Q. And he told you this was a safe deal, that if there was more than $6,500 debts he would make good, did he not? That he would pay it?` A. Yes, sir, he said that. He said, "We are good for it if there is anything wrong about it."

Q. The fact is, it is not, that when he was talking about this $6,500, he told you there might be other bills that he had not got hold of? A. I do not remember him mentioning that.

Q. And he told you he was financially good in that; if there was anything wrong with this statement he would make it good?

A. I think he mentioned that he would make it good.

Mr. Thompson, defendant, offered no testimony at the trial. We will, therefore, for the purposes of this opinion, assume that the testimony of the plaintiffs is true regarding this feature of the case. No cash was paid for the stock, but two notes of $1,500 each were signed by the three plaintiffs and given to defendant. The actual shares of stock, however, were not delivered, it being defendant's theory that they were held as collateral to the notes, and plaintiffs claiming that when those shares were demanded defendant stated that he could not find them upon the moment, and put off their delivery from time to time upon this excuse.

At all events, plaintiffs entered into possession of the store and ran the same until the last part of January, 1912, when it went into the hands of a receiver. In the meantime a dispute had arisen as to the amount of the debts of the mercantile company. A careful examination of the testimony convinces us that this dispute occurred within a month after the sale, and continued at intervals during a period of nearly a year. Further we do not believe there was satisfactory evidence offered showing that the $6,500 limit was much exceeded. The two boys worked continuously in the store, and the father came in frequently to inquire about the business. It is the contention of plaintiffs that the books of the mercantile company nowhere showed the indebtedness of the concern, and that for this reason they did not immediately learn of the false representation made to them regarding the debts. Here again an examination of the testimony convinces us that as early as November 7, 1910, a month and a day after the sale, plaintiffs were in

possession of a complete list of the indebtedness of the mercantile company.

Upon cross-examination Alfred testifies:

Q. Now, refresh your memory and state if you paid the Janney, Semple, Hill, & Company's note on November 7, 1910.

Q. So, as early as November 7, 1910, you had noticed that there were some outstanding accounts that were not included in the invoice, and you went immediately down to Mr. Thompson to see about it? A. Well, we did not know for sure.

Q. Well, you went to see Mr. Thompson about it, did you not?
A. Yes, sir.

Q. Now, you had received statements from practically all of the wholesale houses at that time, had you not?

A. No, I do not believe we had.

Q. Well, you received statements from every wholesale house unless there was some, where there was a note given?

Q. And you were receiving statements from that right along, were you not?

A. I do not just remember about that at all.

Q. You took all of the wholesale houses that had accounts outstanding and took those bills-now did you find that the indebtedness exceeded $6,500?

A. Yes, sir.

It is thus evident that as early as November 7, 1910, plaintiffs claimed that the indebtedness exceeded the sum of $6,500. This is an important fact because no effort was made to rescind, on this ground at least, until one year two months and nineteen days thereafter, at a time when the mercantile company had become insolvent. Plaintiffs had also furnished evidence, at the time the mercantile company was turned over to them there was $800 in the bank to its credit. Thus, of the year and three months the plaintiffs were in control of the store,

all but about a month of that time they were aware of the ground which they now claim entitles them to rescind, but they took no action. This is the only inference that can be drawn from the testimony as a whole. We are not going to give the evidence regarding the disputes between plaintiffs and defendant that occurred during the year and three months of their ownership, but to show that this is the principal ground of complaint, we quote from the testimony of the son George:

Q. You accepted the invoice of August 3, did you not?

A. Yes, sir.

Q. Was it a correct invoice?

A. Yes, sir.

Q. And you never had any cause to complain about that?

A. No, we never made any complaint about that.

Q. The merchandise was all there that he represented to be there? A. Yes.

Q. So the only complaint that you had was that there was a larger indebtedness outstanding than $6,500? That was your only complaint, was it not?

A. Well, we claimed, our complaint was, that there was several items on it that he did not have on his statement.

Q. And that these items made the indebtedness more than $6,500? A. Yes, sir.

The evidence also shows that Thompson at all times insisted that the indebtedness was not more than $6,500, but that if it was he would pay the overplus. January 28, 1912, after the mercantile company had gone into the hands of a receiver, two of the plaintiffs called upon defendant and demanded their notes.

