Ward v. Heath
| Decision Date | 08 January 1943 |
| Docket Number | 682. |
| Citation | 24 S.E.2d 5,222 N.C. 470 |
| Parties | WARD v. HEATH et al. |
| Court | North Carolina Supreme Court |
Civil action in tort to recover damages for personal injuries resulting from an automobile collision and to vacate and annul a release alleged to have been procured by fraud.
On January 28, 1940, about 4:30 P.M., 4 automobiles were proceeding westwardly on the Greensboro-Winston-Salem highway. Snow had been removed from the hard surface portion of the highway and was banked on the shoulders of the road. The hard surface or traveled portion of the road was covered by a thin coating of ice which was melting.
The plaintiff and her husband and child were riding on the back seat of the third car. Defendants Heath were on the fourth car which belonged to defendant Nona Heath. J.C. Heath, her husband, was driving.
The front car attempted to turn into a filling station. This caused the second car to stop suddenly. The driver of the third car, seeing the situation, put on brakes and in order to prevent a collision cut the front of his car into a snow bank. The Heath car then skidded into the car occupied by plaintiffs striking it with such force that she, her husband and child were thrown to the foot of the automobile. As a result plaintiff's sacro-iliac joint was dislocated, her pelvic bone was fractured, her collar bone and one or more ribs were broken and other injuries were inflicted.
On June 20, 1940, plaintiff and her husband executed and delivered to agents of the corporate defendant, liability insurance carrier for the defendant Nona Heath, three releases. One in consideration of $1,975 released all claims of plaintiff; one in consideration of $25 released all claims for injuries to the child and the third was to cover medical and other expenses incurred to that date in the sum of $174.
On July 12, 1941, plaintiff instituted this action. The complaint states two causes of action. The first is for damages proximately resulting from the alleged negligent manner in which defendant J.C. Heath operated the automobile of the defendant Nona Heath. The second is for damages for the wrongful conduct of defendants in procuring the execution of the release by plaintiff, which conduct plaintiff alleges was pursuant to and in furtherance of a conspiracy entered into between defendants.
When the cause came on to be heard the court, on motion of defendants made at the conclusion of the evidence for plaintiff, entered judgment of nonsuit. Plaintiff excepted and appealed.
H.L Koontz and C.L. Shuping, both of Greensboro, for appellant.
Henderson & Henderson, of Greensboro, for appellees.
If the release is valid it is an effective bar and plaintiff may not proceed on either cause of action. Hence, we may pass the question of the sufficiency of the evidence on the issue of negligence without decision and come directly to the vital and decisive questions presented. (1). Has plaintiff offered any evidence tending to show that she was induced to sign the release by the fraud of the defendants; and (2) if so, has she by her conduct, notwithstanding the fraud, ratified the same?
A release executed by the injured party and based on a valuable consideration is a complete defense to an action for damages for the injuries and where the execution of such release is admitted or established by the evidence it is necessary for the plaintiff to prove the matter in avoidance. Aderholt v. Seaboard Air Line R. Co., 152 N.C. 411, 67 S.E. 978; Butler v. Armour Fert. Works, 193 N.C. 632, 137 S.E 813; Sherrill v. Little, 193 N.C. 736, 138 S.E. 14. Hence, as plaintiff pleads the release and acknowledges its execution both in her pleadings and in her testimony, the burden is on her to establish the fraud alleged and relied on by her to invalidate the instrument.
What is fraud? No precise or all-inclusive definition has or can be given. Yet, to establish actionable fraud it is generally recognized that in all cases certain essential facts must appear. These are: (1) a false representation or concealment of a material fact; (2) reasonably calculated to deceive; (3) made with intent to deceive; (4) and which does, in fact deceive; (5) to the hurt of the injured party. McIntosh Cases on Contract (2d), XXXI.
