Hatten Realty Co. v. Baylies, 1618

• Decision Date: 30 July 1930
• Docket Number: 1618
• Citation: 290 P. 561,42 Wyo. 69
• Parties: HATTEN REALTY CO. v. BAYLIES ET UX. [*]
• Court: Wyoming Supreme Court

290 P. 561

42 Wyo. 69

HATTEN REALTY CO. v. BAYLIES ET UX. ^[*]

No. 1618

Supreme Court of Wyoming

July 30, 1930

APPEAL from District Court, Laramie County; SAM M. THOMPSON, Judge.

Suit by the Hatten Realty Company against F. A. Baylies and wife. Judgment for plaintiff and defendants appeal.

Affirmed.

For the appellants there was a brief by Clyde M. Watts, of Cheyenne Wyoming, and Rosenberger, McVey & Freet, of Kansas City Missouri, and oral argument by Mr. Watts and Mr. McVey.

A broker is not entitled to his commission where the deal fails for causes other than the default or wrongful act of his principal. And in this case, as the exchange was rescinded by reason of inducing fraud on the part of the customers procured by the Hatten Realty Company, the commission note sued on is void for want of consideration. McCarthy v Reid, 237 Mass. 371, 129 N.E. 675, 12 A. L. R. 1000, and Annotation 1002; Webb v. Durrett, (Tex.) 136 S.W 1189; Gottlieb v. Connolly, (N. J.) 136 A. 599; Dingman v. Boyle, 285 Ill. 144, 120 N.E. 487. (a) Consent is an essential in every contract. Apparent consent may be unreal, because of fraud, mistake, etc. Baylies' assent having been procured by fraud, his assent was apparent consent, but was actually unreal. 13 Corpus Juris 394 and 610; 6 R. C. L. 591 and 620. (b) So far as the guilty party is concerned, a contract induced by fraud is void. 13 C. J. 369, Section 303; Sass v. Thomas, 89 S.W. 656, 11 L. R. A. (N. S.) 260. (c) When Baylies rescinded the contract on the ground of inducing fraud practiced by the customer secured by the Hatten Realty Company, the situation of the parties was the same as if the contract had never been made. McCarthy v. Reid, 237 Mass. 371, 129 N.E. 675, 12 A. L. R. 1000. The original note being void, the renewal also is void. 13 C. J. Page 314; Beland v. Annheuser-Busch, 157 Mo. 593, 58 S.W. 1. (a) There is no evidence of any new consideration supporting the renewal. (b) Plaintiff's plea of waiver or estoppel is not supported by any evidence aside from the bare fact of renewal. The Hatten Realty Company did nothing, nor did it change its position in any way, or suffer any injury in reliance upon the renewal. The judgment roll is competent evidence in proof of the here collateral fact of rescission by reason of inducing fraud on the part of the customer secured by the Hatten Realty Company. Kock v. Burgess, 176 Iowa 493, 156 N.W. 174; Freeman on Judgments, Vol. 1, Sec. 409 (5th Ed.); Freeman on Judgments, Vol. 2, Sec. 1041, Pages 2172 et. seq. (5th Ed.); 34 C. J. Pages 1054-5; 10 R. C. L. 1116-17; Cobb v. Peters, 68 Ore. 14, 136 P. 656; Udell v. Hollingsworth, 194 Iowa 440, 189 N.W. 944; Wilcox v. Bear, (Wash.) 248 P. 58; Sullivan v. Porter, (Wash.) 161 P. 1186; Wyoming Stockmen's Loan Co. v. Johnson, 240 P. 449; Valley Bank v. Malcolm, (Ariz.) 204 P. 207. The inclusion of the commission claim in the items of loss demanded by Baylies in the rescission suit cannot be urged in denial of defendant's contentions, because, (a) No issue was made under the pleadings. (b) Baylies included the claim in his rescission petition as a matter of protection; there has been no collection and no satisfaction of the judgment against Vandenboom, et al. (c) When (but not until) Baylies collects the commission item from Vandenboom, et al, he becomes bound to the Hatten Realty Company to the extent of such collection under the rule of law governing quasi contracts. 2 R. C. L. page 749, Section 8; Livermore v. Crane, 26 Wash. 529, 67 P. 221; Littlefield v. Bowen, 155 P. 1053. (d) A judgment is not a bar or estoppel as against a person not a party or privy. The estoppel of a judgment is operative only when it is mutual. 34 C. J. 1043, Sec. 1480, Sec. 1391; 21 C. J., Sec. 24, page 1067; Jones on Evidence, (2nd) Vol. 4, Sec. 1814, page 3664.

For the respondent there was a brief by M. A. Kline, of Cheyenne, Wyoming, and oral argument by Mr. Kline.

