Perry v. Rogers

• Decision Date: 20 November 1901
• Citation: 87 N.W. 1063,62 Neb. 898
• Parties: PERRY v. ROGERS.
• Court: Nebraska Supreme Court

62 Neb. 898

87 N.W. 1063

PERRY

v.ROGERS.

Supreme Court of Nebraska.

Nov. 20, 1901.

Syllabus by the Court.

1. A person is justified in relying on a representation made to him in all cases where the representation is a positive statement of fact, and where an investigation would be required to discover the truth. Foley v. Holtry, 61 N. W. 120, 43 Neb. 133, followed.

2. Where a party is induced to his damage to enter into a contract by the false and fraudulent representations of the other party, and where such false and fraudulent representations have been relied on as the inducing cause for entering into such contract, and where such representations are of facts peculiarly within the knowledge of the party making them, and not mere expressions of opinion, the party so defrauded may elect whether he will stand by the contract or rescind it.

Error to district court, Valley county; Thompson, Judge.

Action by John W. Perry against John C. Rogers. Judgment for defendant. Plaintiff brings error. Affirmed.A. M. Robbins, for plaintiff in error.

Clements Bros. and Munn & Hall, for defendant in error.

OLDHAM, C.

This is a suit in which the plaintiff sued the defendant for damages for the breach of a contract for the sale and delivery of 7,000 bushels of wheat. Plaintiff alleges in his petition that he contracted for this wheat from the defendant on the 18th day of September, 1896, for 40 cents per bushel, the wheat to be delivered within 30 days; that in pursuance of this contract a part of this wheat had been delivered at the price agreed upon; that the price of wheat advanced to 54 cents per bushel during the time within which the wheat should have been delivered; and that defendant refused to deliver the remainder of the wheat, although requested to do so. Defendant answered this petition, alleging, in substance, that the contract with plaintiff for the sale and delivery of the wheat was entered into on an agreement with the plaintiff that he was to pay the market price of cash wheat at Chicago on the 18th day of September, 1896, less 18 1/2 cents per bushel; that plaintiff received the market reports daily from Chicago; that defendant had no means of knowing the market reports, except from plaintiff, and that plaintiff falsely and fraudulently, and for the purpose of inducing the defendant to enter into this contract, represented and stated to defendant that cash wheat had closed in Chicago at 58 1/2 cents on said day, when in fact and in truth cash wheat had closed at 60 5/8 cents; that but for this false and fraudulent representation this defendant would not have entered into the contract sued upon. Defendant also alleged that, as soon as he discovered the fraud that had been practiced upon him by the plaintiff, he, for that reason, rescinded the contract, and refused to deliver any more wheat. He also alleges in his answer that he did not enter into the contract severally for the sale and delivery of the wheat, but entered into it jointly with James A. Ollis, Jr., and that this fact was well known to the plaintiff at the time the contract was made. Plaintiff filed a reply to this answer, denying all the allegations, except the allegation that cash wheat closed at 60 5/8 cents in Chicago on the 18th day of September, 1896. On the issues thus joined the defendant had judgment below, and plaintiff brings error to this court.

The first question to which our attention is earnestly directed by counsel for plaintiff in error is as to whether the answer of defendant states sufficient ground for the rescission of the contract. We believe that the rule with reference to the kind of a false and fraudulent representation which will be sufficient to warrant the rescission of a contract of sale is well stated by this court in the case of Foley v. Holtry, 43 Neb. 133, 61 N. W. 120, in which it is held: “A person is justified in relying on a representation made to him in all cases where the representation is a positive statement of fact, and where an investigation would be required to discover the truth.” This case also quotes with approval the test as to the character of the representation essential for either...