NEGLECT TO EXAMINE TITLE.

25

LETTER V.

I SHALL now dismiss you from your character of a seller, and treat you as a Buyer.

In running over, in my last Letter, the misstatements which a seller may with impunity make, I of course was looking to the situation in which I now consider you to stand; for when you know how far an unprincipled vendor may with safety go, you can guard against fraud by not trusting to misrepresentations which are made. without fear of retribution.

If you should have a right to avoid a purchase on the ground of fraudulent representations by the seller, you ought at once to exercise your right, and not go on dealing with the property as the owner of it, for such conduct may amount to a waiver of your right to rescind the contract.

With the exception of a vendor, or his agent, suppressing an encumbrance, or a defect in the title, it seems clear that a purchaser cannot obtain relief against him for any encumbrance or defect to which his covenants do not extend; and therefore if a purchaser neglect to have the title investigated, or his counsel overlook any defect in it, he has no remedy beyond what the seller's covenants may afford. It has even been laid down, that if one sell another's estate, without covenant or warranty for the enjoyment, it is at the peril of the purchaser, because he might have looked into the title; and there is no reason he should have an action by the law, where he did not provide for himself. I may remark, by the

26

LIABILITY OF LAWYERS.-RIGHT OF WAY.

way, that as counsel, that is, barristers, have no remedy for recovery of their fees, which are considered purely gratuitous and honorary, they are not deemed liable to their clients for any blunders which they commit, however gross. But it is otherwise as to attorneys; they may maintain an action for their fees; and if a purchaser is damnified by the gross want of skill in an attorney, or by his neglect to search for encumbrances, he may recover at law against the attorney for any loss which he may sustain. But where the attorney has acted under the advice of counsel, he is safe. To return: You will collect from the observations in my last Letter, that as a purchaser you are entitled to relief on account of any latent defects in the estate, or the title to it, which were not disclosed to you, and of which the vendor, or his agent, was aware. In addition to this protection afforded by the law, you, as a provident man, ought not to trust to the description of the vendor, or his agents, but to examine and ascertain the quality and value of the estate yourself, and you should have the title to it inspected by counsel.

If there are rights of way over the property, you cannot object, although they are not noticed in the contract. A right of way is not a latent defect, and you ought to inquire. If you buy a mine, and it is full of "faults," you will be bound, for they are incidents to a mine, as you must have known, and therefore ought to have inquired. The very name of the place where the property is situated may mislead you; for example, a house "in Regency Square, Brighton," was sold by auction in London, and the buyer bought on that description, never having seen the house. But the houses running from the north-west corner of the Square into an adjoining street, although in no respect within the Square, had

FALSE STATEMENTS OR SILENCE BY PURCHASER. 27

always been numbered, and named, and treated as part of the Square. This house was, unluckily for the purchaser, in the street and not in the Square, but he was compelled to take it, as he ought to have inquired. So the immediate neighbours may be such as to prevent the purchaser from taking his family to the house recently purchased for their habitation, yet he must complete his purchase. These instances are sufficient to show the necessity of previous inquiry.

I may here remark, that although a vendor is bound to tell the purchaser of latent defects, yet a purchaser is not bound to inform the vendor of any latent advantage in the estate. If you were to discover that there was a mine on an estate, for which you were in treaty, you would not be bound to disclose that circumstance to the vendor, although you knew that he was ignorant of it. Nor need you as a purchaser adhere closely to truth in procuring the estate at as cheap a price as you can. a case where a false statement by a purchaser was held not to give the seller a right of action, the Court said, that the question was, whether the purchaser was bound to disclose the highest price he chose to give, or whether he was not at liberty to do that as a purchaser which every seller in this town does every day, who tells every falsehood he can to induce a buyer to purchase.

A purchaser may misrepresent the seller's chance of sale, or the probability of his getting a better price for his property than that which the buyer offers. But a purchaser is always in danger who makes an actual misrepresentation, which tends to mislead the seller. And he cannot justify misrepresenting the estate to any person desirous of purchasing it, or concealing the death of a person, of which the seller is ignorant, by which the estate is increased in value.

28

MISREPRESENTATION BY STRANGER.

In regard to false representations to a purchaser of value or rent, I must still observe that the same remedy will lie against a person not interested in the property, for making such false representations as might be resorted to, in case such person were owner of the estate; but the statement must be made fraudulently, that is, with an intention to deceive; whether it be to favour the owner, or from an expectation of advantage to the party himself, or from ill-will toward the other, or from mere wantonness, is immaterial. And in these cases, to use the language of Sir William Grant, it will be sufficient proof of fraud to show, first, that the fact as represented is false; secondly, that the person making the representation had a knowledge of a fact contrary to it. The injured party cannot dive into the secret recesses of the other's heart, so as to know whether he did or did not recollect the fact; and therefore it is no excuse in the party who made the representation to say, that though he had received information of the fact, he did not at that time recollect it.

And on the same ground, if a person having a right to an estate permit or encourage a purchaser to buy it of another, the purchaser will be entitled to hold it against the person who has the right, although a married woman, or under age. And the same rule has even been extended to a case where the representation was made through a mistake, as the person making it might have had notice of his right.

If you suspect that any person has a claim on an estate which you have contracted to buy, you should, before proper witnesses, inquire the fact of him, at the same time stating that you intend to purchase the estate; and if the person of whom the inquiry is made have an encumbrance on the estate, and deny it, equity would

EXAMINATION OF LEASES.

29

not afterwards permit him to enforce his demand against you. The witnesses in this case should take a note of what passes, because a witness may refresh his memory by looking at any paper, if he can afterwards swear to the facts from his own memory.

Where it is stated upon a sale, even by auction, that the estate is in lease, and there is no misrepresentation, the purchaser will not be entitled to any compensation, although there are covenants in the lease contrary to the custom of the country, because whoever buys with notice of a lease is held to have knowledge of all its contents. If, therefore, you have notice of a lease, or even that the estate is in the occupation of a tenant, you should not sign a contract for the purchase of the estate until your solicitor has seen and read the leases, unless the vendor will stipulate in writing that they contain such covenants only as are justified by the custom of the country. And even such a stipulation is not quite satisfactory, for there is frequently great difference of opinion as to what is the custom of any particular place.

And in buying a leasehold estate, it is absolutely necessary to know the contents of the lease, particularly the covenants on the tenant's part. They may be onerous, and may, for example, prohibit you, as the purchaser, from assigning without the landlord's consent; yet you would be bound by them, because you would be held to have bought with implied notice of them. So it is not unusual to stipulate, in conditions of sale of a leasehold property, that the production of a receipt for the last half-year's rent shall be accepted as proof that all the lessee's covenants were performed up to that period. Never bid for an estate clogged with such a condition, for if there had been a breach, of which the lessor could take advantage, notwithstanding his receipt of rent, you