Lillis v. Silver Creek & Panoche Land & Water Co.

Water-right Appurtenant to Land—-Action by Purchaser to Reform Contract—Presumption of Notice.—In an action by the purchaser of land with an appurtenant water-right to have the contract for the use of water, made between his grantor and the defendants, reformed for mistake in expressing the quantity of water agreed upon, it will not necessarily be presumed that the plaintiff, “as a man of ordinary business capacity,” made his purchase after examination of the record title and hence with knowledge of the terms of the agreement.

Id.—Failure of Purchaser to Examine Records as Barring Right to have Contract Reformed.-—-The right of the purchaser to have the contract reformed for mistake in expressing the quantity of water agreed upon is not necessarily forfeited by his failure to examine the contract, which was of record, before buying, if his grantors had used the amount of water claimed from the date of the contract, and were using that amount when he purchased the premises, and he thereafter continued to use it until his discovery of the mistake.

Id.—Discovery of Fraud or Mistake—Statute of Limitations—Pleading.—If in such action subdivision 4 of section 338 of the Code of Civil Procedure, providing that an action on the ground of fraud or mistake must be .commenced within three years after the discovery thereof, is relied upon, it is not sufficient for the pleader to aver ■the mere discovery of the fact within three years, nor mere ignorance of the fact at the time of its occurrence, but he must allege the facts, time, and circumstances so that the court may determine from the allegations of the complaint whether or not the discovery was within the period mentioned.

Id.—Record as Notice of Fraud or Mistake.—The fact that the contract was on record before the plaintiff purchased the premises, and for over three years before he commenced the action, is not alone sufficient to charge him with notice of the fraud or mistake so as to put the statute of limitations in operation.

Id.—Right to Reformation not Dependent upon Actual Injury.—If the parties to the contract intended that it should convey the right to seventy-five miner’s inches, and by mistake only seventy-five cubic inches were conveyed, the right to have the contract reformed does not necessarily depend upon a showing of actual injury.