cover back the price. He cannot deal with the article purchased after discovery of fraud in a sale without

a Fielder v. Starkin, 1 H. Blacks. Rep. 17. Weston v. Downes, Doug. Rep. 23. Towers v. Barrett, 1 Term. Rep. 133. Curtis v. Hannay, 3 Esp. Rep. 82. Kellogg v. Denslow, 14 Conn. Rep. 411. Pateshall v. Tranter, 4 Neville & Manning, 649. 3 Adolphus & Ellis, 103, S. C. In this last case the decision in Fielder v. Starkin, that an action will lie on a breach of warranty of soundness of a horse sold, though it be not returned, and though notice of the unsoundness be delayed, was held to be sound law. Franklin v. Long, 7 Gill & Johnson, 407. Boorman v. Johnston, 12 Wendell's Rep. 566. Waring v. Mason, 18 Wendell, 426. To the same purpose it has been held, that if the chattel had a defect fraudulently concealed, the vendee has his election either to keep it, and sue for damages, or to return, or offer to return it within a reasonable time, and rescind the contract. Hoggins v. Beecraft, 1 Dana's Ken. Rep. 30. The vendor, after notice that the horse warranted sound is unsound, and when an offer is made to return him, and the vendee sells him, is answerable for the difference of price, and the keep of the horse for a reasonable time. Chesterman v. Lamb, 4 Nevile & Manning, 196. In Street v. Blay, 2 Barnw. & Adolph. 456, it was held that the vendee could not rescind the sale and return the property if the sale was without fraud. Cowen, J., in Cary v. Gruman, 4 Hill, 625, S. P. He has only an action on his warranty, Sedgwick on Damages, p. 290, and it is now well settled, he observes, Id. p. 290, that the rule of damages is the difference between the actual value and the value the article would have possessed, if it had conformed to the warranty. As to the measure of damages on breaches of contract, it seems not to be explicitly settled, whether in the case of a horse sold and warranted sound, which proves to have been unsound, and is resold by the buyer at a reduced price, the measure of damages is to be the difference between the original price and the price the horse sold for, or between the price the horse sold for, and the value of the horse, if sound, going far beyond the original price. The dictum of Lord Eldon, in Curtis v. Hannay, 3 Esp. 82, is in favour of the actual value of the horse, if sound, at the resale, but Lord Loughborough, in Fielder v. Starkin, 1 H. Black. 17, is in favour of the value, as ascertained by the original agreement, and this would seem to be in harmony with the rule of damage on the covenant of warranty in the sale of land. The general rule is well settled, that in a suit by vendee for a breach of contract on the part of the vendor, for not delivering an article sold, the measure of damages is the price of the article at the time of the breach. The contract price, on the one hand, and the rise subsequent to the breach, are both to be disregarded. Mr. Sedgwick, in his Treatise on the Measure of Damages, p. 266, says, that in this place the author of the Commentaries appears to have overlooked the distinction running through the cases, resulting from the pay

losing his right of action.a An offer to return the chattel in a reasonable time, on breach of warranty, is equiva

