Brown v. Freeman & Bynum , 79 Ala. 406 ( 1885 )

SOMERYILLE, J.

If a vendor of chattels misrepresents a material fact, at the time of, or pending the negotiation for the sale, on which the purchaser has the right to rely, and in fact relies as an inducement to the trade, this is a fraud, which will furnish a ground of defense to an action for the purchase-money7, or even a cause of action in favor of the purchaser, as the case may he.—Tabor v. Peters, 74 Ala. 90; Sledge v. Scott, 56 Ala. 202; Benj. on Sales, 3d Ed., § 454.

To constitute a representation which is in the nature of an expressed opinion, a ground of fraud, it' must be shown to have been knowingly false, made with intent to deceive, and to have been accepted and relied on as true. Under these circumstances, a mere opinion may often also constitute a warranty7.—Wilcox v. Henderson, 64 Ala. 535; Tabor v. Peters, supra; 1 Whar. Contr. § 259.

Where the matter affirmed is one of fact, as contradistinguished from mere opinion, it may constitute a fraud, although the vendor at the time had no knowledge of its falsity. The gist of the liability is, that .he has affirmed as fact what he did not know to be true, and he or another has thereby profited by it, to the prejudice of one whom he has deceived.—Perry v. Johnson, 59 Ala. 648; Blackman v. Johnson, 35 Ala. 252; Munroe v. Pritchett, 16 Ala. 785. As observed by Mr. Parsons, “material misrepresentations, which go to the substance of a contract, avoid that contract, whether they are caused by mistake, and occur wholly without fault, or are designed and fraudulent.” — 2 Parsons Contr. *786.

It is often a matter of difficulty, to decide whether a representation is intended as the statement of a fact, or of an opinion. This subject is fully discussed in the case of Tabor v. Peters, 74 Ala. 90, 96, and we need not add any thing at length to what is said there. When the question is one of doubt, and does not involve the construction of a written instrument, it should always be referred to the jury for their determination ; the proper inquiry being, in what sense the assertion was intended and mutually understood.—Bradford v. Bush, 10 Ala. 386; Ricks v. Dillahunty, 8 Port. 134; Sledge v. Scott, 56 Ala. 202; 2 Add. on Contr. (Amer. Ed.), § 625, note 1; Story on Contr. § 511.

While it is true, as said in Tabor v. Peters, sufra, that warranties and representations are never construed to cover defects which, being external and visible, are obvious to the purchaser upon casual inspection with the eye, or, as described by Mr. Addison, “those manifest arid visible defects which wore obvious to all observers;” yet, with the exception of such defects, where a warranty is given, the purchaser may rely on the positive representation or assurance embodied in it, and is not bound to make an examination, or even to prosecute any further inquiry on this particular subject.—2 Add. Contr. (Amer. Ed.), § 628; Benj. on Sales, § 429, note c. The main purpose of a warranty is often to excuse examination, and render inquiry unnecessary ; and it is only in the absence of such protection that these precautions are required.—Tabor v. Peters, 74 Ala. 90, 98, supra.

Where the defense of fraud, or want of consideration, is set up in a suit for the purchase-money, it is not necessary for the defendant to offer to rescind the contract of sale, or to return the thing purchased, before he can be permitted to give in evidence, in reduction of damages, a fraudulent representation made by the vendor, or a breach of warranty. Such is the modern, and, in our opinion, the better view, except where the subject of sale is real estate, when a different rule is held to prevail. The purchaser may elect to rescind within a reasonable time, and return the subject-matter of sale; or he may retain it, and avail himself of the damage he has suffered, either by bringing his cross-action for the fraud or breach of warranty, as the case may be, or, if he be sued for the purchase-money, may prove the real value of the thing purchased, and ■abate the recovery pro tanto. This is the later rule of the American courts, adopted to avoid an unnecessary circuity of action, although the English cases, no doubt, hold to the contrary doctrine.—2 Greenl. Ev., § 136; Harrington v. Strathan, 22 Pick. 510; Hills v. Bannister, 8 Cow. 32; Benj. on Sales, § 898; Perry v. Johnson, 59 Ala. 648; Marshall v. Wood, 16 Ala. 806; Jemison v. Woodruff, 34 Ala. 143, In the absence of warranty or fraud, the buyer, of course, must offer to return goods, which are defective, or not conformable to order, or lie will ordinarily be bound to pay for them the contract price.—Gibson v. Bingham, 5 Amer. Rep. 589. In this State, as far back as 1831, it was held in Peden v. Moore, 1 Stew. & Port. 71, that whenever a defendant can maintain a cross action for damages, based on a partial failure of consideration in the goods purchased by him, this would be available as a defense, in reduction of the sum sought .to be recovered.

The rulings of the court were clearly in conflict with one or more of the foregoing rules; and the jndgment is reversed, and the cause remanded.