Jones v. Jackson

• Citation: 110 S.W. 215,86 Ark. 191
• Parties: JONES v. JACKSON
• Decision Date: 27 April 1908
• Court: Supreme Court of Arkansas

110 S.W. 215

86 Ark. 191

JONES v. JACKSON

Supreme Court of Arkansas

April 27, 1908

Appeal from Sharp Circuit Court; John W. Meeks, Judge; reversed.

R. M Jackson sued Jones & Wilson upon a note executed by them to W. E. Smith and by him assigned to plaintiff. Separate answers were filed by the defendants. They were substantially the same. That of defendant Jones is abstracted by his counsel as follows:

1. That he admitted that on the 8th day of May, 1905, by their promissory note he and his co-defendant promised on or before the first day of February, 1906, to pay to the order of W. E. Smith the sum of five hundred and nineteen dollars and twenty-five cents, but denied that said note was given for value by either of said defendants.

2. He denied that on the 16th day of May, 1905, or at any other time, before maturity of said note or after its maturity, plaintiff, in due course of trade and for value or for any consideration became the owner of said note by purchase or otherwise from payee, W. E. Smith, and denies that plaintiff is still the owner and holder of said note as alleged in plaintiff's complaint.

3. He states and alleges the facts to be that said note was obtained by the said W. E. Smith through fraud and false pretense and intimidation, and that it is, and was, without consideration, all of which was well known to said R. M Jackson before he became the holder and pretended purchaser of said note.

4. That about the 20th day of April, 1905, the said W. E Smith came to this defendant and represented to him that he was agent for one S. E. McNeil, of Calico Rock, Ark., who had a good, fresh and salable stock of general merchandise for sale, whose storehouse had recently been burned, and that he (Smith) would give this defendant a great bargain in said goods if he would purchase the same. That after repeated efforts the said Smith induced this defendant to go to Calico Rock to buy said goods.

5. That defendant had never had any experience in the mercantile business; knew nothing about goods nor their value; that when they reached said town of Calico Rock they found the said S. E. McNeil in charge of a stock of goods piled up stairs in an old store house, some in boxes and some piled around on the floor; that the place where the goods were was poorly lighted, and what goods were shown this defendant in daylight were the best goods and the clothing, jewelry, trimmings, and the goods that were damaged and old were shown him after night by very poor lights; that he was unable to detect by what little opportunity he had, the defects in said goods; that the said W. E. Smith and the said S. E. McNeil told defendant, which he was let to believe, that said goods were all new goods and salable.

7. That said Smith represented to this defendant that he would sell and was selling said goods to defendant at a discount of twenty-five per cent. from the first cost price; that Smith and McNeil never showed defendant any invoice bills of said goods, and in listing the same he was compelled to take their word for the wholesale price, when in truth and in fact the said goods had been marked up on an average of twenty-five per cent. more than original costs; and some of said goods must have been fifteen years old. That the invoice as taken by said Smith and McNeil showed said goods to be worth, as they represented, something over $ 2,000.

8. That, after deducting twenty-five per cent. and throwing out a few things, the sum amounted to the sum of $ 1,586.25. That while there at Calico Rock this plaintiff was induced to execute two certain promissory notes to the said S. E. McNeil, one dated April 28, 1905, for $ 400.00, payable sixty days after date, before but few of said goods had been invoiced; and to secure the payment of said note this defendant was induced to give a mortgage to said S. E. McNeil on certain personal property. That on the next day the said Smith and McNeil, by fraud and false pretense, which they never fulfilled, viz.: "That all of said goods were new and not damaged in any way, and that they, Smith and McNeil, would give defendant all the time he wanted when he should reach home with the goods, to examine them fully, and that if any defects were found or any goods damaged they would make them good by deducting the value of the damaged goods from the amount, and place credits on said notes for the same; and further they threatened to foreclose the mortgage he had given to secure the $ 400.00 and sell his personal property, unless he went forward with the deal and give the note $ 667.00 note. That they failed and refused to make good the damaged goods and to give him credit for same upon said notes."