The father testifies:

Q. Do you remember what date it was?

A. That was January 28th.

Q. Who did you come with then?

A. George.

Q. Had you consulted a lawyer in the meantime ?
A. Well, I think we had. Yes.

Q. After you had consulted your lawyer, then you went down and demanded your notes, did you not?

A. Yes, sir.

Q. That is the time you told Mr. Thompson you did not think you got a consideration for the notes?

A. Yes.

In their brief plaintiffs state that the grounds of the rescission were as follows: "The plaintiffs claimed that Thompson agreed to sell fifty shares of stock in the Anderson Mercantile Company, and represented that it had an indebtedness of $6,500, and that that was all of the indebtedness that was against the company at the time, with the exception of two or three small accounts that did not amount to anything and were of no consequence; whereas, in truth and in fact, the indebtedness was much larger. That it amounted to something like $1,700 more at the time the deal was closed, and that the notes amounting to $3,000 were delivered to the defendant Thompson and the Devils Lake State Bank, with the agreement that the defendant was to deliver to them fifty shares of stock in the Anderson Mercantile Company, and that no stock had ever been delivered to them, although they had from time to time made a demand for this stock, and that the defendants had failed, neglected, and refused to deliver it to them; so that the issues presented by the complaint for the rescission are: First, fraud in misrepresenting the condition of the indebtedness; and, secondly, an absolute failure of consideration in not delivering the shares of stock to them. The case was brought on for trial, and was concededly an equity case. The trial judge, however, announced that he would call a jury to whom he would submit certain disputed questions of fact. Defendant objected to the jury upon the grounds that the same would deprive him of a trial de novo under the Newman act in the supreme court, because all of the evidence would not be received. He also objected to the jury upon the grounds that there were, or probably would be, no disputed questions of fact, only questions of law, and upon the grounds that the nature of the case was such that a jury could not be of any assistance. We prefer, however, to place our decision upon other grounds, thus ending the litigation. As already stated, the defendant offered no testimony. There was therefore no dispute as to the facts. The court, nevertheless, submitted six questions

to the jury which the defendant insists were questions of law. Upon the answer of these questions a rescission was ordered. Defendant appeals, specifying numerous errors. Several questions of practice have already arisen and been decided in this case, and we will give no further consideration to those technicalities. For the same reason we will not discuss defendant's contention that the complaint does not state a cause of action, nor the questions which he raises as to the impropriety of submitting questions of law to the jury for answer.

(1) An important point and one that will end the litigation will be taken up and decided. Accepting the testimony of the plaintiffs as true, it, to our mind, shows conclusively that they were estopped from rescinding the contract by their own laches. They acquiesced in the contract, and continued in possession of the store for more than a year after they learned that the indebtedness exceeded the amount represented, and for the same period after the defendant had neglected and refused to turn over to them the actual shares of stock. They sold goods from the store, and used up the $800 that had been left on deposit, and ran the business into bankruptcy before making their formal rescission. The father even paid $500 upon one of the $1,500 notes, and the interest on the other, and renewed the same. Upon this occurrence the defendant released the two sons from further obligation upon that note. They made no attempt to restore to the defendant the business in the condition in which they had received it. In fact, they could not have done so had they tried. They therefore could not rescind. This is elementary. 2 Pom. Eq. Jur. 499, 500; Clarke v. Dixon, 27 L. J. Q. B. N. S. 223, El. Bl. & El. 148, 4 Jur. N. S. 832; Oakey v. Cook, 41 N. J. Eq. 350, 7 Atl. 495; Rosenwater v. Selleseth, 33 N. D. 254, 156 N. W. 540.

The judgment of the trial court is reversed and the case is ordered dismissed.

CHRISTIANSON, J., disqualified; HANLEY, District Judge, sitting by

request.

On Petition for Rehearing, filed April 27, 1916.

Upon petition for rehearing respondent insists that this court has no right to consider the insufficiency of the evidence because this appeal is