21 Mont. 277 | Mont. | 1898
Lead Opinion
The complaint alleges, in substance, that the plaintiff is the owner and entitled to the possession of certain hotel furniture of the value of $649.06; that the same is unlawfully held by defendants, after demand therefor; that on October 2, 1893, plaintiff delivered the chattels in controversy to defendant Gates, Townsend & Co., a corporation, under the provisions of a contract entered into on that day between plaintiff and defendant corporation, as follows:
“Helena, Montana, Oct. 2, 1893. I have this day rented of J. R. Sanford the following described goods as per memorandum attached, for which I' agree to pay him as rental $649.06 as follows, viz.: Fifty dollars on the first-of each month until the whole amount of $649.06 is paid, together with interest at 1 per cent, per month on all unpaid balances; the interest to be paid monthly. And it is further expressly understood and agreed that the title to the above described goods shall not pass to me until I have paid an amount of rental equal to $649.06, as herein provided; and that the same shall be and remain the property of the said J. R. Sanford until the same shall be fully paid. And in case I make a default in my payments, as herein provided for, or any part thereof, I hereby grant and give to said J. R. Sanford or his agent or employee the right and privilege to enter on my premises and into my house or place where the goods may be, and take possession of said goods without process of law. In case I make default in said payments, or any'part thereof, it is expressly agreed and understood that all sums paid by me prior to such default shall be, and the same is hereby, forfeited as a part of the damages sustained by said J. R. Sanford for the use of the goods belonging to said J. R. Sanford,
That afterwards the defendant assigned to its co-defendant all its interest in the property. That on September 2, 1894, there fell due as interest $2.50, which remains unpaid, and that on October 2, 1894, the sum of $50, with further accrued interest of $2.50, became due, and was not paid. That there was due and unpaid October 4, 1894, when the complaint was filed, the sum of $55, and that the additional sum of $150 had not then matured.
The answer admits that the chattels were delivered and received in pursuance of the contract set out in the complaint. Por an equitable defense defendants plead that at and before the making of said contract one Rohrbaugh was renting from defendant corporation the Grandon Hotel, and had possession of and was using the chattels as part of the furniture of the hotel under some agreement with plaintiff, the terms of which were unknown to the defendants, that Rohrbaugh was then indebted to defendant company to the extent of $1,800 or thereabouts, and was insolvent, and unable to pay any part of such debt, except by a transfer of his interest in the said chattels, and that there was then due, or to become due, from Rohrbaugh to plaintiff, the sum of $449.06 — all of which plaintiff knew; that defendant company agreed to execute a contract in writing to pay plaintiff whatever was due, or to be paid by Rohrbaugh to plaintiff for the chattels, and thus become the owner thereof; that plaintiff and Rohrbaugh conspired to
The defendant, upon whom rested the burden of proof, introduced evidence. Plaintiff then moved the court to direct the jury to find for plaintiff on several grounds, one being that defendant had failed to show that it had relied upon or- believed the false representations made by plaintiff to it; and another being that there was no evidence that the amount due from Rohrbaugh had been paid. The motion was granted upon the first ground mentioned, a verdict returned, and a judgment signed and entered accordingly. From the judgment, and from an order refusing a new trial, defendant appeals.
