
    Alexander M. Powell, Plaintiff, v. The F. C. Linde Co., Defendant. Two Cases.
    (Supreme Court, New York Trial Term,
    November, 1899.)
    1. Action for rent — Assignee of a lease presumed to know its contents.
    An assignee of a sealed lease is chargeable with knowledge of its contents, and therefore, where he subsequently takes a new lease from the same landlord, he cannot successfully interpose, to an action for rent thereunder, the defense that he has been defrauded into making the new lease by misrepresentations as to the amount of rent reserved in the old lease.
    2. Same — Fraud — Rescission and restoration.
    Fraud is not available as a defense, or in damages, unless the party aggrieved promptly rescinds and restores the other party to the same condition as he was in before the transaction.
    Action to recover installments of rent under sealed lease. Defense — fraud in misrepresenting the amount of rent reserved by a prior lease made to Dean & Co., from whom the defendant had received such prior lease.
    H. W. Schmitz, for plaintiff.
    G. D. B. Hasbrouck, for defendant.
   McAdam, J.

By purchasing the lease from Dean & Co., the defendant became chargeable with knowledge of its contents. Grosvenor v. Green, 28 L. J. Ch. 173; Wilson v. Hart, L. R., 1 Ch. App. 463. But assuming that the defendant can legally plead ignorance of the terms of the lease it purchased and was defrauded into making the new lease by the alleged misrepresentation as to the rental reserved by the old lease, the defendant is liable for the rent reserved by the new lease because of its failure to rescind the ° fl contract by restoring the plaintiff to the position he before occupied. There is neither allegation nor claim that upon discovering the fraud the defendant rescinded the hiring, nor is there any counterclaim for damages resulting from the alleged fraud. To rescind is u to abrogate, annul, avoid or cancel a contract ” (Abb. Law Diet.), and the defendant, instead of retaining the lease executed by the plaintiff which gave it the unquestionable right of possession to valuable property for a term of over ten years, and thereby treating if as an existing obligation and term, ought to have indorsed a cancellation thereon or surrender thereof, and tendered such canceled and surrendered lease to the plaintiff, and in that way effectually repudiated the contract of hiring and all benefit under it. If this had been done the plaintiff would have had his election to accept such surrender, and then pursue his legal remedies on the Dean lease, which he claimed to be unassignable without his consent. The plaintiff was deprived of this opportunity by the act of the defendant, and the defendant, upon the allegations contained in its pleading, has no defense to the action, in view of the undisputed fact that it took possession of the property and is now in possession thereof and presumably under this lease, the former one having been canceled. “ In cases of suits for rescission on the ground of fraud, the general principle is that he who seeks equity must do equity; that the party against whom relief is sought shall be remitted to the position he occupied, so far as may be, before the transaction complained of. The courts proceed on the principle that, as the transaction ought never to have taken place, the parties are to be placed as far as possible in the situation in which they would have stood if there had never been any such transaction. Hence, though a party who has been induced by fraud may elect, under proper circumstances, to rescind the same, he can only do so upon the terms of restoring to the wrongdoer the consideration received from him, or its value.” Big. on Fraud, 408, 409; Hunt v. Singer, 1 Daly, 209; affd., 41 N. Y. 620. Bescission is the undoing of a thing, and nothing seems to have been undone here. What was done is still in force. The election to rescind must be exercised promptly or the party will be deemed to have affirmed the contract. Pryor v. Foster, 130 N. Y. 171; Strong v. Strong, 102 id. 73; La Follette v. Noble, 13 Misc. Rep. 574; Hallahan v. Webber, 7 App. Div. 122. Bescission with a string to it will not do. It must be unmistakable and unconditional in a case like this. Mo such rescission is alleged or was offered to be proved. For these reasons the motion for a new trial must be denied, but without costs.

Motion denied, without costs.  