171 P. 190 | Or. | 1918
Lead Opinion
The only other errors assigned by defendant are based on the order sustaining the demurrers to the three affirmative defenses set up in the fourth amended answer.
“That in order to induce the defendant to purchase from the plaintiff, Henry Gabel and Mary Gabel, the personal property hereinabove described, the plaintiff, Henry Gabel and Mary Gabel, falsely and fraudulently represented to the defendant that many months prior to said July 5, 1913, they had been operating the said bakery; * * that they were drawing between them thirty-nine ($39.00) dollars per week as part of the running expenses of said business, and after paying all other expenses of' conducting the said business were making a profit of not less than three hundred and no/100 ($300.00) dollars per month, which they were dividing among them; that said bakery business was being conducted at a large profit of not less than $300.00 per month, and would continue in the ordinary course of business to net defendant such profit # * . That each and all of the said representations were false and untrue, and were known by the plaintiff, Henry Gabel and Mary Gabel, to be false and untrue, and were made by them to the defendant for the purpose of falsely and fraudulently inducing the defendant to purchase said personal property, and that plaintiff and Henry.Gabel and Mary Gabel, intended that the said defendant should rely upon said repre*89 sentations, and defendant did rely thereon, and believing the same to be true made the purchase aforesaid.
“That in truth and in fact the said bakery business had not been conducted at a profit by the plaintiff and said Henry Gabel and Mary Gabel, but had in fact for some time prior to the said sale been conducted by them at á loss.”
There are other allegations not necessary to be quoted. We think that the averments which we have set out sufficiently allege actionable fraud. They contain all of the elements of a valid plea as defined in Rolfes v. Russel, 5 Or. 400, 402. While the pleading is to be most strongly construed against the pleader, the language is to be interpreted fairly and in accordance with the intent of the pleader if that intent is to be gathered from a reasonable construction of the language used. Defendant plainly intended to charge that plaintiff and his co-owners represented that they were in possession of the bakery at the time of the sale; that they had been operating the bakery for many months at a profit which was specified in the representations; that in fact the bakery was conducted at a loss; that the representations were made with intent to deceive and were acted on by defendant to her injury. There can be no doubt of the materiality of the misrepresentation. The profitableness of a business is vitally related to its value and is always important from the-standpoint of the purchaser.
“The technical objection to adjusting this whole matter in this suit, is of no avail in a court of equity. It is in no sense an offset; it is a defense growing out of the same contract on which the note and the mortgage were given, and strikes at the consideration of the note. The proof shows a partial want of consideration. The orator is asking the court in a proceeding instituted by himself, to enforce the note for the whole nominal amount, and thus to compel the defendant to pay more than he justly or equitably owes, or else to be barred of his equity of redemption. A party who asks equity must do equity. It is not in accordance with equity law to compel this defendant to pay for land he never had; to pay more than the orator is entitled to hold; and to compel the defendant to resort to a court of law to recover back the excess. The whole matter should be adjusted in this suit, and the defendant decreed to pay only so much as the orator is equitably entitled to receive and ultimately retain.”
We are committed by two recent decisions of this court to the doctrine that on the foreclosure of a purchase-money mortgage it is competent for the defendant to allege fraud on the part of plaintiff inducing the purchase and to recoup the damages arising therefrom against plaintiff’s cause of suit: Kreinbring v. Mathews, 81 Or. 243 (159 Pac. 75); Hanna v. Hope, 86 Or. 303 (168 Pac. 618, 619). The defendant was therefore within her rights in alleging the fraud of plaintiff and his co-owners as a defense to this suit.
“If a defense is set up as an answer to. the whole cause of action, while it is in fact only a partial one * * it will be bad on demurrer.”
This principle is not applicable to the answer under consideration.
In a suit for $1,100 an answer setting up fraud at the inception' of the contract sued on and claiming damages in the sum of $750 by reason of the fraud cannot be treated as an attempt to answer the whole cause of suit. In a note to the section above cited, Mr. Pomeroy says:
“But this rule does not' extend to an answer simply pleading a setoff less than the plaintiff’s demand, since a setoff is not strictly a defense.”
We think that the Circuit Court erred in sustaining the demurrer to this portion of the answer.
This pleading is defective in that it fails to allege a consideration for the agreement relied on and in that it fails to allege that plaintiff and his associates opened their competing bakery within a year from the date of the sale to defendant. The Circuit Court did not err in sustaining the demurrer to this portion of the answer.
The judgment is reversed and the cause remanded.
Reversed and Remanded.
Concurrence Opinion
Concurring Specially. — A. mere defense is not as a rule available as ground for an original action. This characteristic distinguishes the second affirmative answer and puts it in the classification of pure counterclaims, for without reference to whether the chattel mortgage was due or not or already paid, the defendant could have instituted an action at law to recover damages from the plain