Averill v. Wood
| Decision Date | 28 December 1889 |
| Court | Michigan Supreme Court |
| Parties | AVERILL v. WOOD. |
Error to circuit court, Kent county.
Taggart, Wolcott & Ganson, for appellant.
Ward & Ward, for appellee.
The plaintiff alleges that on the 18th of November, 1887, he was induced to take of Isaac W. Wood, in payment of real estate sold to said Wood, two certain promissory notes, as follows:
Upon the back of said note are the following indorsements:
Upon the back of said last note was the following indorsement:
That the said Wood then and there falsely and fraudulently represented and warranted that the note signed by Bradford was good and collectible for the face value of said note, and interest, from its date, and that there was due about $900 upon it, and that Bradford was pecuniarily responsible for the amount of said note, and would pay the same to plaintiff; and also falsely and fraudulently represented that the other note was good and collectible for its face value, with interest, less the amounts of the indorsements thereon, payable in lumber by the receiver of said Newaygo Manufacturing Company; and that he had an arrangement with said receiver by which the note should be paid in lumber when called for, which arrangement the receiver would carry out; and that said company had, since the appointment of said receiver, paid in lumber, to apply on said note, the sum of $78.83, which, with other payments, Wood indorsed on the back of said note at the time of the transfer to plaintiff; that he took these notes for the sum of $1,128, confiding in and relying upon such representations, and deeded his real estate to said Wood; whereas, in truth and in fact, such representations were untrue, alleging their falsity in detail, by means of which premises the said Wood falsely and fraudulently deceived him, and thereby the plaintiff has lost, not only the value of the consideration paid for the notes, but also $200, in a fruitless attempt to collect them. Defendant pleaded the general issue. Wood died after the trial in the court below, and his administratrix has been substituted as defendant. The plaintiff had verdict and judgment in the Kent circuit court for $1,212.11.
It appears from the testimony of both plaintiff and Wood that their dealings first commenced in a trade between Wood's father, for whom he acted, and plaintiff about the 1st of November, 1887. At this time plaintiff owned a block on West Bridge street, which he valued at $6,000, incumbered to the extent of $2,900. Abijah Wood, father of Isaac W., owned property on Livingston street, which, plaintiff claims defendant valued at $4,500. This was incumbered by a mortgage of $2,500. Also property on Clinton street, which defendant, as plaintiff claims, valued at $1,500, upon which was a mortgage of $500. The parties traded even, each assuming the incumbrances upon the property received by him. The plaintiff testified that defendant told him that the mortgage of $2,500, which was then past due, and held by one Waters, could run as long as he wanted it to. On the 9th of November, 1887, the defendant procured an assignment of this mortgage to himself, as he claims, at the request of plaintiff. The testimony of the plaintiff tended to show that soon after this defendant came to him and asked him what he would take for the property received by plaintiff from Abijah Wood in the trade above referred to. After some negotiations the sum of $1,400 was agreed upon as the price to be paid plaintiff. The defendant thereupon offered him the notes above given and $200 in cash for the property. Represented to him that nothing had been paid on the Bradford note; that the amount due thereon for principal and interest was the sum of $900; that Mr. Bradford, the maker, was in business at Sparta, and was perfectly responsible; that the reason nothing had been paid on the note was that Bradford was good, and represented in regard to the Newaygo Manufacturing Company's note that the receiver had accepted that note, and had agreed to pay it in lumber, and had already made part payment thereof in that way, and that there was then due upon that note about $300; that these representations were all false; that the Bradford note had been all paid long before, excepting $100; that Bradford was not in business in Sparta, but had failed long before, and was wholly irresponsible financially; that the Newaygo Manufacturing Company's receiver had not accepted that company's note, nor agreed to pay it, nor paid any part of it in lumber; that he believed these alleged representations to be true, and parted with his property in reliance upon them, and would not have otherwise done so; that he has attempted to collect the notes, and has wholly failed, and that they are wholly uncollectible; that defendant had knowledge of such attempts and failure, and for a long time afterwards recognized and acknowledged his continued liability to the plaintiff to make good to him the amount for which he took the notes, and that both notes were wholly worthless because of the insolvency of the makers; that he did not know until the next day after he took the notes that the defendant had indorsed them, "without recourse," and that when he discovered that fact he did not know the significance or effect of such indorsement. The defendant testified that he made none of the representations claimed by plaintiff; that no price or sum was agreed upon for the property; that defendant was besought to buy the property by plaintiff, who was unable to pay the interest on the $2,500 mortgage. Defendant urged plaintiff to improve the property, and finally offered to assume the mortgages, and give him $200. Plaintiff asked him if he had not some notes he would give him,- Defendant then said to him that $200 was all the property was worth to save a foreclosure, and showed him the notes. Nothing was done at this time. Afterwards defendant went to see plaintiff about the payment of the interest, and then plaintiff wanted to see the notes. Plaintiff took a memorandum of them. Defendant told him that the $2,500 mortgage might lie, but he must have the interest. Plaintiff stated that he wanted to look up the notes, and the interview ended. About a week afterwards the plaintiff met defendant, and said: Defendant did not make much reply, because he did not really like to deal with him; but plaintiff seemed to think it was all right, and as he started off, said he would make out the deed. On the next morning, November 19, 1887, he came to defendant's home, with the deed executed, and the sale was made. That plaintiff knew that the notes were indorsed without recourse at the time the indorsement was made, and understood its import, and that it was expressly understood between them that defendant incurred no liability upon said notes in any event, and that plaintiff subsequently acknowledged that he had no claim against him on account of these notes. He further gave testimony tending to show a full statement of all the matters between them, including these notes. He testified that in April, 1888, the plaintiff desired him to purchase a building belonging to plaintiff's wife, and situated on land leased by plaintiff. Defendant had some talk with plaintiff's wife, and on the 21st of April, 1888, he bought the building, a store; that plaintiff told him the property was really his, but he did not want his creditors to get hold of it. He would not buy the store, or take the lease, until the plaintiff executed to him a full release of all demands against him, as he had heard that plaintiff was claiming that defendant owed him. He paid the plaintiff $225 in cash, and gave Mrs. Averill a bill of sale of flour and produce in payment. He introduced in evidence the assignment of the lease, containing also the release: ...
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