Cottrill v. Crum

• Decision Date: 19 May 1890
• Citation: 13 S.W. 753,100 Mo. 397
• Parties: COTTRILL v. CRUM.
• Court: Missouri Supreme Court

13 S.W. 753

100 Mo. 397

COTTRILL v. CRUM.

Supreme Court of Missouri.

May 19, 1890.

DECEIT — DUTY OF INQUIRY — WAIVER.

1. In a suit for damages for false representations by the business manager of a panorama company to plaintiff, a stranger to the enterprise, whereby he was induced to trade valuable property for stock of the company at an exorbitant valuation, it was error to charge that, if plaintiff might by diligent inquiry have ascertained the falsity of such representations, and did not inquire, he could not recover. It was not plaintiff's duty to make diligent inquiry.

2. The words "diligent inquiry" were used in their ordinary meaning, and required no explanation from the court.

3. Where there has been a misdirection, but for which the jury might have reached a different conclusion, the reviewing court cannot say that judgment was rightfully rendered for defendant.

4. The fact that plaintiff offered to sell such stock at the price falsely represented by defendant to be its value, constituted no waiver of his right to sue the latter for damages.

5. Nor does the lapse of five months between the purchase of the stock and the bringing of the action operate as such waiver.

Appeal from St. Louis circuit court; AMOS M. THAYER, Judge.

Chester H. Krum, for appellant. John C. Orrick, for respondent.

BRACE, J.

The plaintiff in this action seeks to recover damages for false representations alleged to have been made by the defendant in a trade in which the plaintiff, in exchange for 50 shares of paid-up stock in the Globe Panorama Company, sold and conveyed to the defendant a certain lot of ground in the city of St. Louis. The verdict was for the defendant, and from the judgment thereon in his favor the plaintiff appeals. Many grounds are assigned in the motion for a new trial, but the only one urged here why the court should have granted a new trial is the alleged error of the court in giving the seventh instruction for the plaintiff, which is as follows: "(7) If you find from the evidence that plaintiff, by diligent inquiry, might have ascertained the truth or falsity of the alleged representation, and failed to make such investigation, then the court instructs you that he cannot recover in this action."

1. It is urged against this instruction that it is merely an abstract proposition of law, and does not define or explain to the jury what meaning the law gives to the expression "diligent inquiry," and is therefore erroneous; and in support of this contention we are cited to many cases in which instructions were held to be erroneous because legal propositions, and the meaning of technical legal phrases or words, were therein submitted to the jury, e. g., Fugate v. Carter, 6 Mo. 267, and Anderson v. McPike, 86 Mo. 293, in which the jury were called upon to determine what was "a material averment;" Morgan v. Durfee, 69 Mo. 469, to define "malice;" Boogher v. Neece, 75 Mo. 383, in which the question of what was "adverse possession" and "color of title" was left to the jury; Wiser v. Chesley, 53 Mo. 547, what was "gross negligence;" and Atteberry v. Powell, 29 Mo. 429, in which it was left to the jury to determine the meaning to be applied to the words "in substance," in an action of slander. In all these cases, it will be observed, either a question of law, or the meaning of certain words and terms to which a special and peculiar meaning had by law been applied, was left to the jury; and it was properly held that this was error. It is possible that cases might arise in which the words "diligent inquiry" might become the proper subject of judicial interpretation, but in this case it is evident they were used by the court, and could have been understood by the jury, in no other than in their usual, ordinary, and conventional sense; and such sense is presumed to be as well comprehended by the jury as the court, and needs no definition. It is not necessary that the meaning of ordinary words and phrases, used in their usual and conventional sense, should be explained in instructions.

2. It is further argued against said instruction that it asserts an incorrect legal proposition, and ignores the difference between the situations of the parties in regard to the property concerning which the representations are alleged to have been made. The facts upon which the court in its first instruction to the jury authorized a finding for the plaintiff were "that if, at the time when the defendant traded to plaintiff the panorama stock in the petition described, defendant was, and from the opening of the enterprise had been, business manager of the Globe Panorama Company, and in charge of the business in St. Louis, and that, with a view to the trade of the stock aforesaid to plaintiff, and as an inducement thereto, he stated to plaintiff, in substance, that the intrinsic and actual value of said panorama stock was $100 per share, and that none of said stock had been sold or could be bought for less than par, or $100 per share, and if he further stated at the time, and with the purpose aforesaid, that the actual cost price of the panorama property in St. Louis was seventy-five to eighty thousand dollars, and that from the opening of the business the company had been, and was still, doing a profitable business, and that from the time the business opened the company had been earning and paying a dividend of 2 per cent., or $2 per share, per month; and if you further find that said statements were untrue, — that they were made for the purpose of deceiving and misleading plaintiff as to the true character or value of said stock; and if you find that plaintiff traded the Pine-Street lot for said stock on the faith of said...