That, in addition to the fraud and false pretense and coercion, as above stated, in securing the first and second notes above described at Calico Rock, when the defendant and the said Smith reached Hardy with said goods, said Smith, in order to get defendant to execute the note sued on, and obtain a security thereon, proposed to defendant and promised him that he might take all the time he wanted to examine said goods when he should open them up, and, if they were not good fresh goods as represented to defendant at Calico Rock by said McNeil and Smith, that he need not pay said note, but threatened said defendant that if he refused to give said note he, Smith, would attach said goods at the depot, and that this defendant would have to pay the other notes theretofore given. That the said Smith further agreed and promised this defendant that he would leave the note sued on with Walker Clayton or any other man in Hardy until defendant should haul the goods out and open them up, and if they did not prove to be as good as represented that the said Smith was not to have the possession of said note, and same was not to be delivered to him until all defects and damages should be made good.

That, after he had executed said note, the said Smith refused to allow the said Walker Clayton or any one else to hold said note as per agreement.

That, in addition to said goods being old and moth-eaten, rotten and musty, there were a great many coats without vests; that in the few coats shown defendant by the said Smith and McNeil at Calico Rock there were vests to match, but when defendant opened up said clothing he found there were only four coats and vests, and 78 coats had no vests at all, which defect damaged the same more than one-half. That there were 36 pairs of shoes that did not mate, and are absolutely worthless; that the notions and jewelry were old and valueless. That immediately, viz., on the 11th day of May, 1905, after examination, and discovering the fraud as above set out, he went to the said Smith, and notified him of same, and demanded that he (defendant) be made whole as promised and agreed by said Smith. That the said Smith failed and refused to make good the damage on said goods as he had promised to do, and failed and refused to give him credit on the said notes therefor. That this defendant then and there notified said Smith that he would not pay said note now sued on by plaintiff, and demanded that Smith return the same to him, and offered then and there on the 11th day of May, 1905, to return to said Smith and McNeil all of said goods and demanded a surrender of said note. That said defendant proposed to return the goods to them at Hardy or any other point they might want them shipped to. That on the 16th day of May, 1905, and before the said R. M. Jackson had pretended to trade for said note, in the town of Hardy, in the presence of his co-defendant J. A. Wilson, this defendant informed the said plaintiff, R. M. Jackson, that the said note was fraudulently obtained and was without consideration and warned him not to buy or trade for same, and all the circumstances and fraud practiced on him by the said Smith and McNeil in obtaining said note and that he would not pay it. That immediately after the commencement of this suit this defendant proposed and offered to plaintiff, by his attorney, at the store house of said R. M. Jackson, in the town of Hardy, to turn over to him the said goods as set out in the invoice filed herewith, if he would return to him the note sued on; that on the next day by certain promises and fraudulent representations, this defendant was induced to execute another note to said McNeil, payable November 15, 1906, in the sum of $ 667.00, and the remainder on said goods, the sum of $ 519.25, the note sued on, he was induced by the said Smith and McNeil to execute to said Smith and to obtain a security on the same, which he did in the person of J. A. Wilson his co-defendant.

9. That, after the said Smith and McNeil had induced defendant to execute the first note and mortgage in the sum of $ 400, they refused to make good any of the defects they promised to do, and when the goods had reached the depot at Hardy the said Smith threatened to attach same for balance $ 519.25, and not allow said defendant to haul same out until this said note was executed and delivered to said Smith.

10. That in the purchase of said goods the said Smith guarantied said goods to be good merchantable goods and free from incumbrance, and, relying upon what he and the said S. E McNeil said and promised to do, this defendant was fraudulently deceived and induced to execute said note, when in truth and in fact said goods, with few exceptions, were old and moth-eaten--being an old stock of goods owned by J. A. Schenck & Son of Hardy, Ark., which had recently been removed from Hardy to Calico Rock. That in truth and in fact the said goods did not belong to the said McNeil at all, but were, at the time of the sale, the property of said Schenck & Son, and the said McNeil had no interest in them, that the notes given to said...