M.C. Kiser Co. v. Padrick

• Decision Date: 25 June 1923
• Docket Number: 13994.
• Citation: 118 S.E. 791,30 Ga.App. 642
• Parties: M. C. KISER CO. v. PADRICK.
• Court: Georgia Court of Appeals

118 S.E. 791

30 Ga.App. 642

M. C. KISER CO. v. PADRICK.

No. 13994.

Court of Appeals of Georgia, Second Division

June 25, 1923

Rehearing Denied Aug. 24, 1923.

Syllabus by the Court.

"In a suit for damages growing out of a breach of contract, the petition is not demurrable on the ground that it does not state whether the contract was in writing. A general allegation of the execution of a contract is sufficient; the specific character of the contract being a matter of proof. If the contract is of a kind required by the statute of frauds to be in writing, the presumption is that it was in writing." Georgia, etc., Ry. Co. v. Parsons, 12 Ga.App. 180 (1), 76 S.E. 1063. It not appearing upon the face of the petition that the contract was in parol, no question as to a compliance with the statute of frauds is involved on demurrer. See, also, Ansley v. Hightower, 120 Ga 719 (3), 48 S.E. 197; Crovatt v. Baker, 130 Ga. 507 (3), 61 S.E. 127. The same rule would apply as to express trusts, which are required to be in writing. Eaton v Barnes, 121 Ga. 548 (2), 49 S.E. 593.

"A contract will be construed as made for a legal, rather than for an illegal purpose; and the more especially when such contract is attacked by a party thereto who has been benefited thereby." Virginia Bridge Co. v. Crafts, 2 Ga.App. 126 (3), 58 S.E. 322.

" 'Courts hold themselves bound to the observance of rules of extreme caution, when invoked to declare a transaction void on grounds of public policy; and prejudice to the public interest must clearly appear before a court will be warranted in pronouncing the transaction void on this account. It is not to be lightly inferred from facts and circumstances of doubtful import and meaning, or which may admit of different construction, one consistent with and the other opposed to unquestioned policy.' Smith v. Du Bose, 78 Ga. 415, 3 S.E. 314, 6 Am.St.Rep. 260." Virginia Bridge Co. v Crafts, supra.

While it is true that a contract, whereby it is agreed that one of the parties thereto shall refrain from bidding upon property to be sold at public outcry at a bankruptcy sale, and that the other shall bid upon the property, and, upon buying it resell it to the one not bidding for the price of the accepted bid, and for the further consideration that the one not bidding shall assume to the bidder a debt which was owing to the latter by the bankrupt, will be void as against public policy, if the contract is not the result of the bona fide co-operation on the part of the parties thereto to render a service to the creditors which neither alone could perform or which could be better performed by the co-operation of the parties to the contract (Rittenbaum v. Cohen, 29 Ga.App. 87 (1), 113 S.E. 828), yet, where it does not appear that both of the parties would have bid upon the property but for the making of the agreement and the only effect of the agreement appearing is that, while one bidder is eliminated another is substituted in his stead, it neither being shown nor presumable as a matter of law that the latter, except for the making of the contract, would or would not have been a bidder, or that the agreement was tainted with an illegal purpose, the agreement should not be held unenforceable upon demurrer, but should be submitted to the examination of a jury, the question of the object or purpose of the contract being one of fact, to be determined upon the trial by evidence. If the agreement is the result of a fraudulent combination to suppress and stifle fair competition, it should not be enforced at the instance of either party; otherwise, as between the parties, if the agreement is the result of honest co-operation, though competition may be lessened thereby, the principal question as between the parties to the agreement being one of intention. Virginia Bridge Co. v. Crafts, 2 Ga.App. 126 (6), 58 S.E. 322; 16 R.C.L. 69, § 50; 15 Am. & Eng. Ency. Law, 950, 951.

Accordingly, a contract between P. and K., wherein it is agreed that K. will buy the assets of a bankrupt at a public sale, and then resell the property to P., who was the general manager of the bankrupt until its bankruptcy, at the price for which it was bid in by K., and for the further consideration that P. will assume or pay to K. an indebtedness of the bankrupt to the latter, will not be held void as against public policy, upon demurrer to an action by P. against K. for a failure to abide by the contract after the purchase of the property by K., although it appears that P. would have bid upon the property in the absence of the agreement, but not whether, but for the agreement, K. would have bid; there being no presumption that K. would have become a bidder but for the agreement, and no sufficient facts appearing in the petition from which a fraudulent intention can be presumed as a matter of law. Whether the agreement had for its purpose the unfair elimination of a bidder, rather than the fair substitution of the one for the other, or an honest combination of the purchasing strength of the two, is a question for a jury to determine, under the evidence. The illegality of the contract does not "affirmatively appear." See, in this connection, Robson v. N. J. Weil & Co., 142 Ga. 429 (2), 83 S.E. 207.

