Alabama Machinery & Supply Co. v. Caffey

• Decision Date: 16 April 1925
• Docket Number: 3 Div. 705
• Citation: 104 So. 509,213 Ala. 260
• Court: Alabama Supreme Court
• Parties: ALABAMA MACHINERY & SUPPLY CO. v. CAFFEY.

104 So. 509

213 Ala. 260

ALABAMA MACHINERY & SUPPLY CO. v. CAFFEY.

3 Div. 705

Supreme Court of Alabama

April 16, 1925

Rehearing Denied May 28, 1925

Appeal from Circuit Court, Montgomery County; Leon McCord, Judge.

Action by William G. Caffey against the Alabama Machinery & Supply Company for fraud and deceit. Judgment for plaintiff, and defendant appeals. Affirmed.

See also, 19 Ala.App. 189, 96 So. 454.

Ball &amp Beckwith, of Montgomery, for appellant.

Steiner Crum & Weil, of Montgomery, for appellee.

BOULDIN J.

The action is for damages growing out of the sale of a steam tractor to be used by the purchaser in the manufacture of a crop of cane or sorghum millet into syrup.

The case was before the Court of Appeals on former appeal. Caffey v. Alabama Machinery & Supply Co., 19 Ala.App. 189, 96 So. 454. The decision of the Court of Appeals was sustained on certiorari to this court. Ex parte Alabama Machinery & Supply Co., 209 Ala. 466, 96 So. 459.

Upon the trial now under review, the plaintiff struck out all counts of the complaint based upon breach of warranty, and retained the counts for fraud and deceit. Some of these counts rely upon fraudulent misrepresentations of the seller. Code 1923, § 8049 (4298). Others are for deceit. Code 1923, § 5677 (2469). We note that fraudulent deceit is further defined by new sections 7353-4, Code of 1923. The present case does not call for a consideration of these new provisions.

The consequential damages recoverable under these counts were fully considered on the former appeal. We adhere to the views there expressed, and need not here repeat them. We deal with specific questions now raised, some of which were impliedly decided on the former hearing.

A sales agent engaged in negotiating a sale is acting within the line and scope of his employment in making representations of fact touching the condition or quality of the article he is selling. In sales of machinery located at a distance, this rule covers representations that the machinery is in good running order. Where the machine is made and sold for power production, representations as to the rated and actual horse power the machine will develop are within the implied authority of the sales agent, and the principal is bound thereby; the purchaser having no notice of limitations of the agent's authority in that regard. Dothan Grocery Co. v. Pilcher, 200 Ala. 151, 75 So. 334; Ray v. Fidelity-Phoenix Fire Ins. Co., 187 Ala. 91, 65 So. 536; King v. Livingston Mfg. Co., 180 Ala. 118, 60 So. 143; Id., 192 Ala. 269, 68 So. 897; Mid-Continental Life Ins. Co. v. Beasley, 202 Ala. 35, 79 So. 373; Tennessee River Transportation Co. v. Kavanaugh Bros., 101 Ala. 1, 13 So. 283; Robinson v. AEtna Ins. Co., 128 Ala. 477, 30 So. 665; Williamson v. Tyson, 105 Ala. 644, 17 So. 336; 2 C.J. p. 855, § 541, and notes.

A stipulation in the written contract that there are no verbal understandings not incorporated therein does not estop the party to set up fraud in verbal misrepresentations inducing the contract. Fraud vitiates the contract as a whole. The law does not countenance a contract against the consequences of fraud. Burroughs v. Pacific Guano Co., 81 Ala. 255, 1 So. 212; Fay & Egan Co. v. Independent Lbr. Co., 178 Ala. 166, 59 So. 470; Brenard Mfg. Co. v. Jacobs & Padgett, 202 Ala. 7, 79 So. 305.

The contract for the sale of the tractor having been made wholly with plaintiff in carrying out his part of the joint adventure by which he and his father were to share in the net proceeds of the crop, plaintiff was the proper property to use for all recoverable damages arising from fraud in the transaction. The father, not being a party to the contract, but looking to the son, if any one, for any losses resulting from failure to furnish proper machinery to work up the crop, was not a necessary party to the suit.

There was no error in refusal of instructions limiting plaintiff's recovery to the loss of his share in the crop in consequence of the fraud of defendant.

The terms of the contract for growing and gathering the crop, manufacturing and marketing the syrup having been set out in the complaint as showing the occasion for the purchase of the tractor, there was no error in admitting evidence in support of these averments.

It appearing in evidence that the tractor was sold for the known purpose of operating the cane mill and steam cooking vats, that the vats were constructed as part of the contemplated equipment, that they operated successfully when steam was available, and that they were worthless when the tractor failed wholly to meet the representations made for purposes of a sale, evidence of the item of $25 expense in constructing the vats was properly admitted as part of the consequential damages recoverable in the case.

Upon evidence that the syrup had been sold in advance at a fixed price, and that the crop had been grown ready for manufacture into syrup, the reasonable cost of making and marketing the syrup furnished proper data to determine the loss per gallon upon that portion of the crop lost to plaintiff for want of power. If plaintiff could not manufacture properly at reasonable cost,...