Budd v. T. C. Power & Co. , 8 Mont. 380 ( 1889 )

McConnell, C. J.

The appellant, who was the plaintiff below, brought an action against the respondents before a justice of the peace of Gallatin County upon a promissory note, for the sum of two hundred and seventy-two dollars, dated November 22, 1886, payable to W. S. De Lancy ninety days aft.er date. The plaintiff below filed a complaint setting out the note sued on. To this there is no exception. The respondents filed an answer, which, after admitting that they executed and delivered the note sued on, proceeded to state that it was given for an “ undivided half interest in a certain drove of stock cattle thereafter to be delivered by the plaintiff to them, which at the time plaintiff falsely represented to them that he was the owner of, and thereby, and without consideration, they were induced to make said note to him for the purchase price of said cattle, and that said representations were false, and that plaintiff never was the owner of said cattle, or any number or portion thereof, nor did he have any beneficial interest therein, and that they were misled by said false misrepresentations, and had never received said cattle, or any of them, and that the plaintiff has failed, refused, and neglected to deliver said cattle to them.” The cause was tried by the court without a jury, who found in favor of the respondents, upon the ground that there was a failure of consideration. Motion for a new trial was made and overruled, and an appeal taken to this court. ,

The first objection made by the appellant is as to the sufficiency of the answer, it being contended by him that to maintain the defense of a failure of consideration by reason of a failure ,of title, it must appear that the plaintiff wa.s guilty of fraud or deceit, or that there was a warranty of the title to the cattle, either express or implied, and that the answer does not aver either. An inspection of the answer, the substance of which is given above, shows that it is insufficient for the purpose of either defense, that is, of fraud or warranty. The averment that the representation that the plaintiff was the owner of the cattle was false, or that he falsely represented that he was the owner of the cattle, is not sufficient to sustain the charge of fraud or deceit; a proper interpretation of such language is that the representation made was simply untrue. There is no pretense that the answer contains a warranty, either express or implied. As we have already noted, the case was brought before a justice of the peace, and the sufficiency or insufficiency of the answer must be decided by the provisions of the statute touching pleadings before justices of the peace. Section 768, et seq., Code of Civil Procedure, provides, that pleadings in Justices’ Courts shall be, ■first, the complaint by the plaintiff, stating the cause of action; second, the answer by the defendant, stating the ground for the defense; that where the action is for the forcible or unlawful detention of lands, tenements, or other possessions the pleadings shall be in writing, but in all other cases the pleadings may be oral or in writing. This answer, then, being insufficient and demurrable upon that account, may be entirely disregarded, and treated as oral. The fact that the plaintiff below saw fit to go to trial without demurring to the answer, or moving to strike it out, was simply to ignore it, as he might well have done, and treated the answer as oral. Section 777 provides that in trials before justices of the peace a “variance between the proof on trial and the allegations in pleading shall be disregarded as immaterial, unless the court be satisfied that the adverse party has been misled to his prejudice thereby.” There was no exception to any of the evidence introduced, upon the ground of variance between it and the answer; in fact, the whole cause was tried without reference to the answer at all. Hence we hold that the objections upon the ground of the insufficiency of the answer are not sustained.

The court found twelve special findings of fact and two conclusions of law. The substance of the findings of fact are as follows, to wit: That the respondents executed the joint note sued on as stated in the complaint; that the note was given as the purchase price of De Lancy’s interest in the “F” brand of cattle, on the range in Gallatin County; that De Lancy represented to the respondents that he owned a half interest in the brand; that at the time of the sale he turned over to respondents a bill of sale from one Scribner to himself, of an interest in the cattle, but did not mention any particular interest; that the plaintiff’s intestate sold a half interest in the cattle, under the bill of sale which he had procured from Scribner; that the brand and cattle belonged exclusively to Mr. Ferris,- who sold and delivered them to the Gallatin Mill Co. for seventeen liunded dollars, on the 22d of December, 1886; that Ferris was at all times the owner of the brand of Cattle, and there is no evidence whatever to show that Scribner and De Laney had any interest at all in the “F” brand of cattle; and lastly, that the respondents never received any consideration for the note sued on. And as a conclusion of law from these findings, “that there was a total failure of consideration; that there must be a judgment for the respondents; that as there was nothing sold no question of warranty arises.”

