137 Iowa 301 | Iowa | 1908
To a proposition made by defendant to plaintiffs, with reference to the purchase of a small car load of Eaco flour and feed, containing the statement “ I have a car bought of the Alton Milling Co., but it ain’t giving good satisfaction; if I can buy Eaco I won’t let
Counsel for appellants insist that the failure of defendant to countermand his order to the Alton Milling Company, resulting in his receiving a car load of flour from that company about the same time that he received the flour shipped to him'by appellants, established a fraudulent purpose, and that a verdict should have been directed for the appellants. But this cannot be so in the absence of proof that the defendant entertained the fraudulent purpose not to countermand the order given to the Alton Milling Company at the time of the purchase of the flour from the appellants. The language relied upon, found in Pollard v. McKenney, 69 Neb. 742 (96 N. W. 679, 101 N. W. 9), is not applicable here. That was a case in which plaintiff was seeking to establish a constructive trust upon land by reason of a promise alleged to have been fraudulent that the defendant as grantee of the plaintiff would hold the land for plaintiff’s benefit, and the court finds constructive fraud to have existed in the intention not to perform the promise at the time it was made. What is further said in the case with reference to a presumption of fraud arising from the failure to comply with such a promise is expressly announced by way of dictum, but, whether dictum or not, it has no application to this case. That was an equitable action
This is an action at law based on an attempted rescission on account of fraud in the purchase of property sold and delivered to the defendant, and we find no authority supporting the rule of evidence contended for by counsel for appellants — that the failure to perform an executory agreement in itself shows that such agreement was made -with the secret intent not to perform it. If the rule contended for by counsel were recognized, then the seller could make out a case for rescission wherever goods have been sold on credit and the buyer has not subsequently paid in accordance with his promise. We have frequently held that while a false representation as to financial standing relied upon by the seller may be sufficient ground for rescission, although the buyer did not know himself to be insolvent, yet in all these cases there was evidence that the representations made by'the buyer at the time of the purchase were false and fraudulent, and were relied on by the seller as an inducement to the sale. Reid v. Cowduray, 19 Iowa, 169 ; Oswego Starch Factory v. Lundrum, 57 Iowa, 573; Morris v. Posner, 111 Iowa, 335; Starr v. Stevensen, 91 Iowa, 684.