Deal v. Wilson

• Decision Date: 03 December 1919
• Docket Number: 514.
• Citation: 101 S.E. 205,178 N.C. 600
• Parties: DEAL v. WILSON.
• Court: North Carolina Supreme Court

101 S.E. 205

178 N.C. 600

DEAL v. WILSON.

No. 514.

Supreme Court of North Carolina

December 3, 1919

Appeal from Superior Court, Catawba County; Webb, Judge.

Action by Jacob W. Deal against George W. Wilson. Judgment for plaintiff, and defendant appeals. No error.

Where in reliance on defendant's oral promise to presently convey his property to plaintiff, plaintiff disposed of his own property and rendered services pursuant to the agreement defendant, who refused to convey, cannot escape liability for the value of the services rendered by plaintiff, and money expended by him at special request of defendant, by pleading the statute of frauds.

Plaintiff sued to recover damages for a breach of contract by which, as he alleges, the defendant agreed that, if the plaintiff would give up his business and dispose of his property and move to defendant's farm, where the latter lived, cultivate the same, and take care of and support the defendant and wife during their lives, the defendant would presently convey his property to him; that plaintiff accepted the proposal, sold out his property, abandoned his own ordinary work, and went to the defendant's place, where he proceeded to work, and in all other respects to perform his part of the contract upon faith in the defendant's promise that he would at once convey the property to him; that defendant failed to do what he had promised to do, and put off the plaintiff from time to time with one excuse and another, and finally refused to convey the property as stipulated. The plaintiff thereupon refused to continue what he had been doing in fulfillment of his part of the agreement and left defendant's premises after he found that it was futile to wait any longer for defendant to act or to expect him to keep his promise. He sues, not to enforce the specific performance of the contract to convey the property of defendant to him, nor for damages because of defendant's breach of the contract in this respect, but solely for the value of the services rendered by him in performing his part of the contract and for what he laid out in money, or money's worth, at the special request of defendant, while he was attempting to do his part in the transaction, of which defendant received the benefit. The defendant denied the contract and relied on the statute of frauds, objecting to evidence of the oral contract, and to the charge of the court in regard to it.

The court confined the issues to the contract made between the parties and the amount of the recovery, and refused to submit issues tendered by the plaintiff, and there was no issue involving an enforcement of the contract to convey the land or damages for its breach. The referee found with the plaintiff, and assessed his damages, or the value of services rendered and money advanced, at $1,787.03, and from the judgment of the court thereon, after overruling defendant's exceptions, defendant appealed.

Councill & Yount, of Hickory, for appellant.

C. L. Whitener and W. A. Self, both of Hickory, for appellee.

WALKER, J. (after stating the facts as above).

The question on this appeal seems to be easy of solution when it is properly, and clearly, understood. It is not sought by the plaintiff to enforce specifically the contract of sale, nor to recover damages for a breach of the contract, but the whole basis upon which his claim rests is that, by reason of the promise of the defendant to convey his property upon the considerations stated, he was induced to lay out money, and to perform services, for which he seeks compensation. It would appear very strange if, under the law, he is not entitled to this relief, as the justice of his demand is very manifest, and the law, as we think, is strongly with him.

The principle upon which a recovery may be had in a case like this is firmly established by the authorities. The subject is fully treated in 20 Cyc. pp. 298-303, where it is said that, where services are rendered on an agreement which is void by the statute, an action will lie on the implied promise to pay for such services, and the terms of the contract are admissible as evidence of what those services are worth. Where a defendant has successfully resisted the specific performance of a contract, he will not be allowed to set up such contract as binding in order to defeat an action brought to recover money paid in pursuance of said avoided contract. Pendleton v. Dalton, 92 N.C. 185. And so in Wilkie v. Womble, 90 N.C. 254, and Kelly v. Johnson, 135 N.C. 647, 47 S.E. 674, it was held that, where a vendor repudiates a parol contract to convey land, the vendee is entitled to recover the amount he has paid under the contract. But this case is absolutely ruled by that of Faircloth v. Kenlaw, 165 N.C. 228, 81 S.E. 299. We there said that where the defendant has promised, in consideration of services to be rendered, that he will transfer to the plaintiff certain property, which he afterwards refuses to do, and, instead of fulfilling his contract, sets up the statute of frauds, as a bar to any recovery on the same, he acts in bad faith and his conduct having deceived the plaintiff, who, relying upon the assurance that the contract would faithfully be performed, had been induced to part with his money or to render services of value to the defendant, the latter may recover compensation for the loss he has sustained. It is a just and salutary principle of the law that every man is bound to the observance of good faith in his dealings with others, and at least to the extent that, as he knows, he is trusted, which may be inferred from the nature of the transaction, and when he induces another to act upon such confidence in him, and betrays it, where the latter has advanced money or performed services and will sustain damage, if the contract is not carried out, the injured party may recover for the loss. We there said:

