by herself or by S. P. Brown her attorney in fact, or other evidence satisfactory to said bank, the payment of sums aggregating two hundred thousand dollars; this deposit is made in pursuance of a contract signed by S. P. Brown and Daniel E. Murphy, dated April 9th, 1900; said company is the corporation to be organized referred to in said agreement. If said company shall fail to pay said sums or shall be in default over ninety days in the profits of the mine mentioned in said contract or shall surrender said contract as therein provided or shall fail for any time for ninety days to fulfill said contract by the continuous operation of said mines and mills or other reduction works according to the tenor of said con

ed to Constance H. Brown or her order. John H. Denison is hereby substituted for said bank. Constance H. Brown,

"By S. P. Brown, Attorney in Fact. "The Gordon Tiger Mining & Reduction Com pany, Daniel E. Murphy, President."

connection with the $60,000 equaled $200,- | ceipts of S. P. Brown or Constance H. Brown, 000. When this was paid conveyances were to be delivered. The contract also provided that in case Murphy or the corporation, after working the mines, should determine that they could not be worked profitably, possession should be surrendered to Brown, and the deeds to be placed in escrow returned and the agreement canceled; "but all moneys paid and all machinery, betterments, and improvements added to said property by said party of the second part (Murphy or the corporation) shall be forfeited to said first party as fixed and liquidated damages." A few days after this contract was executed, Brown assigned it to the plaintiff, and another contract was drawn up and signed by the same parties, making some slight changes not material, however, to any question involved. Aft- | tract, then the within deeds are to be deliverer signing this second agreement Brown and Mr. Denison, representing Murphy, went to Leadville to complete the examination of the title and to pay off some of the pressing liens against the property. Upon examination of the records, Murphy's representative was not satisfied with the powers of attorney which Brown held from the other owners and demanded that Brown furnish deeds from all his children. Brown thereupon furnished deeds signed by himself, Mrs. Brown, and the heirs of Belinda H. Brown, deceased, except James W. Brown, conveying the property to Mr. Murphy. Mr. Murphy's representative insisted upon a deed also from James W. Brown. Mr. S. P. Brown then stated that James W. Brown had died two years before, intestate, leaving no debts, had never been married, and that he (S. P. Brown, his father) was his only heir. He also made an affidavit to the same effect. This statement and affidavit were false. James W. Brown was not dead, but at the time was insane and confined in an asylum in Pueblo, as S. P. Brown well knew. Relying upon this statement and affidavit, Murphy's representative passed the title to the property, and paid upwards of $33,000 for a pressing lien represented by a sheriff's certificate of sale which had been issued on a sale of the property under execution, by buying the certificate of purchase and taking a commissioner's deed direct to Murphy. Afterwards Murphy discharged other liens and taxes against the property which, with the one referred to, aggregated upwards of $49,000. The Gordon-Tiger Mining & Reduction Company was organized as provided in the contract, and a deed from Murphy, who had obtained the commissioner's deed under the sheriff's certificate of sale mentioned, to Constance H. Brown, together with a deed from her to the company, were put in an envelope indorsed as follows:

"To the Denver National Bank: The within deeds are to be delivered to The GordonTiger Mining and Reduction Company, or to its order, upon showing to said bank by re

April 9, 1900, this escrow agreement was deposited with Mr. Denison, and the possession of the property turned over and delivered to the Gordon-Tiger Mining & Reduction Company under the contract. From that date the company held the absolute and undisturbed possession thereof as its property. During this time it had not furnished or placed on the property any stampmill or other machinery for the treatment of ores therein, had not mined or removed or sold any of the ore, and had not operated any machinery for the treatment of the ore. The work done by the company in and about the mine consisted in extending tunnels thereon and uncovering and exposing ore bodies and the erection of a boarding house on the premises. March 11, 1901, the company learned that James W. Brown was not dead, but confined as a lunatic in an asylum in Pueblo. It did not elect to rescind the contract, but, on the other hand, elected to treat the contract as valid and continuing until the expiration of 21 months after it was fully advised that the statement and affidavit of S. P. Brown respecting the death of James W. Brown was untrue. July 24, 1902, Mrs. Brown instituted this action, based upon the ground that the company had failed to comply with and carry out the terms and conditions of the contract mentioned, and its willful neglect and refusal to perform the obligations imposed thereby, and prayed that because of its default in these respects the defendant be compelled to return the possession of the property to her, and that all sums paid by the defendant company and betterments made under the contract be forfeited as fixed and liquidated damages, and that she be decreed to be entitled to the deeds and conveyances in the hands of Mr. Denison. She predicated her right to this relief upon

The judgment of the district court is reversed, and the cause remanded for a new trial."

