Fort Smith v. Fairbanks, Morse Company

The defendants in error brought this action against the plaintiff in error to recover the amount due upon a promissory note executed by defendant to plaintiff for the price of a pump and attachments purchased by the former from the latter.

The questions in the case arise upon the cross action of the defendant for damages resulting from a breach of warranty on the part of plaintiff in the sale of the pump. It appears from the evidence that the pump was delivered and installed according to the contract of sale about June 15, 1902, and after a few days trial, was found not to have the power stipulated, and to be incapable of performing the work for which it was needed. There was evidence that after this fact was developed the defendant was about to remove the pump and install another, when plaintiff's agent appealed to him not to do so, undertaking to make it comply with the contract and furnish the requisite power, to which defendant assented; that this was attempted and the efforts to comply consumed the time until November 15, 1902, when plaintiff's agent abandoned further effort and admitted its failure. Further facts of the case, which need not be stated here, may be found in the opinion of the Court of Civil Appeals, 17th Texas Ct. Rep., 542. The damages claimed by defendant resulted from the loss of his rice crop for the irrigation of which the pump was intended, which loss occurred after the final failure to make the pump work efficiently and could have been prevented had the efforts to that end succeeded.

The Court of Civil Appeals held that the defendant's cause of action was for the original breach of warranty which occurred when the pump was found to be insufficient soon after its installation, on June 15, and that it was barred by limitation when defendant's first plea in reconvention was filed November 11, 1904. One of defendant's contentions, in opposition to this view, is that the damage claimed as the result of the breach, the loss of the rice crop, accrued within two years before the plea was filed, and that his cause of action for that damage then arose. As to this, we agree with the Court of Civil Appeals that the original breach of the contract, if it were unaffected by the subsequent transactions, would have given a right of action at once, including the right to recover all such damages as proximately resulted, whether they had then accrued or not, and that limitation would therefore have run from the time of that breach. This is sufficiently discussed in the opinion of the Court of Civil Appeals. We granted the writ of error upon the view that the evidence stated warranted the conclusion that the parties had made a further oral agreement, which was binding, and by which further time was given to plaintiff in which to perform its contract, and that the defendant's cause of action arose upon the breach of that agreement. Heisch v. Adams, 81 Tex. 94; Loan Assn. v. Stewart, 94 Tex. 441. But it is found upon an examination of the record that in his plea filed November 11, 1904, the defendant did not set up the last agreement nor seek to recover for its breach. This was first done by the amended plea filed February 22, 1905, when more than two years had elapsed from the breach of that agreement. As the stipulations on the part of plaintiff, for breach of which damages are claimed, were oral, the two years statute applies and the action was barred.

The plaintiff in error takes the further position, in substance, that the facts set up constitute a defense to plaintiff's action upon the note, to which limitation is not applicable. It is true that limitation does not affect defenses which are properly applicable to a plaintiff's cause of action, but nothing of that nature is set up. The defendant kept the property, gave his note for the price on December 15, 1902, after all of the transactions referred to had passed, has made payments upon and repeatedly promised to pay it and has never denied his liability upon it. He does not plead a failure of consideration, entire or partial, but asserts a cause of action for damages for a breach of the prior contract. This is not a defense to the note but a cross action.

The Court of Civil Appeals reached the right conclusion and its judgment must therefore be affirmed.

Affirmed.