Seymour Improvement Co. v. Viking Sprinkler Co.
| Citation | 161 N.E. 389,87 Ind.App. 179 |
| Decision Date | 09 March 1928 |
| Docket Number | No. 12908.,12908. |
| Court | Court of Appeals of Indiana |
| Parties | SEYMOUR IMPROVEMENT CO. v. VIKING SPRINKLER CO. |
OPINION TEXT STARTS HERE
Appeal from Bartholomew Circuit Court; Julian Sharpnack, Judge.
Action by the Viking Sprinkler Company against the Seymour Improvement Company. Judgment for plaintiff, and defendant appeals. Affirmed.Thomas M. Honan and Montgomery & Montgomery, all of Seymour, for appellant.
Seba A. Barnes, of Seymour, Dixon & Meloy, of North Vernon, and George H. Batchelor and Austin V. Clifford, both of Indianapolis, for appellee.
This is an action by appellee upon an alleged written contract between it and appellant to recover the contract price for the installation of an automatic firesprinkler system in a factory building owned by appellant and leased to Sam B. Wolf, Jr., and to foreclose a mechanic's lien. An answer of non est factum and a reply of estoppel closed the issues. A trial by the court resulted in a judgment of appellee on the contract for $3,049.96, there being no finding or decree on the issue relating to the alleged mechanic's lien. The errors assigned relate to the overruling of appellant's demurrer to the third paragraph of reply and the overruling of its motion for a new trial. The alleged contract, which was made a part of the complaint, was in the nature of a proposal made by appellee to appellant to install a sprinkler system in the factory building owned by appellant. This proposal was dated May 26, 1924, was addressed to “the Seymour Improvement Company,” and by its terms proposed to equip the building of the improvement company with automatic sprinklers. Following the signature of appellee was a purported acceptance by appellant, reading as follows:
To this was attached a certificate of acknowledgment signed by Thomas M. Honan, notary public, wherein the latter certified that J. M. Shields, as president of the Seymour Improvement Company, acknowledged the execution of the instrument. The contract price was $2,748, with provision for extra sprinklers at a designated price. One-fourth of the contract price was to be paid when the materials were shipped to substantially commence the work, one-fourth when the work was completed, one-fourth 30 days after the date of approval by the Indiana Inspection Bureau, and the balance 60 days after such approval.
The third paragraph of the reply alleges that at the time the contract sued on was executed, appellant was the owner of the premises described in the complaint on which was situated a large brick building used for manufacturing purposes; that at that time and since said building was leased and used for the manufacturing of shoes; that a sprinkler system such as installed was a practical, proper, and economical equipment for manufacturing establishments, adding to and increasing the value of buildings so equipped and reducing the cost of insurance; that appellant through its president had notice and knowledge that appellant and appellee had entered into said contract and that the sprinkler system was being installed by appellee under said contract; that when the materials used in installing the plant were delivered to and upon said premises so owned by appellant and before the same had been installed, appellee rendered and delivered to appellant a bill and statement for $687, and demanded payment thereof under said contract, the amount so demanded being the first installment of the contract price due under the contract; that on August 15, 1924, while said plant was being constructed, appellee rendered to appellant another bill and statement for 687, and demanded payment under said contract, the amount so demanded being the second installment on the contract, and that from time to time thereafter appellee rendered additional bills and statements for subsequent installments and demanded payment thereof. Appellant paid none of the installments and gave appellee no intimation or notice that it denied and disputed liability under the contract, or the authority of its president to execute the contract, or the execution of the contract by J. M. Shields, its president, but, on the contrary, it remained and continued silent and permitted appellee to continue under and in reliance upon said contract. Appellee replied upon the contract and furnished the material for and installed the work wholly in reliance upon the contract, and believed that Shields as president of appellant company had the authority and right to execute the contract; that appellee would not have furnished the material and installed the plant except for said contract and its reliance thereon and belief that the same was valid and binding upon appellant; that appellee at all times was ignorant of any want of authority, right or power of Shields to execute such contract; that appellant still has and retains said sprinkler system in its said building, thereby enhancing the value thereof in excess of the contract price of $2,748, and is profiting by reduced insurance charges; and that by reason of all of the aforesaid premises appellant is estopped to deny the execution of said contract and liability thereunder.
The only objections to this reply as set out in the memorandum filed with the demurrer, and not waived, are: (1) That it does not allege that defendant misrepresented or concealed any material fact; (2) it does not allege that the defendant made any representations or concealed any matter with knowledge of the facts; and (3) that this paragraph of reply is a departure in theory and substance from the complaint.
Appellant in its brief makes two points and no more in support of its contention that the court erred in overruling its demurrer to this paragraph of reply. The first is, that no representation or concealment, by appellant, of any material fact is alleged; and, second, that the reply tacitly admits the nonexecution of the contract by appellant, and pleads facts upon which appellee asserts appellant should be liable for the value of the sprinkler system, which appellant says is a departure.
[1] In so far as the contention that the reply is a departure from the theory of the complaint, we fail to see any reason to support that contention. The matter pleaded in the reply was a defense to the answer of non est factum. It did not set up any fact inconsistent with the allegations of the complaint, and did not amount to a departure. Bowen v. Laird, 166 Ind. 421, 77 N. E. 852;Brickely v. Edwards, 131 Ind. 3, 30 N. E. 708;Walker v. Griffin, 107 Okl. 107, 232 P. 65.
[2] The only other objection to the sufficiency of this reply which appellant makes in this court is that “no representation or concealment by appellant, of any material fact, is alleged.” Does the reply allege a representation or concealment of a material fact?
For a statement of the principles and elements of estoppel see General Realty Co. v. Silcox, 84 Ind. App. 451, 146 N. E. 408.
The reply alleges that appellant knew appellee and appellant through its president had entered into the contract to equip appellant's building with the sprinkler system, and knew the same was being installed by appellee under that contract; that when the material was delivered upon the factory premises of appellant and before the same had been installed appellee rendered and delivered to appellant a bill for the first installment which was due under the contract; that thereafter while appellee was installing the system in the building it from time to time rendered and delivered to appellant bills and statements for the several installments as the same became due under the contract and demanded payment thereof from appellant; that appellant gave appellee no intimation or notice that it denied or disputed liability for the installation of the sprinkler system under the contract, or of the authority of its president to execute the contract, but that appellant remained silent and permitted appellee to complete the installation in its building under and in reliance upon said contract; that appellee relied upon such contract and furnished the material and work wholly in reliance upon the contract and believing that appellant's president had full authority and right to execute the contract; that appellee would not have furnished the materials and installed the plant except for such contract and its reliance thereon and belief that the contract was valid and binding upon appellant; that appellee was at all times ignorant of any want of authority of appellant's president to execute the contract.
Clearly, under the facts as alleged, it was the duty of appellant to speak and not to conceal from appellee its claim that its president had no authority to execute the contract in the name of and for appellant. Under the facts as alleged common honesty required appellant to speak and to notify appellee if its president had no authority to execute the contract, and not to knowingly permit appellee to install the plant in reliance upon the contract so executed by its president. Its silence and failure to speak amounted to the concealment of a material fact. The reply alleges that appellant knew its president had entered into the contract and that appellee was installing the sprinkler system in its building under that contract. It knew this before any of the materials had been placed in its building. It knew appellee was looking to it for payment, and without giving any intimation or notice that its president had no authority to enter into the contract it remained silent and allowed appellee to install the plant in the belief that the contract was a valid and binding contract.
[3] While there must be a false representation or a concealment of material facts, silence when it is the duty of the party to speak is equivalent to concealment. Markland v. Kimmel, 87...
To continue reading
Request your trial