When the cause reached the district court, the defendant company was permitted to file an amended answer and cross-complaint, in which it set up practically the same defenses that were set forth before, but, instead of asking for a rescission of the contract, stated the damages alleged to have been suffered by reason of the fraud and breach of contract of S. P. Brown, and prayed for judgment for these damages, and that it be subrogated to the rights of the lien claimants whose liens against the property it had discharged, which it alleged it was induced to do by the false representations of S. P. Brown with respect to the title. Previous to this time and, in fact, before the former trial, a conservator had been appointed by the county court for the estate of James W. Brown. The conservator had secured an order from the county court permitting him to intervene in the cause. He had filed his petition to intervene, and in open court offered to perform any decree that the court might render regarding the interest of his ward. Plaintiff then rested, and the defendants made a motion to dismiss the bill for lack of equity and evidence. The court then announced that the company would be given an opportunity to

the clause in the contract which gave the de-, to the recovery of the purchase price fendant company the option to surrender and forfeit all improvements and moneys paid if it should determine that the mines could not be worked profitably, and also upon the language of the escrow agreement. To this action Mr. Denison was made a party defendant. The grounds upon which the company relied in support of its cross-complaint were to the effect that the plaintiff had failed to keep and perform the conditions of the contract in that she had failed to convey the title to the property as agreed to be conveyed, and had been guilty of fraud with respect to statements regarding the death of James W. Brown. Respecting these matters and the testimony received in support of them as excuses for failure of the company to comply with its contract, this court said that they were manifestly frivolous and insufficient, and, with respect to the title, stated: "The defect in the title, however it may affect the rights of the respective parties in other respects, certainly affords no excuse for, and was not the cause of, the delay in the erection of the mill within the time provided." Speaking further to this point it was said: "It may be conceded that the defendant had the right to rescind the contract upon the discovery of the falsity of the statements of S. P. Brown in regard to the death of James W. Brown, and his consequent inability to convey the title to an undivided one forty-elect whether it would accept the so-called eighth of the property by his own deed as he had purported to do; but having failed to avail itself of that right in apt time, and by recognizing the contract as in force thereafter waived the right to rescind, and became as conclusively bound by the contract as if the fraud had not intervened."

tender of title of the intervener's interest and perform the contract. A colloquy then occurred between counsel and the court for the purpose of ascertaining what was meant or intended by such election; the court ruling that by permitting the company to perform the contract it was meant that it should be permitted to pay the balance of the purchase price, $140,000, in cash within a reasonable time, but that it would not be allow

In other words, we held, in disposing of the case, that one who proposes to rescind a contract by reason of a fraud practiced on him inducing him to enter into it must acted to go ahead and carry out the contract by promptly upon the discovery of the facts. If he continue acting under the contract and recognizing it as in force, he will be bound by the contract as if the fraud had not occurred. He is not permitted to play fast and loose. "Delay and vacillation are fatal to the right which has before subsisted." In finally disposing of the case we said: "The defendant, having waived the right to rescind the contract upon the ground of Brown's fraudulent representation, is conclusively bound by the contract, and cannot now urge the defect in the title as an excuse or justification for its failure to perform the obligations imposed upon it by its express terms; in other words, it cannot retain the possession of the property and successfully evade its obligations thereunder. In the event that it shall carry out the contract on its part and the defect in the title is not 'made good' as provided in the contract, any damages it may suffer by reason of such de

erecting a mill, working the property, and paying the balance of the purchase price out of the proceeds. For the purpose of enabling the defendant company to determine whether or not it would elect as suggested by the court, a continuance of the cause was had for 30 days. At the expiration of that time, the trial was resumed, and the company announced that it was unable to accept the offer of election as made by the court. Some further evidence was then introduced on the part of the plaintiff, which is not material to any question involved, when the plaintiff again rested. The defendants then moved to dismiss the bill substantially on the grounds previously noted. This motion was denied. The defendants then offered to prove the damages sustained as claimed by their amended answer and cross-complaint, which, in effect, were the amount paid to discharge the liens to which reference has been made and the money expended in working the

ey expended thereunder, or (2) he may waive the right to rescind and have an action for damages resulting from the fraud. When, however, he elects to waive the fraud, such election is irrevocable, and his remedy thereafter is an action for damages. As' previous

rendered, quieting the title to the property | the other party thereto, he has two remedies, involved in plaintiff and intervener, and ad- (1) to rescind and be reimbursed for the monjudging that all sums of money paid by the defendant company were forfeited to the plaintiff and intervener as fixed and liquidated damages. In brief, the decree gave the plaintiff and intervener the property, and denied the defendant company any relief whatever. To review this judgment the com-ly stated, the company waived its right to repany had brought the case here on error.

