Walker, Evans Cogswell v. Ayer

The Walker, Evans Cogswell Company, a corporation under the laws of this State, on the 24th day of October, 1903, let and leased to the defendant, Hartwell M. Ayer, two Empire typesetting machines and other personal property, at the price of eight hundred dollars; of which two hundred dollars was paid in cash, with a credit for the remaining six hundred dollars, payable in installments of seventy-five dollars at the end of each quarter, with interest at eight per cent.

In May, 1904, the defendant notified the plaintiff that he would not pay any further sums of money and would turn over the machines as their property because such machines were not satisfactory. The parties being thus at arm's length, an action was brought on January 31, 1905, by the plaintiff, Walker, Evans Cogswell Company, to enforce the payment by the defendant of said sum of money then due.

To this action the defendant set up four defenses.

For a first defense:

1. "Denies each and every allegation in the said complaint contained.

For a second defense:

I. "That on or about the date mentioned in the second paragraph of the complaint, or shortly thereafter, the defendant delivered to the plaintiff the personal property described in the complaint, and on or about said date they entered into an agreement with reference thereto, a copy of which is hereto attached, marked `A,' and made a part of this answer.

II. "That at said times the defendant was running and operating a newspaper and printing office in the city of Florence, and the said delivery and contract was entered into by the said parties with reference to said business, and the said property was delivered and contract entered into by the said parties to secure the use of said property in setting and distributing type and facilitating and promoting the business of the said office.

III. "That at all of said times, the plaintiff represented that the said property was machinery and paraphernalia appertaining thereto, in good and sound condition and suitable for the purpose of setting and distributing type and facilitating the same and the work and labor in the said office, and the defendant was induced to receive said property and sign said contract upon the same.

IV. "The defendant was induced to receive the said property and sign said contract, not only on the aforesaid representations, but upon the special representations made to him by the plaintiff to the effect: (1) That said machines would set clear proof with little practice by the operators. (2) That there was no trouble in correcting the galleys. (3) That any person of ordinary intelligence could operate the same. (4) That each machine would do the work of five printers, working by hand. (5) That the distributors were simple and an ordinary boy could attend to them. (6) That they had been in successful operation for years. (7) That they would not break type. (8) That they would pay for themselves in a short time. (9) That they were particularly suited and adapted to a small newspaper and printing office like that of the defendant, and the defendant, confiding in the truth of said representations, was induced to receive said property and enter into said contract.

V. "The defendant alleges that all of said representations, both general and special, were and are wholly false and so known to the plaintiff at the time, and the same were made to mislead and overreach the defendant, and the said property was and is wholly unsuited for the purpose for which is was delivered to the defendant and wholly worthless.

VI. "That the defendant, relying on said representations and wholly induced by the same, paid to the plaintiff the first payment of two hundred dollars ($200) mentioned in said agreement, and attempted to use said property in his said office for the said purposes, and the defendant, in good faith, attempted to use said property and make the same come up to the said representations made by the plaintiff and to perform the work it was represented to do, from the said date until about the first day of May, 1904, to defendant's great loss and expense, when defendant abandoned his efforts in that regard and tendered the said property to the plaintiff, and refused to make any further payments thereon, but the plaintiff refused to receive the same.

VII. "That the said property has not since been used, or attempted to be used by the defendant, but the same was and is subject to the order or demand of the plaintiff.

VIII. "The defendant denies each and every allegation of the complaint except as herein admitted."

For a third defense:

I. "That on September 4, 1903, the plaintiff sold to the defendant the property described in the complaint for the consideration of eight hundred dollars, to be paid it by the defendant, and shortly thereafter the plaintiff delivered said property to the defendant, and on or about the 23d of October, 1903, the defendant, for the purpose of securing said purchase money, executed and delivered to the plaintiff the contract hereto attached, marked 'A,' and made a part of this answer."

The allegations of paragraphs II, III, IV, V, VI, VII, and VIII are the same as in the second defense.

For a fourth defense, and by way of counterclaim, the defendant alleges:

I. "That at all times herein mentioned the plaintiff, Walker, Evans Cogswell Company, was, and is, a corporation under the laws of this State.

II. "That on September 4, 1903, the plaintiff sold to the defendant the property described in the complaint for the consideration of eight hundred dollars, to be paid it by the defendant, and shortly thereafter the plaintiff delivered said property to the defendant, and on or about the 23d of October, 1903, the defendant, for the purpose of securing the said purchase money, executed and delivered to the plaintiff the contract hereto attached, marked 'A,' and made a part of this answer."

