Aaron v. Hampton Motors, Inc.

• Decision Date: 13 March 1962
• Docket Number: No. 17884,17884
• Citation: 240 S.C. 26,124 S.E.2d 585
• Court: South Carolina Supreme Court
• Parties: Winston AARON, Respondent, v. HAMPTON MOTORS, INC., Appellant.

Page 585

124 S.E.2d 585

240 S.C. 26

Winston AARON, Respondent, v. HAMPTON MOTORS, INC., Appellant.

No. 17884.

Supreme Court of South Carolina.

March 13, 1962.

James D. Walters, Columbia, for appellant.

Melton Kligman, Columbia, for respondent.

LEGGE, Justice.

Action by vendee against vendor of a used automobile seeking recovery of actual and punitive damages for fraud and deceit based upon alleged misrepresentation as to its condition and mileage. The trial judge granted a nonsuit as to punitive damages and submitted the issues of liability and actual damages to the jury, which returned a verdict for two thousand three hundred fifty ($2,350.00) dollars. Defendant alone appeals, charging error in the refusal of its motiosn for nonsuit, direction of verdict, and new trial.

On September 12, 1959, under a written agreement of that date executed by both parties, respondent purchased from appellant a 1958 Plymouth, appellant taking as the down payment respondent's 1951 Mercury at an agreed valuation of $300.00 (less a balance of $102.00 due on it to a finance company, which respondent agreed to pay to that company on October 1, 1959), the balance, $2302.20, to be paid by respondent in thirty consecutive monthly instalments of $76.74 each, commencing November 1, 1959.

The agreement contained, in large print, the following:

'It is further understood and agreed that the seller does not guarantee used or second-hand automobiles, and makes no representation or guasrantee as to correctness of speedometer mileage shown on car, and does not obligate itself to do any free work or service on such cars unless specified in writing here below.'

It also contained, under the printed caption 'Special Agreement', the following, written in pencil as were all other provisions of the agreement not printed:

'Subject to credit approval 9-14-59 50/50 warranty 30 days or 1000 miles mileage 16,246'

Respondent testified that he had bought the 1951 Mercury from appellant, through its salesman Mr. Eleazer; that it had given good service; and that when he and his wife decided in September, 1959, to get a better car they went to appellant's used car lot and sought out Mr. Eleazer, who showed them first a 1957 Plymouth, then a 1958 Ford, and finally the 1958 Plymouth that he bought. He testified that Mr. Eleazer told him that in his opinion the 1958 Plymouth would be a better buy than the 1957 one if they could make a deal on the Mercury as a down payment, because although the 1958 Plymouth would cost about $200.00 more it had a heater and radio that the 1957 car did not have, and that it 'was awfully clean and had only about 16,000 miles on it.' He testified that after a trial drive in the 1958 Plymouth he and his wife came back to the lot, where they examined the tires and the interior of the car, lifted the hood and looked at the engine, finding everything, including the engine, very clean; and that Mr. Eleazer said, in response to his inquiry, that his company had not 'gone into the engine.'

Respondent having agreed to buy the 1958 Plymouth and having agreed with Mr. Eleazer as to the value of the 1951 Mercury to be traded in, Mr. Eleazer prepared the written contract before mentioned, and it was then executed by him on behalf of the appellant, and by the respondent. The latter testified that he made the purchase in reliance upon Mr. Eleazer's unqualified representation that the car's actual mileage was approximately 16,000. Mr. Eleazer, on the other hand, testified for the appellant that in his transaction with respondent no mention was made of mileage, and that the words 'mileage 16,246' had been written into the contract simply to afford a basis for the calculation of the 1,000-mile warranty under the 'Special Agreement' before mentioned.

There is no controversy as to the meaning of the express '50/50 warranty 30 days or 1,000 miles' in the 'Special Agreement'.

Respondent testified that the 1958 Plymouth gave him no trouble until the early part of January, 1960, by which time he had driven it about 3,000 miles. Then it 'started knocking', 'threw' a connecting rod, and broke down. Understanding that the warranty period had expired, he asked appellant's service manager if the company would make the necessary repairs and, meanwhile, lend him a car; but he was informed that this could not be done. Being a long-haul truck driver and living some two miles from the place where he had to report for duty whenever called, and being thus in need of a car during the time that the Plymouth would be laid up for repairs, he then went to Snelgrove's Garage, in West Columbia, where he was advised that they would repair his car and let him have another, without charge, while the job was being done. Accordingly, he left his car with them, taking theirs for use during the course of the repair job.

