Jones v. Cooper, 17539

• Decision Date: 02 June 1959
• Docket Number: No. 17539,17539
• Citation: 234 S.C. 477,109 S.E.2d 5
• Court: South Carolina Supreme Court
• Parties: G. Charlie JONES, Respondent, v. John S. COOPER, doing business as Dixie Provision Company, Appellant.

Page 5

109 S.E.2d 5

234 S.C. 477

G. Charlie JONES, Respondent, v. John S. COOPER, doing business as Dixie Provision Company, Appellant.

No. 17539.

Supreme Court of South Carolina.

June 2, 1959.

Cooper & Gary, William A. Dallis, Columbia, for appellant.

Law, Kirkland & Aaron, Columbia, for respondent.

MOSS, Justice.

This action was brought by G. Charlie Jones, the respondent herein, against John S. Cooper, doing business as Dixie Provision Company, appellant herein, to recover actual and punitive damages on account of alleged fraud and deceit arising out of a contract entered into between the respondent and appellant.

The complaint alleges that the respondent is a citizen of High Point, North Carolina, and that in the month of October 1957, an advertisement by the appellant appeared in a newspaper published in said City of High Point, which read as follows:

'Supervisor: Man or woman earn $200.00 per week and up spare time, full time more. Servicing packaged food. Trade mark new sensational 'Pup in a Poke' accounts to chain store, dime stores, theaters, drive-ins, taverns, drug stores, schools, concessions, etc. No selling: accounts established by company. Permanent business, guaranteed income. Unlimited possibilities. You service accounts at your convenience $1,000.00 to $3,000.00 cash required 'Fully Secured'. Investment depends on size of territory you wish to start with. Complete assistance for unlimited expansion. For local interview and details, give phone number, write. Box P-4, care Enterprise.'

The complaint alleges that the respondent answered the above advertisement, and relying upon the same, entered into a contract with the appellant to purchase seven 'hot-dog' cooking machines and two thousand five hundred cellophane bags used in the preparation, cooking and sale of hot-dogs. It is further alleged that an agent of the appellant represented to the respondent that the above mentioned machines would require servicing only one day a week, and that the appellant would be responsible for placing said machines in locations in the City of High Point. It is then alleged that the appellant delivered the said machines and sent a representative to the City of High Point for the purpose of securing locations for said machines. It is then alleged that the machines were located at 'various negro establishments, all of which were among the poorest places of business in the City of High Point'. The complaint alleges that the advertisement heretofore quoted was a fraudulent misrepresentation, and that the appellant 'did not intend to establish proper locations' for the cooking machines, and further 'that the machines would require more time for servicing than was available to' respondent.

The appellant, by way of answer, denied all the allegations of the complaint charging him with fraud and deceit. He admits that the respondent purchased seven 'hot-dog' cooking machines and a supply of bags for a total purchase price of $1,409.00; that the respondent signed a purchase and sales agreement ordering such and that thereafter the said seven cookers were placed in seven locations in and around the City of High Point; and that the respondent did, on November 13, 1957, certify in writing, that he had looked over the locations where the machines were placed and did 'approve them as being satisfactory for me to start my business in. All agreements made between the Co. and myself and noted on the order have been completed as agreed'.

This case was tried before the Honorable Legare Bates, Judge of the Richland County Court, and resulted in a verdict for the respondent for actual and punitive damages. The appellant made timely motions for a nonsuit and directed verdict, and after the rendition of the verdict, appellant moved for judgment non obstante veredicto, or in the alternative, for a new trial. All of these motions were denied. Timely notice of intention to appeal to this Court was given. The appellant has filed twelve exceptions, and for the purpose of the disposition of this appeal, we consider two questions: (1) Was there sufficient evidence of fraud and deceit to require the submission of this question to the jury? (2) Was the respondent barred from recovery by reason of the signing of a release and approval of the locations of the machines by the appellant?

The respondent in this case having charged the appellant with fraud and deceit as the basis of his cause of action must establish such by evidence that is clear, cogent and convincing, Griggs v. Griggs, 199 S.C. 295, 19 S.E.2d 477; and must prove all of the elements of fraud, and the failure to prove any one of them is fatal to recovery, Able v. Equitable Life Assur. Society of United States, 186 S.C. 381, 195 S.E. 652; Mishoe v. General Motors Acceptance Corporation, S.C., 107 S.E.2d 43, 49.