The allegations in paragraphs III, IV, V, VI, VII and VIII in this defense are the same as the allegations in paragraphs II, III, IV, V, VI and VII in the second defense.

IX. "That the defendant was induced by plaintiff's said false and fraudulent misrepresentations, not only to pay to the plaintiff said two hundred dollars, the first payment thereon, but was induced thereby to pay plaintiff fifty dollars on account of alleged charges for packing said property, and to further expend the sum of thirty-five dollars freight charges on said property from the city of Charleston, from which point the said property was shipped by the plaintiff to the defendant, and to further expend the sum of one hundred dollars for work, labor and material in putting up and putting together the said machines, the same having been by the plaintiff separated into parts to facilitate shipment of the same. That during the said period, when the defendant was making, in good faith, efforts to use and operate said machinery in setting type and performing the work in his office, which it was sold and falsely represented to do and perform, defendant was put to the further necessary expense of hiring and paying extra hands and help, over and above the cost of performing the same work by hand, to the amount of nine hundred and sixty dollars; all of which said sums were induced and caused to be paid by the defendant by the said false and fraudulent representations and acts of the plaintiff, to the damage of the defendant thirteen hundred and forty-five dollars.

X. "Denies each and every allegation of the complaint except as herein admitted.

"Wherefore the defendant demands judgment.

I. "That the complaint be dismissed.

II. "Judgment against the plaintiff on his counterclaim for the sum of thirteen hundred and forty-five dollars."

Thereupon plaintiff demurred to the second, third and fourth defenses on the ground that they failed to state facts sufficient to constitute a defense, in that the alleged false and fraudulent representations, if true as alleged, amounted to nothing more than mere matters of opinion and commendatory expressions as to value, prospects and the like, and fraud can not be predicated thereon.

The case came on for trial at the November, 1906, term of Court of Common Pleas for Florence County.

Upon hearing the demurrer and the answer, the same was overruled. Both sides then introduced testimony. After the charge of the Judge the jury rendered a verdict for the defendant in the sum of five hundred dollars. Thereupon the plaintiff appealed.

And in his first ground he submits that the Judge erred in not sustaining the plaintiff's demurrer.

So far as the allegations of fraud set forth in these exceptions to which the demurrer was directed they have no bearing on the issue, for the reason that a general allegation of fraud is a mere legal conclusion rather than the statement of facts, and therefore insufficient. State v.Jaques, 65 S.C. 154, 43 S.E., 393: Chemical Co.Youngblood, 58 S.C. 56, 36 S.E., 437. Thus it is manifest that the specific allegations, which are identical in each defense, are only to be considered by us. The nine instances specified are already set forth in this opinion. We are very much inclined to hold that these representations are nothing but a statement of the seller's opinion of these two machines; the defendant admits there was no guarantee as to any qualities as to the machines. They seem but expressions of opinion. As said in Ruberg v. Brown, 50 S.C. 397,400, 27 S.E., 873, "the general rule undoubtedly is that mere expressions of matters of opinion, however erroneous or false, will not support an action for misrepresentation, and that statements as to the value of the thing sold are generally mere expressions of opinion, and come within the rule. Cooley on Torts, 483; 3 Sutherland on Damages, 584; 5 A. E. Enc. L., 324; Fraser v. Harvey, 2 Bailey, 270; Means v. Brickell, 2 Hill, 320; Rupart v. Dunn, 1 Rich., 105, andLebby v. Ahrens, 26 S.C. 282, 2 S.E., 387."

In Bishop on Contracts, the rule is stated, "the law, departing from the rule in morals, tolerates a good deal of lying in trade, when in the nature of merely puffing one's own goods or depreciating those of another, provided the thing bargained about reveals its own qualities, and is open to the party's equal inspection." In 20th Cyc., page 53, it is said: "General assertions or expressions of a vendor in commendation of his lands or wares — commonly called dealers' talk — are generally held to fall within the rule under discussion and thus to constitute no ground for an action of deceit. Statements merely descriptive of the operation and utility of an invention or patented article are generally regarded as mere expressions of opinion or dealers' talk, upon which a purchaser cannot safely rely; and even misrepresentations as to experiments which have been made with the invention and have proved successful have been held to be merely expressions of opinion, and so not actionable, although put in the form of a statement of past facts."