It is insisted on the part of the appellant, that inasmuch as the court found that the respondents purchased of De Laney a one-half interest in the “ F” brand of cattle, and that the defense rests upon a failure of title, the question of warranty necessarily arises. In this we agree with him, and think that the court erred in holding that there was no question of warranty in the case. In the absence of fraud or deceit in the sale of personal chattels, the right of the purchaser to rely upon a failure of consideration, by reason of a failure of title, depends upon whether the purchase was made under such circumstances that the seller expressly warrants the title, or the law implies a warranty thereof. Of course where there is an express warranty, and there is a total failure of title, and in consequence a breach of said warranty, it necessarily results that there is a total failure of consideration, and this will be a good defense to an action brought for the recovery of the purchase price of the goods sold. Mr. Benjamin on Sales, page 583, section 627, second American edition, says, in speaking of the ancient Fnglish law: “It is well settled that in an executory agreement the vendor warrants by implication his title in the goods which he promises to sell. Plainly, nothing could be more untenable than the pretension, that if A promised to sell one hundred quarts of wheat to B, the contract would be fulfilled by the transfer, not of the property in the wheat, but of the possession of another man’s wheat. Secondly, it is also universally conceded that in the sale of an ascertained specific chattel, an affirmation. by the vendor that the chattel is liis is equivalent to a warranty of title, and that this affirmation may be implied from, his conduct, as well as from his words, and may also result from the nature and circumstances of the sale.” Again, in Hoy’s Maxims, chapter 42, it is said: “ If I take the horse of another man and sell him, and the owner take him again, I may have an action of debt for the money, for the bargain was perfect by the delivery of the horse, and caveat emptor? Again, Lord Coke says: “The common law bindeth him not unless there be a warranty, either in deed or in law, for caveat emptor? But Blackstone gives the contrary rule. “If the vendor sells him as his own,” then he warrants the title. After much discussion in the English courts, the law of that country has finally been settled as stated in the work of Benjamin on Sales, section 639, as follows, to wit: “A sale of personal chattels implies an affirmation by the vendor that the chattel is his, and therefore he warrants the title, unless it be shown by the facts and circumstances of the sale that the vendor did not intend to assert ownership, but only to transfer such interest as he might have in the chattel sold.” But this is not the rule in America. Here a distinction is made between goods in the possession of the vendor and goods not in possession at the time of the sale. As to the goods in the possession of the vendor, there is an implied warranty of title; but where the goods sold are in the possession of a third party at the time of the sale, there is no such warranty, and the vendee buys at his peril. In the work of Story on Sales, third edition, 459, it is said that “this distinction has now become so deeply rooted in the decisions of courts, in the dieta of judges, and in the conclusions of learned authors and commentators, that even if it were shown to be misconceived in its origin, it could not at this time be easily eradicated.” And to the same effect is the doctrine laid down by Chancellor Kent in volume 2, side page 478 ; 3 Wait’s Actions and Defenses, p. 529; Charlton v. May, 5 Hayw. (Tenn.) 496; Word v. Cavin, 1 Head, 598; McLean v. Houston, 2 Heisk. 43; Barbee v. Williams, 4 Heisk. 527; Topp v. White, 12 Heisk. 165; Gregory v. Underhill, 6 Lea, 210.

While we think the English doctrine is better than the American, still we adhere to the latter, as it is so universally adopted throughout the States of the American Union. It follows, then, from this view of the law, that in order to avoid the doctrine of caveat emptar, the purchasers must show that there was either an express warranty of the title of the cattle sold, or that the cattle were in the possession of the plaintiff at the time of the sale, from which fact the law would imply a warranty. Of course, if there was fraud or deceit in the sale, if the plaintiff knew that he had no title, and fraudulently represented that he had, and thereby deceived the respondents, this would vitiate the sale, and sustain the plea of a want of consideration without any reference to the question of a warranty of title. The record purports to contain all the evidence in the case. There is no evidence of any fraud or deceit. The court finds that the cattle were on the range in Gallatin County, and there is nothing to show that they ever were, in the possession of De Lancy. There is no proof of any express warranty. The respondents having confessed the execution of the note, the burden of proof was upon them to sustain the plea of failure of consideration. If there was any evidence to sustain these propositions, we would not reverse, under the provisions of section 280 of the Code of Civil Procedure. But we are compelled to do so under our view of the law, and while we might render a judgment here under the findings of the court for the appellant, we deem it best to remand the case for a new trial, to the end that another trial may be had according to the views herein expressed.

. The costs of this appeal will be paid by the respondents.

Judgment reversed.

Bach, J., and De Wolfe, J., concur..