Memphis St. Ry. Co. v. Giardino

• Decision Date: 25 April 1906
• Parties: MEMPHIS ST. RY. CO. v. GIARDINO.
• Court: Tennessee Supreme Court

92 S.W. 855

116 Tenn. 368

MEMPHIS ST. RY. CO. v. GIARDINO.

Supreme Court of Tennessee.

April 25, 1906

Appeal from Circuit Court, Shelby County; A. B. Pittman, Judge.

Action by J. Giardino against Memphis Street Railway Company. From a judgment in favor of plaintiff, defendant appeals. Reversed and action dismissed.

Ewing & Williamson, for appellant.

W. H Cox and John E. Bell, for appellee.

WILKES J.

This is an action for damages for personal injuries. There was a trial before the court and a jury; and a verdict and judgment for $750.

It appears that the plaintiff entered into an agreement of accord and satisfaction with the company before the bringing of the suit. This agreement was made on the same day the accident occurred, and about an hour or two after it happened; and this suit was commenced on the same day by plaintiff's taking the pauper oath, about five or six hours after the accident, and four or five hours after the agreement for settlement had been made. There is evidence tending to show that both when the agreement of settlement was made and when the oath was taken the plaintiff was in an unconscious condition.

Plaintiff insists that the release on the settlement was procured with undue haste, and the defendant that the suit was brought with undue haste; and upon these features of the case, we heartily agree with both counsel.

The defendant, among other pleas, set up the accord and satisfaction, to which the plaintiff replied that it was fraudulently procured, and was void. This replication was amended; and as finally put to the court, and passed on by it, was as follows:

"Comes now the plaintiff and by leave of the court files this, his amended replication to defendant's plea of settlement and for amendment says:

"First. That at the time of said settlement he was in a semiconscious condition, suffering severe pain and agony, with his mind clouded from the effects of the injury; and that the defendant took advantage of his condition to procure the same.

"Second. That his injury was severe, and to compensate him would take several thousand dollars, and that the amount which was paid to him, or to another for him, to wit, $50, was so grossly inadequate as to shock the mind and conscience, and for that reason should be held for naught.

"Third. That the plaintiff at the time of said settlement, in addition to his physical and mental disability, was an illiterate foreigner, who spoke the English language with great difficulty and imperfectly, and who understood the English language so little that he did not understand the import of said settlement; that he was not upon equal terms with the defendant, and did not understand and know his rights in the premises, and this the plaintiff is ready to verify."

The defendant moved to strike out this replication. This motion appears to have been made September 26, before the evidence was heard. It was strenuously insisted upon, and as warmly contested, and much argument was indulged in, the defendant insisting that the replication was insufficient, and that the suit should be dismissed, because the $50 paid on the accord and satisfaction were not paid or tendered into court, and for other reasons; and the plaintiff insisting that no payment or tender was necessary, because the agreement was procured by fraud, and when the plaintiff was unconscious, and that it was absolutely void.

The court overuled the motion to strike out at that time, saying that if at a later stage it should appear that he had made a mistake, or that the failure to pay back the $50 was fatal to plaintiff's effort to recover, he would so charge the jury.

Thereupon witnesses were examined. The next morning the trial judge decided that there must be a tender of the money with the replication to make it good, and reargument of the question was resumed by counsel for plaintiff, he still insisting that no tender or payment was necessary or could be required.

Counsel for the company at this stage of the proceeding moved for peremptory instructions on the pleadings and plaintiff's evidence that the suit be dismissed.

The court thereupon said he had not finally decided the question of the necessity of payment or tender, but only expressed his opinion, and that he would hear the motion for peremptory instructions at the proper time.

Thereupon argument was resumed upon the question of the necessity of tender or payment, and quite a number of authorities were cited. Counsel for the defendant company insisted on his motion for peremptory instructions, and the court held that he could not give peremptory instructions until plaintiff had closed his evidence.

Thereupon counsel for plaintiff paid into court the $50, and interest, to which the counsel for defendant objected, on the ground that the plaintiff had ratified the settlement, by not tendering or paying it into court with his replication. The objections of defendant's counsel were overruled, and the $50 and interest being paid into court, the examination of plaintiff's witnesses was proceeded with.

After plaintiff had introduced all his evidence defendant's counsel renewed his motion for peremptory instructions which the court declined to give, and counsel excepted; and defendant thereupon produced its evidence, and at the conclusion of its evidence again moved the court to give peremptory instructions, and based his motion upon the grounds that the plaintiff accepted the compromise and retained the money for two years with full knowledge of all the facts, and did not repudiate it, and acted with his eyes open, and on such advice as he sought for himself. The court again refused to give the peremptory instructions.

It is assigned as error, among other things, as follows:

"(1) The court erred in overruling the defendant's motion to strike the plaintiff's replication and amended replication from the files because there was no tender made of the money received by the plaintiff.

"(2) The court erred in allowing the plaintiff to amend his replication so as to tender this money back in the progress of the trial, and after the plaintiff had refused to tender it at the beginning of the trial, and before any of the evidence had been adduced.

"(3) The court erred in refusing to grant a peremptory instruction in favor of the defendant because (1) there was no tender made of the money received by the plaintiff in settlement of his claim; (2) the plaintiff received the money and retained it with full knowledge of all of the facts, and thereby elected to stand on the adjustment and settlement that had been made; and (3) the plaintiff could not ratify the bringing of the suit which was instituted while he was unconscious, and without legal authority."

It was an open question in this state until the case of Brundige v. Railway, 112 Tenn. 526, 81 S.W. 1248, whether fraud in procuring an accord and satisfaction and release could be set up in a court of law, and whether the settlement must not first be set aside in a chancery court before the plaintiff could proceed upon the original cause of action. It was held that it might be set up in an action at law as a defense against an accord and satisfaction procured by fraud. In that case, the consideration for the accord and satisfaction was paid into court along with the replication setting up its fraudulent procurement. No special question arose as to the necessity of such payment or of a tender in such cases, as the payment was voluntarily made, as stated.

Counsel for defendant asked the court to charge:

"If you find from the evidence that the agreement pleaded as a defense to this suit is void, under the charge of the court and the facts as proven, then the court charges you that it was the duty of the plaintiff, upon the discovery of the fraud, to repudiate it, and if you find that the plaintiff, with full knowledge of the facts, and having gotten such advice as he deemed proper in the premises, made an election to stand on the settlement and accept it as such, then, however void it may have been in the beginning, it will now constitute a defense to this suit."

And the refusal of the trial judge to charge this request is also assigned as error, and the matter presented by this assignment may very properly be considered along with the question of the necessity for tender or repayment of the consideration received.

In ordinary cases when it is sought to be relieved from contracts and agreements procured by fraud, the law has been laid down by this court in quite a number of cases as to what condition will be imposed upon the party seeking to rescind.

In Talbott v. Manard, 10 Tenn. 60, 59 S.W. 340, it is said:

"But if it were granted that we are wrong in these conclusions yet there is another well-recognized rule of equity practice, which repels complainants in their effort to rescind, and that is, that nothing can induce a court of equity to exercise its extraordinary power in decreeing rescission of contracts, save conscience, good faith, and reasonable diligence. When one with full knowledge of the fraud of which he complains sleeps on his rights, he will be repelled. Knuckolls v. Lea, 10 Humph. 577; Ruohs v. Bank, 94 Tenn. 57, 28 S.W. 303; Woodfolk v. Marley, 98 Tenn....