In the matter here under consideration, no efforts were made, so far as proofs show, to prevent the defendant from a full investigation of the machines while in actual use by the plaintiff. The defendant remained in the examination of the machines as long as he desired, and that, too, while the plaintiff was not present. No effort was made at concealment by the plaintiff, but the defendant was left with the servants of the plaintiff, and therefore could have asked any questions he thought proper. It must be admitted, however, that whether the said machines would set clear type with little practice by the operators was not admitted by the plaintiff or his witnesses, and the same may be said as to there being no trouble in correcting the galleys, and the same may be said as to any person of ordinary intelligence operating the machines. The same may be said about the machines doing the work of five printers, who work by hand, and so in regard to the other statements of opinion by the seller.

There can be no doubt that Mr. Ayer had bright hopes of the sterling qualities of these machines when he bought them. So it may be said of any purchaser when he makes a trade. The fact that the plaintiff, when he bought the machines, five years before, paid six thousand dollars for them, and after five years' use was selling the same at eight hundred dollars, was a strong indication either that the machinery was inferior, or supplemented by other machinery adapted to this work.

As before remarked, the two machines were at work; when the defendant investigated, he saw them for himself.

As was said in Lake v. Tyree, 19 S.E., 787, 789: "The mere expression of opinion, however, even in strong and positive language, is no fraud, though it be false." It has been held by courts when considering statements made by an owner to induce another to purchase mining stock, "that the mine was rich in silver, would pay a dividend of from twenty to one hundred per cent., and there was enough ore on the dump to pay the par value of the stock, are matters of opinion, and though false do not constitute fraud." Croker v. Manley, 56 Am. St. Rep., 196. As said in Parker v.Moulton, 19 Am. Rep., 315: "The affirmations here set out as between buyer and seller, it has been repeatedly decided, will not support an action, although the defendant knew them to be false when made. They concern the value of land or its condition and adaptation to particular uses which are only matters of opinion and estimate, as to which men may differ. To such representations the maxim caveatemptor applies. The buyer is not excused from examination, unless he be fraudulently induced to forbear inquiries which he would otherwise have made. If fraud of this latter description is relied on as an additional ground of action, it must be specifically set forth in the declaration, and cannot be charged in the general terms only."

I think, therefore, that there were not sufficient allegations to make out a case of fraud, and it was error to overrule the demurrer.

Secondly: It is contended that the Circuit Judge erred upon the close of the testimony in not directing a verdict for the plaintiff on the ground that the plaintiff's case in chief had been fully proven and that defendant had entirely failed to establish the allegations in reference to false representations.

It is a delicate duty of the Circuit Judge to direct a verdict, and the duty ought not to be exercised by him unless it is perfectly plain. In the case at bar, the appellant pitched his battle upon false representations of the plaintiff, hence if the Judge decided that defendant's position was untenable, the plaintiff was entitled to a recovery. The Judge, therefore, committed error here.

The third, fourth, fifth and sixth exceptions, which are as follows:

Third: "His Honor erred, it is respectfully submitted, in not setting aside the verdict of the jury and granting a new trial. He should have held that the verdict was contrary to the overwhelming weight of the testimony, and should have set it aside and granted a new trial.

Fourth: "His Honor erred, it is respectfully submitted, in refusing to charge plaintiff's third request to charge, as follows: `There is no fraud or deceit in a contract between parties capable of contracting, where no fiduciary relation exists, where no facts are concealed,' the same containing a correct proposition of law, directly applicable to the facts of the case.

Fifth: "His Honor erred, it is respectfully submitted, in refusing to charge plaintiff's fifth request to charge as follows: `Where the purchaser undertakes to make investigations of his own, and the vendor does nothing to prevent his investigation from being as full as he chooses to make it, the purchaser cannot afterwards allege that the vendor made misrepresentations,' the same containing a correct proposition of law directly applicable to the facts of the case.

Sixth: "His Honor erred, it is respectfully submitted, in refusing to charge, as requested by plaintiff's sixth request to charge, as follows: `Representations, for instance, amounting merely to commendatory expressions or exaggerated statements as to value, prospects or the like, as where the seller puffs up the value of and quality of his goods, or a man, to induce another to contract with him, holds out flattering prospects of gain, are not regarded as fraudulent,' the same containing a correct proposition of law and directly applicable to the facts of the case."

I sustain each of these exceptions; indeed, when the first exception was sustained, this follows as a necessary consequence.

I think the Circuit Judge erred, and that the judgment of the Circuit Court should be reversed.