Capac State Savings Bank v. McKnight

Defendants William F. McKnight and Katherine McKnight executed a $35,000 mortgage and note to the plaintiff, Capac State Savings Bank. During the course of the mortgage, the McKnights sold the mortgaged premises to defendants Henry G-. Morykwas and Betty J. Morykwas.

The warranty deed accepted by defendants Morykwas provided that the purchasers were to assume the balance due on the mortgage.

Subsequently, the Morykwases sued the McKnights for rescission contending that the sale of the property was based upon fraud in the inducement. After a lengthy trial, the court found that there had been…