"Under such circumstances, while it is unquestionably true that no action can be maintained, either to recover damages for the loss of the land or a good bargain, or for a specific performance, yet to hold that the action cannot be sustained to recover for the injury or loss already named would be equivalent to saying that the subject was one in regard to which fraud or bad faith could not be practiced. Frazer v. Howe, 106 Ill. at page 563. It is well settled by the authorities that where payments are made or services rendered upon a contract void by the statute of frauds, and the party receiving the services or payments refuses to go on and complete the performance of the contract, the other party may recover back the amount of such payments, or the value of the services, in an action upon an implied assumpsit. A party who refuses to go on with an agreement void by the statute of frauds, after having derived a benefit from a part performance, must pay for what he has received"--citing Galvin v. Prentice, 45 N.Y. 162, 6 Am. Rep. 58; King v. Brown, 2 Hill (N. Y.) 485, 487; Lockwood v. Barnes, 3 Hill (N. Y.) 128, 38 Am. Dec. 620.

The same was decided in Williams v. Bemis, 108 Mass. 91, 11 Am. Rep. 318, where there was a lease within the statute of frauds which defendant pleaded. The court held that the plaintiff could maintain an action for work and labor done, money advanced, materials furnished in cultivating the land or in performing the contract on his part, notwithstanding the bar of the statute, as he did not seek to enforce the contract specifically or to recover damages for a breach thereof. It was said by the court:

" 'The true principle is this: The contract being void and incapable of enforcement in a court of law (the defendant having refused to perform it), the party paying the money, or rendering the services in pursuance thereof, may treat it as a nullity, and recover the money or value of the services under the common counts.' * * * If it had been a payment in money, it would be too plain to be controverted. A payment in labor and services, of which the other has secured the benefit, stands upon the same ground."

The case of In re Estate of Kessler, 87 Wis. 660, 59 N.W. 129, 41 Am. St. Rep. 74, is to the same effect, for there the court held that a parol agreement to devise and bequeath real and personal property as compensation for services rendered by a relative is within the statute of frauds as to the real estate and, the contract being indivisible, the whole agreement fails. But in such case the relative may recover for his services what they may appear to have been reasonably worth, and such void agreement may be shown in evidence to rebut the presumption that they were rendered gratuitously.

"It is a most important principle, thoroughly established in equity, and applying in every transaction, where the statute is invoked, that the statute of frauds, having been enacted for the purpose of preventing fraud, shall not be made the instrument of shielding, protecting, or aiding the party who relies upon it in the perpetration of a fraud, or in the consummation of a fraudulent scheme"--quoting from 2 Pomeroy's Equity Jur. (3d Ed.) § 921.

See also, Woodbury v. Gardner, 77 Me. 68, and Wood v. Rabe, 96 N.Y. 414, 48 Am. Rep. 640, where the same section of Dr. Pomeroy is cited with approval and relied on. It is further said by Dr. Pomeroy in the same connection: "This most righteous principle lies at the basis of many forms of equitable relief." See, also, Kidder v. Hunt, 1 Pick. (Mass.) 328, 331, 11 Am. Dec. 183; Lane v. Shackford, 5 N. H. 130; Gillet v. Maynard, 5 Johns. (N. Y.) 85, 4 Am. Dec. 329; Van Deusen v. Blum, 18 Pick. (Mass.) 229, 29 Am. Dec. 582. The...