With two exceptions, every material allegation of the equitable derense was, prima faciej clearly established. The evidence disclosed that §12 or thereabouts were still unpaid on the
The following quotations are extracts from the testimony of Gates, president and managing officer of defendant: “I was to pay for this1 furniture just what balance Rohrbaugh owed Sanford. Sanford said all he wanted was his pay for this furniture. I then entered into the contract sued on. Plaintiff had made out before that time, and given me, a statement of Rohrbaugh’s account. JEe said this was the amount-due.” Witness produced itemized bill, showing §649.06 as due from Rohrbaugh to plaintiff. ‘ T have had this account in my possession ever since. I went to plaintiff, and told him I did not think that account was right, and I would like to see his books, as I had assumed the balance Rohrbaugh owed him. He informed me that he would not let me see the books; he would not let any man see his books, he did not care who he was. I had fio other means of knowing, except through the statements of Rohrbaugh and Sanford, what amount was due. ’ Question: ‘Did you accept the statement as true, and act upon it?’ Answer: T accepted it under protest.' 1 told Sanford I didn’t think the account was right. I says, ‘There have been other payments made.’ ‘Well,’ says he, ‘if there has been any other payments made on that account, Adam (meaning his clerk) got it. I never got it. ’ This was at the time he refused to permit me to look at his books. I asked Sanford how much Rohrbaugh owed him. He said he couldn’t tell until he had looked up his account. Said I, ‘Did he keep up the payments? ‘Yes,’ he said, ‘he did promptly; very good; better than I expected. ’ That afternoon Sanford came to the hotel with the statement given in evidence. I looked at it and says: ‘That can’t be right. You told me he kept up his payments very well. ’ 1 says, ‘This shows no payments made since the 1st of May, ’ and I says, ‘Rohrbaugh told me he had
On April 1, 1894, defendant began making the payments
On July 1st there was unpaid of the $649.06 the sum of $349. Defendant then paid $53.49, and took from plaintiff a receipt showing that $50 was for the July installment and the $3.49 for interest. This receipt also was written by the witness. The last payment was made September 5, 1894. “Up to the time 1 refused these payments, I had a suspicion that this amount was not correct. 1 never knew, but 1 suspicioned that it was not right, and for the purpose of investigating it I refused to pay these last payments. * * * The first time I became fully satisfied of it was after the books had been examined. ’ ’ After plaintiff moved the court to instruct the jury to find for him, the court permitted the witness to be recalled. He then testified that j ust before the contract was signed he asked Rohrbaugh what was due, and Rohrbaugh said, “Not far from $400.” “Then, when the contract was presented to me, it was so much larger than what had been represented to me, I was suspicious that there was something wrong, and afterwards was satisfied that it must be right, and signed it. This occurred from my conversations with Sanford. After-wards so many things came to my mind that the thing was not right, and that I Avas being swindled out of some money, 1 thought 1 would contest it, and see what there was in it. I told Sanford every time we met that I would like to see the accounts. 1 asked him every time I saw him that I would like to see the books. I think 1 told him before signing the contract that 1 wanted to see his books. I asked him a great many times. I did not see them. He would not let me.”
1. The contract upon which the action is based is attacked as unconscionable, because it provides that, if the company fails to make any of its payments, all sums paid prior to default shall be forfeited as part of the damages for the use of
2. That the defense interposed by the answer is equitable in its nature is conceded by the parties. Although defendant asks the court to declare the contract null and void, the failure to offer a return of the goods obtained under it, or to give an excuse for the omission to do so, renders the defense pleaded unavailing for purposes of rescission. Indeed, relief by rescission would not benefit defendant, for the title to the goods was in plaintiff when the contract was made. His title does not come from or depend on the contract. • If the contract were declared void, the chattels would go to plaintiff, and defendant might have an action to recover whatever he has paid for them. So, if the contract were rescinded, plaintiff must necessarily recover possession of the property.
