Int'l Milling Co. v. Priem

• Decision Date: 06 February 1923
• Citation: 179 Wis. 622,192 N.W. 68
• Parties: INTERNATIONAL MILLING CO. v. PRIEM.
• Court: Wisconsin Supreme Court

179 Wis. 622

192 N.W. 68

INTERNATIONAL MILLING CO.

v.PRIEM.

Supreme Court of Wisconsin.

Feb. 6, 1923.

Appeal from Municipal Court, Langlade County; Arthur Goodrick, Judge.

Action by the International Milling Company against William Priem. From a judgment dismissing the complaint, with costs, plaintiff appeals. Affirmed.H. L. Hoidale, of Minneapolis, Minn., and E. A. Morse, of Antigo, for appellant.

Hay & White, of Antigo, for respondent.

DOERFLER, J.

The plaintiff, a foreign corporation operating a flouring mill at Wells, Minn., executed a contract with the defendant on the 16th day of October, 1920, under and pursuant to which the plaintiff agreed to sell and the defendant agreed to buy 200 barrels of flour known as the Ethan Allen brand, at $12.65 per barrel, and such contract also included the sale of 6 barrels of bran. The contract, in the absence of the defendant, was signed by his son Richard, and, as defendant claims, without his consent or knowledge, and contrary to his express directions. As a defense to the plaintiff's cause of action based on damages for refusal on defendant's part to accept the flour, etc., defendant alleged fraud.

It also appears from the record that the defendant, with the co-operation of his wife and 13 children, conducted a general store at Lily, Wis., a small unincorporated settlement containing not to exceed ten structures; that the defendant was only partially conversant with the English language; that he read but one paper, a weekly, published in the German language; that he kept a daily English paper, published at Antigo, which contained reports of the market quotations, which he neither read nor was familiar with; that in his purchase of merchandise he placed implicit faith in the honesty of the dealers; that his principal assistant in the store was his son Richard, a youth 23 years of age; and that his said son had no authority to sign contracts or give orders for the purchase of flour, excepting pursuant to defendant's express directions.

When plaintiff's agent, one Geise, called upon the defendant on October 15, 1920, to secure an order for a carload of flour, the agent represented to the defendant and his son Richard that the price of wheat had been going up during the last 30 days, and the statement was made to the defendant that flour had advanced during the last 30 days. The making of these representations is uncontradicted in the evidence, as is also the testimony of the defendant that he relied upon these statements and was induced thereby to give the order referred to. The case was submitted to a jury, who among other things found: (a) That the plaintiff's agent prior to the execution of the contract, falsely represented to the defendant or his son that the market price of wheat had risen during the period of 30 days previous to the execution of the contract; (b) that such false representations constituted a material inducement to the defendant to enter into said contract; and (c) that the defendant or his son relied upon the said fraudulent representations when the contract was executed.

[1] To be actionable, the false representation must consist, first, of a statement of fact which is untrue; second, that it was made with intent to defraud and for the purpose of inducing the other party to act upon it; third, that he did in fact rely on it and was induced thereby to act, to his injury or damage. 12 R. C. L. p. 240, § 10; J. H. Clark Co. v. Rice, 127 Wis. 451, 106 N. W. 231, 7 Ann. Cas. 505;Standard Manufacturing Co. v. Slot, 121 Wis. 14, 18, 19, 98 N. W. 923, 105 Am. St. Rep. 1016;Hart v. Moulton, 104 Wis. 349, 359, 80 N. W. 599, 76 Am. St. Rep. 881;Krause v. Busacker, 105 Wis. 350, 354, 81 N. W. 406;Zunker v. Kuehn, 113 Wis. 421, 425, 88 N. W. 605.

The evidence disclosing the making of the fraudulent statements is uncontradicted. Defendant still had on hand about 70 barrels of flour, purchased from the plaintiff during the preceding year, and it appears, further, that no other flour had been purchased by him for about one year. Plaintiff's only witness testified that the price of flour fluctuated in accordance with the price of wheat. In determining whether the statements so made are material statements of fact, and whether they had a natural tendency to induce the defendant to enter into the contract, and whether they actually did induce such contract on the part of the defendant, we must take into consideration all the facts and circumstances in the evidence. With but one exception, the defendant had purchased from time to time all of his flour in small lots, sufficient only to meet the requirements of his immediate trade. This alleged contract was executed shortly after the war, while readjustments in prices were in process of settlement. Violent fluctuations had taken place in the market, covering a considerable period of time. Manufacturers, jobbers, and dealers were greatly agitated as to ultimate results, and every one dealing with merchandise strained his efforts to the utmost to protect himself financially with respect to the future. It was at such a time and under such circumstances that plaintiff's agent appeared at Lily and made the representations aforesaid.

Under the circumstances, it is difficult to conceive of any statement being made at that time which would be more conducive of...