purchase of lands "was . . . not a contract valid and operative between the parties but omitting (designedly or otherwise) some particular term which had been verbally agreed upon, but was a mere piece of machinery. subsidiary to and for the purposes of the verbal and only real agreement." And since the object of the suit was not to enforce the verbal agreement, nor " any hybrid agreement compounded of the written instrument and some terms omitted therefrom," but only to prevent the defendant from using the written document in a manner inconsistent with the real agreement, there was no difficulty raised by the Statute of Frauds, "which does not make any signed instrument a valid contract by reason of the signature, if it is not such according to the good faith and real intention of the parties." If it appears that a document signed by the parties, and apparently being the record of a contract, was not in fact intended to operate as a contract, then "whether the signature is or is not the result of a mistake is immaterial" (a). ceptions in We shall see however that the heads now to be discussed Real expresent two classes of really exceptional cases recognized equity. by equity. construc First, those in which equity applies to instruments of Artificial certain kinds rules of construction which (as regards the rules of actual terms of the instruments) are highly artificial, so tion: artificial, indeed, that they come to much the same thing assigned as presuming a verbal agreement inconsistent with and to them. operating to vary the written agreement (b). The ground on which these rules were established (or at any rate which in modern times has been relied on to account for them) was that the manner in which the (a) Per Bramwell, B. Rogers v. Hadley, 2 H. & C. 227, 249, 32 L. J. Ex. 241. In this case there was "a real contract not in writing and a paper prepared in order to comply with some form, which was stated at the time to contain a merely nominal price." (b) "You are to ascertain the intention of the parties not only by what they said but by what the Court sees to be the consequence, and by what the Court may or may not consider to be absurd or oppressive, or thought to be so in former times: " Lindley, L. J. in Wallis v. Smith, 21 Ch. D. at p. 274. origin Limited admission of oral evidence against written contract. parties had expressed their intention did not correspond with their true intention. We must therefore consider the cases governed by the rules in question to have been originally cases of relief against mistaken expression. But since the doctrine of equity has been fixed and uniform they have practically ceased to have any such nature. For persons who make contracts are presumed to know the law of the land, including the law administered by courts of equity; and therefore they must be presumed to know that if the nature of the contract and the terms used in framing it fall within the scope of these peculiar rules which have now become fixed rules of construction, the contract will be interpreted accordingly. And in fact they generally do know this, and use the accustomed expressions for the very reason that they have acquired a definite artificial meaning in courts of equity. It seems proper, on account of the origin of these equitable rules, to say something of them in this place, though not to go into details belonging to the fuller treatment of the special departments affected by them. In the other class of exceptional cases, which form the last division of the subject, courts of equity have admitted oral evidence, for certain purposes and under certain limitations, to show that by reason of a mistake the terms of a written instrument fail to express the real intention of the parties, and that the real agreement is different from the written agreement. It will be obvious from the foregoing remarks that this class originally included the last. We proceed to consider the topics thus indicated. 2. Peculiar Rules of Construction in Equity. The material exceptions to the rule that contracts are construed alike at common law and in equity are A. Restricted construction of general words, and especially of releases. B. Stipulations as to time. c. Penalties. IN EXPRESSION: PECULIAR RULES OF CONSTRUCTION. A. Restriction of General Words. 461 Restricted construc words We have seen that courts both of law and of equity have tion of assumed a power to put a restricted construction on general general words when it appears on the face of the instrument that carried it cannot have been the real intention of the parties that than by they should be taken in their apparent general sense. farther common law: es Courts of equity went farther, and did the like if the pecially in same conviction could be arrived at by evidence external releases. to the instrument. Thus general words of conveyance (c) and an unqualified covenant for title (d), though not accompanied as in Browning v. Wright (e) by other qualified covenants, have been restrained on proof that they were not meant to extend to the whole of their natural import. This jurisdiction, in modern times a well established one, is exercised chiefly in dealing with releases. "The general words in a release are limited always to that thing or those things which were specially