[1] The first point urged is that the court erred in rendering the decree without sufficient evidence to entitle the plaintiff and intervener to the relief granted. The pleadings established the execution of the contract and the failure of the defendant company to perform its conditions; consequently it was not necessary to introduce evidence to establish facts which the pleadings of the parties admitted. The only questions of fact presented by the pleadings were the affirmative defenses set up by the defendant company as an excuse for its failure to comply with the contract. By the amendments filed they were substantially the same as when the case was here before, namely, the fraud of S. P. Brown, regarding which we said, as previously noted, that: "The defect in the title, however it may affect the rights of the respective parties in other respects, certainly affords no excuse for, and was not the cause of, the delay in the erection of the mill within the time provided."

scind, consequently by way of cross-complaint was only entitled to the damages resulting from the fraud. Such damages cannot include expenditures made under the contract, for the very obvious reason that to permit it to be reimbursed on this account would be nothing less than allowing it to recover what it would be entitled to in case it could maintain an action to rescind.

[4, 5] It is strenuously insisted, however, that it should be entitled to recover the amount expended in discharging liens upon the property for the reason that it expended money for this purpose before it was aware of the falsity of the statements and affidavit of S. P. Brown, and would not have made such expenditures had it been aware, or had it known, that they were false. This contention is without merit. When it waived its right to rescind by continuing in possession of the property and expending money thereon, after knowledge of the fraud, it waived its right to have the contract declared void. The contract was still executory, and, in such circumstances, a waiver after knowledge of the fraud constitutes full affirmation and rat

fraud. Richardson v. Lowe, 149 Fed. 625, 79 C. C. A. 317. The contention under consideration amounts to this, that notwithstanding the company has waived its right to rescind the contract it is nevertheless entitled to recover the amount expended in discharging

rule of law that where a party has an election to rescind a contract he must rescind it wholly or not at all. He cannot consider it

[2] Logically the next question presented for consideration, though not in the order ar-ification of the contract, notwithstanding the gued in the briefs, is whether, under the averments of the amended answer and crosscomplaint to the effect that the company would not have discharged the liens on the property it did but for the false statements of Brown regarding the death of his son, James, and changing the prayer of its cross-com-liens against the property. It is a settled plaint from one for rescission to damages, and that it be subrogated to the rights of those whose liens it discharged, and for a judgment for the money expended in work-void for one purpose and in force for another. ing the property, it was entitled to such relief. Counsel for the plaintiff insist that the company is not entitled to such relief, either in whole or in part, for the reason that the former opinion of this court denies it; while on the part of the company it is urged that this question was left open. It is unnecessary to determine this proposition. When the company discovered the fraud perpetrated by Brown, it may be conceded without deciding it that the company had the right to rescind the contract and recover the expenditures made thereunder, provided, as was said when the case was here before, it acted promptly. But its failure to so act waived the right to rescind. Assuming, then, that it had the right to rescind had it elected to do so in apt time, its other remedy was to resort to an action for damages.

[3] In other words, when a party has been >induced to enter into a contract by fraud of

Auld v. Travis, 5 Colo. App. 535, 39 Pac. 357. We must therefore conclude that the only relief to which the company would be entitled would be damages resulting from a breach of the contract with respect to the title. It is not, however, in a position to invoke this relief, for it does not ask it, neither has it complied with the contract upon its part so as to entitle it to a conveyance of the property.

[6, 7] Counsel for the company urge upon our attention two propositions, which it is claimed precludes the plaintiff from maintaining her action: (1) That a court of equity never enforces a forfeiture; and (2) that plaintiff does not come into court with clean hands. While it is true that the relief granted plaintiff may in a sense be said to be a forfeiture of the rights of the company in the subject-matter of the controversy, it is nothing more than an enforcement of the provisions of the contract between the par

The invalidity of a tax deed would not affect the jurisdiction of the county court to quiet title thereunder, and, when such deed was not then attacked, the decree in that suit could not be collaterally attacked.

such agent in the county in which the land was situated, was sufficient as against a collateral attack upon a decree therein obtained.

[Ed. Note. For other cases, see Corporations, Cent. Dig. §§ 2603-2627; Dec. Dig. § 668.*] 6. JUDGMENT (§ 487*)-COLLATERAL ATTACK— TAX DEED-JUDGMENT QUIETING TITLE.

Where the county court in an action to quiet title under a tax deed void on its face had jurisdiction of the subject-matter and of the person, its decree for plaintiff therein was a good defense to a purchaser under plaintiff; [Ed. Note.-For other cases, see Judgment, in an action to quiet title under previous tax Cent. Dig. §§ 921, 1256; Dec. Dig. § 487.*] deeds such purchaser not being charged with 2. CORPORATIONS (§ 668*)-FOREIGN CORPO-notice of any defect of title not appearing in RATIONS EVIDENCE. the decree or judgment roll.

