McCrary v. Pritchard

• Decision Date: 30 March 1904
• Citation: 47 S.E. 341,119 Ga. 876
• Parties: McCRARY v. PRITCHARD et al.
• Court: Georgia Supreme Court

47 S.E. 341

119 Ga. 876

McCRARY v. PRITCHARD et al.

Supreme Court of Georgia

March 30, 1904

Syllabus by the Court.

1. Where, in a suit by the payee of a promissory note against the makers thereof, the defendants pleaded that the note was given to the plaintiff for part of the purchase money of an insurance agency business sold by him to them, and that the consideration of the contract between the parties had failed to an extent equal to the amount represented by the note because the plaintiff "represented to defendants that he had made certain profits out of said business for the three years previous to said purchase, and said purchase was based upon the amounts alleged to have been made, but said representations, as defendants have since discovered, were untrue," a demurrer to the plea upon the ground that it fails "to set forth how much profits plaintiff represented he had made, *** or how much damage had resulted to defendants" by reason of the alleged misrepresentations of the plaintiff, should have been sustained.

2. Where there is nothing in the pleadings to show that the contract between the parties was in writing, the question whether a plea seeks to contradict or vary a written contract cannot be raised by demurrer.

3. The amended answer of the defendants did not show "on its face that no damage could have resulted to" the defendants on account of the alleged misrepresentations of the plaintiff, and was therefore not demurrable upon this ground.

4. Fraudulent misrepresentations as to a material fact, made by one party to a written contract for the purpose of inducing the other party to enter into it, may be proved by parol.

5. It was erroneous to allow a witness to state to the jury his opinion as to the amount of damages which the defendants had sustained in consequence of the misrepresentations of the plaintiff in reference to the property at the time he sold it to the defendants.

6. When testimony is objected to as a whole, and some portion of it is admissible, it is not erroneous to overrule the objection.

7. Where a purchaser of property is entitled to recover for damages sustained by him in consequence of his reliance upon false and fraudulent representations of the vendor in reference to matters affecting the value of the property, the measure of damages is the difference between the actual value at the time of the purchase and what the value would have been if the property had been as it was represented to be by the seller.

Error from City Court of Sandersville; P. P. Taliaferro, Judge.

Action by J. A. McCrary against H. L. Pritchard and others. Judgment for defendants, and plaintiff brings error. Reversed.

Rawlings & Howard, for plaintiff in error.

Marion Turner, Hardwick & Hyman, and James K. Hines, for defendants in error.

FISH P.J.

J. A McCrary brought suit in the city court of Sandersville against H. L., L. J., and Mary J. Pritchard for the sum of $200.48 principal, and also interest and attorney's fees, upon a promissory note for $250, dated April 5, 1902, and due October 1, 1902, upon which there was a credit of $49.52, dated September 15, 1902. The defendants filed an answer, which was demurred to. Pending the demurrer they amended their answer, and the plaintiff then demurred to the answer as amended. Except as to one paragraph of the original answer and a similar paragraph of the amendment, the court overruled the demurrers, and the plaintiff filed exceptions pendente lite. Upon the trial there was a general verdict for the defendants. The plaintiff made a motion for a new trial, which was overruled, and he excepted.

1. Error is assigned in the bill of exceptions upon the overruling of the demurrer to the original answer and the overruling of the demurrer to the answer as amended. In the original answer, the defendants admitted giving the note sued on, but alleged that it was given to the plaintiff solely for the purchase of a certain fire insurance business which he had been conducting in the city of Tennille for several years, the sale consisting in the transfer of the agency for certain fire insurance companies, all books, stationery, etc., belonging to such agency, and the good will of the plaintiff; that the business was purchased by the defendants for the purpose of continuing the same at the city of Tennille, which the plaintiff knew; and the plaintiff, "as part of the contract of sale and consideration for said note, represented to defendants that he had made certain profits out of said business for the three years previous to said purchase, and said purchase was based upon the amounts alleged to have been made, but said representations, as defendants have since discovered, were untrue." The answer further alleged that the defendants "purchased said insurance business for said purpose, trusting in the representations of the plaintiff"; that the price agreed upon was $450, "defendants paying plaintiff $200 cash and giving the note sued upon for the balance, upon which note they paid $49.52 before learning of the facts herein set out." There was also a paragraph in the answer in reference to an offer by the defendants to rescind the contract, and also an offer of compromise, both of which it was alleged the plaintiff refused; but these things are not material in the consideration of the questions involved here. The answer concluded as follows: "Wherefore defendants allege the consideration for said note has completely failed, and that they have paid plaintiff $49.52 more than said business was worth, and pray judgment against plaintiff for that amount, and of this defendants put themselves upon the country."

We think it is very clear that this answer was subject to the objection, raised by the demurrer, that it wholly failed "to set forth how much profits plaintiff represented he had made in the past three years, *** or how much damage had resulted to defendants" by reason of the misrepresentation of the plaintiff as to the amount of such profits. The allegations that the plaintiff had represented to defendants that he had made certain profits out of the business for the three previous years, and that these representations were untrue, was too general, vague, and uncertain to withstand the demurrer. It will be observed that it was not alleged that the consideration for the contract of purchase had wholly failed, but the effect of the answer was that it had partially failed to an amount equal to the sum for which the note was given. The plea afforded no basis whatever for a comparison between the profits actually made by the plaintiff from the business and the profits which he represented to the defendants he had made; and such a comparison was necessary in order to ascertain whether there was, in the contract of purchase, a failure of consideration, and, if so, to what extent the consideration had failed. The allegation that the plaintiff had represented that he had made "certain profits," and this representation was untrue, was about as uncertain as any allegation could be. Suppose the plaintiff had admitted this allegation of the plea to be true, what sort of a verdict in favor of the defendant could there have been rendered upon this admission? In a suit for a rescission of a contract alleged to have been procured by fraud such an admission might authorize a verdict in favor of the party seeking the rescission, but under a plea of partial failure of consideration the jury would be unable to determine from such an admission to what extent the consideration for the contract had failed. The defendants did not ask for a rescission of the contract, but relied upon their plea of partial failure of consideration to defeat a recovery upon the note given for only a part of the purchase money. Certainly the plaintiff was entitled to know what representations the defendants expected to prove he had made to them as to the profits of the business for the three previous years, and what they expected to prove the profits of the business for this period actually were. The court erred in not sustaining the demurrer to the original answer, as the amendment failed to cure this defect therein.

2. The amendment alleged that the plaintiff, at the time the contract was entered into, represented to the defendants "that he did not allow any rebates to any of his patrons, or divide...