Opinion
(August Term, 1856.)
In assignments of interests resting in grant, if there be no fraud, the purchaser must depend, to make good a deficiency of value, wholly upon his covenants.
CAUSE removed from the Court of Equity of Lincoln County.
Avery and Lander for plaintiff.
Boyden for defendants.
On the 9th of August, 1848, the defendants executed to the plaintiff the following deed of assignments, viz.:
"Know all men by these presents, that James F. Leach and William W. Eaton, who are legally possessed of the patent-right of J. W. Howlet and F. M. Walker's improved smut-machine, patented May 9th, 1846, as will appear by reference to the record of the Patent Office, do by these presents sell unto William Cansler, of Lincoln County, State of North Carolina, the full and exclusive right to twelve Counties, viz., Walker, Murray, Chatooga, Cass, Gilmer, Floyd, Paulding, Cobb, DeCalb, Campbell, Carroll and Dade all in the State of Georgia, to sell in any way, either by County or individual rights, to sue and bring suits the same as Leach and Eaton, in case of patent being intruded on; as witness our hands and seals, this (500) 9th day of August, 1848;" and took eight bonds, of one hundred dollars each, from the plaintiff, payable six months after date, as a consideration for the said deed.
The plaintiff alleges in his bill, that shortly after the execution of the deed and bonds, he was making preparation to construct and vend machines according to the specifications of the patent above contracted for, in the twelve Counties above named; but that he found out, and he alleges the fact to be, that the same machine had been duly patented on the 12th day of November, 1835, by one Edmund J. Fitzpatrick, and that the right to sell the same in the State of Georgia, was vested in L. D. Childs by deed of assignment, bearing date 11th day of February, 1842, who threatened to sue the plaintiff if he presumed to use and exercise the right pretended to be assigned in the deed above set out; and that at the time of making this contract, the defendants well knew that the said machine had been previously patented by the said Fitzpatrick, and the right to make and vend machines was in the said Childs; and, that taking advantage of the youth and inexperience of the plaintiff, the defendants did, by imposition and false representations, induce him to make this contract.
The prayer of the bill is for an injunction to stay the collection of said bonds, and for general relief.
The answer denies all fraud and combination, and insists that the patent-right conveyed is for an original invention, and not an encroachment on any precedent right; but if it be otherwise they were totally ignorant of such preceding patent when they sold to the plaintiff, and were guilty of no fraud.
There was no proof taken on either side; and the cause being set down for hearing on the bill and answer, was sent to this Court by consent.
The record in this case is carelessly drawn up. (501) There is nothing upon it to show that the defendants even answered the bill. An order of publication was made as to the defendant living out of the State; but there is nothing to show that the bill was taken pro confesso against him. The answers of the two defendants living in the State are on file; but how they came there we are not informed. In the present condition of the record, we certainly should not decide the case, if we were not at liberty to presume that all the orders necessary to its final decision, had been made in the Court below; and if we were not satisfied that, from a decision in this Court, the plaintiff cannot sustain his bill.
In the case of Hiatt v. Twomey, 21 N.C. 315, the bill charged that the defendants had sold and conveyed to the plaintiffs, the exclusive right of constructing, vending and using, in the Counties of Stokes and Orange, in this State, a patent-right, for a new and useful method of letting in water upon water-wheels. The bill charged fraud on the part of the defendants, and prayed for a rescission of the contract. The Court say, that in contracts for the assignment of such interests, if there be no fraud, the purchaser must depend, when they prove of no value, wholly upon his covenants. Both parties are equally innocent; there is no necessary warranty of title; and the loss must fall wherever the bargain leaves it.
In our case, the plaintiffs purchased of the defendants the patent-right, to use, construct and sell, within a specified region of country, the patent-right to a smut-machine, and allege that they subsequently discovered that a patent for the same machine, before the date of the patent under which the plaintiffs claimed by assignment, had been granted to another person, which renders their purchase of no value, and that the defendants knew of its existence at the time they sold to the plaintiff; and the bill prays the defendants may be enjoined from suing on the bonds given for the purchase-money of the patent, and that they may be decreed to surrender them up to be cancelled.
The answers expressly deny, if there were any precedent patent for the machine, the use of which they had conveyed to the (502) plaintiffs, that they knew of it; and they deny that such patent was made. They deny all fraud; and aver that, at the time of the sale they did believe, and do still believe, the patent-right they conveyed to the plaintiffs was good; and that they had a right to sell and convey it.
There is no evidence in the case; and there is no fraud, as far as we can perceive. If such a patent as is alleged by the plaintiffs, does exist, there is nothing to prove that the defendants had any knowledge of it. Both parties are equally innocent. This Court cannot interfere; but leaves the plaintiffs to their remedy at law, if they have any.
Per curiam.
The bill is dismissed with costs.