Snelgrove's shortly thereafter informed respondent that the engine was worn out and required new connecting rods and a new crank shaft. Respondent then, through the records of the State Highway Department, located its former owner, a Mr. Lee, of Columbia, whose business was that of a traveling salesman. Mr. Lee informed respondent and testified at the trial: that he had bought this car from Oliver Motors; that it had given him trouble and had 'thrown a rod'; and that he had had it repaired by Oliver Motors, whose repair man told him that they would not guarantee the job; and that he, in August, 1959, had 'traded it' two weeks later to Hampton Motors, appellant here. Mr. Lee testified that when he traded this car to Hampton Motors the speedometer showed mileage in excess of 55,000.

Mr. Shealy, service manager of Oliver Motors, testified that the 1958 Plymouth, then owned by Mr. Lee, had been repaired by his department on August 11, 1959, at which time the speedometer showed mileage of 54,957, and again on August 18, 1959, the mileage shown on the speedometer being then 55,320. He testified that the repair work sheets showed these repairs to have consisted of installing a drive shaft, replacing all connecting rods, and replacing main bearing; that this work required removal of the cylinder head and replacement of old gaskets with new ones; and that after completion of such a job it would be apparent to a mechanic or an experienced automobile dealer that work had been done inside of the motor.

Snelgrove's bill for repairing respondent's car was about $263.00. Respondent was unable to pay it, and was in default in payments under his purchase agreement. The finance company that held his obligation to appellant accordingly repossessed the car and paid Snelgrove $200.00 in compromise settlement of the repair bill.

Respondent testified that in October, 1959, he paid to the finance company the balance of $102.00 owing on the 1951 Mercury. He testified that on the purchase price of the 1958 Plymouth he made two monthly payments of $76.74 each, plus 'two or three' late charges of $4.00, and a further payment, in January, 1960, of $120.00. The correctness of the amounts so testified to is in dispute, appellant contending that only one monthly payment of $76.74 was made.

Exceptions 1 and 5 charging error in the refusal of appellant's motions for nonsuit and direction of verdict, are based upon the contention that negotiations leading to the sale of the car merged in the written agreement of sale; that the written warranty, limited to '30 days or 1,000 miles', was therefore conclusive; and that since the uncontradicted evidence showed that no defect appeared or damage occurred within the period of that warranty, respondent was not entitled to recover. We find no merit in this contention; the action was for fraud and deceit, and parol evidence on that issue was admissible despite the limited warranty. Parham-Thomas-McSwain v. Atlantic Life Ins. Co., 111 S.C. 37, 96 S.E. 697; Continental Jewelry Co. v. Kerhulas, 136 S.C. 496, 134 S.E. 505; Southern Iron & Equipment Co. v. Bamberg E. & W. R. Co., 151 S.C. 506, 149 S.E. 271; General Motors Acceptance Corp. v. Whitehead, 163 S.C. 236, 161 S.E. 494.

Exceptions 2 and 4, charging error in the refusal of the motions for nonsuit and direction of verdict, are based upon the contention that proof of two of the essential elements of fraud was lacking, in that there was no showing either (1) that appellant had knowledge of the falsity of its representations as to the mileage and condition of the car, or (2) that damage resulted from such misrepresentations. Exception 6 also charges that the proof of fraud was insufficient in that all of the evidence showed that the respondent could have easily obtained, as he later did, information as to the actual condition of the car, and as to its true mileage, at the time of his purchase.

These exceptions are likewise without merit, in our opinion. Although there was no direct proof that the speedometer had been tampered with or replaced by another during the two weeks or so that appellant had the car, between the time of its acquisition from Lee and its sale to the respondent, we cannot say that such an inference would have been wholly without evidentiary support. And, aside from that, it is not necessary, in order to establish fraud, to prove that the person making the allegedly false representation had actual knowledge of its falsity; if he makes it as of his personal knowledge, with reckless disregard of his lack of information as to its truth, his knowledge of its falsity is legally inferable. Gary v. Jordan, 236 S.C. 144, 113 S.E.2d 730. We think, too, that there was sufficient evidence of damage to take that issue to the jury.

In our opinion the record here does not require the conclusion, as a matter of law, that respondent's claim was barred by the well-known rule, Jones v. Cooper, 234 S.C. 477, 109 S.E.2d 5, that one will not be heard to say that he was deceived by a vendor's misrepresentations if, by his own negligent failure to avail himself of information...