Greensboro Morris Plan Co. v. Palmer

• Decision Date: 14 March 1923
• Docket Number: 388.
• Parties: GREENSBORO MORRIS PLAN CO. ET AL. v. PALMER ET AL.
• Court: North Carolina Supreme Court

116 S.E. 261

185 N.C. 109

GREENSBORO MORRIS PLAN CO. ET AL. v. PALMER ET AL.

No. 388.

Supreme Court of North Carolina

March 14, 1923

Stacy J., and Clark, C.J., dissenting.

Appeal from Superior Court, Guilford County; Harding, Judge.

Action by the Greensboro Morris Plan Company and another against J I. Palmer and his guardian ad litem. Judgment for defendants and plaintiffs appeal. Affirmed.

Where the original complaint against an infant alleged the execution of a note and mortgage by the infant, his default in payment, the seizure and sale of the mortgaged truck, and sought to recover the balance due on the note after such sale, an amended complaint, alleging deceit by the infant in misrepresenting his age, which claimed the exact amount of the indebtedness as damages caused by the fraud, shows a manifest purpose to collect the unpaid balance due on the note by transforming an action on contract into an action in tort, which is not permitted.

The plaintiffs brought suit to recover $1,308 as damages for false representation and deceit. They alleged that on July 19, 1920, the defendant J. I. Palmer was only 19 years old but had the appearance of a man of full age and was emancipated and married; that at that time he was engaged in the business of hauling lumber and falsely represented to them that he was over 21, by means of which he deceived them and induced them to sell him a truck at the price of $3,014.32, to secure which he executed his note and chattel mortgage on the truck. It is admitted that he paid the Hare's Motors $1,016.91 and the Greensboro Morris Plan $1,006.32, and that under proceedings in claim and delivery the truck was seized and sold by the plaintiffs for $700. The plaintiffs further alleged that of the payments made $1,223.23 was money made by using the truck. The defendant for the purpose of his motion for judgment did not deny that he was a minor, or that he made the alleged false representation. He moved for judgment upon the pleadings, and Judge Harding held that the plaintiffs could not recover either on contract or in tort, and adjudged that the plaintiffs should take nothing by their action, and that the defendant should recover of the Hare's Motors $1,016.91 and from the Morris Plan Company $1,006.32, with interest on such sums from December 1, 1920. The plaintiffs excepted and appealed.

Brooks, Hines & Smith, of Greensboro, and B. D. McCubbins, of Salisbury, for appellants.

Shuping, Hobbs & Davis, of Greensboro, for appellees.

ADAMS J.

It may be remarked in the beginning that the controversy is not concerned with real estate, and that in this jurisdiction the law has been declared with respect to an infant's right to avoid his contract relating to personal property. Omitting reference to contracts for necessaries and to such contracts as a minor is authorized by statute to make, the court has held that an infant may during his minority avoid his contract relating to personal property, and that such avoidance when effected is irrevocable and renders the contract null and void ab initio. Pippen v. Ins. Co., 130 N.C. 23, 40 S.E. 822, 57 L. R. A. 505; Norwood v. Lassiter, 132 N.C. 56, 43 S.E. 509; Austin v. Stewart, 126 N.C. 525, 36 S.E. 37; State v. Howard, 88 N.C. 651; Devries v. Summit, 86 N.C. 133; Turner v. Gaither, 83 N.C. 357, 35 Am. Rep. 574; Skinner v. Maxwell, 66 N.C. 45; Id., 68 N.C. 401; Hislop v. Harris, 68 N.C. 141; Freeman v. Bridger, 49 N.C. 1, 67 Am. Dec. 258; Francis v. Felmet, 20 N.C. 637; Chandler v. Jones, 172 N.C. 569, 90 S.E. 580.

This doctrine seems to be established. It is approved and maintained, with practical unanimity; and while the infant's right to disaffirm his contract may sometimes be exercised to the injury of the other party, the right nevertheless exists for the protection of the infant against his own improvidence and may be excercised entirely in his discretion. 1 Elliott on Contracts, § 302; 3 Page on Contracts, § 1593; Dibble v. Jones, 58 N.C. 389. And fraud is not a bar to the exercise of the infant's right to disaffirm. Indeed, it is generally held that if an infant is sued on his contract his fraud in procuring the execution of the contract will not prevent his disaffirmance, or, as stated by Judge Cooley:

"All the cases agree that if an infant is sued on his contract, his fraud will not preclude his relying upon his infancy as a defense in that suit." 1 Cooley on Torts, 188, note; Kirkham v. Wheeler-Osgood Co., 39 Wash. 415, 81 P. 869, 4 Ann. Cas. 535, note; La Rosa v. Nichols, 6 A. L. R. 413, note; Carolina Interstate B. & L. Ass'n v. Black, 119 N.C. 323, 25 S.E. 975.