If the judgment can be upheld on any theory, even though decided upon an erroneous theory, it should not be reversed. Chesney v. Livestock Co., 34 Wyo. 378. Appellant acquiesced in and paid the judgment below, and should be precluded from appealing to this court. Diefenderfer, et al. v. State, 13 Wyo. 387, 14 Wyo. 302; Elwert v. Marley, (Ore.) 99 P. 887; Todd's Executor v. Bank, (Ky.) 190 S.W. 468; Hajny v. Hajny, (Kan.) 232 P. 611; Home Builders Lbr. Co. v. White, (Okl.) 183 P. 725; Ottenheimer v. Mountain States Supply Co., (Utah) 188 P. 1117; Hurt, et al. v. Bauer, (Cal.) 173 P. 601; Hipp v. Grenshaw, (Iowa) 20 N.W. 492; Grady v. Hansel, (N. D.) 223 N.W. 937; Tong v. Miller, (Mich.) 204 N.W. 108; Poffinborger v. Sumner, (Ind.) 117 N.E. 646. A broker is not entitled to his commission where the appeal fails for causes other than the default of his principal. DeWeese v. Brown, (Colo.) 135 P. 800. If plaintiff acted in good faith he was entitled to his commission even though the contract was subsequently rescinded for fraud or other cause. Koffel v. Rhud, (N. D.) 191 N.W. 464; Smith-Burns Investment Co. v. Jones, (Mich.) 214 N.W. 946; Wray v. Carpenter, (Colo.) 27 P. 248; Shepherd-Teague Co. v. Hermann, (Cal.) 107 P. 622; Knapp v. Wallace, 41 N.Y. 477; Carey v. Conn., (Ohio) 140 N.E. 643; Micek v. Wamka, (Wis.) 161 N.W. 367; Lecky v. Holst, 275 P. 1015; Bowman v. Myers, 241 Mich. 642, 217 N.W. 916. The note sued on was given in renewal of five notes of $ 500.00 each, all past due at the time the renewal note was executed. The surrender of the original notes and the extension of time of payment was sufficient consideration for the note sued on. Bank v. Williams, (Iowa) 121 N.W. 702; Millet v. Aetna Trust & Saving Co., (Ind.) 122 N.E. 344; McCormick etc. v. Yeoman, (Ind.) 59 N.E. 1069; Stebbins v. North Adams Trust Co., (Mass.) 136 N.E. 880; Fidelity State Bank v. Miller, (Ida.) 162 P. 244; Smith v. Smith, (Ida.) 35 P. 697; Title Guarantee & Trust Co. v. Pam, 182 N.Y.S. 824; Pool v. Gates, (Kan.) 225 P. 1069; Douthat v. Bank of Quapaw, (Okla.) 222 P. 547; Brown v. Bank, (Ind.) 18 N.E. 56. The giving of a renewal note with knowledge of want or failure of consideration for the original note, waives such defense in an action on the renewal note. Stewart v. Simon, (Ark.) Ann. Cases 1916A 825, and notes; Brown v. First Nat. Bank, (Ind.) 18 N.E. 56; Dodd v. Axle-Nut Sign Co., (Ark.) 189 S.W. 663; Adams v. Overland Auto Co., (Tex.) 202 S.W. 207; Security Natl. Bank v. Bohnefeld, (Okla.) 267 P. 631; Muschelwicz v. Tidrick, (S. D.) 167 N.W. 499. The original notes were valid and enforceable obligations of defendant when the renewal note was given. The consideration was the cancellation of the old notes. The burden of proving a failure or want of consideration for a promissory note is upon the maker. Kemppainen v. Suomi Temperance Society, (Ore.) 275 P. 680; State Bank of Hazen v. Radke, (N. D.) 35 A. L. R. 1355; Wyoming Compiled Statutes 1920, Sec. 3961. When the original notes were given the exchange of properties had been concluded, and the plaintiff was entitled to its commission. There is a difference between a want of consideration, and a failure of consideration. Bank v. Parker, (Tenn.) 35 A. L. R. 1270; Steward v. Simon, (Ark.) Ann. Cases 1916A p. 825; Haglin v. Friedman, (Ark.) 177 S.W. 429. Defendant waived the defense of failure of consideration by giving a renewal note, which is the subject of this action. Absence or failure of consideration is a matter of defense. 3961 C. S.; Kemppainen v. Suomi Temperance Soc., supra. The judgment roll in the case of Baylies v. Vanden Boom, et al. was incompetent evidence; and should not have been admitted. Being incompetent evidence, it cannot serve to reverse the judgment. Silvius v. Mordoff, (Calif.) 192 P. 289; Lee v. Rwy. Co., (Kan.) 73 P. 110; Nance v. Company, (Okla.) 120 P. 948; 2 Black on Judgments, Sec. 510; City of Tulsa v. Wells, (Okla.) 191 P. 186. Plaintiff was not a party to that suit, or in privity with any party to that action, and therefore was not bound by the judgment thereon. 34 C. J. 1050, and cases cited. The judgment will not be reversed if there be evidence to sustain it. Simms v. Southern Surety Co., 38 Wyo. 165. Specifications of error not discussed, are deemed to be waived. Boswell v. Bliler, 9 Wyo. 277; Automobile Ins. Co. v. Lloyd, 40 Wyo. 44. The letter written by the trial court announcing its decision cannot be considered as a finding. Stevens v. Laub, 38 Wyo. 187; Sewall v. McGovern, 29 Wyo. 62. The points urged for the reversal of the judgment below are without merit, and the authorities cited in support thereof are not applicable to the facts shown by the evidence of the present case. The judgment should be affirmed.

Rosenberger, McVey and Freet, and Clyde M. Watts in reply.

Respondent's assertion that defendant acquiesced in the judgment is untrue. There was no waiver of right of appeal. 3 C. J. 678 2 R. C. L. 65. Involuntary payment of a judgment does not affect the right of appeal. 3 C. J. 675; Freeman on Judgments 480; Warner Bros. v. Freud, (Calif.) 63 P. 1017; Dakota Co. v. Glidden, 113 U.S. 222; State v. Winthrop, (Wash.) 269 P. 793. A note void for want of consideration invalidates a renewal thereof unless supported by new consideration. Roche v. Smith, 176 Mass. 595. An analysis of respondent's authorities on this point make our position clear. Respondent's premise on the issue as to the effect of the renewal is wrong. The question here involves a note void for want of consideration. The cases cited by respondent are distinguishable from the cases at bar on the facts. Forbearance in the pursuit of a claim void for want of consideration is of no avail. If a note is without consideration, a renewal thereof even though extending the time of payment also is without consideration. City Natl....