due to Gilpin; and they were transferred without indorsement, and without any liability on account of them in any way whatever. The complainant does not mention a conditional transfer in his bill. The allegation is “ that on the 28th day of August, 1838, the said John Ingersoll, syndic of the estate of John Ingersoll- & Co. as aforesaid, did, for a valuable consideration, transfer and deliver to your orator, &c., the said bond and promissory notes last mentioned and described, and also made an assignment of the mortgageand in proof of this, the written assignment is made an exhibit, and referred to. The assignment is under seal, was executed in Adams county, and acknowledged in due form, before the clerk of the probate court. It bears date, as stated in the bill, the 28th August, 1838. It is an absolute assignment of the mortgage, the bond and the notes, and expresses to have been made for and in consideration of a full acquittance on account of a certain debt,” &c. This is very far from being a conditional transfer; and not only is it an absolute and unqualified transfer, but it is also an absolute and unqualified discharge to Ingersoll; for although. Gilpin did not sign it, he assented to it, and accepted its t?rms by receiving it with the notes and bond. Wharton, however, who was examined as a witness for respondent to the cross-bill, gives rather a different coloring to the subject of transfer. He says he was the agent for Gilpin, and arranged the negotiation for him. Before he took the transfer, he was frequently assured by Ingersoll that Smith had no offsets or defence, as he, Smith, had so informed him in an interview whilst travelling on a steam-boat. The witness, knowing that the laws of Mississippi would allow the maker of a bond or note to bring in any defence which he had before transfer, considered this important. Inger-soll says that he never saw Smith until after he had transferred the notes to Gilpin. He then met him on a steam-boat, and in conversation told him who held the notes. Smith said nothing of a defence to them. Wharton further states that after he received the bond and notes, he made inquiries as to the residence of Smith, but received no information until he met with Harry Hill, who gave him the desired information, and stated to him that Smith desired to know who held the notes, so that he might make some arrangement for their liquidation. The witness thereupon determined to make Smith a visit, which he did, he thinks in December, 1840, and in the course of the evening mentioned his business. He was informed that the notes were given for land, the title to part of which was defective; that the deeds were then in the hands of a lawyer for exmination, and it was uncertain whether the notes would be paid or not. In the morning, however, Smith stated that he had reflected much on the subject during the night, and had determined to accept the offer made, to wit, that the four small notes should be paid immediately, and the payment of the bond should be extended to one. two, three and four years, for which purpose Smith was to visit New Orleans in January, and make the payment at the counting-house of Dick & Hill, where the arrangement was to be completed. This was fully agreed on, and Smith expressed his gratification. It was not until after this arrangement was made with Smith, that the witness, as agent of Gilpin, gave a final discharge to Ingersoll. To the cross interrogatories, he states' that, to the best of his recollection, the assignment was made in the latter part of 1839, or the beginning of 1840; that Ingersoll held many conversations with him on the subject of the transfer, and frequently mentioned his interview with Smith on the steam-boat, but does not recollect the dates of the conversations. The witness compromised the debt due from Ingersoll to complainant, by agreeing to take these and other notes, if, upon inquiry, he should be satisfied that they were good, and after he had adopted such measures as he deemed necessary to insure collection, he discharged Ingersoll. Thinks the negotiation commenced in 1839, and terminated by the discharge of Ingersoll in 1841. We have thus given what seemed to be the substance of Wharton’s testimony, in which what seemed to be unimportant has been omitted. It has been criticised by counsel with much severity, and not without some apparent cause.

The witness says that, before he took the assignment, he had frequent conversations with Ingersoll, who stated the conversation already mentioned between himself and Smith. Ingersoll says he never saw Smith until after the assignment. Pie then met him on a steam-boat, and informed him who held the notes. The witness, Wharton, also says that he did not discharge Ingersoll until after his interview with Smith. This fact he dwelt on much, as it is repeated twice, or perhaps thrice, when no interrogatory was propounded on that point, as counsel probably did not think of proving a fact to be different from the allegation in their bill, and its exhibits. It is a voluntary statement, and seems to indicate, on the part of the witness, a knowledge of the equity jurisprudence of Mississippi, in addition to a knowledge of her laws. In this. particular, it is manifest that the witness was mistaken, as it already has been shown that Ingersoll had been absolutely discharged by the very terms of the assignment in 1838. But he does not say what sort of final discharge he gave. If it was in writing, it should have been produced, or its substance stated.

But suppose the witness really did believe that he had not discharged Ingersoll until after he had received assurances from Smith; as the fact was not so, his belief would not alter the case. The promises of the maker bind him to the assignee, because by them he was induced to take the assignment, and would be deceived and prejudiced by the maker, by permitting him afterwards to bring in a defence. It would be a violation of good faith. But here there is no deception, no breach of good faith, because the discharge was in truth given long before the promises were made. The important question is, did Smith by his promises induce the discharge of Ingersoll ? He clearly did not, because Ingersoll had received a discharge long before. We conclude that the facts present only the case of a subsequent promise — a promise made by the maker to the assignee, after the transfer of the security, the effect of which we have already shown.

But a further consideration presents itself, assuming that the discharge was only given as stated. What was the promise ? It was not absolute, but conditional. Part was to be paid at a certain time and place, and the payment of the balance was to be made in one, two, three and four years. If Smith waived his equity by this promise, he is entitled to exact a compliance with the conditions. And still we hear nothing of an offer to perform by the complainant. By making only a promise to pay on certain conditions, he did not bind himself absolutely.

It is further insisted, that Smith has lost the benefit of his defence by delay. It would seem that the fraud was not discovered until 1840, and in that year Hadley moved to Texas; no delay has occurred- as to him, and he was a necessary party to a bill for rescission. It is not certain when Smith became informed who was the holder of the paper; he says not until a short time before this suit was brought, and there is no proof which shows certainly that he knew who the holder was before the year 1840. This bill was filed in December, 1841, and the answer and cross-bill in February, 1842. We cannot say that this was such delay, under the circumstances, as to preclude him. The law only requires reasonable, vigilance.

The decree of the chancellor is affirmed, and the cause remanded.  