Such a contract is sufficiently definite as to the consideration or price. See, in this connection, Freeman v. Cooper, 14 Ga. 238 (1); White v. Crew, 16 Ga. 416; Mathews v. Starr, 68 Ga. 521 (1); Pearson v. Horne, 139 Ga. 453 (3), 77 S.E. 387; Civ. Code 1910, § 4128.

While the right of P. to bid upon the property may not have been a thing of value, so as to constitute a consideration for the agreement of K. (Lyons v. Bass, 108 Ga. 573, 578, 34 S.E. 721; Roughton v. Rawlings, 88 Ga. 819, 822, 16 S.E. 89), the promise of P. to assume the debt of the bankrupt to K. would supply this necessary element of the contract. Wright v. Watters, 12 Ga.App. 308, 77 S.E. 106.

An original undertaking by one person to become primarily liable for the debt of another is not within the statute of frauds, and, regardless of whether the rule announced in the first headnote would apply to a promise, within the statute of frauds, by one person to answer for the debt of another, when offered as a consideration for an agreement by the creditor to the promisor, the agreement in the instant case of P. to assume the debt of the bankrupt to K. was not within the statute. Holcomb v. Mashburn, 10 Ga.App. 781, 74 S.E. 307, and cases cited.

If the contract was originally unilateral, binding only upon K., its acceptance by P. with his offer of compliance before its withdrawal by K. would supply the element of mutuality. But the contract as made does not appear originally to have been wanting in mutuality. Buick Co. v. Thompson, 138 Ga. 282, 75 S.E. 354; Hardin v. Case Co., 134 Ga. 813 (1b), 68 S.E. 648; Owenby v. Georgia Baptist Assembly, 137 Ga. 699(1), 74 S.E. 56, Ann.Cas. 1913B, 238; Robson v. N. J. Weil, supra.

The averments of the petition, as amended, that the contract was made through a named agent of the defendant in a given county on a given date, were sufficient as to time and place of the making of the contract, and the allegation that the performance was to be in the same county was a sufficient averment of the place for performance, as to a contract of the particular nature here involved. Compare Georgia Construction Co. v. Horton, 135 Ga. 58 (2), 68 S.E. 794.

In view of the averments that the bankruptcy sale was to take place on February 24, that the contract between the parties was to be performed on February 27, "and as soon as said sale was confirmed by the referee," and that, as soon as the sale was confirmed, the plaintiff offered and the defendant refused a performance, with the result that the plaintiff is damaged, a further allegation as a basis for the measure of the damage, that the property was of a value stated, may be reasonably construed to have reference to the value at the time of the breach; no other dates being referred to than those of the sale, the confirmation, and the breach, and the date of the breach being the one mentioned last preceding the allegation as to value. "All pleadings must receive a construction in accordance with the natural intendment of the * * * language" used (Athens Mfg. Co. v. Rucker, 80 Ga. 291, 294, 4 S.E. 885, 886), and "was" will relate back to the date stated next above it. Thus the measure of damages--the difference between the contract since and the market price at the time and place for delivery--was sufficiently alleged.

An averment in regard to the authority of a named agent of the defendant with whom the contract was made is not destroyed by a further allegation that, after the making of the contract and after the bankruptcy sale, the defendant, through a second agent, referred the plaintiff to a third agent as the one having the authority to carry out the agreement declared on.

An averment that an agent was "duly authorized" to act for his principal is not objectionable as being a conclusion. 16 Enc. Pl. & Pr. 900.

The tender alleged was sufficiently conformable to the terms of the contract, but, if it were not, the petition alleges a refusal of the defendant upon other grounds, and this would cure any defect in the tender; the plaintiff sufficiently alleging a readiness, willingness, and ability to carry out the contract as made. Civ. Code 1910, § 4322.

That no copy of the contract was attached was not a good ground of demurrer. Lynah v. Citizens' & Southern Bank, 136 Ga. 144 (2), 71 S.E. 469; Dotson v. Savannah & C. Co., 140 Ga. 161 (1), 78 S.E. 801.

The court did not err in overruling any of the demurrers.

Error from City Court of Hinesville; W. C. Hodges, Judge.

Action by W. O. Padrick against the M. C. Kiser...