Morriss-Buick Co. v. Pondrom

• Decision Date: 23 February 1938
• Docket Number: No. 1721-6999.,1721-6999.
• Citation: 113 S.W.2d 889
• Parties: MORRISS-BUICK CO. v. PONDROM.
• Court: Texas Supreme Court

Page 889

113 S.W.2d 889

MORRISS-BUICK CO. v. PONDROM.

No. 1721-6999.

Commission of Appeals of Texas, Section B.

February 23, 1938.

Error to Court of Civil Appeals of Fifth Supreme Judicial District.

Action by F. C. Pondrom against the Morriss-Buick Company based on fraud in the sale of an automobile. A judgment for the plaintiff was affirmed on condition of remittitur by the Court of Civil Appeals, Morriss-Buick Co. v. Huss, 84 S.W.2d 272, and the defendant brings error.

Judgment of the trial court and of the Court of Civil Appeals reversed and cause remanded.

R. T. Bailey, of Dallas, for plaintiff in error.

Young, Blakley, Cooper & Armstrong, Haskell H. Cooper, Hoyet A. Armstrong, and Joe Utay, all of Dallas, for defendant in error.

MARTIN, Commissioner.

A judgment based upon fraud in the sale of an automobile was entered by the trial court for both actual and exemplary damages against plaintiff in error and was affirmed by the Court of Civil Appeals. Morriss-Buick Co. v. Pondrom, 84 S.W.2d 272. The proper measure of damages is the controlling question presented here. We copy from the opinion of the above court sufficient facts to illustrate the point:

"On October 2, 1929, appellee purchased from appellant a Buick automobile, being a sedan of the 1929-47 model, for the alleged purchase price of $1,382, but, as shown by the bill of lading issued at the time, for the actual purchase price of $1,389.85. The consideration, as shown by the same instrument, was cash $7.85 and appellee's used Buick sedan of the 1926-47 model at the agreed value of $450, and a note for $932, maturing November 2, 1929. This note was paid soon after its maturity. * * *

"The item of $682 for actual damages, fixed by the court in the judgment, was arrived at by the court, by applying the same measure of damages as was applied in the case of Morriss-Buick Co. v. Huss, supra [Tex.Civ.App., 84 S.W.2d 264]; that is, from the purchase price of the car was deducted the sum found by the jury to have been the reasonable cash value of the car appellee purchased, on the date of the purchase, plus the down payment, which is shown to have been $7.85 cash, and plus the $450 allowance on the used car."

Briefly, the contention of Morriss-Buick Company is, that the correct measure of damages was the difference, if any, between the value of what Pondrom parted with and what he received. The trial court assumed that Pondrom's secondhand automobile given in part exchange for the alleged new car was worth the value placed upon it in the trade by the parties, and used such value as a basis for the judgment, without submitting same as an issue to the jury.

The question has been the subject of much contrariety of opinion, both in and out of Texas. See 27 C.J. pp. 96, 97, 98, 99, and footnotes. The rule in Texas is stated in 27 C.J. p. 98 as follows: "In Texas it has been held by the supreme court that, where one is induced by fraud to enter into a contract to his loss, the measure of his damages is the difference between the value of what he parted with and what he received under the contract, such difference being regarded as the only actual loss involved and the difference between the real and represented value being regarded as too speculative to furnish a correct measure of damages."

This is the familiar rule announced by Judge Gaines in George v. Hesse, 100 Tex. 44, 93 S.W. 107, 8 L.R.A.,N.S., 804, 123 Am.St.Rep. 772, 15 Ann.Cas. 456. It is here claimed that because the parties agreed upon the value of Pondrom's automobile, the rule does not apply. We think the facts are not essentially different from those found in a multitude of similar cases where the George-Hesse rule has been applied. In almost every case where different properties go into the consideration for the purchase of other property, the parties place a value upon each individual piece, so that the aggregate will equal the value placed upon that received. This obviously, we think, is its trading value, not its actual market value. Where, as in this case, notes are given, the amount of same could not be ascertained without first fixing a value upon the other personal property going to make up the entire consideration. Such value ought not to be held conclusive, under the particular facts of this record. Such a conclusion does not comport with what is common knowledge that automobiles are exchanged, not upon the respective actual market values of the two, but upon values arrived at after a verbal joust between a trained auto...