The respondent, in order to recover in an action for fraud and deceit, must allege and prove the elements thereof, which are as follows:

'(1) A representation; (2) its falsity; (3) its materiality; (4) the speaker's knowledge of its falsity; (5) his intent that it should be acted upon by the person; (6) the hearer's ignorance of its falsity; (7) his reliance on its truth; (8) his right to rely thereon; (9) and his consequent and proximate injury.' Mishoe v. General Motors Acceptance Corporation, supra; Flowers v. Price, 190 S.C. 392, 3 S.E2d 38.

The testimony shows that the respondent is a native of, and has lived all of his life, in High Point, North Carolina. He is twenty-eight years of age, a graduate of High Point High School and had three years of college work at High Point College. The respondent is a salesman and has been so engaged for about four and one-half years. He testified that he saw the advertisement heretofore quoted in a newspaper published in High Point, and that he wrote a letter in response thereto stating that he was interested in the offer made. He advised that he was twenty-eight years of age, married and had two children, and had completed three years of college in Business Administration. He also stated that selling had been his career since leaving college in 1952, and was presently employed with the Clover Manufacturing Company of Norwalk, Connecticut, as factory representative in the Southeastern territory. To this letter the appellant replied and advised the respondent that one of its representatives would call upon him within a few days. It appears from the record that on October 28, 1957, a representative of the appellant visited the respondent at his home in High Point. In this connection he testified as follows:

'A. Mr. Holiday came to my house on a Monday morning around eight o'clock and during the course of his sales talk he said that I would be dealing with one of the top companies in South Carolina, this same Cooper owns the Cooper Motor Lines and had given land for a golf course here in South Carolina to the City, and that they would only be hot dog machines--I'm just blank right now.

'Q. Did he suggested how much you could make out of it? A. Yes, he said I should go over $100.00 every week.

* * *

* * *

'Q. Was Mr. Holiday, the person to locate these machines, or did somebody else do that? A. He was going to send a 'Specialty' as he phrased it, and that was Mr. Harper.

'Q. Did Mr. Holiday tell you anything about how these machines were doing in other locations? A. Yes, he said that Mr. Harper here in South Carolina was very successful and that's how he got his job that he had then as a 'Specialty', that he had done so well with his machines.

* * *

* * *

'Q. Did he lead you by his remarks, to believe that he had available, desirable locations or would have desirable locations? A. Yes, he did, and I also suggested some accounts at that time to him, too, such as Kress' in High Point, the five and ten store.

'Q. What was his answer to that? A. He said, well, Mr. Harper was a Specialty in that type of work and he would pick the better accounts out.

'Q. You had no person to believe that these people weren't telling you the truth in this advertisement, and that Mr. Holiday wasn't telling you the truth, did you? A. I didn't.'

The respondent testified as a result of the advertisement that he had seen in the newspaper and of the conversation he had with Mr. Holiday that he purchased, by written order, seven 'hot-dog' machines and two thousand five hundred special cellephane bags for $1,409.00. The order referred to contained the following:

'Company agrees to obtain locations for above order in following territory:

'High Point and surrounding areas. Under 'Pup in Poke' franchise accounts of seven secured and installed by company.'

It further appears from the testimony that a representative of the appellant went to High Point on November 13, 1957. The seven machines and cellophane bags had already been received by the respondent. It further appears that the machines were uncrated and minor repairs were made to one of the machines by such agent of the appellant. All of this was done in the presence of the wife of the respondent. The wife testified that after the machines were uncrated, that the agent of the appellant took the machines and went out for the purpose of obtaining locations where they were to be operated. This agent returned to the home of the respondent on the same night and advised that he had succeeded in obtaining locations for all of the machines. This agent turned over to the respondent seven printed slips, one for each location. There was submitted to the respondent a locations list, giving the list of names and addresses of the business establishments which had entered into an agreement to permit the placing of the 'hot-dog' machines on their premises. This location list showed that the respondent was to pay 35% of the sales to the establishment for the privilege of placing the machines on the premises. The respondent signed at the bottom of this list the following statement:

'I have looked over...