But an infant is liable for his torts. There can now be no doubt as to his liability for the commission of a pure tort--a "tort simpliciter"--which is disconnected with contract. Moore v. Horn, 153 N.C. 415, 69 S.E. 409, 138 Am. St. Rep. 675, 21 Ann. Cas. 1350; Smith v. Kron, 96 N.C. 393, 2 S.E. 533; Crump v. McKay, 53 N.C. 35. There is authority to the effect that if the tort be connected with his contract, the question of his liability may be resolved by the time at which the tort is committed or by the relation which the wrong sustains to the subject-matter of the agreement or by the question whether the contract is substantially the ground of the action. For example, it is the generally accepted view that infancy is a defense to an action for false representation as to anything which is essentially the subject-matter of the contract. This principle is applied in Fitts v. Hall, 9 N. H. 441, one of the cases on which the plaintiffs rely, in which Parker, C.J., said:

"If the tort or fraud of an infant arises from a breach of contract, although there may have been false representations or concealment respecting the subject-matter of it, the infant cannot be charged for this breach of his promise or contract, by a change of the form of action. But if the tort is subsequent to the contract, and not a mere breach of it, but a distinct, willful and positive wrong of itself, then, although it may be connected with a contract, the infant is liable."

The difficulty frequently encountered is in the practical application of these principles, for the courts are not in accord as to when the alleged tort is independent of or is essentially connected with the contract or when the contract is the substantial basis of the action. This perhaps is the chief cause of the marked difference of opinion expressed in the decisions of various jurisdictions in this country. To reconcile the conflict of opinion is impossible, and we must determine the question presented in the appeal by adhering to the principles which in our judgment are consonant with the policy outlined in former decisions and with the fundamental principles of the law affecting contracts made by those of immature years.

The first decisions on the question before us were rendered in the reign of Charles II. In 1665 the English rule was established in Johnson v. Pye, 1 Lev. 169; 1 Keb. 913; 83 Eng. Rep. 353, 1312, 1317; Sid. pt. 1, p. 258. Following is the case as reported:

"The defendant affirms to the plaintiff that he was of full age, on which the plaintiff lends him the money. And he takes his security (a mortgage), when in truth he was only twenty and a half. Then he avoids his security. And a difference was taken between torts and contracts of infants, for though infants will not be bound for contracts, yet they will be bound for torts. But though infants will be bound for actual torts, as trespass, etc., which are vi et contra pacem yet they will not be bound by those which sound in deceit, for if they should be, all the infants in England would be ruined. And according to Keble, Keeling, J., said: 'Such torts that must punish an infant must be vi et armis, or notoriously against the publick; but here the plaintiff's own credulity hath betrayed him.' And Windham, J., said: 'The commands of an infant are void; and for such he shall never be attainted a disseisor; much less shall he be punished for a bare affirmation. * * * Also by this means all the pleas of infancy would be taken away, for such affirmations are in every contract.' " 57 L. R. A. 675, note.

This decision has been vigorously assailed on the ground that it is dubious and that the disposition of the case is uncertain; but in England it has withstood all assaults and "has been stolidly followed again and again * * * as the highest authority, and it is now firmly established in that country as law, that an infant is not liable at law for his deceit in inducing a contract." 57 L. R. A. 675, note.

It is in this country that the confusion has arisen. Here the decisions are in hopeless conflict. In the summary of the note just cited it is said that the weight of authority here is against the English rule, but Cooley says that the tendency here is with the English cases. 1 Cooley on Torts, 186. Perhaps nowhere has the decision in Johnson v. Pye been criticized with more force and clearness than in two of the cases cited in the plaintiffs' brief. In Fitts v. Hall, 9 N. H. 441, Parker, C.J., said:

"The next question is, whether this action can be maintained against the defendant, for the fraudulent representation that he was of age, by reason of which the plaintiff was induced to sell him the hats, on a credit, and to take his note. * * * If infancy is not permitted to protect fraudulent acts, and infants are liable in actions ex delicto, whether founded on positive wrongs, or constructive torts, or frauds (2 Kent, 197), as for slander (Noy's Rep. 129, Hodsman v. Grissel), and goods converted (auth. ante), there is no sound reason that occurs to us why an infant should not be chargeable in damages, for a fraudulent misrepresentation, whereby

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