inent of the price before hand, and which distinction is, that if the price be not advanced before hand, the measure of damages is the value of the article contracted for at the time it was to be delivered, but if the price be previously advanced, the contract price is not the rule of damages, but the highest value of the article at the time of trial. The cases that declare or countenance this distinction are Shepherd v. Johuson, 2 East, 211. M'Arthur v. Seaforth, 2 Taunt. 257. Downes v. Buck, 1 Starkie, 254. Harrison v. Harrison, 1 Carr. & P. 412. Gainsford v. Carrolton, 2 B. & Cress. 634. West v. Wentworth, 3 Cowen, 82. Clark v. Pinney, 7 Id. 681. The cases in opposition to the distinction, either expressly or impliedly, are Gray v. Portland Bank, 3 Mass. Rep. 364. Swift v. Barnes, 16 Pick. 194. Gilpins v. Consequa, Peters' C. C. U. C. Rep. 85. Bush v. Canfield, 2 Conn Rep. 485. Wells v. Abernethey, 5 Conn. Rep. 222. Startup v. Corlazzi, 2 Co. Mees. & Roscoe, 163. Blydenburg v. Walsh, 1 Baldwin's Rep. 331. Smethurst v. Woolston, 5 Watts & Serg. 106. Vance v. Tourne, 13 Louis. Rep. 225. The learned author is mistaken in supposing I had overlooked that distinction. These commentaries are not calculated to embody all the nice, or arbitrary, or fanciful distinctions that are to be met with in the reports. I do not regard the distinction alluded to as well founded or supported. It is disregarded or rejected by some of the best authorities cited. The true rule of damages is the value of the article at the time of the breach or when it ought to have been delivered. Mr. Sedgwick seems himself to come to that conclusion amid the contrariety of opinion and cases which he cites. Treatise, p. 260-280. That is the plain, stable, and just rule within the contract of the parties. Damages for breaches of contract are only those which are incidental to, and directly caused by the breach, and may reasonably be supposed to have entered into the contemplation of the parties, and not speculative profits, or accidental or consequential losses, or the loss of a fancied good bargain. Walker v. Moore, K. B. 1829. In Masterton v. Mayor of Brooklyn, 7 Hill, 62, the question of damages was well discussed, and it was held that profits or advantages which were regarded as the direct and immediate fruits of the contract, are to be considered as parcel and elements of the contract, and to be allowed. See, also, Hayden v. Cabel, 17 Mass. R. 169. Deyo v. Waggoner, 19 Johns. Rep. 241. Sedgwick's Treatise, p. 81-88. 6 Toullier, sec. 286. Flureau v. Thornhill, 2 Black's Rep. 1078. Williams v. Barton, 13 Louis. Rep. 404. Blanchard v. Ely, 21 Wendell,

Campbell v. Fleming, 1 Adolph. & Ellis, 40. A party defrauded in a contract has his choice of remedies. He may stand to the bargain, and recover damages for the fraud, or he may rescind the contract, and return the thing bought and receive back what he paid or sold.

lent in its effect upon the remedy to an offer accepted by the seller, and the contract is rescinded, and the vendee can sue for the purchase money in case it has been paid.a But a contract cannot be rescinded without mutual consent, if circumstances be so altered by a part execution, that the parties cannot be put in statu quo; for if it be rescinded at all, it must be rescinded in toto.b The parties to a contract may rescind it at any time before the rights of third persons have intervened; but a resale of the disputed article does not of itself rescind the contract, or destroy the right to damages for non-performance of the contract, to the extent of the loss in a resale, provided the same be made after default and due notice. If the sale be absolute and the contract remains open and unrescinded, and without any agreement to rescind, the vendee of the unsound article must resort to his warran

342. But Lord Ch. J. Denman, in Cox v. Walker, cited in a note to Clare v. Maynard, 6 Adolph. & Ellis, 519, and also in the last case, laid down the rule of damages to be, the difference between the value of a horse at the sale considering him to be sound, and the value with the defect complained of, and not the difference between the price of the first purchase and of the actual sale. So, in Shannon v. Comstock, 21 Wendell, 457, it was held, that in an action to recover damages for non-performance of a contract, the rule of damages was held to be the loss sustained, and not the price agreed to be paid on actual performance. In Cary v. Gruman, 4 Hill, 625, the rule as declared by Lord Denman was adopted, and the price paid was only prima facie evidence of the then value. In O'Conner v. Forster, 10 Watts' Rep. 418, on a breach of contract to carry wheat from P. to Philadelphia, the difference between the value of the wheat at P. with the freight added, and the market price at Philadelphia, at the time it would have arrived there, if carried according to contract, is the measure of damages. Bracket v. M⚫Nair, 14 Johnson, 170. Davis v. Shields, 24 Wendell's Rep. 322, to S. P. In Badgett v. Broughton, 1 Kelly, 591, the rule declared by the supreme court in Georgia, was the difference between the price paid for an article warranted sound, and the value of the article in its unsound condition.

■ Thornton v. Wynn, 12 Wheaton, 183.

Hunt v. Sylk, 5 East's Rep. 449.