The plaintiff urges that the complaint does not state facts which would, if proved, authorize a reformation of the contract, for the reason that defendant' knew exactly what the language and import of the writing was, and that, therefore, there was no mistake, induced by fraud or otherwise, as to the terms and conditions of the contract, and hence the writing-must stand as the only evidence of the only contract that was entered into. This view of the jurisdiction of equity is top
Defendant claims that the real contract was that it was to pay $449.06, instead of $649.06, as stated in the contract sued on, and that it was induced to sign the latter by fraudulent representations. The relief which it seeks is reformation, so that $449.06 shall take the place of $649.06, and then the enforcement of the contract as reformed. This is evidently the view taken by the court on the former appeal. (See Sanford v. Gates, 18 Mont. 398, 45 Pac. 559.) As suggested by respondent’s counsel, this court did not intend to say that, if a written contract be entered into, and by the fraud of one of the parties it fails to express the true agreement, the writ
Defendant complains that the question whether the false representations of plaintiff induced it to make the contract should have been submitted to the jury. Learned counsel insists that the defendant was deprived of a constitutional, legal, and sacred right by the action of the trial court in refusing to permit the jury to pass upon that question of fact. The defense was equitable. Where an equitable defense is interposed, the court exercises the power and jurisdiction of a chancellor, and may or may not, according to its discretion, order issues to a jury. If the remedy sought be equitable, the court is not bound to call a. jury, and, if it does call one, it is only for the purpose of enlightening its conscience, and not to control its judgment. The decree which it must render upon the law and the facts must proceed from its own judgment respecting them, and not from the judgment of others. (Gallagher v. Basey, 1 Mont. 457; Basey v. Gallagher, 20 Wall. 670.) The court must determine the issues
To warrant reformation on the ground of deceit by means of false representation, it is essential that the false representation induced the party asking such relief to enter into the con
The court below had the advantage, not possessed by this court, of hearing the testimony orally delivered by the witness Gates, and of observing his demeanor and manner of testifying. The court found that defendant did not believe the false representations to be true when it entered into the contract. Gates was the president and managing officer of defendant. He alone represented it in all matters pertaining to the contract with plaintiff. The important question was, did he believe the false representations to be true, and act on them? Was he deceived by plaintiff? As presented in the record, his testimony is not without uncertainty, and self-contradiction. He testified that he was suspicious from the very first that plaintiff had fraudulently swelled the account against Rohrbaugh; that plaintiff always refused to permit an inspection of his books; that he was satisfied at the time he signed the contract that the amount stated was incorrect; that he accepted plaintiff’s assurance, and signed the contract under protest. Eight and nine months afterwards he made payments on the contract, expressly recognizing its validity by preparing and accepting receipts for interest paid by him on the remainder of the §649.06. When recalled after plaintiff had argued the motion to direct the jury, Gates testified that he became satisfied from his conversations with plaintiff that the amount, §649.06, was correct, and that he then signed the agreement. The burden of proof, in both of the senses in which the term is used, rested upon the defendant, and the court found from the testimony of the managing officer of defendant that he did not believe the representation of plaintiff
The contemporaneous oral promise said to have been made by Sanford, to the effect that he would rectify any mistake in the amount, while it was evidence tending to prove fraud, may not be imported into the written contract, for the reason that it was not intended by the parties to be incorporated into that agreement; nor can the defendant be permitted to set up that he signed the contract in reliance upon an oral agreement, made at the time, relating to the subject of the contract, and qualifying or varying the instrument which he signed. Where there is no fraud or mistake in the preparation of the instrument, and it appears that the party signing understood its language and purport, it cannot be reformed on Qthe ground that he signed upon the faith of a contemporaneous oral promise which was not kept, nor may such promise be received in evidence to control the written contract. In equity, as at law, a written contract merges all prior and contemporaneous negotiations and promises made by word of mouth in reference to the subject of the instrument. The presumption is conclusive that the whole agreement is embraced in the writing; and while, in equity, a written contract may be canceled or reformed for fraud or mistake, it may not be canceled on the ground that the oral promise has not been kept, nor reformed on the ground that such promise was made, unless it be shown that its omission therefrom was by mistake, fraud or accident. It was not contemplated or intended by either party that the oral promise of plaintiff should be inserted in the contract. Defendant perhaps relied upon that promise. If so, its duty
We have given this case most careful consideration. The seeming injustice, from an ethical point of view, which defendant has suffered at the hands of plaintiff, strongly appeals to us, and we have endeavored to find an equitable ground or principle which could be invoked in this suit, and applied for its relief. We are unable to do so. The doctrines which govern the state of facts presented by the pleadings and evidence are well settled; and, while it may be conceded that they seem to work hardship in some individual instances, their wisdom cannot well be questioned. An established rule of law must operate equally upon all cases falling within it, without regard .to the views entertained by the judges touching the supposed hardship occasioned in the particular case.
The judgment and order appealed from are affirmed.
Affirmed.
Concurrence Opinion
I concur with reluctance, but am unable to reach any other conclusion than one of affirmance under the principles of law properly applicable.
