Knopfler v. Flynn
| Decision Date | 12 January 1917 |
| Docket Number | 19,973 - (123) |
| Citation | 160 N.W. 860,135 Minn. 333 |
| Parties | MARTIN KNOPFLER v. JOHN F. FLYNN |
| Court | Minnesota Supreme Court |
Action in the district court for Nobles county to enforce specific performance of an agreement to exchange property, and to recover $2,000 damages for withholding the property. The facts are stated in the opinion. The case was tried before Nelson, J., who when plaintiff rested denied defendant's motion to dismiss the action, made findings and ordered judgment in favor of defendant for $3,119.13. From an order denying his motion for a new trial, plaintiff appealed. Affirmed.
Exchange of property -- invoice value of goods -- meaning of phrase.
1. Plaintiff represented that a stock of goods which he offered in exchange for other property was of the invoice value of $12,000. It is held, that the expression "invoice value" should be construed as having reference to the cost price for which the seller invoiced the goods to the purchaser, and not to their actual value.
False representation one of fact, not of opinion.
2. The representation was one of fact, not mere opinion upon the question of value, and its falsity constituted actionable fraud.
Discovery of falsity after acceptance of goods.
3. The falsity of the representation was not discovered until after the acceptance of the goods; such acceptance did not therefore bar a claim for relief from the fraud.
Evidence -- inventory of goods admissible.
4. An inventory or list of the goods taken in the manner stated in the opinion soon after the delivery and acceptance of the same, held, following Itasca Cedar & Tie Co v McKinley, 124 Minn. 183, properly received in evidence.
Evidence -- proof of cost price.
5. The invoice or cost price of the goods held sufficiently established by competent evidence.
Finding -- admission of evidence.
6. The evidence sustains the findings of the trial court, and there were no errors in the admission or exclusion of evidence.
Kerr Fowler, Schmitt & Furber and Paul C. Cooper, for appellant.
J. A. Town and J. A. Cashel, for respondent.
Plaintiff was the owner of certain farm land in Martin county, this state, and of a retail stock of hardware at Arcola, in the state of Illinois. Defendant was the owner of certain farm land situated in the county of Nobles. On December 30, 1913, the parties entered into an executory contract for the exchange of properties; defendant thereby agreeing to convey his Nobles county land to plaintiff in exchange for a conveyance of plaintiff's Martin county land and the Arcola stock of hardware. This stock was represented by plaintiff as of the invoice value of $12,000, and it was taken in the transaction at that value. The contract was in writing, fully expressed the obligations of the parties and was in all things valid and binding upon each. By the terms thereof defendant was required to take possession of the goods on or before the fifteenth day of January, 1914; but an exchange of deeds was not to take place until abstracts were prepared, and March 1, 1914, was fixed as the date for the final completion of the transaction. Defendant accepted the goods before January 15, as required by the contract, and made a sale thereof to one Thier, to whom plaintiff surrendered possession. Soon after Thier so became the owner, and after taking possession of the goods, he made claim that the value thereof was much less than plaintiff had represented, and so informed defendant and also plaintiff. Plaintiff insisted that defendant had by the contract taken the goods at the valuation of $12,000, and that he was bound thereby; saying that defendant could take them at that figure or reject them. This raised an issue between the parties, and, not being settled, prevented a performance of the contract by the exchange of deeds.
Thereafter plaintiff brought this action for specific performance. Defendant by his answer interposed the claim that the stock of hardware was falsely represented to be of the invoice value of $12,000, when it was in fact worth less than $9,000, and he demanded as relief, in addition to a conveyance of the Martion county land by plaintiff, that he recover of plaintiff the sum of $3,119.13, the amount the invoice value of the stock fell short of the represented value. The allegations of the answer were put in issue by the reply. When the cause came on for trial, it was announced to the court that the parties had adjusted all matters in litigation, except defendant's claim of damages arising from the alleged deficiency in the value of the goods, and that the issues in that respect alone remained for trial. The trial proceeded accordingly, resulting in a judgment for defendant as claimed in his answer. The court found that the goods had no greater value than $8,880.87, and judgment was ordered for the difference between that sum and the represented value, or $3,119.13. Plaintiff appealed.
Numerous assignments of error are made by appellant, but they involve only two or three distinct contentions which will be disposed of in the order presented in the briefs.
1. The provision of the contract upon which defendant relies in support of his claim to damages for the failure of the goods to measure up to the represented value, after referring to the land to be conveyed by the parties, reads as follows:
"And said second party (plaintiff) further agrees to sell and deliver (to defendant) a certain stock of hardware and fixtures located in Arcola, Illinois, which said second party represents to be of the invoice value of Twelve Thousand ($12,000.00) Dollars, and which is to be taken at said price."
The parties in entering into the contract had valued their respective properties, plaintiff his land and stock of goods on the one hand, and defendant his land on the other, with the result that there was a difference between them of $800 in defendant's favor, the payment of which was provided for. The stock represented $12,000 in the transaction, and the evidence justified the court in finding that defendant accepted the same in reliance upon the representation of plaintiff that it was of that invoice value. Defendant alleged in his answer that the representation was false and fraudulent and made with intent to deceive defendant; that defendant relied thereon in entering into the contract, and in accepting the goods in part performance thereof.
The contention of plaintiff that the answer fails to state facts entitling defendant to the relief demanded and that the evidence in support thereof was improperly received is not sustained. It was not necessary that the defendant either plead, or prove on the trial, a fraudulent design on plaintiff's part to deceive or defraud defendant. All that defendant was required to show was that the representations were unqualified and not true, for the falsity thereof, whether known to plaintiff or not, constituted a fraud and a breach of the contract entitling defendant to appropriate relief. Bullitt v. Farrar, 42 Minn. 8, 43 N.W. 566, 6 L.R.A. 149, 18 Am. St. 485; Jacobson v. Chicago, M. & St. P. Ry. Co. ...
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