"`Rescission of a contract on ground of fraud will not always be denied merely because parties cannot be placed in statu quo.' [1924, 194 Cal. 73, 227 P. 715] "In Harvey v. Thomas [1931, 150 Okla. 106, 300 P. 772] the Oklahoma court accurately stated this logical principle when in the first syllabus the Court said: "`In order to rescind a contract for fraud, the party defrauded must as a general rule restore, or offer to restore, the consideration which he has received under the contract, but if the defrauded person, by reason of the wrongful conduct of the wrongdoer, is rendered incapable of fully restoring the latter to his former position, such restoration to that extent is not necessary to a rescission.
(Emphasis supplied.) 1931, 150 Okla. 106, 300 P. 772. In the instant case the defendant's conduct unmistakably brought about the condition whereby the plaintiff is unable to return the consideration of the contract in question.
Lee was aware of plaintiff's desire to rescind the transaction and knew full well what would happen if the mortgage payments were not made. The defrauded plaintiff will not lose her right to rescind when the defendant is directly responsible for plaintiff's inability to return the subject matter of the rescinded contract. Delta Investing Corp., supra; Harvey v. Thomas, 150 Okla. 106, 300 P. 772 (1931). In light of the foregoing we hold that the lower court erred in refusing to rescind the contract and return the Phoenix property to Mrs. Jennings.
In an action on a promissory note by one who is not a holder in due course, both fraud in the procurement of the note and absence or failure of consideration are valid defenses. Planters Trading Co. v. Golden Grocery Co., 139 Okla. 246, 281 P. 771; Harvey v. Thomas, 150 Okla. 106, 300 P. 772; Frank Harber Buick, Inc. v. Miller, Okla., 328 P.2d 716; Strickland v. Hetherington, Okla., 353 P.2d 138; Hawkins v. McElhanon, Okla., 315 P.2d 667; Selected Investments Corporation v. Lester, Okla., 327 P.2d 668. Under the evidence as outlined, the defendants were entitled to a decree for rescission and cancellation of the entire obligation and the jury did, in effect, declare a rescission.
Parol evidence would be admissible to vitiate such obligation. See, Strickland v. Hetherington, Okla., 353 P.2d 138; Harvey v. Thomas, 150 Okla. 106, 300 P. 772. In any event, the allegations of the pleadings present controverted issues of fact which may not be resolved without introduction of proof. It is error to render judgment on the pleadings if there is raised an issue of fact upon which a valid judgment might be rendered.
"Where L. sues F. upon a promissory note, and F. files answer and cross-petition, and introduces material, competent evidence thereof, it is error for the court to sustain a demurrer to the defendant's evidence." Also see Planters Trading Co. v. Golden Grocery Company, 139 Okla. 246, 281 P. 771; Harvey v. Thomas, 150 Okla. 106, 300 P. 772; Mitchell v. Fayette Bank Trust Co., 149 Okla. 64, 299 P. 498; First National Bank of Poteau v. Allen, 88 Okla. 162, 212 P. 597; Mitchell v. Finance Reserve Co., 151 Okla. 92, 1 P.2d 717; State ex rel. Shull v. Ingle, 167 Okla. 377, 29 P.2d 959, and Davidor v. Smith, Okla., 309 P.2d 272. Thus we conclude that where lack of consideration for a note is pleaded as a defense, parol evidence may be presented to show the lack of consideration.
That certainly raised a question of fact to be submitted to the jury under proper instructions from the court. In Harvey v. Thomas, 150 Okla. 106, 300 P. 772, we held: "It is error to direct a verdict for plaintiff where, admitting the truth of all the evidence given in favor of the defendant, together with such inferences and conclusions as may be reasonably drawn therefrom, there is enough competent evidence to reasonably sustain a verdict, should the jury find for the defendant."
" This court has adhered to the same rule in numerous decisions, among which are Roberts v. Boydston, 186 Okla. 336, 97 P.2d 898; Harvey v. Thomas, 150 Okla. 106, 300 P. 772; Redwine v. Cummins, 108 Okla. 39, 233 P. 418. Since there was no consideration for the note and mortgage which the defendant exacted from the plaintiff, she may not now be heard to say or claim that a note and mortgage secured under such circumstances may be enforced.
The language of the statute contains no such implication and we decline to draw such an inference. Of course, where the purchaser is guilty of some wrong, as, for instance, fraud which under the general law would authorize the county acting through its governing board to rescind the transaction at its option, making restoration of the consideration only if such restoration is possible, and excusing restoration on the grounds of impossibility by reason of the wrongful concealment of the fraud by the purchaser while the money was being distributed (notice 15 O.S. 1941 ยง 235[ 15-235] and Harvey v. Thomas, 150 Okla. 106, 300 P. 772), different considerations would govern and a different result would follow. In this case the county asserted in the trial court that the purchaser was guilty of fraud.
The law relating to bona fide holders of a negotiable note has no application in an action between the original parties to the note. State ex rel. Shull v. Ingle, 167 Okla. 377, 29 P.2d 959; Planters Trading Co. v. Golden Gro. Co., 139 Okla. 246, 281 P. 771; Harvey v. Thomas, 150 Okla. 106, 300 P. 772; Hagan v. Bigler, 5 Okla. 575, 49 P. 1011; 8 C. J. 717, sec. 1004. 2.