in the contemplation of the parties at the time when the release was given" (ƒ). This includes the proposition that in equity "a release shall not be construed as applying to something of which the party executing it was ignorant" (g). There is at least much reason to think that it matters not whether such ignorance was caused by a mistake of fact or of law (h). In particular a release executed on the footing of accounts rendered by the other party, and assuming that they are (c) Thomas v. Davis, 1 Dick. 301. (d) Coldcot v. Hill, 1 Cha. Ca. 15, sed qu. for the case looks very like admitting contemporaneous conversation to vary the effect of a solemn instrument, and that without any mistake or fraud being made out, which is quite contrary to the modern rule. (e) 2 B. & P. 13. Supra, p. 454. (f) Per Lord Westbury, L. & S. W. Ry. Co. v. Blackmore, L. R. 4 H. L. at p. 623; cp. Lindov. Lindo, 1 Beav. 496, 506; Farewell v. Coker, cited 2 Mer. 353; Dav. Conv. 5. (7) Per Wilde, B. Lyall v. Ed- (h) See the cases considered at p. 406 above. Stipula tions as to time. correctly rendered, may be set aside if those accounts are discovered to contain serious errors. It would be otherwise however if the party had examined the accounts himself and acted on his own judgment of their correctness. An important application of this doctrine is in the settlement of partnership affairs between the representatives of a deceased partner (especially when they are continuing partners) and the persons beneficially interested in his estate (i). A releasor, however, cannot obtain relief if he has in the meanwhile acted on the arrangement as it stands in such a way that the parties cannot be restored to their former position (). B. Stipulations as to Time. It is a familiar principle that in all cases where it is sought to enforce contracts consisting of reciprocal promises, and "where the plaintiff himself is to do an act to entitle himself to the action, he must either show the act done, or if it be not done, at least that he has performed everything that was in his power to do” (1). Accordingly, when by the terms of a contract one party is to do something at or before a specified time, and when he fails to do such thing within that time, he could not afterwards claim the performance of the contract if the stipulation as to time were construed according to its literal terms. The rule of the common law was that "time is always of the essence of the contract." When any time is fixed for the completion of it, the contract must be completed on the day specified, or an action will lie for the breach of it (m). The rule of equity, which now is the general rule of (i) Millar v. Craig, 6 Beav. 433; Lindley, 2. 969. (k) Skilbeck v. Hilton, 2 Eq. 587, but qu. whether the principle was rightly applied in the particular case. (1) Notes to Peeters v. Opie, 2 Wms. Saund. 743. (m) Parkin v. Thorold, 16 Beav. 59, 65. English jurisprudence, is to look at the whole scope of the transaction to see whether the parties really meant the time named to be of the essence of the contract. And if it appears that, though they named a specific day for the act to be done, that which they really contemplated was only that it should be done within a reasonable time; then this view will be acted upon, and a party who according to the letter of the contract is in default and incompetent to enforce it will yet be allowed to enforce it in accordance with what the Court considers its true meaning. "Courts of equity have enforced contracts specifically, where no action for damages could be maintained; for at law the party plaintiff must have strictly performed his part, and the inconvenience of insisting npon that in all cases was sufficient to require the interference of courts of equity. They dispense with that which would make compliance with what the law requires oppressive, and in various cases of such contracts they are in the constant habit of relieving the man who has acted fairly, though negligently. Thus in the case of an estate sold by auction, there is a condition to forfeit the deposit if the purchase be not completed within a certain time; yet the Court is in the constant habit of relieving against the lapse of time: and so in the case of mortgages, and in many instances relief is given against mere lapse of time where lapse of time is not essential to the substance of the contract." So said Lord Redesdale in a judgment which has taken a classical rank on this subject (n). Contracts between vendors and purchasers of land are however the chief if not the only class of cases to which the rule has been habitually applied (0). making It was once even supposed that parties could not make As to time of the essence of the contract by express agreement; time of the but it is now perfectly settled that they can, the question essence of being always what was their true intention (p), or rather tract. "what must be judicially assumed to have been their (n) Lennon v. Napper, 2 Sch. & L. 684, cited by Knight Bruce, L. J. Roberts v. Berry, 3 D. M. G. at p. 289, and again adopted by the L.JJ. in Tilley v. Thomas, 3 Ch. • 61. (0) See per Cotton, L. J., 4 C. P. D. at p. 249. (p) Seton v. Slade, 7 Ves. 265, 275, and notes to that case in 2 Wh. & T. L. C.; Parkin v. Thorold, supra. the con |