Where defendants in a suit to quiet title claimed under a tax deed to a corporation and a decree quieting title thereunder, and such deed to the grantor corporation described it as "of the county of Hudson in the state of New Jersey," and the word "the" was not part of the corporate name as required of domestic corporations, in the absence of any contention that such corporation was not a foreign corporation, it sufficiently appeared that it was a foreign corporation.

[Ed. Note.-For other cases, see Corporations, Cent. Dig. §§ 2603-2627; Dec. Dig. § 668.*] 3. CORPORATIONS (§ 668*)-FOREIGN CorporaTIONS-PROCESS.

Where a foreign corporation filed a paper with the secretary of state designating a certain person as its agent, service upon him in D. county and not in the county where the suit was brought was sufficient, although no designation was on file in D. county, as the corporation could not take advantage of its own negligence in not filing the appointment in D. county, or in not designating an agent or maintaining an office in the county where its land was situated.

[Ed. Note. For other cases, see Corporations, Cent. Dig. §§ 2603-2627; Dec. Dig. § 668.*] 4. CORPORATIONS (§ 666*)-FOREIGN CORPORA TIONS-ACTIONS-VENUE.

Mills' Ann. Code, § 38, requires service on a foreign corporation to be made upon its agent in the county in which the action is brought, but provides in the same act that any law permitting a summons to be served in any county other than that in which the action was brought should not be repealed; section 39 provides that separate summons may be issued in each county where any of several defendants reside; Mills' Ann. St. § 506, requires summons in suits against corporations to be served in the county where its principal office is kept, or its principal business is carried on, and permits plaintiff to sue in the county where the cause of action accrues; and section 499 requires foreign corporations to file with the Secretary of State and in the office of the recorder of deeds of the county in which its business is carried on a designation of an agent to accept process; Const. art. 15, § 10, requires that foreign corporations shall have a known place of business and an authorized agent to accept process. Held, that a suit to quiet title under a tax deed making plaintiff's grantor, a foreign corporation, a party defendant was properly brought in the county where the land was situated.

[Ed. Note. For other cases, see Corporations, Cent. Dig. §§ 2601, 2002; Dec. Dig. § 666.*] 5. CORPORATIONS (§ 6C8*)-FOREIGN CORPORATIONS-PROCESS.

Under such provision, service on the agent of a foreign corporation designated to accept process by a filing in the office of the Secretary of State, made in D. county, where no designation of agency was filed, where there was no

[Ed. Note.-For other cases, see Judgment, Cent. Dig. §§ 921, 1256; Dec. Dig. § 487.*] Appeal from District Court, Kit Carson County; W. S. Morris, Judge.

Action by Albert E. King against M. T. Austin. From a decree quieting title in plaintiff, defendant appeals. Reversed.

Louis Vogt, of Burlington, for appellant. John F. Mail, of Denver, for appellee.

MORGAN, J. Appeal from a decree of the Kit Carson district court, quieting title in the plaintiff, based upon two tax deeds issued to his grantor upon a sale for the taxes of the years 1892 and 1893, respectively, conveying a quarter section of land. The defendant pleaded a later tax deed for the land, and also a decree of the county court of that county quieting his title based upon the later deed, which he contends defeats the plaintiff's title. The deed and decree pleaded are subsequent to the plaintiff's tax deeds, and, if valid, extinguish plaintiff's title. deed is void on its face, and appellee contends that this and lack of valid service on the Municipal Debenture Company, one of the defendants in that suit, and plaintiff's grantor, makes the decree void.

The

[1] Now, the invalidity of this deed, even on its face, would not affect the jurisdiction of the court over the subject-matter in that suit, and it must have found, from the evidence necessary to justify a judgment by default, that the plaintiff's title was then sufficient. This deed should have been attacked in that suit. Whatever that court did in the exercise of jurisdiction in that suit cannot be questioned here. Mortgage Trust Co. V. Redd, 38 Colo. 458, 464, 88 Pac. 473, 8 L. R. A. (N. S.) 1215, 120 Am. St. Rep. 132; Jackson v. Larson, 136 Pac. 81. It will only be necessary, therefore, to determine whether that court had jurisdiction, by valid service, over the person of Municipal Debenture Company. Service was made in Denver county upon C. E. Rich, as the agent of that company, and it is admitted that, at the time, there was "a paper on file in the office of the Secretary of State, filed by that company, which designated Rich as its state agent," and that "no such paper was on file in the office of the county clerk in what was then Arapahoe county."

For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes