claim for attorney fees denied, because it was based on the rescinded contract; partial rescission unwarranted, because the attorney fees provision was not supported by independent consideration
How later courts described this case
- claim for attorney fees denied, because it was based on the rescinded contract; partial rescission unwarranted, because the attorney fees provision was not supported by independent consideration
Written by the judges who cited it.
The opinion
O’CONNELL, C. J.,
dissenting in part.
I dissent from that part of the majority opinion which holds that plaintiffs are not entitled to recover attorney’s fees.
I am willing to concede that plaintiffs must rest their claim upon the provision in the contract providing as follows: “In any suit or action brought on this contract the prevailing party shall be entitled to recover reasonable attorney’s fees to be fixed by the court.”
The majority denies plaintiffs’ recovery on the ground that the rescission of the contract vitiated the entire contract, including the provision for attorney’s fees.
Although this makes a nice symmetrical, logical construct, it does not make any sense in the real world in which people make bargains. The parties certainly must have intended that the person violating the terms of the contract would have to pay attorney’s fees in ease it was necessary to bring a lawsuit, whether the suit took one form or another. Despite this apparent intent, the majority’s decision results in denying attorney’s fees if the suit takes the form of rescission *19 while allowing them if the suit is for specific performance or damages. If this does not appear unreasonable on its face, it can easily be demonstrated how it might well be in fact. Thus, plaintiffs’ remedy by way of specific performance or damages may not give him the relief he needs and deserves and consequently he seeks rescission. According to the principal opinion, he must do so at the cost of giving up any claim to attorney’s fees. This is obviously the wrong conclusion.
If the game of logic must be played to win for plaintiffs, it can readily be done simply by recognizing an exception to the whole or nothing rule of rescission adopted by the majority. The exception can be found in the same authority relied upon by the majority. In Black, A Treatise on the Rescission of Contracts § 589, 1437 (2d ed 1929), it is observed:
“* * * [T]he more reasonable doctrine now generally prevails that a partial rescission may be ordered if that is the only way in which complete justice can be executed as between the parties.”
Then, too, we could treat the provision for attorney’s fees as separable from the other provisions of the contract, which would then make applicable the following rule (also taken from Black, at § 585, 1433):
“When a contract is separable or divisible into a number of elements or transactions, each of which is so far independent of the others that it might stand or fall by itself, and good cause exists as to one of such parties, it may be rescinded and the remainder of the contract affirmed * * *. The usual test of severability of a contract is the entirety or divisibility of the consideration.”
Thus both the symmetry of logic and the ends of justice would be served.
Holman and Howell, JJ., join in this opinion.