The material elements of fraud, a commission of which will justify the court in setting aside a contract or other transaction, are well settled. First, there must be a misrepresentation or concealment. Second, an intent to deceive or negligence in uttering falsehoods with intent to influence the acts of others. Third, the representations must be calculated to deceive and must actually deceive. And, fourth, the party complaining must have actually relied upon the representations. Prichard v. Dailey, 168 N.C. 330, 84 S.E. 392; Bolich v. Prudential Ins. Co., 206 N.C. 144, 173 S.E. 320; McNair v. Southern States Finance Co., 191 N.C. 710, 133 S.E. 85; 12 R.C.L. 239, § 10.
The conditions under which representations as to material facts in the course of a bargain may be made the basis of an action for deceit as a general proposition are well stated in Pollock on Torts (7d), 276, as follows: "To create a right of action for deceit there must be a statement made by the defendant, or for which he is answerable as principal, and with regard to that statement all the following conditions must concur:
It must be a false representation of fact materially affecting the value of the contract and which is peculiarly within the knowledge of the person making it and in respect to which the other person in the exercise of proper vigilance has not an equal opportunity of ascertaining the truth. Smith on Fraud, § 3. See, also, Whitehurst v. Life Ins. Co., 149 N.C. 273, 62 S.E. 1067; Cooper v. Schlesinger, 111 U.S. 148, 4 S.Ct. 360, 28 L.Ed. 382; Kerr on Fraud and Mistake, p. 68; 23 R.C.L. 395, § 24, 396 § 25.
It is not always necessary in order to establish actionable fraud that a false representation should be knowingly made. It is well recognized with us that under certain conditions and circumstances if a party to a bargain avers the existence of a material fact recklessly or affirms its existence positively when he is consciously ignorant whether it be true or false he must be held responsible for a falsehood. Plaintiff must establish either positive fraud or that she was deceived and thrown off her guard by false statements designedly made at the time and that such statements were reasonably relied upon by her. Butler v. Armour Fert. Works, supra. False assurances and statements of the other party may, of themselves, be sufficient to carry the issue to the jury when there has been nothing to arrest the attention or arouse suspicion concerning them. Butler v. Armour Fert. Works, supra; McCall v. Toxaway Tanning Co., 152 N.C. 648, 68 S.E. 136; Whitehurst v. Life Ins. Co., supra; Planters Bank & Trust Co. v. Yelverton, 185 N.C. 314, 117 S.E. 299.
Applying these generally recognized principles to the facts of this case we are constrained to hold that plaintiff has offered no sufficient evidence of fraud in the procurement of the release to justify the submission of an issue to the jury. It fails to induce the conclusion that the parties to the release did not deal at arm's length.
Her only allegations of fraud are these: that defendant caused and procured her to accept the sum of $1,975 as compensation for the injuries sustained by her which induced plaintiff "to believe that her injuries were of such nature that she would, in a reasonable time, fully recover therefrom without any serious and permanent results and without further hospitalization, medical or other expenses", and that she accepted settlement and signed the release "on the assurance that her said injuries were temporary and not permanent and that she was soon going to be all right."
The substance of plaintiff's testimony in support of these allegations may be briefly stated.
One Chapman, an agent of the corporate defendant, called on her shortly after the accident. He was seeking a statement as to how the accident occurred. Its agent Greene next went sometime thereafter. He inquired as to her condition but neither made nor requested a proposition of settlement. Altogether he made six trips. On the third visit Greene inquired whether plaintiff and her husband had decided what they wanted to do. He received a negative answer. He asked about plaintiff's condition and talked as if he thought her injuries were only temporary. On the fourth trip he wanted to talk settlement but plaintiff's husband told him she was in no condition to talk settlement. On his sixth trip the releases were signed. On none of his visits, except the last, did he press for settlement. On one occasion he proposed a settlement for $800 and expenses and suggested that plaintiff consult Dr. Register, a bone specialist, to ascertain her condition. She went and the corporate defe...
To continue reading
Request your trial