General Electric Company v. O'Connell
| Decision Date | 31 May 1912 |
| Docket Number | 17,528 - (105) |
| Citation | 136 N.W. 404,118 Minn. 53 |
| Parties | GENERAL ELECTRIC COMPANY v. WICK O'CONNELL |
| Court | Minnesota Supreme Court |
Action in the district court for St. Louis county to recover $1,583.60, balance of the purchase price of certain electric drills. From an order, Cant, J., overruling plaintiff's demurrer to the answer, it appealed. Affirmed.
Answer sufficient as against demurrer.
Answer in an action for the price of machinery, setting up fraud on the part of the seller in obtaining the written contracts sued on, and claiming damages on account thereof, held not obnoxious to demurrer, on the ground that its establishment would involve the admission of parol evidence to vary the terms or the scope of the said contracts.
Houpt Oakley & Dickey, for appellant.
O. J. Larson and M. E. Louisell, for respondent.
This is an appeal by the plaintiff from an order overruling its demurrers to the answer and alleged counterclaims of the defendant, on the ground that the answer does not state facts sufficient to constitute a defense or counterclaim.
It appears from the complaint that the Fort Wayne Electric Works, a corporation, on December 17, 1910, entered into a written contract with the defendant, whereby it sold to him certain rock drills and equipment for the agreed price of $1,550, payable one-half in cash and the remainder within thirty days; and for a second cause of action the plaintiff alleges that on January 6, 1911, the said Fort Wayne Electric Works entered into another written contract with the defendant, whereby it sold him certain other drills and apparatus for the sum of $1,550, payable on the same terms as above stated. The complaint further alleges, with reference to both causes of action, that the said drills, equipment, and apparatus were duly delivered to the defendant; that on June 1, 1911, the said Fort Wayne Electric Works assigned the said contracts to the plaintiff; and that no part of the purchase price of the said drills and equipment has been paid, except the sum of $775 on each contract. Neither of the said contracts, which were set out in the complaint, contained any warranty; and both included a provision to the effect that there were no understandings, promises, or agreements on the part of either of the parties, other than those stated in the said contracts.
The defendant, in his answer, admitted the execution of the said contracts, the delivery of the property to him as claimed by the plaintiff, and that the defendant had paid nothing thereon, except as stated in the complaint, and set out, both as a defense and as an alleged counterclaim thereto, that before the defendant executed the said written contracts the said Fort Wayne Electric Works, to induce him so to do, falsely and fraudulently represented to him that it had made a test of the said drills and equipment with a certain rock from the site of a certain tunnel, which the defendant had theretofore contracted to construct, and which he was then constructing, and which rock was a fair sample of the material the defendant would encounter in the prosecution of such work, all of which the said Fort Wayne Electric Works then knew; that the said drills and equipment were procured to drill the said tunnel, of which the said Electric Works was advised before the execution of the said contracts; that the said Electric Works, further to induce the defendant to sign the said contracts, falsely and fraudulently represented to him, among other things, that the said drills and equipment would bore fifty lineal feet per day in the said tunnel, and guaranteed that they would do so; that such representations were relied upon by the defendant, and that he was thereby induced to execute the said contracts; that all of the said representations were false, and were known so to be by the said Electric Works; that thereafter the defendant, relying upon the said representations, permitted the said drills to be installed on the said work, and attempted to construct the said tunnel therewith; that they did not and could not be made to do the said work, and did not have to exceed twenty-five per cent of the capacity which they were represented to have; that thereafter the defendant insisted on returning the same to the said Electric Works, and on repudiating and rescinding the said contracts for such fraud, whereupon the said Electric Works represented that the defendant's laborers were incompetent, and that because thereof the drills failed to do the work, all of which representations were false, and were known so to be by the said Electric Works, and guaranteed to the defendant that if he would permit its expert to take charge of the said work the drills would be made to do the work speedily and successfully, and that they would do at least the amount of work per day theretofore represented, and that the said drills had the capacity aforesaid; that the defendant relied upon such representations and believed the same, and was thereby induced to allow the said Electric Works' agent to take charge of the drills, and that such agent undertook to do the work, but failed therein, and could not do work to exceed twenty-five per cent of the represented capacity of the drills; that such drills broke and flattened out; that by reason of their failure to do the work a number of the defendant's employees remained idle, though drawing wages from the defendant; that the drills and equipment were valueless for the work; that the defendant necessarily spent $3,000 for equipment in installing the drills and in attempting to make them work, one-half whereof was a loss to the defendant because of the fraud aforesaid; and that the defendant suffered certain other damages.
The sole contention of the plaintiff (appellant) is that the establishment of the defendant's so-called counterclaim would necessarily involve the admission of parol evidence to alter the scope and meaning of the written contracts sued upon, which said contracts purport, both in law and by their express terms, to embody the entire agreement between the parties; and that hence the defendant's answer and so-called counterclaim are obnoxious to the demurrers interposed thereto.
In support of this contention, the plaintiff relies largely upon Haycock v. Johnston, 81 Minn. 49, 83 N.W. 494, 1118. That case was an action to recover rent under a written lease. The defense sought to be established, so far as is here material, was that the defendant was entitled to a cancelation of the lease, because the plaintiff had violated a parol collateral...
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