Andrews v. National Oil Co.

• Decision Date: 01 March 1933
• Docket Number: 53.
• Citation: 168 S.E. 228,204 N.C. 268
• Parties: ANDREWS v. NATIONAL OIL CO.
• Court: North Carolina Supreme Court

168 S.E. 228

204 N.C. 268

ANDREWS v. NATIONAL OIL CO.

No. 53.

Supreme Court of North Carolina

March 1, 1933

Appeal from Superior Court, Edgecombe County; Daniels, Judge.

Action by D. B. Andrews against the National Oil Company. From a judgment overruling demurrer to the complaint, defendant appeals.

Affirmed.

Demurrer to entire complaint will be overruled if complaint is good in part.

The complaint is as follows:

"1. The plaintiff, D. B. Andrews, is a resident of Edgecombe County, North Carolina, and the defendant National Oil Company is a corporation organized and doing business under the laws of the State of Virginia, having its principal office in the City of Richmond, but doing business in North Carolina and having an office in Nash County in said State on Earl Street, in the City of Rocky Mount.

"2. On October 6, 1930, the defendant was in possession of a gasoline filling station in the City of Rocky Mount, at the corner of Church and Nash Streets, known as 'Church Street Service Station,' under a lease expiring September 30, 1932. The said service station was equipped with three gasoline tanks buried underground and covered with concrete, two of which had one gasoline pump each, the other having two gasoline pumps connected with the tank by underground pipes through a T-joint.

"3. That on October 6, 1930, the defendant made a verbal contract with the plaintiff whereby plaintiff agreed until the expiration of said lease to occupy and operate the said service station, buying all gasoline and oil for sale for automobiles from the defendant daily therefor at current tank wagon prices, plus one cent additional per gallon, and selling same at current retail prices in Rocky Mount, N. C., the additional one cent per gallon on the gasoline being paid as rent for the premises and the tanks and gasoline pumps, the plaintiff himself owning the air pump, greasing equipment, tools, etc., plaintiff's compensation for his services as sales agent or commission man for defendant being the difference between the cost and the retail price of the products handled.

"4. Within sixty days after October 6, 1930, the plaintiff discovered that he was losing money, apparently through shortage in gasoline, and complained to the defendant about it, suggesting that the underground tanks belonging to the defendant were leaking. The defendant assured plaintiff that this could not be so, that it had operated these tanks for a long time and that it knew that they were in good condition, that the defendant suggested that the loss was due to plaintiff's faulty records, and not to any leak. Plaintiff accepted the assurances made by the defendant and continued to buy gasoline from it. Plaintiff had no right to tear up concrete and inspect the tanks which were the property of the defendant, and no duty to do so, and relied upon the assurances made to him by the defendant in continuing to let the defendant put gasoline into the said tanks.

"Said assurances were in fact untrue, and were made by defendant in reckless disregard of their truth or falsity, with intent that plaintiff should rely thereupon and continue to buy gasoline from the defendant. Throughout the year 1931, plaintiff repeatedly made complaints to the defendant that he was losing gasoline in some unexplained way, and requested that the defendant tear up the concrete and examine the tanks, but as often as plaintiff made complaint the defendant assured him that it must be faulty records, and that there could be no leak in the tanks, which assurances were accepted by the plaintiff as a possible explanation, until March 19th, 1932, when plaintiff made a careful test of the pumps on the largest tank, allowing no one to operate these pumps except himself from the 19th of March until the 21st of March, locking both pumps and fill pipe when plaintiff was absent during this period, the result of which test was a loss of some unexplained cause of forty-three gallons out of two hundred and seventy gallons, in the space of 48 hours. Thereafter the plaintiff refused to permit the defendant to put any more gasoline into the tank with the two pumps which had been tested. The defendant for the first time made a test on its own account on Tuesday, March 22, 1932, locking both pumps and fill pipe, and found a loss of eight gallons out of one hundred gallons in the space of 5 hours. A few days thereafter the defendant's district manager again insisted that the loss was plaintiff's fault and not a leak in the tanks, but plaintiff persisted in refusing to permit any gasoline to be put into that tank, and finally the defendant broke up the concrete and examined the tank and found a leak in the pipe at the T-joint, through which a stream of gasoline as big as a man's finger was running out. The plaintiff immediately demanded reimbursement from the defendant for gasoline lost through the leak, which demand the defendant referred to its district manager, who ignored it.

"5. The defendant repaired the leak and shortly thereafter, to-wit, on April 7, 1932, at the request and insistence of the defendant, the plaintiff agreed to a rescission of his contract with the defendant, and sold his equipment, thus terminating his connection with the defendant.

"6. That the plaintiff has suffered a minimum loss through the said leak of 8370 gallons of gasoline from October 6th, 1930 to April 7th, 1932, for which the plaintiff paid the average price of 16 1/2 cents per gallon, making a total of $1381.05 which the plaintiff has paid the defendant for gasoline which was lost through the leak in the equipment belonging to the defendant into which plaintiff was required to place said gasoline, which was under the sole control of the defendant, for which the plaintiff has received no benefit, which amount was not paid voluntarily, but upon the insistence of the defendant that plaintiff's loss was due to plaintiff's fault in that he was ignorant of proper methods of accounting which assurances were accepted by the plaintiff until March 19, 1932, when plaintiff acquired definite and reliable knowledge that there was a leak in the defendant's equipment. The said money was paid by plaintiff to the defendant in good faith under a mutual mistake of fact, induced by the assurances of the defendant, but for which plaintiff would not have paid for said gasoline, and plaintiff is entitled to recover the same from the defendant in equity and good conscience as money had and received to his use.

"Wherefore, plaintiff prays that he recover of the defendant the sum of $1381.05 with interest from the average interest date, July 1, 1931, at the rate of six per cent. per annum and the costs of this action, and such other and further relief as he may be entitled to."

The demurrer of defendant is as follows: "The defendant demurs to the complaint filed in this action by the plaintiff upon the following grounds; that the complaint does not state facts sufficient to constitute a cause of action, for that: (1) The complaint does not allege facts which show that the defendant was under any legal or contractual duty to discover the leaks in the tank, if any existed, or to repair such leaks, if any existed. (2) The complaint does not allege facts which show that the defendant knew of the existence of such leaks in the tank, if any existed, and knowing such facts falsely represented to the plaintiff that none existed. Wherefore, the defendant prays that this demurrer to the complaint be sustained and that this action be dismissed at plaintiff's cost. This the 13th day of September, 1932."

The court below rendered the following judgment: "This cause coming on to be heard upon demurrer filed by defendant to the complaint and being heard and the plaintiff moving for leave to file an amendment to the complaint during the course of the argument, the defendant not objecting, the Court allowed the amendment and the cause was determined upon the demurrer to the complaint as amended. After argument, it is Ordered Considered and Adjudged: (1) ...