Bencoe Exporting & Importing Co. v. Erie City Iron Works, No. 169

No. 169 | 2d Cir. | Mar 6, 1922

HOUGIT, Circuit Judge

(after stating the facts as above). [1] We are of opinion that the court below rightly sustained demurrer to the second cause of action. The substance of this part of the complaint is that certain governmental agents, who had power to give or withhold export licenses during the late war, erroneously or stupidly imputed to plaintiff the wrongful deeds of defendants, and therefore punished plaintiff by preventing the procuring and/or fulfillment of export contracts. Ret the defendants be assumed as guilty of all the wrongdoing charged, yet (1) it is nowhere asserted that defendants ever said or suggested to any one, much less the agents of the United States, that plaintiff had shared in or consented' to the defendants’ acts; and (2) especially, in the absence of any allegation of communication by defendants to the agents of the United States, it is not seen how defendants can be held responsible for the uninspired, and on the face of complaint inexcusable, mistake or stupidity of said governmental officers.

[2] The first cause of action is novel, and most interesting. There can be no doubt of the existence of the legal principle asserted as applicable to new and singular facts, viz. that when fraud is committed, and damage is thereby occasioned, a cause of action results to him who is damaged. Rice v. Manley, 66 N.Y. 82" court="NY" date_filed="1876-04-25" href="https://app.midpage.ai/document/rice-v--manley-3597674?utm_source=webapp" opinion_id="3597674">66 N. Y. 82, 23 Am. Rep. 30; Benton v. Pratt, 2 Wend. (N. Y.) 385, 20 Am. Dec. 623; Parley v. Freeman, 3 T. R. 51. But we find it impossible profitably to discuss the application of the principle, because we are convinced that the court below too narrowly interpreted the language of the complaint, and what the facts will be when evidence is adduced cannot be certainly stated.

Every case, though heard on ‘demurrer, must rest decision on facts: but the facts on demurrer often, if not usually, consist of inferences from the pleader’s words, and such inferences are often of small value, when compared with the results of sworn evidence. Reading the complaint benevolently, as must be done on demurrer, we find plaintiff asserting that what he bought were plates “for export to Japan,” and the knowledge that this- was plaintiff’s bargain, was passed on from iEtna Company to Erie Works and O’Brien.

'Decision below, however, was rested on, and grew out of, a holding or finding that the “reference to export” was no more than a “description.” From this holding logically flowed a reading of the pleaded contract as requiring no more than the delivery to plaintiff in the United States of plates physically complying with requirements as to quality, size, etc. Under such a contract, it would and did with equal logic result that, since plaintiff had gotten plates physically acceptable, he had no cause of complaint, for no fraud had been worked on him by any one, and (as was held) he got “exactly what he had contracted for.” The fact that plaintiff’s goods, exactly as contracted for, had been procured for him by frauds or falsehoods worked on Illinois Steel Company and the United States, was quite immaterial. In terms of the undoubted rule of law, there was no concurrence of fraud and damage to the hurt of plaintiff.

But Ave cannot read the complaint as making the exportable quality or attribute of these boiler plates no more than descriptive. Plaintiff is entitled to the reading we prefer, which is that it was part of the original bargain between plaintiff and IEtna Company, and part of the fractional bargain between 2Etna Company and Erie Works, and something communicated to and known by O’Brien, that plaintiff was rjot getting what he was entitled to, and was not obtaining fulfillment of his contract, unless the plates tendered him had not only the stipulated physical qualities, but possessed also the political or legal and additional quality or attribute of exportability.

Whether there ever was such a singular and burdensome contract we do not know; but we hold it clear that an agreement of that kind is possible, and would' be legal, and further that it is such a contract that plaintiff has with reasonable clarity alleged. Therefore he is entitled to an opportunity of proving it before a jury. No further holding is now necessary. To lay down rules which now seem applicable to possible results of evidence only makes confusion.

It is ordered that the judgment on review be affirmed as to the second cause of action, and reversed as to the first; that there be no costs of this court, and the case be remanded with directions to require the defendants to answer the first cause of,action within a time to be fixed by the District Court.