• Sands & Crump v. Taylor, 5 Johns. Rep. 395. Maclean v. Dunn, 4 Bing. Rep. 722.

ty, unless it be proved that the vendor knew of the unsoundness, and the vendee tendered a return of the arti cle within a reasonable time.a

In South Carolina and Louisiana, the rule of the civil law has been followed, and as a general rule a sale for

a sound price is understood to imply a warranty of *481 soundness against all faults and defects.b *The

same rule was for many years understood to be the law in Connecticut; but if it did ever exist, it was entirely overruled in Dean v. Mason, in favour of the other general principle, which has so extensively pervaded the jurisprudence of this country. Even in South Carolina, the rule that a sound price warrants a sound commodity, was said to be in a state of vibration; and it is not applied to assist persons to avoid a contract, though made for an inadequate price, provided it was made under a fair opportunity of information as to all the circumstances, and when there was no fraud, concealment or latent defect.d

Thornton v. Wynn, 12 Wheaton, 133.

Timrod v. Shoolbred, 1 Bay's Rep. 324. Whitefield v. M'Leod, 2 Ibid. 360. Lester v. Graham, 1 Const. Rep. S. C. 182. Crawford v. Wilson. 2 Ibid. 353. Dewees v. Morgan, 1 Martin's Louis. Rep. 1.

4 Conn. Rep. 428.

& Whitefield v. M‘Leod, 2 Bay's Rep. 384. The law in South Carolina seems at last to be conformable to the old general rule. It was held, in Carnochan v. Gould, in the court of appeals, 1 Bailey's Rep. 179, that a vendor of cotton was not liable for a defect in the quality of the cotton of an unusual character, which extended equally through the bulk, and was fully exhibited in samples. The law in that case would not raise an implied warranty, for there was no fraud, and the buyer was possessed of all the information necessary to enable him to make a correct estimate of the value of the article. In Osgood v. Lewis, 2 Harr. & Gill, 495, implied warranties upon the sale of chattels, and arising by operation of law, were held to he of two kinds. 1. In cases where there was no fraud, as that the provisions purchased for domestic use were wholesome, or that the article contracted for in an executory contract, and which the purchaser had no opportunity to inspect, should be saleable as such in the market. 2. Where the fraud existed, as if the seller, knowing the article to be unsound, disguises it or represents it as sound.

If the article be sold by the sample, and it be a fair specimen of the article, and there be no deception or warranty on the part of the vendor, the vendee cannot rescind the sale. But such a sale amounts to an implied warranty that the article is in bulk of the same kind, and equal in quality with the sample. If the article should turn out not to be merchantable, from some latent principle of infirmity in the sample, as well as in the bulk of the commodity, the seller is not answerable. The only warranty is, that the whole quantity answers the sample.

*VI. Of the duty of mutual disclosure.

*482

If there be an intentional concealment or suppression of material facts in the making of a contract, in cases in which both parties have not equal access to the means of information, it will be deemed unfair dealing, and will vitiate and avoid the contract. There may be some difference in the facility with which the rule ap plies between facts and circumstances that are intrinsic, and form material ingredients of the contract, and those that are extrinsic, and form no component part of it, though they create inducements to enter into the contract, or affect the price of the article. As a general rule, each party is bound to communicate to the other, his knowledge of material facts, provided he knows the other to be ignorant of them and they be not open and naked, or

■ Parkinson v. Lee, 2 East's Rep. 314. Sands & Crump v. Taylor, 5 Johns. Rep. 395. Bradford v. Manly, 13 Mass. Rep. 139. Woodworth, J., in 20 Johns. Rep. 204. The Oneida Manufacturing Society v. Lawrence, 4 Cowen's Rep. 440. Andrews v. Kneeland, 6 Ibid. 354. Gallagher v. Waring, 9 Wendell's Rep. 20. Boorman v. Johnston, 12 Ibid. 566. Waring v. Mason, 18 Ibid. 425. Phillipi v. Gove, Rob. Louis. R. 315. Civil Code of Louisiana, art. 2449. Moses v. Mead, 1 Denio, 378. In the sale of an article, as hemp, in bales, it is held, that there is no implied warranty that the interior shall correspond in quality with the exterior of the bales, and if the purchaser is at liberty to open the bales and examine, there is no sale by sample, though the interior does not correspond with the external part. Salisbury v. Stainer, 19 Wendell, 159.