Murphy v. Weil

• Decision Date: 11 December 1894
• Citation: 61 N.W. 315,89 Wis. 146
• Parties: MURPHY v. WEIL.
• Court: Wisconsin Supreme Court

89 Wis. 146

61 N.W. 315

MURPHY

v.WEIL.

Supreme Court of Wisconsin.

Dec. 11, 1894.

Appeal from superior court, Milwaukee county; R. N. Austin, Judge.

Action by Newton S. Murphy against Benjamin M. Well upon contract. From an order granting a new trial on the special verdict, plaintiff appeals. Affirmed.

The action is upon a contract in writing for the sale of 250 shares of paid-up corporate stock in the Jacobs Electric Company, a corporation, by the plaintiff and one Jacobs, jointly, to the defendant, for the sum of $25,000, of which $13,500 was to be paid at the date of the contract, and the remaining $11,500 was to be paid in several deferred payments. The contract provides that, if the patents applied for by Jacobs on an invention for thermostat and automatic machines be disallowed in substance, the parties of the first part agree to refund the said Weil $12,500 of the money paid. The full number of shares of such stock were delivered to the defendant, who has not fully paid for the same. The plaintiff now owns the interest of Jacobs in the contract. The action is to recover the unpaid balance of purchase money. The defense, so far as involved in the question decided, is (1) that the contract was void by reason of false and fraudulent representations by which the plaintiff induced the defendant to enter into the contract; (2) that the consideration for defendant's promise has entirely failed, by reason of the fact that the patents are worthless; (3) that the patents applied for by Jacobs, for thermostat and automatic machines, were disallowed, in substance, so that, by the terms of the contract, plaintiff's action for the balance of the purchase money for the stock is defeated. At the date of the contract, Jacobs had several applications pending for thermostat and automatic machines, but none of them, so far as then known, had been allowed. Several were afterwards allowed. Jacobs had also an application pending for a patent for an automatic adjustment of the thermostat, at predetermined times, by means of a clockwork device. This application was allowed, but came into interference with a patent for a similar device to one Butz, and the patent was not issued. By contract with Jacobs, the Jacobs Electric Company was the owner of all patents issued to him for thermostat and automatic machines, and improvements thereon. There was a special verdict as follows: “(1) Did the plaintiff, at or about the time alleged, represent to the defendant that the devices in question were valuable and useful? A. Yes. (2) Did the plaintiff, at or about the time alleged, represent to the defendant, substantially, that the inventions and devices in question were as good as those of the Johnson Electric Service Company, and that experiments had been completed, and said devices had gotten beyond the experimental stage, and had been found practicable and useful, and that patents would surely issue thereon? A. Yes. (3) Was the plaintiff guilty of any false or fraudulent representations in the sale of the stock to the defendant? A. No. (4) If you answer the first, second, and third questions in the affirmative, did the defendant enter into the contract in question relying upon such representations? A. Yes. (5) Did the plaintiff, in the sale of the stock to the defendant, substantially comply with the terms of the written agreement? A. Yes. (6) What sum of money has the defendant paid out prior to December 1, 1887? A. (by direction of the court). $5,250 to the corporation, and $1,000 to Jacobs on the contract. (7) Was such money so paid out by the defendant at the request and with the consent of H. E. Jacobs, as and for payment upon the written contract in question? A. (by direction of the court, with consent of parties). Yes. (8) Did the defendant, at the request of the plaintiff, pay out any sums of money on account of the business of the Jacobs Electric Company? A. No. (9) If you answer the eighth question in the affirmative, then what amount was so paid out? A. No answer. (10) If the court should be of the opinion that the plaintiff is entitled to recover, what sum is due him upon the contract in question? A. ($9,120) nine thousand one hundred and twenty dollars. (11) Were the terms, ‘Patent applied for on thermostat and automatic machine,’ in the contract in question, used with reference to the automatic machine involved in the Butz interference proceedings? A. (by direction of the court). Yes. (12) Were all the patents applied for, and on which applications were pending at the date of the contract in question, for thermostat and automatic machines, allowed in substance? A. (by direction of the court). Yes.” Both the parties moved for judgment on the special verdict. Both motions were denied, and both parties appealed. The defendant then moved to set aside the...